Monthly Archives: March 2013

Today’s Key Gold Headlines – 3/20/13

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Do Not Invest in the Eurozone (Video)

Nigel Farage, representing the UK Independence Party as a Member of the European Parliament, appeared on Russia Today, talking about Cyprus and the “irreconcilable split” between Northern and Southern European countries when it comes to bailing out Eurozone partners. He warned all investors to avoid the Eurozone, and urged residents of struggling European economies to get their money out of the banks.

“Even in my direst predictions in this parliament over the years about the way the EU bosses were behaving, never did I think that they would, in a completely unprecedented manner, resort to stealing money from people’s bank accounts…They know that once one country [abandons the euro], the whole deck of cards will come tumbling down, and countries like Germany will realize absolutely vast losses…Don’t invest in the Eurozone…You’ve got to be mad to do so…”

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Gold ETF Outflows vs. Physical Bullion Demand

Alena Mikhan and Jeff Clark, part of Casey Research’s Metals Team, published a commentary this week countering the bearish sentiment surrounding the recent gold ETF outflows. While investors in the paper market may be selling gold, long-term physical holders are buying record amounts of bullion from the US Mint.

Since January 1, the holdings of gold-backed exchange-traded funds (ETFs) have dropped by nearly four million ounces (125 tonnes). February turned out to be the worst month for the world’s largest ETF, the SPDR Gold Trust (GLD), which saw its holdings drop to 39.7 million ounces (1,236.73 tonnes), its lowest level since October 2011.

If this were the only data investors looked at, they might conclude that “everyone is selling” and maybe even that the bull market is over. But these data are misleading.

That’s because while ETF holdings are declining, the physical market is seeing robust support. In fact, the US Mint – the bellwether for measuring demand of physical gold in the Western world – reports that sales of gold and silver coins are soaring.

Read the Full Commentary Here

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Today’s Key Gold Headlines – 3/19/13

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Cyprus: A Warning to US Depositors (Video)

Peter Schiff appeared on CNBC this afternoon to explain why the United States is not immune to the problems Cyprus is experiencing.

“Because we have this deposit insurance, American depositors don’t care how reckless their banks are, and the banks don’t care, because the depositors don’t care. So it’s a terrible system, and eventually it is going to implode. People who have money on deposit in US banks are going to take huge losses one way or another. Either they’re going to lose their deposits, or their deposits are going to lose value because of all the inflation that is going to have to be created to bail out the banks.”

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Cyprus Depositors Should Have Owned Gold (Video)

Peter Schiff’s latest video blog explains the Cyprus bailout’s effect on depositors, and how the United States will face a much worse situation.

“If you think your money is at risk in a bank and you pull it out, what are you going to do with it? Well, putting it in gold is a great alternative. In fact, if you had euros deposited in a Cyprus bank, now you’ve lost…close to 10%…of your euros. But if you had gold in a safety deposit box in a Cyprus bank, you haven’t lost an ounce. So the people who have gold are whole, and those who have euros…they’ve had a loss. So this highlights the safe haven aspect of gold.”

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Today’s Key Gold Headlines – 3/18/13

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Inflation Is Driving the Market (Video)

Yesterday, Fox Business interviewed Peter Schiff about the latest report on retail sales and the false confidence of stock market investors.

“The increase in retail sales is mainly the result of prices going up. Sure, people are spending more money, because things cost more. In fact, the increase in import prices matched the increase in retail sales. Of course, if you look at the savings data that came out last week, where the savings rate plunged – how are Americans supporting higher priced gasoline and higher priced food? They’re borrowing money, they’re digging into their savings. They’re struggling just to make ends meet.”

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Today’s Key Gold Headlines – 3/15/13

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Central Banks’ Diversification into Gold

The World Gold Council released a new report this week entitled “Central bank diversification strategies – rebalancing from the dollar and the euro”. It is well worth a read.

Gold has a long history as a reserve asset for central banks, and as such is considered a traditional one. Gold is statistically uncorrelated with other traditional reserves and new alternatives, making it one of the most important assets for diversifying out of the US dollar and euro. In line with this trend, central bank gold buying in the fourth quarter of 2012 marked the eighth consecutive quarter of net purchases by the official sector and the highest level since 1964.

Ashish Bhatia, Manager for Government Affairs at the World Gold Council said:

“Building gold reserves in tandem with new alternatives is an optimal strategy as central banks remain under-allocated to gold and many attractive alternatives are either too small or, as is the case with the renminbi, not yet open to broader international participation.

“Gold has a deep and liquid market with no credit risk, making it one of the most attractive assets for central banks to consider as they diversify away from the US dollar and euro. Gold’s tail-risk hedging properties add to its appeal as a particularly valuable component of a diversified reserve portfolio.”

Continue Reading and Download the Full Report Here

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