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StoneX: Gold to “Maintain High Prices” on Inflation, Slow Recovery, Low Yields

This week, Your News to Know rounds up the latest top stories involving gold and the overall economy. Stories include: StoneX’s bullish outlook for gold in 2021, low interest rates to support gold for years to come, and a rare gold coin fetches $9.36 million at Texas auction.

StoneX: Expect gold to trend up for at least another six months

In their outlook for 2021, commodities and foreign exchange trader StoneX said that gold should continue trending upwards throughout the first half of 2021 on the back of numerous powerful drivers. These include economic risks and uncertainty as well as geopolitical turmoil, both domestic and international.

As the firm noted, last year saw precious metals emerge as the best-performing commodity group with a 27% rise year-on-year. Silver and gold supported each other’s prices as investors looked for a hedge amid conditions that seem to have very much poured over into the new year. In particular, StoneX sees additional stimulus by global central banks and the accompanying rise in inflation expectations as prominent vehicles for an extension of the bull run.

“The United States, the European Central Bank, and the Bank of Japan have all been active with combined asset growth of over $7 trillion last year. With Congress’ approval of a $900 billion virus relief package in the United States (tied to the $1.3 trillion government funding program) there is more liquidity coming; Europe may follow suit, while Japan is looking to extend support for the corporate sector,” explained the firm.

More than inflation on its own, StoneX noted that its effect on real rates will continue driving money managers to utilize gold as a hedge, especially due to the threat of a stock market correction…

…click on the above link to read the rest of the article…

This Analyst Says Gold’s Pullback is Proof that Higher Prices Are to Come

Precious Metals Soaring

This week, Your News to Know rounds up the latest top stories involving gold and the overall economy. Stories include: Gold has more room to run, why central banks have been buying gold for over a decade, and two massive gold nuggets worth $250,000 found in Australia.

Standard Chartered: Gold has more to show this year despite hitting a new all-time high

For a steady asset such as gold, a rapid breach of its decade-old all-time high is quite a showing. Yet, according to multiple analysts, the metal could stagger market watchers some more by the end of the year. Since blazing past $2,000, gold has pulled back as some expected, yet seems unwilling to go below the $1,940 level if the previous two weeks are any indicator.

Standard Chartered Private Bank’s Manpreet Gill attributes gold’s correction to a slight recovery in the 10-year Treasury yield amid an increase in risk sentiment. If this is indeed the reason for the pullback, the development is actually positive for gold, as the general consensus is that sovereign bond yields are on a firm downwards spiral, with no central bank showing any inclination towards elevating its benchmark rate.

“We have quite a bit of one-sided positioning in gold and I think, you know, that’s actually unwound quite quickly. A lot of our proprietary indicators are telling us exactly that,” said Gill, while acknowledging that central bankers are favoring a cap on their bond yields.

In a recent note, Fitch Solutions’ analysts likewise said that gold should keep moving up for the rest of the year and pass its August high in doing so in the absence of any notable headwinds. “We expect gold prices to remain supported in the coming months with rising geopolitical tensions and an uneven and slow global economic recovery,” said the team in the note.

…click on the above link to read the rest of the article…

Citibank Joins Mainstream Gold Bulls Forecasting Record Prices

Citibank Joins Mainstream Gold Bulls Forecasting Record Prices

Citibank has joined other mainstream gold bulls calling for record gold prices.

Citi raised its gold price forecast this week. It now projects a three-month price of $1,825 per ounce and for the yellow metal to head into record territory in 2021. Citi analysts expect gold to eclipse the $2,000 mark early next year.

Citibank joins several other mainstream players that now project record gold prices in the coming months. Last week, we reported Goldman Sachs now forecasts record gold prices within the next 12 months and Bank of America released a note saying gold could break its US dollar record by the end of the year if it continues to breach key resistance levels.

