THE OUTLOOK 2014-US CURRENCY-STOCKS-GOLD AND OIL.....??? >>> COULD ITS BECOME A STRANDARS OF ECONOMIC VALUE SYSTEM...??? >> Many traders and investors are still scratching their heads at the peculiar gold trading Wednesday which pushed gold below the important technical level of $1,250/oz. Support at $1,250/oz has been breached and gold is vulnerable of a fall to test support at $1,200/oz and the June 28th low of $1,180/oz (see charts below)...>>> ...22 November 2013 | Share this article | Comment - New! http://news.goldseek.com/GoldSeek/1385128800.php Today’s AM fix was USD 1,241.75, EUR 918.59 and GBP 766.75 per ounce. Yesterday’s AM fix was USD 1,248.50, EUR 929.64 and GBP 775.76 per ounce. Gold fell $1.50 or 0.12% yesterday, closing at $1,243.20/oz. Silver climbed $0.14 or 0.71% closing at $19.99/oz. Platinum rose $4.60 or 033% to $1,389.50/oz, while palladium climbed $3.78 or 0.53% to $714.75/oz...>>> ...So the outlook for gold and silver remains very bullish because another – even bigger – crisis is coming. Whether it ends up being called a “crack-up boom” or “the end of paper money” or “the second Great Depression,” it will change everything, from the kinds of investments that create new fortunes to the kinds of money that most of us save and spend...>>> ..History is about to repeat. Instead of addressing the causes of the 2008 financial crisis, the world’s governments have continued along the same path, accumulating even more debt and inflating even bigger financial bubbles. Thus, the outlook for 2014 is the same as it was for last year, the important point being the potential for a black-swan event like the one experienced in 2008 with the Lehman Brothers collapse...>>>

Dollar's 30 Year Slide May Be Gold's New Life: 2014 Outlook

-- Posted Friday, 22 November 2013 | Share this article | Comment - New!
http://news.goldseek.com/GoldSeek/1385128800.php 

Today’s AM fix was USD 1,241.75, EUR 918.59 and GBP 766.75 per ounce.
Yesterday’s AM fix was USD 1,248.50, EUR 929.64 and GBP 775.76 per ounce.

Gold fell $1.50 or 0.12% yesterday, closing at $1,243.20/oz. Silver climbed $0.14 or 0.71% closing at $19.99/oz. Platinum rose $4.60 or 033% to $1,389.50/oz, while palladium climbed $3.78 or 0.53% to $714.75/oz.

Many traders and investors are still scratching their heads at the peculiar gold trading Wednesday which pushed gold below the important technical level of $1,250/oz. Support at $1,250/oz has been breached and gold is vulnerable of a fall to test support at $1,200/oz and the June 28th low of $1,180/oz (see charts below).

 

US Dollar Index - 1983 to Today (Bloomberg Industries)
And yet gold still seems to be stuck in a downtrend. This week's sell off may have been due to trading shenanigans on the COMEX and many, including the UK Financial Regulator are asking questions as to whether gold price rigging is taking place.

Gold’s falls come despite there being many compelling reasons for gold to rally. These include uber dove Yellen at the Fed's helm, the near certainty that the Eurozone debt crisis will erupt early in the New Year, signs ETF outflows are stabilizing and China picking up the slack with regard to physical demand, after India’s demand fell from near record levels.

 

Gold in U.S. Dollars, 5 Days - (Bloomberg)

THE U.S. DOLLAR has been on a 30 year slide versus other competing paper currencies, in particular the Chinese yuan. If the dollar's decline, as measured by the DXY Index continues, gold may be the main beneficiary.

The dollar may be printed in unlimited quantities, though the global stock of gold increases by just 2% to 2.5% annually. Irrespective, of the huge increase in money supplies globally today. Indeed, should gold prices fall more, gold production is likely to begin falling.

This is seemingly lost on Janet Yellen and central banks, who continue to print money at record rates.

The smart money who understand gold’s importance as a diversification continue to accumulate gold.

The very poor state of the U.S. economy bodes badly for the U.S. dollar in 2014 which should help gold resume its multi year bull market.

