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How Gold Bugs can Have their cake and eat it too by Embracing the trend

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September 13, 2016

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How Gold Bugs can Have their cake and eat it too by Embracing the trend

By Sol Palha http://news.goldseek.com/GoldSeek/1473777766.php

Executive ability is deciding quickly and getting somebody else to do the work.

John G. Pollard

Many individuals sit back and look wistfully at the 1^st stage of the Gold Bull Market they missed. It is interesting that people focus on what they lost but not what they might miss. Since Gold topped out in 2011, many sectors took off; one could have deployed a portion of one’s funds in any of these sectors and walked away with healthy gains. Instead, the classic Gold bug clung to Gold and let all these opportunities slide away.

Never live in regret, life is much too valuable for that. There is always another bull market, why focus on one market only. Many people fixate on the precious metals markets because many hard money experts continue to come out with gloom or doom scenarios. Never listen to anyone giving you a script that is painted with strokes of Panic. No one can function properly once he or she succumbs to panic; reason goes out the window, and nonsense takes over.

There is a way that Gold bugs and hard money experts can have their cake and their pie, but that would entail a change in perspective. If you can do this then, the process is rather simple. We will provide these details shortly; please bear with us.

Precious metals will trend higher one day but why fixate on that day only, what about today, and all the other opportunities you might be sacrificing because you have restricted your vision. If you cling to a particular outlook, you have reduced your line of sight by a significant margin. This is why Gold bugs openly state that they will not support “Fiat”, and they will rather embrace Gold and Silver than the stock market which is funded by worthless paper. To which we respond “oh really” well then what are these bugs doing when they buy Gold; are they not hoping that Gold soars in value and what will it rise in value, oh yes, worthless dollars.

If you cling to one perspective, you cannot see the full picture. How about looking at the picture from every angle. You are Gold bug or hard money fan; here is how you can have your cake and your pie

Why not embrace the equities bull, use the worthless money to get more cheap money and then use some of this paper to buy the Gold and Silver you crave; this perspective is lost to the on many because all they see is Gold and nothing else. Had they embraced this point of view, they would have been embraced the equities bull and multiplied the worthless paper (money) they had. Then, they could have used some of this worthless money to buy real money (Gold), and maybe then they would not be so obsessed with the Gold Markets. The Gold they obtained would technically be free as they used paper profits generated by embracing assets they typically would not; this extra paper was used to bankroll the purchase of new bullion. In effect, they would be pulling a page out of the central banker’s books. A perception depends on the angle of observance; alter the angle and you modify the perception.

This chart illustrates how Gold performed vs. the SP500 over the past five years; in comparison, Gold has taken a beating and is now making a modest comeback. This took place in the face of the greatest money printing efforts from central bankers in the history of this planet. What happened to the hard money argument that Gold will rise as the money supply soared. Instead the opposite took place, the more money central bankers created, the more Gold fell.

This chart clearly illustrates that since 1980, Gold has not fared as well as it should have. Look at how the money stock has increased. The price of Gold should have continued to trend upwards, and it should be north of $2500. Instead, it cannot even trade to $1400. There is a reason for this; central bankers have managed to recreate reality. By brainwashing the masses and creating new definitions for inflation, they have convinced the masses that Gold is an old relic not worth focusing on, but that is a story for another day.

This is why it is important not to be belong to any group and why it is more important to concentrate on the trend. Don’t fall in love with Gold; it is just another investment; it will trend up for some time, then pull back and correct firmly and then trend up again. Nothing trends up forever, well, stupidity being the only exception.

Once again, the point we are trying to make is that you should not live in regret; the 1^stphase of the Gold bull is over, but the next phase will be even stronger. We have a high-end target of $5000 for Gold and to be honest with you, we hope it does not trade to $5000, and we are wrong. Inflation will be quite significant if Gold hits $5000, so those fools hoping for Gold $25,000 or $50,000 have no idea how terrible things would be if Gold traded to those targets. If, Gold ever trades to $50,000, the world as you know it will be over. Chaos will be the order of the day. We will be facing a situation that will be even worse than the Greate Depression. Luckily most of these guys are full of hot air, and it is more likely Central bankers will embrace Gold before Gold trades to those targets.