Meanwhile, SGMC Capital Founder & CEO Massimiliano Bondurri told Bloomberg he thinks gold may hit close to $2,000 by the end of this year and could rally further due to dollar weakness.

It can rally much, much further than here, for a number of reasons. First of all, we expect dollar depreciation to continue, so that’s likely to benefit gold.”

And Edison Investment Research is even more bullish, saying gold has the potential to go as high as $3,000.

Gold has been on a strong run over the last couple of weeks as the number of coronavirus cases has surged. Bullion is up better than 12% in this quarter.

Safe-haven demand has given gold a boost, but the big driver is the Federal Reserve and its unprecedented money printing. As US Global CEO Frank Holmes recently pointed out, there is a strong correlation between the expansion of the central bank’s balance sheet and the price of gold. We’ve already seen the balance sheet balloon by over $3 trillion in response to the coronavirus pandemic and it currently stands at over $7 trillion. Holmes said he thinks the central bank will likely grow its balance sheet to $10 trillion before all is said and done. If history is any teacher, that could mean $4,000 gold.

…click on the above link to read the rest of the article…

Important Factors Impacting The Gold & Silver Supply And Price

Important Factors Impacting The Gold & Silver Supply And Price

The majority of analysts still don’t understand that gold and silver are based on two different price or value functions.  To understand the future forecasts for precious metals, investors need to the difference between the two value functions.

In my newest video update, Important Factors Impacting Gold & Silver Price And Supply, I discuss in detail the two different price functions and why the current commodity-based mechanism differs from the precious metals “Store of Value.”

In the video, I explain why the “commodity-priced mechanism” is important as a floor for the gold and silver prices.  Unfortunately, because Harry Dent doesn’t understand this mechanism, he continues to put out faulty and incorrect analysis on the gold price.  Dent stated in his April 13th video update that during the next deflationary collapse of the markets, gold would head back down to $900-$1,000 or the lows of 2008 at $700.

Dent’s gold forecasts continue to be wrong because he fails to incorporate the impact of “ENERGY” and the “COST OF PRODUCTION” on the gold mining industry.

I updated Barrick and Newmont’s combined total production cost versus the gold price for Q1 2020, and was quite surprised.  Again, I explain why I don’t see gold heading anywhere near $700 due to the significant increase in cost to produce the yellow metal since 2006 when gold was the same price.

This video took longer to publish then I had planned due to the research.  I was quite surprised to see Barrick and Newmont’s total production cost rise to nearly $1,400 an ounce for Q1 2020 versus the $1,272 average for 2012, when oil prices were over $100 a barrel.

…click on the above link to read the rest of the article…

London Gold Pool Collapse 2020s (VIDEO)

London Gold Pool Collapse 2020s (VIDEO)

To better understand where Gold is going, you have to know where it has been (gold price suppression history).

Especially in the context of our last 50+ full fiat currency regime years as only for a small single-digit percentage in that time was gold allowed to do its freaking premiere money job.

Given the ridiculous situation, central banks and fiat financialization has gotten us to in 2020, it’s only a brief time from now where the ultimate final bubble of this debt supercycle shows up in gold.

Here we dig through in detail how the City of London has often been at the center of rigging gold prices for the benefit of fiat financiers.

Such frauds and those who learned volatility injection from them (COMEX) are losing effect as the run on gold bullion have begun.

What you’re looking at in the chart above, is the inevitable free-market repricing higher, after pegging and suppressing the price of premiere money, gold bullion near $35 oz for some 35 years of time.

After the original multinational London Gold Pool price rigging operation collapsed in 1968, the fiat Federal Reserve note became the anchor to all fiat currencies everywhere (August 1971).

Last time London was at the center of politely rigging the gold price, France’s Charles de Gaulle decided to break up the price rigging party with his Exorbitant Privilege (1965) speech

The then French President spoke, in a similar tone to how a modern Vladimir Putin or a perhaps a Chinese Nationalist might today.