 
Gold in U.S. Dollars, 1 Year - (Bloomberg)

DATA FROM THE INTERNATIONAL MONETARY FUND today shows that central banks continued to diversify into gold in October.

Turkey's holdings rose the most, with the central bank adding a large 12.994 tonnes - 16.18 million oz vs. 15.762 million oz. Kazakhstan’s gold reserves rose 2.4 tons and Azerbaijan’s gold reserves increased 2 tonnes last month.

Germany, the world's second biggest holder of gold reserves, cut its bullion holdings by a tiny amount in October for the second time in five months. Germany's gold holdings dropped to 108.9 million ounces from 109.01 million ounces in September. The reduction was likely for domestic gold coin sales.

 

Gold in U.S. Dollars and Suspensions Of COMEX Gold Trading - 3 Month (Bloomberg)

GOLDMAN SACHS Inc. has come out with another of their widely covered market predictions.

Gold, iron ore, soybeans and copper will probably drop at least 15% next year as commodities face increased downside risks even as economic growth in the U.S. accelerates, according to Goldman.

As we noted before, Goldman’s gold calls and crystal gazing have been poor at best. Indeed, some suspect that while Goldman is advising clients to sell, they may be on the other side of the the trade going long.

News This Week

* China to Start Interbank Gold Swap Trading November 25China, on track to overtake India as the world’s largest gold consumer this year, will start interbank swaps trading next week in a move to further open up the domestic precious metals market. China gold swaps to trade on China Foreign Exchange Trade System, according to a statement on CFETS website yesterday. Gold swaps to settle and deliver via Shanghai Gold Exchange.
(Bloomberg)

* China's planned crude oil futures may be priced in yuan The Shanghai Futures Exchange (SHFE) may price its crude oil futures contract in yuan and use medium sour crude as its benchmark, its chairman said on Thursday, adding that the bourse is speeding up preparatory work to secure regulatory approvals.

China, which overtook the United States as the world's top oil importer in September, hopes the contract will become a benchmark in Asia and has said it would allow foreign investors to trade in the contract without setting up a local subsidiary.
(Reuters)

* Germany Lowers Gold Reserves in October, IMF Data ShowHoldings drop to 108.9 Million ounces vs. 109.01 Million ounces in September., data on IMF website show. (Note: Likely for domestic gold coin sales)
(Bloomberg)

* Gold-Put Options Surge as Futures Slump to Lowest in Four MonthsPut options on gold, giving the owners the right to sell Dec. futures at $1,200/oz and $1,250/oz, more than tripled on the Comex in New York after the metal slumped to a four-month low.
Puts giving the owner the right to sell at $1,200 rose to $2.30 from 70c on estimated volume of 1,259 contracts, the third most-active option.

Puts giving the owner the right to sell at $1,250 jumped to $15.10, the highest in a month, on estimated volume of 2,206 contracts, the most-active option
Futures for Dec. delivery fell as much as 2.6% to $1,240.20/oz, the lowest since July 9
(Bloomberg)

* China Oct. Silver Imports 230.8 Tons, Customs SaysSilver imports by China were 230.8 tons in Oct., compared with 243 tons in Sept., according to data released by customs agency today
(Bloomberg)

* UBS Estimates 36% of South Africa Gold Industry is Losing MoneyEstimate based on spot price of $1,260/oz, UBS says in report dated yday.
In 3Q, 28% of SA gold industry was loss-making, based on gold price of $1,330/oz
Sector lowered 3Q all-in costs by 20% q/q to $1,138/oz
“Further unit cost reductions will be challenging to deliver”
(Bloomberg)

* CME Lowers Gold and Silver MarginsCME lowers Comex 100 Gold futures (GC) initial margins for specs by 9.4 percent to $7,975 per contract from $8,800
CME lowers Comex 5000 Silver futures (SI) initial margins for specs by 11.1 percent to $11,000 per contract from $12,375
(Reuters)

Conclusion

There is likely a floor under gold prices at the $1,200 level and that should again provide strong support. There are no guarantees regarding price ever - particularly in the short term. However, gold production may fall at prices below $1,200 as it becomes uneconomical for many gold mines to operate profitably.