Conclusion

Forget the noise, focus on the trend. Experts are there to confuse and not enlighten one. We have never claimed to be experts, at most we will settle for the title of advanced students of the Market. The market is a complex beast, and there is always something new you can learn. Those that refuse to accept this are usually punished severely.

Moreover, don’t forget, you can have your cake and your pie. Use worthless paper to make more paper and then use some of this paper to buy (Real Money) Gold and or Silver bullion. In such crazy times, it would be prudent for everyone to have a portion of his or her funds in Gold and Silver bullion. If you have no position in bullion, use strong pullbacks to open new positions.

Ability is a poor man’s wealth.

M. Wren

By Sol Palha http://news.goldseek.com/GoldSeek/1473777766.php

Gold And Presidential Politics: Why Your Vote May Not Count

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September 13, 2016

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Full Article: Gold And Presidential Politics: Why Your Vote May Not Count

By Kira Brecht, Kitco.com

(Kitco News) – Sept 9 –Brace yourself. The winds are changing. Come 2017, there will be a new occupant in the Oval Office in Washington, D.C. However, it may be disturbing to know that your vote may not really matter, depending on what state you live in.

It’s not the popular vote in the United States that
determines who wins the election, it’s the Electoral College.

When Americans go to the polls and vote for President and Vice President, they are actually voting for the Electoral College. It is these electors –who actually choose the nation’s president.

This is an elaborate system created by the Founding Fathers in which the Constitution delegates each state a number of electoral votes equal to the combined total of the state’s Senate and House of Representatives delegations. There is a group of electors voted in for each political party in every state. In the winner-take-all system, whoever wins the popular vote of that state will win all the Electoral Votes from that state.

Example: if you live in California, no matter who you vote for, Clinton is expected to take all the Electoral votes (55) of that state.
Or, if you live in Idaho (4) Wyoming (3), or Tennessee (11), Trump is seen as solid in those states, so no matter who you vote for the Electors will vote for Trump.

The current count: RealClearPolitics.com has a running total in real time and is a good source for this information.

The current read is: Clinton 229, Trump 154

Source: http://www.realclearpolitics.com/

Why was this system developed: Some say, this system was designed because the founding fathers, who were an educated bunch, didn’t trust the rank and file and perhaps less educated citizenship to actually choose the leaders of the country.

Question: How many times was a US president elected to the White House who did not win the popular vote? Yes, it’s happened.

Answer: Four

1824: John Quincy Adams took the White House without winning the popular vote
1876: Rutherford Hayes won the Electoral College, but lost the popular vote
1888: Benjamin Harrison won the election, but lost the popular vote
2000: George W. Bush lost the popular vote to Al Gore, but Bush still took the Electoral College and the White House.

Source: factcheck.org

Swing States Hold the Key

Hint: To track pre-election trends, follow polls in the key battleground swing states. These include:

Florida
Ohio
Pennsylvania
North Carolina
Colorado

Clinton versus Trump: Economic Implications For Gold

“Clinton represents the status quo and Trump represents serious change amid increased
uncertainty. Trump’s easier fiscal policy and decreased regulation could drive growth and
inflation higher in the near term, perhaps requiring tighter monetary policy. However, increased uncertainty under Trump could weigh on growth,” according to a research report from Credit Suisse.

Trump: has potential to get his proposals passed in a likely Republican controlled Congress.
Key points:

Major tax legislation could get passed quickly.

Economic result: “Projections of the future debt will balloon as a result of the tax changes, but lower taxes would likely boost growth forecasts in the short term,” Credit Suisse says.