As you can see in that 1970-1980s gold price chart above, the yellow precious metal went to work repricing some 24Xs higher following the conspiratorial price rigging collapse.

…click on the above link to read the rest of the article…

Gold Bar Shortage Deepens: Credit Suisse Tell Clients “Do Not Bother Asking”

Gold Bar Shortage Deepens: Credit Suisse Tell Clients “Do Not Bother Asking” 

◆ Gold bar shortage globally prompts preppers, bankers and high net worth investors alike to try and acquire large gold bars but mints, refiners, banks and dealers globally are sold out.

◆ As the coronavirus pandemic takes hold, retail and institutional investors and banks are encountering severe shortages of gold bars and coins according to industry participants (see Wall Street Journal story below).

◆ Epic gold shortage prompts those concerned about systemic collapse including preppers, bankers and high net worth alike to try and acquire gold bullion which has become ‘unobtanium’.

◆ Credit Suisse Group AG, which has minted its own bars since 1856, told clients this week “not to bother asking” for gold bars.

◆ Dealers are sold out or closed for the duration and in London, bankers are chartering private jets and trying to finagle military cargo planes to get their bullion to New York exchanges, according to the WSJ. 
◆ Gold prices are consolidating after the near 8% gain last week and remain one of the best performing assets in the last twelve months and year to date.

◆ GoldCore remains open for business and when they become available we are buying coins and bars from our government mint and large refinery suppliers and from our clients. Premiums have surged and we are paying 1.5% over spot to clients for gold kilo bars and higher premiums for smaller bars and bullion coins (1 oz). We are only selling to clients who have cleared funds on account and are on our Buyers List. 

NEWS and COMMENTARY

Coronavirus Sparks a Global Gold Rush – WSJ

How Gold Is Manipulated

How Gold Is Manipulated

How Gold Is Manipulated

Is there gold price manipulation going on? Absolutely. There’s no question about it. That’s not just an opinion.

There is hard statistical evidence to make the case, in addition to anecdotal evidence and forensic evidence. The evidence is very clear, in fact.

I’ve spoken to members of Congress. I’ve spoken to people in the intelligence community, in the defense community, very senior people at the IMF. I don’t believe in making strong claims without strong evidence, and the evidence is all there.

I spoke to a PhD statistician who works for one of the biggest hedge funds in the world. I can’t mention the fund’s name but it’s a household name. You’ve probably heard of it. He looked at COMEX (the primary market for gold) opening prices and COMEX closing prices for a 10-year period.

He was dumbfounded.

He said it was is the most blatant case of manipulation he’d ever seen. He said if you went into the aftermarket, bought after the close and sold before the opening every day, you would make risk-free profits.

He said statistically that’s impossible unless there’s manipulation occurring.

I also spoke to Professor Rosa Abrantes-Metz at the New York University Stern School of Business. She is the leading expert on globe price manipulation. She has actually testified in gold manipulation cases.

She wrote a report reaching the same conclusions. It’s not just an opinion, it’s not just a deep, dark conspiracy theory. Here’s a PhD statistician and a prominent market expert lawyer, expert witness in litigation qualified by the courts, who independently reached the same conclusion.

How do these manipulations occur?

…click on the above link to read the rest of the article…

Gold Prices Will Keep Rising Because Crash Conditions Are Becoming Obvious

Gold Prices Will Keep Rising Because Crash Conditions Are Becoming Obvious

The price movements of precious metals are difficult for some people to understand. In the world of equities, investors are mesmerized by tickers day in and day out, and market movements occur minute by minute. This realm of investment teaches people to shorten their memories, their attention spans and their patience. In the world of gold and silver, however, investors buy and sell according to cycles that last years – oftentimes decades. It is the complete antithesis to stocks.