In South Africa, no longer the world's largest producer, (which is now China) but still a major producer, there are estimates that 36% of the South African gold industry are loss making even at today's spot prices - $1,250/oz. In 3Q, 28% of the South African gold industry was loss making, based on a gold price of $1,330/oz.

The short term technicals remain poor and the trend remains lower so we remain bearish for next week despite the strong seasonals. November, December and January are traditionally strong months for gold due to year end fund allocation and in recent years Chinese New Year demand.

It remains prudent to ignore short term noise and day to day price movements. Instead focus on physical gold’s importance, either in your possession or in allocated gold accounts, as financial insurance and as a vital diversification for investors and savers today.
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Biotech stock has a worldwide monopoly on new cancer cure.  Buy it now for under $3 a share The world is on the cusp of receiving a major cancer cure thanks to one tiny biotech company. It has been supplying Pfizer, Bayer, Merck, Amgen, and other big companies with this new breakthrough liquid so those companies can transform it into new cancer fighting drugs. Best part is this company's stock soared 300% in the last seven months alone, but it still trades under $3 a share. I suggest you get all the details right now before the price bolts higher. Death of Money 2014: This Debt Bubble Changes Everything... By Brittany Stepniak | Thursday, February 6th, 2014 There's been some big news in the headlines this week: The Market Tanks! If You Think Our National Debt Is a Problem Now, Just Wait German Legislator Seeks Repatriation Of All The Bundesbank’s Gold Are Major Bank Runs in Our Near Future? 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This one small company has discovered a revolutionary solution... It's figured out a way to turn air, sunlight, and even water into cheap, easily stored energy. When mainstream investors hear about this incredible breakthrough, five-figure gains are not out of the question... Click here before you miss out on this historic opportunity. Imagine Portugal's dismay and frustration at having to learn the hard way that you can't trust big banks. (And it could have been far worse — gold was trading around $380/oz. then, as opposed to today's price of $1,250/oz.) This time, people aren't investing blindly. We're all paying closer attention. And the scenario for gold is changing across the globe. According to Keith Barron, the geologist and consultant responsible for one of the largest gold discoveries in 25 years: I believe that most of the Western world's gold, which is supposed to be in central bank vaults, has been leased out. Much of it is now in private hands in India, and what remains continues going East to China and other Asian vaults. So most of the Western gold has vanished from the vaults and it's now just a book entry. These various Western countries and bullion banks simply roll these leases over when they come due, and the gold never gets returned back to the countries. So it's very interesting to see what's going on. Obviously the trust is breaking down in the system. Consequently, the yellow metal and its ugly sister are looking better by the day. Germany Won't Be Duped When it comes to Germany's gold reserves, the Germans won't be taken for the same ride Portugal endured in the '90s. That's why, in 2013, Germany demanded its gold holdings be returned from the central bank in New York. Germany has shaken up the market in a major way, the likes of which we've never seen before. Here's why: 1.) Its people are actively preparing for a currency crisis. 2.) 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Thanks to the Fed's tapering, the global public is becoming painfully aware of the currency instability in diverse economies from Turkey to Argentina and India to Indonesia. For me, the message is clear. The bear market is waking up, and so are the people. The illusion of a recovery is fading, and fears of bank runs and currency collapse are growing. You need safe havens. And you need them now. Just make sure you have physical evidence that they're actually yours... Farewell for now, Brittany Stepniak @AngelPubGirl on Twitter Brittany Stepniak is the Project Manager and Editor for the Outsider Club. Her “big picture” insights have helped guide thousands of investors towards achieving and maintaining personal and financial liberties while pursuing their individual dreams in lieu of all the modern-day chaos. For more on Brittany, take a look at her editor's page.

James Turk- The Outlook for 2014: An Even Bigger Crisis is Coming!

