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Gold Will Triumph
“Gold Funds Live up to violate reputation”
“Gold prices have gone up as the dollar has gone down,” he says. “But we may have a situation where gold may go up when the dollar goes up or stays flat.” Caesar Bryan, portfolio manager of the Gabelli Gold fund, Christine Dugas, USA Today, 4-5-2004
weiter...
@dr_fart
Der vom User "koenigstreuer" ohne Quellenangaben gepostete Text, stammt NICHT wie Du irrtümlich zu glauben scheinst von Kai Hackemesser.
Es handelt sich um einen älteren Text vom 10. Juni 2002 von Jason Hommel, dem Silber Analysten, der von Kai Hackemesser eher schlecht übersetzt, auf seiner Homepage, vermutlich sogar ohne Wissen des Autors, veröffentlicht wurde.
Orginal Text in englischer Sprache von Jason Hommel
http://www.gold-eagle.com/editorials_02/hommel061002.html
Heute kennen bereits fast alle Silber Bugs Jason Hommel wegen seinen Beiträgen zu Silberminen, die er regelmässig in den USA veröffentlicht.
http://news.silverseek.com/GoldIsMoney/1081019762.php
Gruss
ThaiGuru
Schöne Oster Feiertage wünsche ich allen Gold/Silber Bugs, und allen Lesern hier im Goldseiten-Forum.DE
Gruss
ThaiGuru
PS:
Die Börse in Thailand ist heute Karfreitag, und auch am Ostermontag geöffnet. Die Morgensession werde ich wohl jedoch heute wieder einmal mehr verpassen.
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http://www.lemetropolecafe.com
CARTEL CAPITULATION WATCH
As is usually the case, the US stock market rallied late just when it looked like it was on the ropes. The DOW, down as much as 90 points, rebounded to close at 10,442, down only 38. The DOG finished up at 2053, up 3.
GATA’s Mike Bolser:
Hi Bill:
The Fed added $12.5 Billion in TOMOs today April 8th 2004, an action that moved the repo pool up to $32.83 Billion and continued the pool's bouncy turn back upward. At this hour 11AM the DOW tracks at 10,480 not making a definitive move, mimicking the repo pool.
Sun orbits Earth
Experts who have operated in the financial field for all their lives find it difficult to accept that the DOW can be steered by its tiny futures market. Indeed, repeated media conditioning that EVENTS control the DOW and the futures players are somehow "plugged in" to these events sooner than us mortals is a pervasive force. We hear it every day, decade in and decade out. The logic of these events moving the DOW can usually be seen after the fact just as the Sun seems to orbit the Earth every day...however powerful it is still an illusion.
The creation of the "Plunge Protection Team" aka Working Group on Financial markets in 1987 was the beginning of Alan Greenspan's reign of interventional dogma. Indeed, his tenure can be described as one of radical, anti-free market bias. Perhaps he just has a coercive style, or he was chosen BECAUSE of his gold knowledge. Upon reflection, it is likely that he knew even back then that the dollar would not survive without massive government intervention to suppress commodities in general and interest rates in particular. In any event, the Fed has overseen 17 years of increasing government intervention and its resultant rising financial vulnerability. The apparent riches of today are an illusion too for they will disappear when the currency quietly dissipates. The process of currency debasement chosen by weak governments always ends with a complete dissipation of value, eroded by the truth.
To admit that the Fed controls the DOW is to admit the DOW has no inherent value. This is the terrible truth that no one wishes to be spoken out loud so it is all-to-easy for experts to dismiss evidence that this index and numerous other widely observed financial barometers aren't what they seem.
Challenging the skeptics, commodities relentlessly advance...and the commodities are drawing new converts each day.
Mike
PS My website has been updated at:
http://www.pbase.com/gmbolser/interventional_analysis
Chuck checks in:
Another day of a strong dollar and the perfunctory response by gold and the shares. Note how many times that gold has gapped down and the shares likewise. But the noteworthy thing is the continued lack of volume and volatility of the shares. Given that this has been the third day in a week when the dollar was up almost one percent, I think that the metals are holding up well.
I doubt that anything exciting will occur today because of the holiday tomorrow. But next week might bring something especially the heavy feel of the stock market which continues to react the opposite to gold. Another bait and switch today. It is quite amazing to see how the same prevalent attitude towards equities persists after all these years. A mighty purge is coming. Chuck
But, there is no inflation:
Kodak profit seen pinched by high silver prices
Wednesday April 7, 4:38 PM EDT
By Franklin Paul
NEW YORK, April 7 (Reuters) - Rising silver prices, a raw material used to make photographic film, are expected to hurt Eastman Kodak Co.'s(EK) first quarter results, and could pinch earnings for the year, according to financial analysts.
Silver, a key ingredient in the manufacturing of traditional "silver halide" film, has been trading at its highest prices since the 1980s, fueled by strength in gold and the dollar's steady declines against other currencies.
Analysts said that may have shaved about $10 million in operating profit for Kodak's first quarter results due to silver, which on the New York Mercantile Exchange's COMEX division rose on Wednesday to about $8.20 an ounce.
"We estimate there may have been a 3-cents-per-share impact from the increased price of silver during the quarter, even taking into account seasonally lower film volumes," said Merrill Lynch analyst Jay Vleeschhouwer, in a note to clients on Wednesday. –END-
But, there is no inflation:
Noveon Announces Price Increases for North American Paper, Printing & Packaging, and Paint and Coatings Emulsion Products
CLEVELAND, April 8 /PRNewswire/ -- Noveon, Inc. has announced that it has increased off-list prices an average of $.04/wet pound for all North American Paper, Printing & Packaging, and Paint and Coatings emulsion products. This increase includes the following product lines: Hycar(R), Carboset(R), Carbobond(R), Carbotac(R), and Hystretch(R) acrylic and styrene-acrylic emulsions; Vycar(R) PVC, Permax(R) PUD and Good-rite(R) SB emulsions. In addition, Noveon has announced that it has increased both the list and off-list prices for Algan(R) oleoresinous overprint varnishes by $.04 / wet pound. All increases will be effective April 20, 2004 or as contracts allow. –END-
If this story below is the case, the US dollar will tank even more than expected and gold is off to the races. The strain on US financial resources will be staggering:
US will need 500,000 men to keep Iraq under control
PARIS, April 8 (Itar-Tass) - The United States will need some 500,000 men for restoring control over the situation in Iraq. This is the opinion of Charles Heiman, the leading military analyst and editor-in-chief of the Jane¹s World Armies journal, whose article was published by French newspapers on Thursday.
