Thursday, December 6, 2012
Monday, December 3, 2012
Gold's Bubble? Think About it in 5 Years - Analyst
Published on Dec 3, 2012 by KitcoNews ; Gold in a bubble? You should only be thinking about that five years down-the-line, says technical analyst Jordan-Roy Byrne.
Wednesday, October 24, 2012
Exclusive: Turkish gold trade booms to Iran, via Dubai
(Reuters) - To see one of Iran's financial lifelines at work, pay a visit to Istanbul's Ataturk International Airport and find a gate for a flight to Dubai.
Couriers carrying millions of dollars worth of gold bullion in their luggage have been flying from Istanbul to Dubai, where the gold is shipped on to Iran, according to industry sources with knowledge of the business.
The sums involved are enormous. Official Turkish trade data suggests nearly $2 billion worth of gold was sent to Dubai on behalf of Iranian buyers in August. The shipments help Tehran manage its finances in the face of Western financial sanctions.
The sanctions, imposed over Iran's disputed nuclear program, have largely frozen it out of the global banking system, making it hard for it to conduct international money transfers. By using physical gold, Iran can continue to move its wealth across borders.
"Every currency in the world has an identity, but gold means value without identity. The value is absolute wherever you go," said a trader in Dubai with knowledge of the gold trade between Turkey and Iran.
The identity of the ultimate destination of the gold in Iran is not known. But the scale of the operation through Dubai and its sudden growth suggest the Iranian government plays a role.
The Dubai trader and other sources familiar with the business spoke to Reuters on condition of anonymity, because of the political and commercial sensitivity of the matter.
Iran sells oil and gas to Turkey, with payments made to state Iranian institutions. U.S. and European banking sanctions ban payments in U.S. dollars or euros so Iran gets paid in Turkish lira. Lira are of limited value for buying goods on international markets but ideal for a gold buying spree in Turkey.
ROUTING VIA DUBAI
In March this year, as the banking sanctions began to bite, Tehran sharply increased its purchases of gold bullion from Turkey, according to the Turkish government's trade data.
original source >>>
Wednesday, October 17, 2012
Monday, September 24, 2012
Gold tumbles as dollar gains on growth fears
SAN FRANCISCO (MarketWatch) — Gold futures sold off on Monday, as a stronger dollar and profit-taking after recent highs took a toll on metals and other commodities futures.
The broader metals complex tracked gold lower, with palladium among the top losers, off 4%.
Gold gained 0.3% last week after the U.S. Federal Reserve’s latest round of quantitative easing and policy action by central banks in Europe and Japan encouraged buyers to seek tangible assets amid fears of inflation.
Gold is viewed as a safe store of value and tends to benefit from expectations of currency debasement. Monday’s fall has chipped away at monthly and yearly gains, but those are still at a respectable 4.6% for the month and nearly 13% for the year.
The metal’s luster hasn’t faded, as Barclays upgraded its gold price forecasts and more money managers upped their “long” bets, or expectations prices will go higher.
Diamonds demand slows in China
After years of meteoric growth in China's demand for diamonds, Varda Shine, CEO of Diamond Trade Co., explains why growth is starting to slow.
Gold for December delivery GCZ2 -0.61%declined $13, or 0.7%, to $1,765.20 an ounce on the Comex division of the New York Mercantile Exchange.
Many investors wanted to be long on gold over the weekend as a cautionary measure, but dumped gold and other metals on Monday to take recent profits, said Carlos Sanchez, director of risk management at CPM Group in New York.
Sentiment on Wall Street was also dented, as worries centering around Spain and whether the embattled country would ask for a full-on bailout, pushing the euro lower.
source here | 24 Sept 2012 >>
Friday, September 21, 2012
Gold hits 6-1/2 month high after central bank stimulus
LONDON |
(Reuters) - Gold prices rose 1 percent on Friday to 6-1/2 month highs as expectations that central bank measures to stimulate growth would boost liquidity, fuel inflation and keep a lid on interest rates put the metal on track for a fifth straight week of gains.
A firmer tone across the financial markets also supported bullion. European shares and the euro rose, while oil rebounded from a 1-1/2 month low, as investors moved back into markets still feeling the benefits of central bank support measures. <MKTS/GLOB>
Spot gold hit a peak of $1,787.20 an ounce and was up 0.8 percent at $1,771.14 an ounce at 9:44 a.m. EDT (1344 GMT), while U.S. gold futures for December delivery were up $14.00 an ounce at $1,784.20.
The Bank of Japan was the latest central bank to unveil easing measures this week, after the Federal Reserve announced an aggressive asset purchasing program earlier this month and the European Central Bank unveiled plans to buy bonds of the bloc's heavily indebted countries.
The Fed move, a third round of so-called quantitative easing which will see it buy $40 billion a month in mortgage-backed debt until the outlook for the labor market improves, lifted spot gold by 2 percent in a single day.
"QE3 was a bit of a game-changer for a lot of people. People are having to think seriously about where they put their money," Ross Norman, chief executive of bullion broker Sharps Pixley, said. "Gold does seem to have taken on a life of its own now. We think we might see $1,800 in the next couple of weeks or so."
source here >>
Saturday, September 8, 2012
Gold hits new high of Rs 32,450 on firm global cues
Tracking strong global cues, gold on Saturday soared by Rs540 per ten grams to fresh all-time high of Rs32,450 in the national capital.
Prices of gold (99.5 purity) in Kolkata increased by Rs620 to Rs32,425, while rates in Chennai rose by Rs710 to Rs32,325 per ten grams. In Mumbai, the precious metal's rates surged by Rs605 to Rs31,955 on Saturday.
"The domestic gold prices are rising purely due to global development. After the announcement of potentially unlimited bond-buying by the European Central Bank (ECB) and unfavourable non-farm pay roll data of the US, international gold prices shot up," SMC Comtrade chairman and managing director DK Aggarwal said.