January 19, 2014 By The Doc 25 Comments

http://www.silverdoctors.com/james-turk-the-outlook-for-2014-an-even-bigger-crisis-is-coming/

  

 

 

 

History is about to repeat. Instead of addressing the causes of the 2008 financial crisis, the world’s governments have continued along the same path, accumulating even more debt and inflating even bigger financial bubbles. Thus, the outlook for 2014 is the same as it was for last year, the important point being the potential for a black-swan event like the one experienced in 2008 with the Lehman Brothers collapse.
The reason for this worrying outlook is simple. The interrelated sovereign debt and bank solvency crises have not been resolved, and central banks are following monetary policies that are favorable to governments and banks, not savers and investors.
So the outlook for gold and silver remains very bullish because another – even bigger – crisis is coming. Whether it ends up being called a “crack-up boom” or “the end of paper money” or “the second Great Depression,” it will change everything, from the kinds of investments that create new fortunes to the kinds of money that most of us save and spend.

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Submitted by James Turk, GoldMoney:

Before looking at the year ahead, it is useful to look back at the year just passed. This adage is particularly true now because little has changed. Three major markets – stocks, bonds and gold – will again be driven this year by the same forces that shaped 2013, but the outcome will be different in one key respect. This year the price of gold will rise.

In January 2013, my outlook for the year ahead focused on three specific events. These were a rising yield on the 10-year Treasury note, growth of the Federal Reserve’s balance sheet, and a decline in the gold/silver ratio.

Two of these events unfolded as expected. But the third did not confirm the other two.

1) Yields on the 10-year Treasury note rise

Back in January 2013, I considered the 2% yield on the 10-year T-note to be crucial. I saw it as an important tipping point, which when breached would signal that financial repression by the Federal Reserve was ending. I expected that when this 2% yield was eventually hurdled, it would be a key indicator telling us that the Fed could not keep interest rates at artificially low levels any longer because market forces had begun to overpower the Fed. In other words, the tipping point would occur when investors were selling more Treasury debt instruments than the Fed was buying, and this imbalance would result in higher yields.

Yields bumped up against the 2% level several times in the first few months of 2013. Eventually 2% gave way in May 2013 as the Fed prepared for that month’s FOMC meeting. The market believed there was a good possibility the Fed would announce that it was cutting back on its quantitative easing program. When that did not happen, yields surged and hurdled above another key technical level, 2.3%. Importantly, the yield on the 10-year T-note now appears ready to break above a third critical level, 3%, which ties into the next point.

2) Growth in the Federal Reserve’s balance sheet

The Federal Reserve began expanding its balance sheet almost immediately after the collapse of Lehman Brothers in September 2008, as it sought to protect banks in the resulting financial crisis that thoroughly routed global markets. Through its quantitative easing program as well as currency swaps it was conducting with European banks, the Fed’s total assets rose to a peak of $2.86 trillion in July 2011.

The Fed then put on the brakes, so that eighteen months later its total assets had actually dropped slightly to $2.81 trillion. It was this unexpected throttling of its asset growth that had me pondering in January 2013.

When the Fed increases its assets, it turns debt into US dollar currency. But in contrast to prevailing economic and monetary theory as well as conventional wisdom, the newly created currency the Fed was pumping out was doing little for the US economy. Unemployment remained stubbornly high, even with the government’s massaging of the numbers. Real personal income and retail sales (excluding high-end sales to the rich) were stagnant, and the customary feel-good factor prevalent in economic expansions was totally absent.

The newly created currency was, however, doing wonders for the stock market and gold as we can see in the following chart, which clearly illustrates their correlation. From the Fed’s announcement in March 2009 that it would be undertaking $1 trillion of quantitative easing, both were lifted by this monetary largesse, with gold and the Fed’s total assets actually reaching a new record in 2011. But advances in gold and the S&P stalled when the Fed stopped expanding its balance sheet.

Taken together, these events meant that stocks had not risen from their post-Lehman low because of good economic conditions. Rather, all the new money the Fed was creating had to go somewhere, and it ended up in the stock market. It also of course ended up in gold, which always responds with higher prices when the Fed debases the dollar by creating too many of them.

So while the advance in stocks and gold stopped, I expected the gold price to rise in 2013 because it seemed highly likely that the Fed would again be expanding its balance sheet with more debt monetization. Turning debt into currency is central banks’ only tool. And they use this tool time and again to paper over financial problems and insolvent banks as well as to try jumpstarting the economy, even though they are already debt-laden.