He believes that when the situation deteriorates rapidly, the military theory says that the more troops one has in the zone of operation the smaller will be the casualties. According to Heiman, 20 men are needed per 1,000 of local residents for establishing control over ³the hostile population.² Since the Iraqi population is some 25 million, the United States will need a 500,000 strong contingent in Iraq now. At present the strength of the U.S. force in Iraq is 135,000.
According to reports coming here, the U.S. military command in Iraq has already asked for reinforcement. The Pentagon has not made an official decision so far, but a report came that the replacement by fresh troops of 24,000 U.S. officers and men, planned for the current week, has been postponed, and they will stay in Iraq for an indefinite period of time.
© ITAR-TASS. All right reserved.
Sounds like Mike Bolser.
This will put President Bush and his Administration in some kind of bind. Remember how they vilified those who called for 200,000 troops to be stationed in Iraq to get the job done.
There is no finer a gentleman and shrewd market guy out there than James Turk. Congrats to him on his latest coup:
DRD ups stake in Goldmoney.com
Durban Roodepoort Deep (DRD) has increased its stake in leading internet-based gold marketing company GoldMoney.com to 14 percent with a further investment of $1.8-million, it was announced on Tuesday.
GoldMoney has enjoyed record growth since DRD announced its initial investment of $200 000 (1.4 percent) in January this year, said founder James Turk.
"Our customer base rose by more than 20 percent in the first quarter of 2004 to 12 000 worldwide, and we increased our holding of physical gold by 51 percent, from 66 LBMA good delivery bars to 100.
"It is pleasing that, since South African-based DRD came on board as a GoldMoney shareholder, all of the LBMA bars added to our system have been sourced from South Africa's Rand Refinery.
"There is now more than $17-million of gold circulating as digital currency within GoldMoney," said Turk.
DRD CEO Ian Murray said: "GoldMoney's success in recent months shows that, at the outset, we were right in identifying it as a suitable vehicle for fulfilling our belief in gold as money and as a means of encouraging private ownership in gold."
"Increasing our stake was the next, logical step, and we look forward to continued growth and diversification in GoldMoney's activities in the months ahead," he concluded.
-END-
The Café is a http://www.goldmoney.com holder of funds!
Good heads up from Dave Lewis in this bulletin of his:
Reports of the capture of 3 Japanese and threats against their lives unless Japan pulls out of the war seem to me a pivotal point. Thus far Asian willingness to recycle their export earnings into the US has mitigated the financing costs of the Iraq War. Should that willingness to recycle change via a shift in public opinion the costs of the war would become more evident in the financial markets. This would likely manifest as some combination of: further US$ declines on the FX markets, further US bond market losses and further gains in the precious metals.
Further stress on the system comes via Afghanistan as Rashid Dostum's troops are on the march. To the extent that western bankers aren't financing the Afghan and Iraqi resistance, further setbacks for the Anglo-American military expeditions will begin to weaken their ability to maintain currency purchasing power given the nature of fractional reserve banking and lopsided exposure.
Things could get very interesting in the days ahead.
Dave Lewis
Gold shareholders put on their selling shoes again. The XAU fell 1.19 to 101.62 and the HUI slumped 2.80 to 229.49. With what is going on in the world, from the CRB rise to the Iraq debacle, the lack of bullishness in the gold/silver world is astonishing. Markets are this way from time to time. No change in my game plan. The boat is loaded.
Gold, silver and the shares remain THE historic investment opportunity of a lifetime.
GATA BE IN IT TO WIN IT!
MIDAS
Appendix
CHICAGO, April 8 (Reuters) - For a brief time late last
year it looked to Barbara Hemme like the worst was finally
over.
Sales at her company, Youngberg Industries Inc., were on
the rise, after four tough years in which the small maker of
vacuum furnaces was forced to lay off nearly a third of its
work force of 90 employees.
Now, steel prices that have doubled, and even tripled in
some cases, since October are threatening the budding rebound
at Youngberg, said Hemme, its corporate controller. The
Belvidere, Illinois, company buys several hundred thousand
dollars worth of carbon and stainless steel plates a month.
"We are worried about profitability. Right now we can pass
it (higher steel costs) on to our customers, but eventually
that might stop. The market only bears so much," she said.
Just when the nation's recession-scarred manufacturers are
enjoying some of the strongest order rates in four years, along
comes a new demon -- rising materials costs.
Skyrocketing prices for metal, especially steel, are
squeezing companies that make everything from automotive parts
to motor homes and home appliances. Steel costs have jumped at
least 30 percent since the beginning of the year on strong
global demand, primarily from China.
BEING BIG HELPS
Some manufacturers, including construction equipment
heavyweight Caterpillar Inc. , the largest consumer of
heavy plate steel in the United States, say they expect to pass
on the higher costs to their customers because of improving
demand in their industries.
But smaller companies with less purchasing power and major
steel users such as the automotive industry, where intense
competition prevents price increases, are feeling the pinch.
Bison Gear & Engineering Corp., which makes gear motors
that run conveyor belts, has been forced to substitute round
bars of alloy steel in a larger diameter than it needs because
of a shortage of bars in the size it typically purchases.
"We've been buying one particular size for years and now we
can't get it anymore," said Matt Hanson, vice president of
sales and marketing of St. Charles, Illinois-based Bison, which
employs 175 people.
"It happened because everybody's volumes picked up pace,
and inventories were depleted," Hanson said of the shortage.
The fear is that a surge in economic activity could
exacerbate shortages and stall the manufacturing rebound.
"Steel demand is only going to increase significantly in
the coming months. That could create significant pain and
difficulties for a lot of our domestic manufacturers," said
Darren McKinney, spokesman for the National Association of
Manufacturers.