New Fed chief: Trump has already said in an interview with CNBC that he would replace Janet Yellen when her term is up. Her term leading the Fed ends in February 2018.
Potential to ease regulations in some industries.
Opposition to trade deals.

Clinton: is expected to be largely status quo, as her policies are similar to President Obamas. Growth, policy and earnings expectations are unliklely to change significantly, Credit Suisse says.
Key points:

She could face difficulties passing bills through a Republican House.
Support for trade deals.

Bottom Line For Gold

With a Clinton win there is potential for “more of the same.” The current environment has been supportive to gold.
With A Trump win there is potential for inflation, and potential for policy uncertainty which is bullish for gold.

No matter who wins the White House in November, gold could come out a winner.

Your popular vote still may not matter. There has been some rumblings for a National Popular Vote bill, but it hasn’t gained a lot of steam. Maybe it is time for this proposal to gain some attention. It would equalize political clout among all states, and all Americans.

By Kira Brecht, Kitco.com

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Full Article: Gold And Presidential Politics: Why Your Vote May Not Count

By Kira Brecht, Kitco.com

Disclaimer© 2010 Junior Gold ReportJunior Gold Report’ Newsletter: Junior Gold Report’s Newsletter is published as a copyright publication of Junior Gold Report (JGR). No Guarantee as to Content: Although JGR attempts to research thoroughly and present information based on sources we believe to be reliable, there are no guarantees as to the accuracy or completeness of the information contained herein. Any statements expressed are subject to change without notice. JGR, its associates, authors, and affiliates are not responsible for errors or omissions. Consideration for Services: JGR, it’s editor, affiliates, associates, partners, family members, or contractors may have an interest or position in featured, written-up companies, as well as sponsored companies which compensate JGR. JGR has been paid by the company written up. Thus, multiple conflicts of interests exist. Therefore, information provided herewithin should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. No Offer to Sell Securities: JGR is not a registered investment advisor. JGR is intended for informational, educational and research purposes only. It is not to be considered as investment advice. Subscribers are encouraged to conduct their own research and due diligence, and consult with their own independent financial and tax advisors with respect to any investment opportunity. No statement or expression of any opinions contained in this report constitutes an offer to buy or sell the shares of the companies mentioned herein. Links: JGR may contain links to related websites for stock quotes, charts, etc. JGR is not responsible for the content of or the privacy practices of these sites. Release of Liability: By reading JGR, you agree to hold Junior Gold Report its associates, sponsors, affiliates, and partners harmless and to completely release them from any and all liabilities due to any and all losses, damages, or injuries (financial or otherwise) that may be incurred.

Forward Looking Statements
Except for statements of historical fact, certain information contained herein constitutes forward-looking statements. Forward looking statements are usually identified by our use of certain terminology, including “will”, “believes”, “may”, “expects”, “should”, “seeks”, “anticipates”, “has potential to”, or “intends’ or by discussions of strategy, forward looking numbers or intentions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results or achievements to be materially different from any future results or achievements expressed or implied by such forward-looking statements. Forward-looking statements are statements that are not historical facts, and include but are not limited to, estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to the effectiveness of the Company’s business model; future operations, products and services; the impact of regulatory initiatives on the Company’s operations; the size of and opportunities related to the market for the Company’s products; general industry and macroeconomic growth rates; expectations related to possible joint and/or strategic ventures and statements regarding future performance. Junior Gold Report does not take responsibility for accuracy of forward looking statements and advises the reader to perform own due diligence on forward looking numbers or statements.

The Crisis Is Escalating!

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September 9, 2016

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Deutsche Bank and Commerzbank are presently discussing merger talks. The fact that these meetings are occurring, is a signal that Germany’s banking troubles are indeed accelerating.

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They are desperately seeking ways in order to cut costs and improve profitability. These plans include restructuring and job cuts using most highly unconventional measures. Last June 2016, Reuters cited anonymous sources as saying that Commerzbank was exploring the option of hoarding billions of euros, in vaults, as a way of avoiding paying a penalty to the European Central Bank which is due to negative interest rates.