Central banks also use debt monetization to hide the insolvency of governments, which borrow more money than the market is willing to lend to them. When faced with the inability to foist its debt instruments on the public, governments do not cut back their spending plan. Rather, they force central banks to buy the government debt and turn it into currency. This path to currency destruction leads to a flight from the country’s currency into real goods, and if not stopped in its tracks by returning to sound money principles, destroys the currency with hyperinflation.

While this outcome for the dollar and a higher gold price seem clear to me, timing is always problematic. So last January I recommended watching one more indicator to confirm my analysis.

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3) The gold/silver ratio falls below 50

During precious metal bull markets, silver outperforms, meaning the gold/silver ratio falls. As the price of both precious metals rise, the price of silver rises faster so that it takes fewer and fewer ounces of silver to exchange for one ounce of gold.

The reverse happens when the precious metals are in a bear market, whether long-term or just a short-term corrective phase within a long-term bull market (which describes the current state of the precious metals). Silver underperforms gold. The price of silver – when measured in percentage terms – falls more than the price of gold.

So I recommended watching the gold/silver ratio in 2013 to see if it fell below 50, which was an important technical level. It remains an important technical level because the ratio has not yet been breached. When it is, this event will signal that silver is outperforming gold, indicating that both gold and silver are moving higher, but with silver rising faster than gold.

Having established this background information, let’s turn now to the year ahead. Interestingly, the next twelve months will depend on the same three forces – interest rates, the Federal Reserve’s balance sheet and the gold/silver ratio confirming whether the precious metals are finally ready to turn higher. This last point is important.

For decades the Federal Reserve’s monetary policies and the US government’s fiscal policies have been destroying the purchasing power of the dollar. The following tables illustrate this ongoing erosion of the dollar’s purchasing power. They also show a similar result for all the world’s major currencies because governments and central banks throughout the globe are following harmful monetary and reckless fiscal policies. In contrast to the 1970s when the German mark and Swiss franc offered refuge from a dollar that was being rapidly inflated, no national currency today offers a safe haven.

	Gold % Annual Change
	USD	AUD	CAD	CNY	EUR	INR	JPY	CHF	GBP
2001	2.5%	11.3%	8.8%	2.5%	8.1%	5.8%	17.4%	5.0%	5.4%
2002	24.7%	13.5%	23.7%	24.8%	5.9%	24.0%	13.0%	3.9%	12.7%
2003	19.6%	-10.5%	-2.2%	19.5%	-0.5%	13.5%	7.9%	7.0%	7.9%
2004	5.2%	1.4%	-2.0%	5.2%	-2.1%	-0.0%	0.9%	-3.0%	-2.0%
2005	18.2%	25.6%	14.5%	15.2%	35.1%	22.8%	35.7%	36.2%	31.8%
2006	22.8%	14.4%	22.8%	18.8%	10.2%	20.5%	24.0%	13.9%	7.8%
2007	31.4%	18.1%	11.5%	22.9%	18.8%	17.4%	23.4%	22.1%	29.7%
2008	5.8%	33.0%	31.1%	-1.0%	11.0%	30.5%	-14.0%	-0.3%	43.7%
2009	23.9%	-3.6%	5.9%	24.0%	20.4%	18.4%	27.1%	20.3%	12.1%
2010	29.8%	15.1%	24.2%	25.5%	40.2%	25.3%	13.9%	17.4%	36.3%
2011	10.2%	8.8%	11.9%	5.1%	12.7%	30.4%	3.9%	10.2%	9.2%
2012	7.0%	5.5%	4.4%	5.9%	5.2%	11.0%	20.5%	4.4%	2.3%
2013	-28.2%	-16.5%	-23.3%	-30.3%	-31.3%	-19.0%	-12.8%	-30.2%	-29.6%
Average	13.3%	8.9%	10.1%	10.6%	10.3%	15.4%	12.4%	8.2%	12.8%
	Silver % Annual Change
	USD	AUD	CAD	CNY	EUR	INR	JPY	CHF	GBP
2001	-0.1%	8.5%	6.1%	-0.1%	5.3%	3.1%	14.4%	2.3%	2.7%
2002	4.8%	-4.6%	4.0%	4.9%	-11.0%	4.3%	-5.0%	-12.6%	-5.3%
2003	24.0%	-7.3%	1.4%	23.9%	3.2%	17.7%	11.9%	11.0%	11.9%
2004	14.3%	10.2%	6.5%	14.3%	6.4%	8.6%	9.6%	5.4%	6.5%
2005	29.6%	37.7%	25.5%	26.3%	48.1%	34.6%	48.8%	49.3%	44.4%
2006	45.3%	35.3%	45.3%	40.5%	30.4%	42.6%	46.7%	34.8%	27.5%
2007	15.4%	3.7%	-2.1%	7.9%	4.3%	3.1%	8.3%	7.2%	13.9%
2008	-23.8%	-4.3%	-5.7%	-28.8%	-20.1%	-6.1%	-38.1%	-28.2%	3.4%
2009	49.3%	16.1%	27.6%	49.3%	45.0%	42.6%	53.0%	44.9%	35.0%
2010	83.7%	63.0%	75.8%	77.7%	98.5%	77.4%	61.2%	66.2%	93.0%
2011	-9.8%	-11.0%	-8.4%	-14.0%	-7.8%	6.7%	-15.0%	-9.8%	-10.7%
2012	8.2%	6.8%	5.7%	7.2%	6.4%	12.3%	22.0%	5.7%	3.5%
2013	-35.9%	-25.4%	-31.5%	-37.7%	-38.7%	-27.7%	-22.1%	-37.7%	-37.1%
Average	15.8%	9.9%	11.6%	13.2%	13.1%	16.8%	15.0%	10.7%	14.5%