RISING COSTS DENT PROFITS
Rising materials costs have begun to make a dent in the
profit outlooks of some larger manufacturers, while others have
acknowledged the growing risk of an earnings impact.
A.O. Smith Corp. , a maker of water heaters and
electric motors for household goods ranging from air
conditioners to garage door openers, last week reduced its 2004
profit forecast due to higher steel costs.
"It's really unprecedented, what's happened here," Kenneth
Krueger, the company's chief financial officer, said on a
conference call, referring to the rapid run-up in steel costs.
Diesel engine maker Cummins Inc. , which this week
raised its earnings outlook amid an accelerating recovery in
the heavy-truck sector, nonetheless cautioned that rapid price
increases in steel, copper and other commodities could have an
uncertain effect.
Price increases are being passed on to the consumer in
sectors such as the recreational vehicle market, where rising
demand has allowed manufacturers such as Thor Industries Inc.
to boost prices by an average of 3 percent in March to
offset the rising cost of steel, lumber and aluminum.
In the auto industry, however, consumer rebates and
interest-free loans used to boost vehicle sales mean there's no
leeway for parts makers to pass on higher materials costs.
Smaller second- and third-tier automotive suppliers that
are not shielded through long-term contracts under automakers'
umbrella purchasing programs are having to tough it out in the
spot metals markets.
"You have Tier Twos and Threes that are on their own and
are facing the biggest challenge. They could be the ones that
end up shutting down an assembly plant. Those are the companies
that are between a rock and a hard place," said Neil DeKoker,
president of the Original Equipment Suppliers Association
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http://www.lemetropolecafe.com
The John Brimelow Report
India buys over $420!
Thursday, April 08, 2004
Indian ex-duty premiums: AM $5.37, PM $5.92. with world gold at $422.60 and $421.15. Above legal import point. It is worth remembering that Indian retail bullion markets, the world’s largest single consumer, will be active throughout the Easter holiday, which in many wholesale gold markets (such as London) extends until Tuesday. A threatening prospect for Bears.
With the Nikkei hitting a 32-month high this morning, and Platinum and Palladium offering plenty of excitement, perhaps it is to be expected that TOCOM is bored with gold. Volume did rise 34% to the equivalent of 23,933 Comex lots, but the sharp rise in yen gold, courtesy NY, was ‘faded’ by the Japanese public: open interest fell the equivalent of 1,436 Comex. The active contract closed up 14 yen, but world gold went out 25c below the NY close. Local premiums at the Shanghai Gold Exchange dropped too, although they remained narrowly positive. (NY volume yesterday was 39,843 lots: open interest rose 758 contracts.)
Alarming news from Iraq enabled the selling experienced at $420 to be overcome yesterday. Today it has re-asserted itself. Many technicians are very uneasy:
(JP Morgan FX Technical Analysis:
Zitat"Gold - we retain a bear bias at this stage - No change. We…may see a bit of panic selling if we start to get down towards 405/400...we are preparing for at least a decline towards 410/400, with the key trendline support lying at 396.").
This anxiety has presumably been communicated to many CTAs: but the premium data do not suggest such a significant downside move.
This morning the Japanese Finance Minister was wheeled out to make the inevitable denial of any intention of diversifying Japan’s FX reserves, particularly by buying gold. UBS expresses dismay. How anyone can expect a subservient (and privileged) Asian state to throw down the economic gauntlet to a visibly bad-tempered US administration in this way is a puzzle. How the public behaves in these countries is another question.
JB
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April 8 - Gold $419.40 down $2.70 - Silver $8.07 down 10 cents
Too Many Gold, Silver Bears Out There
ZitatIn 1945 Winston Churchill said famously, "A lie gets halfway around the world before the truth has a chance to get its pants on."
Not a whole lot to report. As so often happens, gold, which had been firm in Asian trading, sold off as we came into the Comex trading period. A sinking euro took its toll, closing at 120.06, down .95. The dollar rose .74 to 89.29. Can’t understand why.
The gold open interest rose 758 contracts to 306,319.
Silver rallied 7 cents in overnight trading, but sold off in sympathy with gold again as we came into our open. Then Morgan Stanley went into sell mode for the third day in a row. Silver was weak all day long and eventually was pressured down to $8.01. When the locals could not take it below $8, silver drifted back up. This is the first time in 1 ½ months silver did not give us a new high weekly close, as it finished 6 cents lower than last week.
Silver finally left us a gap….. on the upside.
The silver open interest rose 560 contracts to 121,007. It has not risen much during the past 75 cent run-up. It will take a close below $7.50 to really panic a number of the specs.
Platinum soared $24 to $905 and palladium continues its run, flying to $328, up another $8. Crude oil surged to $37.14, up 99 cents. The CRB closed at 284.07, up 1.28, despite weakness in the grain pits. It seems poised to challenge its highs again right below 290.
I received a fair number of emails regarding Frank Veneroso’s latest piece put up at James Turk’s goldmoney.com web site. The tone of most generally went as follows with requests I comment:
Dear Bill:
GATA sent this email which is very gloomy and not what in line what we have been reading in Midas.
Can you please address these points either in this email OR in Midas commentary? I think a lot of small investors like myself who didn't know about gold investing in 2001 when most of you did would like to know if Veneros's commentary is to be taken to heart which is a bit opposite of GATA/Midas's bullish take on gold/silver.
Thanks, Joyce
"At this juncture, commodity investments are dangerous"
"Fundamentals do not support the current strength in commodity prices"
Click here: GoldMoney - Founder's Commentary Vereroso" commentary.
Commodity prices will fall hard when the current global speculation crests. Fundamentals do not support the current strength in commodity prices
Unless core Europe and Japan catch fire, the global macro environment will not be supportive of today's high commodity prices.
The most obvious would be a Fed rise in interest rates.
The speculative craze to purchase commodities has reached proportions I never imagined.
-END-
While I have the greatest deal of respect for Frank, a friend since 1980, I take the other side of the trade on this one and have since we discussed this matter the first week in November at the New Orleans Investment Conference. Since then silver has rallied from $5 to $8.46 and is now $8.07, gold took off from $390 to $430 before settling back. The CRB jumped from 250 to 290. Corn leaped over $1 and soybeans went bananas. In other words Frank thought this way five months ago and has missed out on some very big moves.