Global prices rallied as poor non-farm employment data indicated serious job problems in the US and its weak economic situation, traders said.
The US data also brightened chances of announcement of stimulus package by the US Federal Reserve in its forthcoming meeting, Aggarwal said, adding that these developments are driving prices of gold and silver.
Gold prices in New York shot up by $34 to $1,735.30 an ounce, its biggest single-day gain since February 29.
Aggarwal said there is not much of physical demand of gold in the country. However, jewellery demand is expected to pick in the wedding and festive season.
Echoing similar views, All India Sarafa Association General Secretary Surender Jain said: "Local gold price, which moves in tandem with global rate, is expected to see more peak levels in coming days."
In the domestic market, silver prices also rose by Rs2,100 to Rs61,800 per kg on increased offtake by industrial units and coin makers.
source here | Sat Sept 8, 2012
Wednesday, August 1, 2012
Negative Real Interest Rates Argue for New Highs in Gold
At any given point in time there are several variables that affect the price of gold. There are times when gold’s price is driven by its perceived association with inflation and other times it’s seen as a “safety asset” or even a global currency. One variable in particular that was a constant driver of gold’s bull market in the 1970s was the presence of negative real interest rates—where inflation rates are higher than nominal interest rates—which means savers who park their cash at the bank are seeing their purchasing power eroded. The power of negative real interest rates as a major catalyst for gold has also been dominant in gold’s secular bull market this time around and currently argues for new highs. However, the USD’s strength at present has been keeping gold in check. That may soon change if the Euro begins to stabilize and money flows back out of the USD.
Gold Variables
As mentioned above, one of the strongest correlations to the price of gold is not the USD but actually real interest rates. This can been seen below in which the top panel shows the open interest for gold futures contracts, the middle panel shows gold along with real interest rates (inverted in red), and the bottom panel shows the USD Index along with gold (USD Index shown inverted for directional similarity). Real interest rates in the middle panel have had the most consistent relationship with gold over the years but that changed in the middle of 2011 when the USD Index began to rise (fall in bottom panel below), despite real interest rates falling to new lows which suggested gold should be hitting new highs.
Source: Bloomberg
Monday, June 11, 2012
Wednesday, March 28, 2012
Monday, March 26, 2012
IRAN SAYS “GOLD IS MONEY”
by Louis James
Economic crises signal that the current system isn’t working as expected and needs improvement. When it comes to monetary systems, questioning their fundamentals can lead to doubts about whether the preferred medium of exchange will continue to be preferred for long. The large-scale whirlwind of economic trouble around the globe has pushed some to rethink the role of gold in the economy – and to actually move toward bringing it back.
A month ago, a rumor that India is going to pay in gold for oil imported from sanction-struck Iran sent shockwaves through the markets. It was no small deal, both in principle and volume: India is one of Iran’s largest oil buyers, responsible for about 22 percent of total exports and worth about US$12 billion per year. China is next with 13 percent, and Japan is third with about ten. All of them are having a hard time dealing with Iranian oil imports, as the country is under sanctions caused by Western fears regarding its nuclear program.
Then an Israeli news site claimed exclusive knowledge of a possible workaround between India and Iran: settling the purchases in gold. Indian government officials refused to comment, which added to the speculation.
On the surface, the arrangement looked like a great way to settle the purchases via a stable medium: Iranian currency, the rial, is not widely used outside its border, and gold’s inherent anonymity would have provided a perfect way to avoid unnecessary attention from the global community. Ironically, it was precisely the fact that the settlement was planned in gold that attracted so much attention.
It proved to be nothing but a rumor, however: the sides decided to arrange the deal in a more tactical manner. India will partly cover the purchases with its own currency, and Iran will later use those funds to acquire imports.
But gold is not out of the equation yet. The US-initiated sanctions were effective, at least in the sense of making international institutions avoid the pariah nation. Reuters reported that Iran has failed to organize imports of even basic food staples for its population of 74 million. Prices on local markets rose sharply; and as the country neared parliamentary elections on March 2, the government was taking radical steps to provide citizens with basic necessities. One of those unconventional solutions was offering gold as barter for food.
Tuesday, January 24, 2012
Gold is Money: EU Sanctions on Iran include gold and silver purchases.
Written By Kenneth Schortgen Jr on Monday, January 23, 2012 | 9:02 AM
Think gold is not money to central banks and governments? Just look at one of the prohibitions the EU imposed on Iran recently in their economic sanctions.
Reuters report that the EU has agreed to freeze the assets of the Iranian central bank and ban all trade in gold and other precious metals with the Iranian Central Bank and other public bodies in Iran.
According to IMF data, at the last official count (in 1996), Iran had reserves of just over 168 tonnes of gold. The FT reported in March 2011 that Iran has bought large amounts of bullion on the international market to diversify away from the dollar, citing a senior Bank of England official.
Currency wars continue and are deepening. - Zerohedge
You would think that the EU would LOVE to get rid of their 'relic' metals in exchange for oil. That is, unless you realize the propaganda that gold and silver are not money is a bold faced lie.
Reuters report that the EU has agreed to freeze the assets of the Iranian central bank and ban all trade in gold and other precious metals with the Iranian Central Bank and other public bodies in Iran.
According to IMF data, at the last official count (in 1996), Iran had reserves of just over 168 tonnes of gold. The FT reported in March 2011 that Iran has bought large amounts of bullion on the international market to diversify away from the dollar, citing a senior Bank of England official.
Currency wars continue and are deepening. - Zerohedge
You would think that the EU would LOVE to get rid of their 'relic' metals in exchange for oil. That is, unless you realize the propaganda that gold and silver are not money is a bold faced lie.
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