Their main problems are derived mostly from both low and negative interest rates. These lenders are used to depending on interest rate margins for income while offering some services to depositors at either low or no cost. Low interest rates have significantly eroded these banks’ abilities to make money. It has become difficult for German banks to give incentives to their customers so as to keep their money in their financial institutions. These inefficiencies and the intense competition within the German banking sector have already led to serious financial difficulties. If one combines these factors with the new challenge of declining interest rates, what possible positive impact can they expect to incur?

Interestingly, rates are not just low within the context of American history but they also happen to be at their lowest levels ever in over 5,000 years of civilization.

5,000 Years Of Interest Rates – Rates Lower Than 1930’s Depression Era

Deutsche Bank is not merely Germany’s biggest bank but the political role that it plays in Germany is unique when compared to other countries. Deutsche Bank’s importance to Germany is many times greater than that of an investment bank like Lehman Brothers was to the U.S., in 2008. Deutsche Bank is technically a private bank, however, it is informally tied to the government and formally tied to most major German corporations. The banks’ fate will have an impact on all of Germany.

The Italian banking crisis is not only Italy’s problem!

Italy’s non-performing loan issues have now become common knowledge. Who will be forced into dealing with the repercussions of settling Italy’s impaired debt? That is a political question, and the answer depends, in large measure, on who holds Italian bank debt.

The U.S banks are not shielded from these European Continental banking problems. There is a substantial amount of uncertainty and risk.

The consequences of these failures pyramid the crisis due to the European Unions’ regulations. The European Central Bank (ECB) and the Central Banks of member countries cannot bail out failing banks by recapitalizing them. The bail-in strategy is, in theory, a mechanism for ensuring fair competition and stability within the financial sector, across the Eurozone.

The bail-in process can potentially apply to any liabilities of the institution that is not backed by assets or collateral. The first 100,000 euros ($111,000), in deposits, are protected in the sense that they cannot be seized, whereas, any money above that amount can be.

Germany insisted that the bail-in process should prevail.

The Bank for International Settlements stated that German banks are the second most exposed to Italy, after France, with a total exposure of $92.7 billion. Demand for gold has increased!

Italy’s ongoing banking crisis is presenting yet another threat to the stability of the ECB.

Commerzbank’s financial statements revealed that their Italian sovereign debt exposure was 10.8 billion euros ($12.1 billion).

Deutsche Bank’s net credit risk exposure to Italy is 13.3 billion euros as of the end of December 2015. Its’ gross position in Italy is 35.4 billion euros. Deutsche Bank is sitting on $41.9 trillion worth of derivatives.

Consequences of large bank failures are going to be significant

Gold Is The Only ‘Safe Haven’ Left in the World

Gold has remained as a form of currency for many centuries. Whenever countries followed a strict gold standard and used it as their currency, those economies were very stable. But, governments have always surpassed their means, with their costly spending, and have to leave their gold standard so as to fund their inefficiencies. Currently, gold is now beginning its’ multi-year “BULL MARKET”. Gold is the only ‘asset class’ which will maintain its’ ‘store of value’ during this impending crisis which is on the near horizon. The ‘Gold mania’ is about to be ‘unleashed’. While global Central Banks are now implementing ‘negative interest rates’, this is the perfect scenario for gold to surge much higher.

Gold does have a historical store of value characteristics. It is held by Central Banks and institutions as a reserve. They do not want to sell it; on the contrary, many of them want to buy still more and accumulate it. Therefore, gold’s characteristic role, in regards to sovereign reserves, is still intact even amid the fascinating evolution of Central Banking and institutional finance that we are witness to, today.