That does not mean he won’t be right from here on in. I just don’t see it, especially on gold and silver. While silver, or any market, can correct short-term, there just isn’t enough physical around to keep the silver price from soaring. Only scrap, which will show up at much higher prices, can give us supply to put the silver market in equilibrium for periods on the way up.
When it comes to gold, only Gold Cartel selling has prevented a run to $500 so far. With the Iraq war mess heating up, it ought to have a profound effect on financial markets in the weeks and months ahead. More and more investors are going to want to go to gold as it becomes clearer the US is in deep trouble in Iraq and costs are going to mount significantly, which is going to further strain US deficits.
The big moves in copper, soybeans, cocoa and silver have occurred because of real shortages. Of course the specs jump on board and push prices more than they should be at times. It is the nature of the game. It’s also conceivable, you ain’t seen nothin’ yet. If we ever get a crop failure this summer in the US, forget about it.
Then, the current CRB doesn’t take in the ARTIFICIALLY SUPPRESSED gold and silver prices. They represent speculation in reverse. If it were not for The Gold Cartel keeping gold and silver way below where they would be if the markets were trading freely, the CRB would be MUCH higher. Thus one can make a legitimate case the CRB represents UNDER "proportions," not over.
Besides, the consensus continues to be gold/silver bearish. Few pundits are bullish right now. Just today I learned of four more visible people, normally gold bulls, who are taking their money off the table. With the gold fundamentals a "10+++" this seems remarkable to me. The fact so many are short-term gold bearish and unenthusiastic about silver has me favoring the upside here, a move which would surprise MANY.
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Newmont Manager Sees Golden Future In Nevada
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SpectrumGold And NovaGold Resources Inc. Acquires Additional Properties In Galore Creek District
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A Collective Sigh Of Relief Is Heard At Aflease
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Harmony Keeps Its Finger On The Pulse
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http://www.sabcnews.com/econom…ness/0,2172,77476,00.html
Merger creates largest black-owned mining company
April 07, 2004, 22:34
The Competition Tribunal approved the merger of Ubuntu-Ubuntu Commercial Enterprises, Anglovaal Mining (Avmin), Avgold Ltd and Harmony Gold Mining Company Ltd in a hearing today.
"The parties claim the transaction will not only result in the establishment of the largest black-owned, diversified mining company in South Africa but unlock significant value within Avmin and allow Avgold to be exploited to its fullest potential," the Competition Tribunal said in a statement.
Harmony, which holds 34.5% of Avmin's issued share capital, will be left with 20.1% after the transaction. Ubuntu-Ubuntu would then hold 43.1% of Avmin's issued share capital, while the rest would be held by public and institutional investors.
"Ubuntu-Ubuntu will become the effective controlling shareholder of a larger, diversified and empowered Avmin," the tribunal said.
"Due to Avmin's involvement in gold, platinum, nickel and ferrous metals assets mining, Ubuntu-Ubuntu will establish a significant presence in these mining assets."
The proposed transaction would consist of four stages, which would be entered into simultaneously by the four companies. These stages would be considered a single, indivisible transaction. - Sapa
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Interview With Bernard Swanepoel, CEO Harmony Gold
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German SPD Hopes Bundesbank Still Aims to Sell Gold to Fund R&D
Welteke proposal sticks despite author's highly-publicized problems. . . .
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http://news.goldseek.com/Zealllc/1081445760.php
Relative Gold Bulls
By: Adam Hamilton, Zeal Research
Analyzing the gold market is more challenging than analyzing the general stock markets. While countless speculation indicators have sprung up around the enormous interest in trading stocks, the far smaller gold world lacks these nifty technical tools.
In stocks, for example, there are implied volatility indices that effectively quantify popular greed and fear, there are bullish percent indices that reveal technical strength or decay under the surface, and there are price-to-earnings ratios and dividend yields which provide an absolute yardstick of the relative expensiveness or cheapness of stocks. Unfortunately gold lacks all of these powerful tools.
Just like stocks, over the long-term international supply and demand ultimately drives the gold price. But, also just like stocks, over the short-term the primary driver of gold is emotion and speculation. Sometimes these long-term and short-term driving forces agree and push gold in the same direction, while other times they do not, leading to tradable countertrend moves.
In order to better identify these short-term driving forces in real-time so we can profitably trade upon them, I have been trying to develop technical gold trading tools in the recent years. Some have been so worthless that I don’t even bother writing about them publicly, while others have thankfully proven to be quite useful. One in particular has really captured my attention since the gold consolidation began a few months ago.
I call this indicator Relative Gold, or rGold for short. Like the majority of technical indicators it is simple in concept and easy to calculate, but it offers many additional insights not readily apparent on a standard gold price chart alone. Relative Gold is computed by dividing the closing gold price by gold’s 200-day moving average.
The idea behind rGold is that gold’s price relative to its 200dma can help speculators discern when the probability for a short-term turn in the gold price is high or low. The 200dma is one of the most important lines in all of technical analysis and forms the foundation for rGold. 200dmas are extremely crucial technical levels for several reasons.
In any major trend, bull or bear, countertrend pullbacks to the 200dma of the primary long-term trend are expected and normal. Due to its very mathematical nature, the slow 200dma is the baseline off of which most secular trends flow and ebb. If you are in a bull market and long-term fundamentals are still in your favor, any close convergence of a price with its 200dma usually marks a fantastic buying opportunity.
By averaging about 40 weeks worth of trading days, 200dmas are also very unyielding and are difficult to push around. Big daily price movements driven by popular emotion have a minimal impact on the rock-solid 200dmas. As such, these slow-moving and formidable long moving averages provide an excellent reference point from which to measure prices.
Relative Gold, therefore, provides one simple number that tells us how far above or below its key 200dma that gold happens to be trading at any given time. It also provides a perfectly comparable constant-percentage reading over time. Whether gold is trading at $100 or $1000, an rGold reading of 1.02 always indicates that gold is 2% above its 200dma. Differing price scales over time cannot skew this indicator.