This is why gold catches a lot of ignorant criticism at times. The “barbaric relic” does not behave the way day traders want it to behave. It sleeps, they ignore it or laugh at it, and then it explodes. It is not surprising that your average stock market player is usually caught completely off guard when an economic crisis hits Main Street, while the average gold investor already saw the event coming many months in advance. The gold mentality lends itself to caution, observation and historical relevance. The stock market mentality lends itself to carelessness and the denial of history.

I would acknowledge here that there is plenty of evidence of paper market manipulation of gold and silver to the downside by major banks like JP Morgan. Any investor in metals should take this into account. However, it is also important to realize that in moments of economic uncertainty, the physical market can and does overtake paper manipulation, and prices rise anyway. This is exactly what happened in the lead up to the 2008 crash, and it’s happening again today.

 …click on the above link to read the rest of the article…

Gold & Silver Prices Rise As The Markets & Oil Decline

Gold & Silver Prices Rise As The Markets & Oil Decline

Over the past week, the gold and silver prices have held up rather well compared to the overall markets.  While precious metals investors still fear that a huge sell-off in the gold and silver prices will take place during the next market crash, it seems that the metals continue to be very resilient during large market corrections.

Now, I am not saying that the metals prices cannot fall any lower, but a lot of the leverage in the gold and silver market has already been removed and is now at a near all-time low.  So, even though we could see weaker precious metals prices, the overwhelming leverage and bubble asset prices are in the stock and real estate markets.

Furthermore, one of the reasons precious metals investors still fear that a major selloff is imminent is that they are using the 2007-2008 economic market meltdown as a guideline.  However, when gold and silver prices were plummeting from their highs in 2008, along with the rest of the market, speculators held huge long positions while the commercials controlled an enormous number of short contracts.

If we look at the following Gold Hedgers Chart, we can clearly see that the market setup today is the exact opposite of what it was in 2008:

When gold was trading near $1,000 in early 2008, the commercial banks held a record high of 252,000 net short contracts compared to the present gold price of $1,222 (time of chart), with the commercials only holding 16,000 net short contracts.  The commercial short positions are shown by the blue line.  Thus, the higher the commercial short positions, the lower the line goes and the lower the number, the higher the line moves.  Currently, the gold price and commercial net short positions are both at the near lows.  Also, the speculator net long positions are close to their lows as well

…click on the above link to read the rest of the article…

Has China Finally Lifted its Thumb off of Gold?

Has China Finally Lifted its Thumb off of Gold?

There’s a lot of talk about the Yuan price of gold falling out of a price suppression channel.  Both Zerohedge and Nomura have weighed in on this.

The Yuan price of gold surged overnight to above CNY 8500 per ounce which is a major breakdown  But it’s also indicative of something that has long been suspected during this gold bear market.

China doesn’t want the price of gold to rise.  Those accumulating gold — China and Russia — have zero incentive to accumulate at higher prices.   And the gold chart of the last three years bears out that they have had to come in at higher prices on pullbacks because market bottoms keep coming in higher and higher.

The 2015 low was around $1050.  2016 at $1146.  2017 the low after a pullback in July couldn’t breach $1208 during a strong post-U.S. election rally.  This year the price was briefly pushed below $1200 in the longest downtrend of the seven year bear market but has since popped back over $1230 with its sights now set on  $1250.

China may have no choice here but to let the price of gold rise.  Because conditions in other markets are changing rapidly.  So, ultimately, what China wants really may not matter anymore.

Remember, the eurodollar markets broke in late May this year as Jeffrey Snider at Alhambra Partners reminds us daily.

The PBoC cut the reserve ratio again recently to free up liquidity in Chinese banks but it doesn’t seem to have stemmed the tide.  And that’s why it has continually loosened the Yuan fix rate, now approaching 7 vs. the U.S. dollar.

Offshore dollar markets are the pool of real savings in the global economy and it determines where we are headed.  And the offshore dollar hoarders are pulling out of China… and Europe… and Japan…. and South America.