This week I shared a detailed video for my newsletter subscribers talking about the big picture trends and price targets for gold, silver, mining stocks, oil, natural gas, the S&P 500 index, coffee and also sugar. We have some huge opportunities unfolding on the monthly charts. If you are looking for some easy, big trading opportunities then follow my analysis and trades at: www.TheGoldAndOilGuy.com

Don’t waste your time! Click here to find winning trades in minutes!

Chris Vermeulen

Disclaimer© 2010 Junior Gold ReportJunior Gold Report’ Newsletter: Junior Gold Report’s Newsletter is published as a copyright publication of Junior Gold Report (JGR). No Guarantee as to Content: Although JGR attempts to research thoroughly and present information based on sources we believe to be reliable, there are no guarantees as to the accuracy or completeness of the information contained herein. Any statements expressed are subject to change without notice. JGR, its associates, authors, and affiliates are not responsible for errors or omissions. Consideration for Services: JGR, it’s editor, affiliates, associates, partners, family members, or contractors may have an interest or position in featured, written-up companies, as well as sponsored companies which compensate JGR. JGR has been paid by the company written up. Thus, multiple conflicts of interests exist. Therefore, information provided herewithin should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. No Offer to Sell Securities: JGR is not a registered investment advisor. JGR is intended for informational, educational and research purposes only. It is not to be considered as investment advice. Subscribers are encouraged to conduct their own research and due diligence, and consult with their own independent financial and tax advisors with respect to any investment opportunity. No statement or expression of any opinions contained in this report constitutes an offer to buy or sell the shares of the companies mentioned herein. Links: JGR may contain links to related websites for stock quotes, charts, etc. JGR is not responsible for the content of or the privacy practices of these sites. Release of Liability: By reading JGR, you agree to hold Junior Gold Report its associates, sponsors, affiliates, and partners harmless and to completely release them from any and all liabilities due to any and all losses, damages, or injuries (financial or otherwise) that may be incurred.

Forward Looking Statements
Except for statements of historical fact, certain information contained herein constitutes forward-looking statements. Forward looking statements are usually identified by our use of certain terminology, including “will”, “believes”, “may”, “expects”, “should”, “seeks”, “anticipates”, “has potential to”, or “intends’ or by discussions of strategy, forward looking numbers or intentions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results or achievements to be materially different from any future results or achievements expressed or implied by such forward-looking statements. Forward-looking statements are statements that are not historical facts, and include but are not limited to, estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to the effectiveness of the Company’s business model; future operations, products and services; the impact of regulatory initiatives on the Company’s operations; the size of and opportunities related to the market for the Company’s products; general industry and macroeconomic growth rates; expectations related to possible joint and/or strategic ventures and statements regarding future performance. Junior Gold Report does not take responsibility for accuracy of forward looking statements and advises the reader to perform own due diligence on forward looking numbers or statements.

SWOT Analysis: The Gold Trade Is Not Overcrowded Says UBS

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September 8, 2016

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SWOT Analysis: The Gold Trade Is Not Overcrowded Says UBS
Monday August 29, 2016 11:40
Strengths

Frank Holmes
CEO and Chief Investment Officer
U.S. Global Investors
https://www.kitco.com/commentaries/2016-08-29/SWOT-Analysis-The-Gold-Trade-Is-Not-Overcrowded-Says-UBS.html
The best performing precious metal for the week was gold, down slightly by 1.47 percent. Current market conditions make it the perfect time to invest in gold, according to Heather Ferguson, an analyst at Hargreaves Landsown. “There is a fixed amount of this precious metal in the world so central banks are not able to manipulate the gold market like they can with bonds and cash,” Ferguson explains. “In the current environment of quantitative easing and increasingly extreme monetary policy, gold is highly sought after.”

UBS says the gold trade is not overcrowded, according to a note this week. The group believes that Federal Reserve policy decisions relative to the metal are not as straightforward in this environment where global yields are under pressure ahead of a rate hike.