A high rGold reading indicates that gold is stretched far above its major 200dma support so the probability of a correction or consolidation is high. A low rGold reading indicates that gold has retreated back near its major 200dma bull-market support and is probably due to surge higher in a new upleg in the months ahead. Thus Relative Gold effectively shows the current dearness or cheapness of gold in pure technical terms, very valuable information for speculators to possess.
While we have already been using rGold a great deal to analyze gold’s current bull market, quite a few speculators including I have been wondering how rGold acts throughout modern gold history. Did rGold work the same way in the past? What can we learn from its behavior in earlier bull markets? In order to gain some insights into these important questions, this week we are examining over three decades worth of rGold data stretching back to 1972.
Our charts this week include the daily gold price, gold’s 200dma, and the Relative Gold numbers obtained by dividing gold by its 200dma. This long-term dataset is continuous-contract futures based, so the rGold numbers in our current gold bull differ slightly from those obtained via spot gold prices over the last few years. The best place to begin our explorations is to examine the grand strategic snapshot of all the data at once
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The last few decades really have been extraordinary for the Ancient Metal of Kings! In the 1970s the greatest gold bull of modern history erupted right after Washington unceremoniously severed all gold backing from the US dollar. This gold bull grew into a speculative mania culminating in a spectacular gold bubble. The first half of the 1980s witnessed the shockwaves of the gold markets trying to adjust to the new monetary realities in the bubble aftermath.
Once these massive post-bubble ripples cascaded through the system, the next decade and a half or so were marked by a secular bear trend in gold, albeit punctuated by strong bull markets. For you statistics junkies, the entire period of time shown above encompasses over 8000 trading days. This truly gigantic dataset offers an outstanding opportunity to investigate the utility of Relative Gold over decades.
Not surprisingly, the most volatile rGold numbers on record occurred in the decade after the cataclysmic 1971 dollar/gold default. The terrible decision to remove all gold backing from the US dollar in 1971 and render it a totally fiat-paper currency supported by nothing but faith in Washington marked the beginning of the end of the US dollar’s global hegemony. Gold faithfully bore witness to this atrocity.
Since the gold backing of the dollar has already been tossed into the trash heaps of history, the events of the 1970s cannot be repeated. Without any gold standard whatsoever in place today, there is no way it can be taken away again. As such, it is important to view the decade after the 1971 infamy as a one-time event not necessarily predictive of future markets. The extreme rGold numbers witnessed during this adjustment were the exception and not the rule.
These 1970s dislocations unleashed massive fiat-currency inflation which helped fuel the gold bubble that dominates this chart. Both the all-time high and all-time low rGold readings were registered during the gold bubble and its subsequent crash over two decades ago. At its very apex, gold was trading at 2.383x its 200dma, amazing! As it crashed after this incredible top, the noble metal plunged to 0.755x its 200dma. Such breathtaking extremes are unlikely to be witnessed again in rGold unless a future gold speculative mania leads to another parabolic bubble blowoff and subsequent crash.
After the shockwaves of the gold bubble and its aftermath passed, rGold’s volatility profile has been much tamer. The highest rGold reading in the last couple decades was 1.253, and the lowest 0.828. These numbers are important as they define a multi-decade relative trading range for gold. The metal has tended to bounce between being priced at 125% of its 200dma at best and only 83% of its 200dma at worst. A break out of this macro range in the coming years would certainly be a very noteworthy event.
Since we are using rGold as a technical indicator in today’s gold bull, I am most interested in seeing how it performed in past major gold bulls. On the chart above, there are three major gold bulls labeled with the red numbers. The first was the Great Bull of the late 1970s, which evolved into the infamous gold bubble. The second was a normal cyclical gold bull in the mid 1980s, and the third is our current specimen today.
Our next three charts zoom in and detail each of these major gold bulls in turn. By analyzing how rGold performed in past major gold bulls, we can gain a far better idea if what we have experienced in our current bull market is “normal” in light of past precedent. The historical data will also be valuable to help calibrate our current rGold indicator buy and neutral levels.
[Blockierte Grafik: http://www.goldseek.com/news/Zealllc/2004/Zeal040804B.gif]
While there is a big difference between a normal bull market in gold and a gold bubble, I still wanted to look at the late 1970s superbull. Since all bubbles are essentially bull markets that careen out of control to the upside as the public starts chasing them late in the game, the early years of a superbull look strikingly similar to a typical bull market.
If we divide this chart in two with a split near mid-1979, the left-side bull and the right-side bubble can be analyzed separately. The line of demarcation between a strong secular bull and a full-on speculative-mania bubble is the point where a price begins climbing vertically. Prior to this initial parabolic ascent, a superbull behaves much like a normal bull market.
In the bull shown above before the mid-1979 birth of the bubble, the interaction between gold and its 200dma perfectly captures just why the Relative Gold indicator is so useful. Every major gold upleg launched at an rGold low, and every major consolidation or correction was born at a high rGold reading. As speculators, we want to buy gold and gold vehicles when rGold is low and sell or prepare to get stopped out when rGold is high. The rules for trading this indicator are as simple as the indicator itself.
From the launch of this gold bull in mid 1976 to its metamorphosis into a bubble in mid 1979, every major low was marked by gold bouncing near its strong 200dma support. The average rGold level at the four interim bottoms shown above was 1.021. Interestingly, even during the gold crash following the bubble gold bounced near its 200dma when rGold hit 1.025 in mid 1980! Thus, a gold speculator of twenty-five years ago would have been well served by buying only when gold contracted down to near 2% above its 200dma.
Prior to the gold bubble, the average interim gold top appeared when rGold averaged 1.248. A similar level, 1.276, even marked the initial top after the bounce following the gold crash of early 1980. A gold speculator would have wanted to sell, throw short, or go neutral and tighten stops when gold approached levels about 25% above its 200dma in the late 1970s.
Personally, I lean towards going neutral at high rGold readings rather than selling outright once a gold bull has been running for a few years. The reason is evident above. It is impossible to predict exactly when a secular bull in gold will capture the public’s imagination and morph into a bubble. An established gold investor certainly does not want to sell outright when a bubble is on the verge of launching, so it is generally prudent to give bull markets the benefit of the doubt.