…click on the above link to read the rest of the article…

Global Central Bank Buying Puts A Floor Under The Price of Gold

Global Central Bank Buying Puts A Floor Under The Price of Gold

The only reason the price of gold’s down on the year is because of a strong dollar.

Actually – for how much the dollar’s rallied this year, gold holding around the $1,200 range is very bullish.

And if gold’s been able to hold its own during a stronger dollar and aggressive Federal Reserve tightening – imagine what it will do once they decide to begin easing. . .

Putting it simply – the price will soar. . .

So, who’s taking advantage of this weaker gold price?

The Global Central banks – but specifically the Emerging Markets.

Here is the latest data showing the Q2/2018 Central Bank gold reserves.

This comes after Central Banks added 116.5 tons to their ‘official’ reserves in Q1/2018.  This was the highest first quarter increase over the last four years.

It’s widely known that in the 1990’s and first decade of the new millennium – Central Bank’s were dumping their gold.

Starting in the late 1980’s, gold reserves in Central Bank vaults declined from roughly 36,000 to just under 30,000. That’s a huge drop.

To be clear, they didn’t just sell the gold. The Central Banks also engaged in the ‘gold carry trade’.

This is when Central Banks ‘lease’ their gold reserves to investment banks for a set amount of time and a bit of interest.

The investment banks then sell that gold in to the market – get dollars in return – and buy bonds or equities.

After a while, they take the profits and buy the gold back – returning it to the Central Banks.

You can see how lucrative this trade is. And how it incentivizes the investment banks to keep the gold price down (since they have to buy back the gold later to return it to the Central Banks).

…click on the above link to read the rest of the article…

The coming boom in gold prices. . .

The coming boom in gold prices. . . 

In June 1884, a local farmer named Jan Gerritt Bantjes discovered gold on his property in a quiet corner of the South African Republic.

Though no one had any idea at the time, Bantjes’ farm was located on a vast geological formation known as the Witwatersrand Basin… which just happens to contain the world’s largest known gold reserves.

Within a few months, other local farmers started discovering gold… kicking off a full-fledged gold rush.

Just over a decade later, South Africa became the largest gold producer in the world… and the city of Johannesburg grew from absolutely nothing to a thriving boomtown.

This area is singlehandedly responsible for 40% of all the gold discovered in human history – some 2 billion ounces (or $2.6 trillion of wealth at today’s gold price).

And while the Witwatersrand Basin is still being mined to this day, it’s not as active as it used to be.

Gold production in Witwatersrand peaked in 1970, when miners pulled a whopping 1,000 metric tons of gold out of the ground.

A few decades later in 2016, the same area produced just 166 tonnes– a decline of 83%.

That’s not unusual in the natural resource business.

Whereas it takes nature hundreds of millions of years to deposit minerals deep in the earth’s crust, human beings only require a few decades to pull most of it out.

This creates the constant need for mining companies to explore for more and more major discoveries.

Problem is– that’s not happening. Mining companies aren’t finding anymore vast deposits.

According to Pierre Lassonde, founder of the gold royalty giant Franco-Nevada and former head of Newmont Mining–

If you look back to the 70s, 80s and 90s, in every one of those decades, the industry found at least one 50+ million-ounce gold deposit, at least ten 30+ million ounce deposits, and countless 5 to 10 million ounce deposits.

…click on the above link to read the rest of the article…

Gold Price Will Explode When System Breaks – Gordon Long

Gold Price Will Explode When System Breaks – Gordon Long

Private investor Gordon Long contends the price of gold will shock the world when it revalues to reflect the massive amount of currency that has been printed globally. Long explains, “That is correct, and it won’t be something that is gradual, it will be very abrupt.  The system will break . . . and the financial markets will freeze up.  When they come out of the other end of that freeze, and it may be a number of weeks because the next crisis will be global and much more complex than 2008.  We could control that with the Federal Reserve . . . and this one you cannot do because you cannot get agreement with all those countries.  Never mind understanding the complexity.  So, when we come out on the other side . . . there will be a massive revaluation in the U.S. dollar. . . .  Gold could jump to $5,000 or $10,000 an ounce or something like that. . . . It will be massive.  They will have to put some stability in the monetary system, and the only way they can do it is having something they cannot print.  This is what has gotten us into this problem.  We have to get back to sound money.  It will have to be gold.  What percentage of backing will determine what the value the gold will be.”