Citigroup is also positive on the metal, raising its forecast for the second half of the year. The group cites elevated levels of U.S. election uncertainty and stickiness of ETF and hedge fund flows into gold products, reports Bloomberg.
Weaknesses

The worst performing precious metal for the week was platinum with a loss of 3.77 percent. Platinum sold off when precious metals were bear raided on Wednesday, but did not get much of a bounce following Yellen’s speech on Friday.

“The past 48 hours have been an interesting period for gold…” writes Steven Knight of Blackwell Global. “As the metal has again seemingly fallen sharply following the liquidation of a $1.5 billion futures position over the course of 60 seconds.” According to Knight, given the amount of gold derivatives floating around, the fairness of the COMEX exchange likely needs an additional level of scrutiny. In addition, the timing of this “flash crash” could potentially be revealing.

Gold Bear Raid at Wednesday Open

Goldcorp fell the most in six months, reports Bloomberg, on the back of retreating gold prices and the discovery of a leak at the company’s mine in Mexico. Less-than-stellar news was also reported from Kinross Gold Corp this week, as it suspended operations at a mine in Chile ahead of schedule due to a dispute involving water use (causing 300 workers at the Maricunga mine to be laid off as a result). Lastly, Orezone Gold Corp told investors on Monday that it will likely slash the gold resources at its Bombore project by a staggering 30 percent, reports the National Post.
Opportunities

When viewed against the aggregate balance sheet of the “big four” global central banks (Fed, ECB, BoJ and PBOC), the argument can be made if we view gold as a currency, that the metal is worth closer to $1,700 an ounce (versus the spot price of $1,326 an ounce USD), says Deutsche Bank. Over the same period that the aggregate central bank balance sheet expanded 300 percent, the bank continues, global above ground stocks grew by 19 percent in tonnage terms.

More than 500 million people are living in a climate of negative central-bank interest rates, according to a study by Standard & Poor’s cited by HSBC this week. This represents around 25 percent of global GDP and is a clear sign of “economic and policy desperation,” – a bullish factor for gold. Francisco Blanch of Bank of America agrees, stating that central banks “are very scared of hiking rates and that is a very good story for gold.”

“Although we have seen a significant rally in gold, I think investors should still consider an allocation to the precious metal,” Nick Peters, multi-asset investor at Fidelity, said. He continues by explaining that gold can function as a safe haven during times of market volatility and provide strong countervailing returns to equities.
Threats

The Reserve Bank announced today that sovereign gold bonds issued in February and March can be traded on stock exchanges starting Monday. Four tranches of the bonds have already been issued, with a fifth likely to be issued next month. Sovereign gold bonds provide an alternative to actual gold investing, offering investors a choice to buy bonds worth 2 grams of gold going up to a maximum of 500 grams. The bonds are denominated in gold and pay 2.75 percent interest in physical gold.

Are the positive changes in the gold industry sustainable? This was the point of question from Gold Fields CEO Nick Holland during a keynote presentation on Monday, reports Mineweb.com. Holland points out that not only are companies cutting “fat,” but “muscle” as well. Stay-in-business capital (as a percent of operating expenditure) decreased from 46 percent in 2012 on a per ounce basis, to 26 percent in 2015. How can companies do this? “I believe that they have merely deferred capital that is going to come back, because if you want to sustain the business into the future, you need to spend the money,” Holland said. “That for me is a little bit of a concern.” The Industry is going to play catch up, which could yield poor capital allocation decisions, particularly if the industry errors on the side of growing production ounces versus growing profitability.

In a note from BMO Private Bank this week, Jack Ablin points out that historically, options investors have been able to generate reasonable income by selling options to other investors looking for downside protection and upside opportunity. However, struggling yields have created an “outsized supply of yield-seeking options sellers who collectively outstrip buyers.” The result is that implied volatility has declined. But just because yields are low, doesn’t mean that actual risk has gone away, the note continues.
Frank Holmes
CEO and Chief Investment Officer
U.S. Global Investors