By buying at rGold lows and holding longs but shifting to a neutral bias with strict trailing stop losses at rGold highs, a gold speculator does not have to surrender the chance of missing out on the birth of a gold bubble. And as the chart above shows, bubbles can push gold to dizzying heights leading to legendary gains. Relative Gold initially hit 1.552 on the first upleg of the bubble and ultimately a mind-boggling 2.383 at the ultimate top! Bubbles can earn vast fortunes for those invested early who are wise enough to be stopped out before a crash really snowballs.
So in the late 1970s gold bull, the average rGold range for each upleg ran from about 1.021 to 1.248. These numbers grant us an excellent reference point from which to view our current gold bull today, which is discussed farther below. First, our next graph highlights the second major gold bull of recent decades, the mid-1980s specimen.
[Blockierte Grafik: http://www.goldseek.com/news/Zealllc/2004/Zeal040804C.gif]
While the general character and volatility of this gold bull was vastly different than the 1970s gold superbull that grew into a bubble, the utility of the Relative Gold indicator was still impressive. Every major interim low, ideal opportunities to buy for the next upleg, was marked by rGold lows above. Similarly, all of the interim highs marking times to raise stops and go neutral were heralded by rGold highs.
As is evident in this chart, the average rGold lows and highs in the mid 1980s were generally lower than those of the 1970s gold bull. This particular gold bull was driven more by a weakening dollar than a speculative mania, so its volatility was much lower. Our current gold bull today in 2004 has also primarily been a currency-driven event thus far, but with every passing week more and more folks grow interested in it for investment and speculation purposes. It could very well evolve into another speculative mania in the years ahead.
In this mid-1980s bull, the average rGold low weighed in at 1.003. Gold tended to turn higher right at its 200dma. rGold highs above were all over the map, ranging from 1.077 on the low side to 1.253 on the high side. The average rGold high weighed in at 1.134, which is only a little more than half of the average rGold highs from the late 1970s gold bull.
A gold speculator in the mid 1980s could have done well by buying gold when it approached its 200dma and going neutral when it headed more than 10% or so above its key long-term moving-average support line. Relative Gold once again deftly quantifies this important relationship over time, helping speculators make good decisions about when to buy and when to prepare to sell or get stopped out if necessary.
With the benefit of the historical perspective of rGold readings from the first two major gold bulls of the past few decades, we now have some hard numbers to compare to our current bull market in gold. Once again this long-term continuous-futures dataset has slightly different gold numbers than the usual spot data we use, so rGold readings in this essay do vary somewhat, although immaterially, from the spot calculations
[Blockierte Grafik: http://www.goldseek.com/news/Zealllc/2004/Zeal040804D.gif]
In the late 1970s gold superbull, the average rGold range for each upleg ran from 1.021 to 1.248. In the mid 1980s gold bull, the average rGold range was similar but far less volatile, running from 1.003 to 1.134. It is fascinating that echoes of both of these earlier bulls in rGold terms are evident in today’s secular gold bull rendered above!
In our current specimen, using this particular long-term dataset, the average rGold bottom shown above has been 1.007. The average interim rGold top has been 1.121. Do these numbers ring a bell? They ought to, as they are remarkably similar to the 1.003 to 1.134 results witnessed during the gold bull of the mid 1980s! This revelation is very interesting for a couple of reasons.
First, the similarities in the only two major gold bull markets after the post-1971 dislocations and bubble shockwaves are remarkable. They both tended, as all bulls do, to flow and ebb off of their 200dmas. Major new uplegs generally launched soon after gold traded within less than 1% of its 200dma. These uplegs ran strong until gold was stretched 12% to 13% above its 200dma on average. Then gold corrected or consolidated, waiting for its next 200dma pullback to herald its next major upleg.
Second, these results significantly strengthen the validity of the Relative Gold thesis and indicator. Having two gold bulls running almost two decades apart with similar average rGold signatures suggests that there is indeed some historical continuity in the soundness of this indicator. Generally the longer through history that some market relationship holds, the more likely it is to continue into the future.
In terms of this current gold bull, we have been watching an rGold range of 1.020 to 1.110. Whenever gold trades under 1.020 in relative terms, within 2% of its 200dma, we look for opportunities to go long gold, gold stocks, and other gold vehicles. Conversely, when gold trades above 1.110 in relative terms, more than 11% higher than its 200dma, we tighten our trailing stops and prepare to get stopped out in the next correction or consolidation.
After examining these decades of Relative Gold data, our current range of interest looks reasonable and fits well within the precedent of the 1980s gold bull. Since the average rGold bottoms were 1.003 and 1.007 in these last two major gold bulls, our less than 1.020 rGold buy signal thankfully still makes sense. Similarly, with average rGold interim tops of 1.121 to 1.134 in these bull markets, looking to go neutral at rGold levels above 1.110 also feels prudent. History has vindicated our indicator’s chosen trading range!
If you are interested in seeing how this 1.020 to 1.110 rGold trading range has worked tactically, there are a couple recent essays you may wish to skim. In early January when I wrote “The Relative Dollar and Gold”, a high rGold reading near 1.153 and a low Relative Dollar reading conspired to call for a gold pullback. This proved to be very valuable information to have as gold has indeed consolidated and corrected since January. Score one for rGold!
In mid February in my “Trading the Gold-Stock Bull 4” essay, rGold was used to help make the case that we hadn’t yet witnessed a major buy signal in gold stocks at the time. This rGold neutral signal also proved to be very valuable since neither the gold nor gold-stock consolidations and corrections had ended yet as of the middle of February. rGold again carried the day.
Thus, the Relative Gold indicator we looked at historically in this essay is not merely a strategic curiosity, but a powerful tool designed to help speculators and investors determine the probability at any given time of a major gold upleg or pullback unfolding within this secular bull market. rGold helps remove some of the deadly emotion from gold trading and introduces necessary discipline based on the fire-proven tendency of bull markets to flow and ebb along their key 200dma support lines.
If you are interested in my current interpretation on rGold and the implications for gold investors and speculators in the weeks and months ahead, I discussed the state of this indicator relative to actual trading in the recently published April issue of our acclaimed Zeal Intelligence monthly newsletter. Please consider subscribing today to stay abreast of rGold and all of our indicators as well as actual trades when appropriate.