On the value of the U.S. dollar, Long contends, “Personally, I think the revaluation of the U.S. dollar will be well over 70% devaluation. It doesn’t mean the world is coming to an end.  It just means you have to go through this to reset.  Those who prepare and understand why this is happening and watch for the signals, there’s going to be fortunes transferred.  They are being transferred right now, frankly.  One other big caveat on gold prices going way up, expect the government to tax it like you have never seen before.”

…click on the above link to read the rest of the article…

Grant Williams: “History Is About To Repeat Itself Again… And It Might Get Ugly”

Grant Williams: “History Is About To Repeat Itself Again… And It Might Get Ugly”

Real Vision’s Grant Williams believes that the 76 million retiring Baby Boomers will trigger a major pension crisis.

“With that potentially bad situation we could face,” the seasoned asset manager and co-founder of Real Vision TV said in a recent extended Metal Masters interview (full interview below), “holding physical metal, somewhere safe, somewhere outside the banking system, is just a sensible precaution to take.”

His outlook has changed drastically since he started his first job trading Japanese markets in 1986: “What I walked into at that time was one of the greatest bull market bubbles the world had ever seen, in the Japanese equity market and real estate market.” During this heyday, precious metals weren’t on his radar at all—until a year later, when he witnessed his first stock market crash and started asking some inconvenient questions.

“I’ve always been a fan of history,” says Williams, who also writes the wildly popular macroeconomic newsletter, Things That Make You Go Hmmm… “So I read financial history and I just kept reading. And it was clear to me that at this point in time, I needed to buy some gold.”

Until then, the gold price didn’t mean much to him, except as an indicator of other things, so he considers the crashes he witnessed in his career wake-up calls and blessings in disguise.

The 1987 crash, he says, was more like “a bad day at the office; it came and went so fast… The bounce-back was quick, but it was a real shock to the system that that could happen.” When the dotcom bubble burst, he was well prepared. “I recognized the madness for what it was much sooner… and so that taught me that markets can reverse and just go down.”

…click on the above link to read the rest of the article…

Gold Price Skyrockets in India after Currency Ban

As I write this in the morning of 9th November 2016, there are huge lines forming outside gold shops in India — and gold traded heavily until late into the night yesterday. Depending on who you ask, the retail price of gold has gone up between 15% and 20% within the last 10 hours.

img-20161109-wa0003Gold quotes in India – gold traded for as much as Rs 49,000 per 10 grams or US$ 2,294 per ounce

At some places, it was sold for as much as US$ 2,294 per ounce. That is, if you can actually find physical gold — gold inventories at stores are rapidly depleting. All of this happened well before the international price started to move up because of the election results coming out of the US.

Last night (8th November 2016), India’s government banned the use of Rs 500 (~$7.50) and Rs 1,000 ($15) banknotes. This pretty much made most currency-in-use illegal. Banks and ATMs are closed today. The government believes that doing this will help eradicate corruption and push counterfeit money out of circulation. According to the Indian government, the counterfeit money tends to come from Pakistan and helps finance terrorism.

My first instinct when I heard the news was that people would be on the streets this morning. There would be riots and the Indian Prime Minister, Narendra Modi, would be unceremoniously thrown out. Despite being a huge critic of him, I thought he at least had the spine to take bold action, however erroneous it might have been.

I am sometimes too optimistic about India and expect too much goodness from Indians. And I was wrong.

In the morning no opposition against the government was in sight. But there was some animosity detectable between people.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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