For the past thirteen years, gold and silver have achieved exceptional annual rates of appreciation on average, even with gold’s decline in 2013. This performance ranks gold and silver among the best performing asset classes.

As for the future, gold and silver will continue to rise as long as the same policies in Washington are followed. Given that the federal government is still spending and spending and the Federal Reserve is still printing and printing (even if it actually does taper this month by dropping its debt monetization by $10 billion a month to $75 billion), the precious metals will over time move higher.

I expect that higher gold and silver prices will be the major difference between 2013 and 2014. Accumulating physical gold and/or physical silver on a cost-averaging basis remains an important strategy for 2014. By doing so you are saving real money, and savings are always important, as I explain in an article entitled “Saving Real Money“.

Many years ago prominent newsletter writer Richard Russell coined the phrase ‘inflate or die’ to explain the Fed’s predicament. The financial system has become so abnormal, the Fed has to keep inflating to prevent the system from literally going off the rails. But the irony is that eventually the currency collapses as a consequence of accumulated inflation.

This issue is addressed in The Money Bubble: What To Do Before It Pops, a new book I have co-authored with John Rubino. In our 2004 book, The Coming Collapse of the Dollar, John and I advised readers to bet against the housing bubble before it popped and to buy gold before it soared. Those were literally the two best investment ideas of the decade.

We are now saying that history is about to repeat. Instead of addressing the causes of the 2008 financial crisis, the world’s governments have continued along the same path, accumulating even more debt and inflating even bigger financial bubbles. Thus, the outlook for 2014 is the same as it was for last year, the important point being the potential for a black-swan event like the one experienced in 2008 with the Lehman Brothers collapse. The reason for this worrying outlook is simple. The interrelated sovereign debt and bank solvency crises have not been resolved, and central banks are following monetary policies that are favorable to governments and banks, not savers and investors.
So the outlook for gold and silver remains very bullish because another – even bigger – crisis is coming. Whether it ends up being called a “crack-up boom” or “the end of paper money” or “the second Great Depression,” it will change everything, from the kinds of investments that create new fortunes to the kinds of money that most of us save and spend.

Click here to buy The Money Bubble: What To Do Before It Pops.
James Turk is the Founder of GoldMoney and the co-author of The Money Bubble: What To Do Before It Pops.

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