While there remains a great deal of historical Relative Gold research left to be done, this initial look across three decades of data suggests that this indicator does indeed command both validity and staying power. It will almost certainly continue to prove to be a valuable addition to any gold speculator’s arsenal in the future.
Adam Hamilton, CPA
April 8, 2004
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http://www.silive.com/newsflas…ess-1/108143904913070.xml
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Thursday's world gold prices
The Associated Press
4/8/2004, 3:43 p.m. ET
Selected world gold prices, Thursday.
Hong Kong late: $422.75 up $3.90.
London morning fixing: $422.00 off $0.30.
London afternoon fixing: $419.50 off $2.80.
London late: $420.70 off $1.60.
Paris afternoon fixing: $413.85 up $1.71.
Zurich late afternoon: $419.58 off $2.85.
NY Handy & Harman: $419.50 up $0.50.
NY Handy & Harman fabricated: $453.06 up $0.54.
NY Engelhard: $420.86 up $0.50.
NY Engelhard fabricated: $441.91 up $0.53.
NY Merc. gold spot month Thu: $419.90 off $2.90.
NY HSBC Bank USA 4 p.m. Thu: $419.50 off $3.20.
Copyright 2004 The Associated Press
[Blockierte Grafik: http://www.iii.co.uk/icons/logos/uk_logo.gif]
http://www.iii.co.uk/shares/?t…id=4947484&action=article
2004-04-08 19:20 GMT:
Gold prices down for session and holiday-shortened week
SAN FRANCISCO (AFX) -- June gold closed at $420.70 an ounce on the New York Mercantile Exchange, down $3 for the session, and down $1.80 for the holiday-shortened trading week. May silver ended at $8.09 an ounce, down 10 cents for the session and 0.8 percent for the week, and May copper closed at $1.305 per pound, down 0.4 cent for the day. It closed out last week at $1.347. Regular metals trading on Nymex will resume Monday. This story was supplied by CBSMarketWatch. For further information see http://www.cbsmarketwatch.com.
[Blockierte Grafik: http://www.newratings.com/anal…omponents/nr_logo_160.gif]
http://www.newratings.com/analyst_news/article_407252.html
Bema Gold "buy," target price reduced
Thursday, April 08, 2004 1:55:19 PM ET
UBS
NEW YORK, April 8 (New Ratings) – Analyst Tony Lesiak of UBS reiterates his "buy" rating on Bema Gold (BGO.TO). The target price has been reduced from C$6.00 to C$5.75.
Shares of Bema Gold, a leading company providing mining and exploration services for precious metals, are currently trading at C$4.41.
According to UBS’ research note published this morning, Compañha Minera Casale is a mining company in Chili, in which Bema Gold is a 24% stakeholder. Placer Dome is the majority stakeholder, with a 51% interest in the company, the analyst says. The feasibility study conducted by Placer Dome for the Cerro Casale project in January 2000 included a contingency of $150 million, the analyst reports. However, the update to the study indicates an additional capital requirement of $220 million, the analyst adds.
According to UBS, the likely increase in capital expenditure translates into an increase in cash costs from $97/oz to $115/oz. Furthermore, the analyst expresses his concern regarding Bema Gold’s Q1 results.
The EPS estimates for 2004 and 2005 are $0.04 and $0.07, respectively. The P/E estimates for 2004 and 2005 are –87.7x and 46.0x, respectively.
UBS reiterates its "buy" rating on Bema Gold.
© 2004 New Ratings
ThaiGuru und Gold, oder Silber shorten?
Niemals !!!!!
Zumindest nicht bevor ich einen Gold und Silber Preis erkennen kann der auch nur annähernd dem von Angebot, und Nachfrage entspricht.
Bis jetzt erkenne ich nichts, absolut gar nichts, das auf eine faire Bewertung dieser beiden Edelmetall Preise hindeutet, geschweige denn auf eine Überbewertung, die uns von einigen Analysten eingeredet wird.
Dem Gold, und Silber Cabal in die Hände arbeiten, das macht ein Gold, und Silber Bug wie ThaiGuru nicht!
Das Geld kann ich mir zudem sparen, weil ich Gold, und Silber als Langzeitanlage betrachte, und eh vor Erreichen eines Preises von mindestens 800.- Dollar Gold, und 50.- Dollar Silber pro Unze, nicht einmal im Traum daran denke auch nur ein einziges Gramm davon zu verkaufen. Im Gegenteil kaufe ich nach Möglichkeit weiteres physisches Gold, oder Silber dazu.
Das gilt übrigens genauso für meine Gold, und Silber Aktien, soweit mir keine neuen fundamentalen Erkenntnisse vorliegen, die in Ausnahmefällen einen Verkauf etwaiger Minen Aktien gerechtfertigen könnten.
Falls die Gold-, oder Silberpreis Notierungen, oder die Minen Aktien Preise sich vorübergehend verbilligen, würde ich mich zwar auch nicht freuen, doch geben die mir bekannten fundamentalen Kenntnisse, und jahrelange Erfahrung mit Gold, und meinen Goldminen die Gewissheit, dass ein markannter Preiseinbruch, wenn ein solcher aus welchen Gründen auch immer überhaupt eintreten sollte, nur von kurzer Dauer sein könnte.
Damit Du mich nicht falsch verstehst, ich habe volles Verständnis dafür, falls Du Dich selbst, oder auch jemend anders, durch Puts absichern möchte. Es ergibt für erfahrene Daytrader und Chartanalysten sogar manchmal Sinn dies zu tun. Nur solltest Du Dir trotzdem dabei im Klaren sein, dass diese Handlungsweise genau das ist, was das Gold, und Silber Cabal erreichen will. Nähmlich die Gold, und Silber Anleger/Trader zu verunsichern, und sie auf die Short-Seite (Verkaufsseite) zu ziehen, auch wenn es, wie ich Deinem letzten Posting entnehme, nur zur Absicherung Deiner bereits erziehlten Gewinne gedacht ist, und auch nur einen Papier Gold Leerverkauf darstellt, hilfst Du damit indirekt mehr den Interessen des Cabals, als Deinen eigenen langfristigen Anlageinteressen.
Gruss
ThaiGuru
Wenn sich die "Volksmeinungsmacherin" Bild Zeitung, einmal so stark gegen die Dollar, Gold, und Silberpreis Manipulationen engagieren würde, wie sie es gegen den "Party-Banker" Welteke gerade tut, wäre dem durchschnitts Bürger bedeutend mehr geholfen, als nur mit einem konzertierten Abschuss von Bundes Bank Präsident Welteke.
Gruss
ThaiGuru
[Blockierte Grafik: http://bilder.bild.t-online.de…ild__de,property=Bild.gif]
http://www.bild.t-online.de/BTO/index.html
Wie Bundesbank-Präsident Welteke seine Meinung ändert
Party-Banker:
Jeden Tag ein bisschen klüger!
Von CHR. SCHMITZ
[Blockierte Grafik: http://bilder.bild.t-online.de…ke__hgs,property=Bild.jpg]
Der Party-Banker am Ende! Bundesbankpräsident Ernst Welteke (61, SPD) muss seine Amtsgeschäfte ab sofort ruhen lassen. Die Regierung fordert sogar offen den Rücktritt! Schön für Welteke: In Berlin heißt es, in diesem Fall könne er mit bis zu 21 000 Euro Pension rechnen
[Blockierte Grafik: http://bilder.bild.t-online.de…welteke,property=Bild.jpg]
Jetzt herrscht ein offener Machtkampf zwischen dem Party-Banker und der Bundesregierung!
Bis gestern Abend wollte Bundesbankpräsident Ernst Welteke (61/SPD) noch immer nicht wahrhaben, dass die Party aus ist. Am Nachmittag die Krisen-Sitzung des Bundesbank-Vorstands: Vier der sieben Mitglieder des Bundesbank-Restvorstandes sprechen sich für eine Abberufung Weltekes aus. Einen Nachfolger hatte die Bundesregierung bereits intern ausgeguckt: den Staatssekretär im Bundesfinanzministerium, Caio Koch-Weser (59/parteilos).
Gegen 20 Uhr dann die große Überraschung: Offenbar als „Trotzreaktion“ (ein Regierungsmitarbeiter) auf den großen politischen Druck aus Berlin vertagte der Bundesbank-Vorstand seine Entscheidung – und baute dem Präsidenten eine goldene Brücke: Welteke lässt sein Amt ruhen, sein Vize Jürgen Stark (58) führt die Geschäfte kommissarisch. Aber:
Die Prüfung des Vorwurfs der Vorteilsannahme durch die Staatsanwaltschaft geht weiter!
Die Bundesregierung reagiert empört auf die Wischiwaschi-Entscheidung. Das Bundesfinanzministerium erklärt am späten Abend: „Aus Sicht der Bundesregierung trägt der Beschluss des Bundesbankvorstands dem Ziel nicht angemessen Rechnung, das hohe Ansehen der Bundesbank in der öffentlichen Meinung zu bewahren.“ Die Regierung sei der Auffassung, dass sowohl die Institution als auch das Amt des Präsidenten „vor weiterem Schaden bewahrt werden müssen“. Deshalb gehe sie davon aus, dass der Bundesbankpräsident in seiner Verantwortung vor dem Amt und der Institution Bundesbank die notwendigen Konsequenzen ziehen wird“. Im Klartext: Welteke soll sofort zurücktreten!
Bis zuletzt hatte der Party-Banker versucht, sich herauszureden. Im ZDF wies er gestern mittag noch einmal alle gegen ihn erhobenen Vorwürfe im Zusammenhang mit der von der Dresdner Bank bezahlten Silvester-Sause 2001/2002 im Berliner „Adlon“-Hotel (7661,20 Euro) zurück: „Ich gehe davon aus, dass ich in meinem Leben nie etwas getan habe, das meine Unabhängigkeit und meine Amtsführung ... hätte beeinträchtigen können.“
Welteke sprach erneut von einer „Kampagne“ und „Falschmeldungen“ – auch unter Anspielung auf die jüngste BILD-Enthüllung. Danach steht definitiv fest: Trotz eines Dementis der Bundesbank („falsch“) hat sich Party-Banker Welteke auch beim Wiener Opernball aushalten lassen!
Peinlich für die Deutsche Bundesbank: Die Österreichische Nationalbank (OeNB) bestätigte gestern den BILD-Bericht, wonach Welteke anlässlich des Opernballs 2000 auf Einladung der österreichischen Zentralbank mehrere Tage in Wien war – und zwar von Donnerstag bis Sonntag (Abreise).
OeNB-Gouverneur Klaus Liebscher: „Präsident Welteke und seine Frau waren Gäste der OeNB beim Opernball 2000.“
Der Opernball selbst fand am Donnerstag, den 2. März 2000, statt. Ein Logenplatz kostet zwischen 9000 und 16 000 Euro – zusätzlich zur einfachen Karte (200 Euro)!
Was die Bundesbank weiter verschwieg: Nach BILD-Informationen war Welteke auch 2002 wieder Gast auf dem Wiener Opernball (7. Februar) – diesmal auf Einladung einer großen deutschen Geschäftsbank! Und wieder blieb Welteke ein paar Tage länger in Österreich, ließ sich den Kurzaufenthalt von seinen Gastgebern bezahlen.
Noch unklar: Auf wieviel Pension hätte Welteke Anspruch als Ex-Bundesbankchef?
In Regierungskreisen hieß es zunächst, für ihn würden die beamtenrechtlichen Versorgungsregeln gelten. Danach könnte Welteke mit rd. 21 000 Euro/Monat in den Ruhestand gehen!
Laut Bundesbank dagegen hätte Welteke Versorgungsansprüche erst nach Ablauf seiner achtjährigen Amtszeit (2007). Über ein „Ruhegehalt“ müsse im Einzelfall der Vorstand entscheiden.
[Blockierte Grafik: http://www.n24.de/wirtschaft/finajhvgjhff.jpg]
Geld ver- schieben, Löcher stopfen!
Bei "Finanz- minister" ist logisches Denken gefordert
Jetzt spielen:
http://www.n24.de/wirtschaft/h…und/?a2004040815255736533
