Precious Metals

[sunseeker]

Hi All
We went away and my laptop took a knock. I lost loads of “stuff.”
I like this time of year to build up positions so I've been on a bit of a buying spree........

I have added more SLW (which has been going well for me).

Bought more physical silver.

Bought
http://www.shareprice.co.uk/GPM/GOLDEN-PROSPECT-PRECIOUS-METALS-LD
It's a well run trust with a good SLW holding
http://www.ncim.co.uk/fact/gppm.pdf
64.4 pence now.

Bought
http://www.shareprice.co.uk/GCL/GEIGER-COUNTER-LD
The same stable as GPM. Only uranium.
http://www.ncim.co.uk/fact/gcl.pdf

54.625 pence now

Bought
http://www.shareprice.co.uk/URU/NIGER-URANIUM-LD
More uranium. Took a hit from political difficulties but they seem behind them now.
“the best uranium deposit we’ve seen in the last 20 years.”
http://buy-high-sell-higher.com/forum/general-discussion/stock-market-august-2009-t1039.0.html;msg11271#msg11271

5 pence now

Bought
http://www.shareprice.co.uk/BAO/BAOBAB-RESOURCES-PLC

Something seems to be going on here. Regularly trading above average volume.

9.145 pence now

I am doing a little better than the (mid) prices that I've quoted, but I didn't want to post my buying prices after the event.

I'm looking more to the future with the uranium picks. I believe that uranium is the only viable alternative in the long term to fossil fuels.

Energy Conversion: Typical Heat Values of Various Fuels

Firewood
16 MJ/kg
Brown coal
9 MJ/kg
Black coal (low quality)
13-20 MJ/kg
Black coal
24-30 MJ/kg
Natural Gas
39 MJ/m3
Crude Oil
45-46 MJ/kg
Uranium* - in light water reactor
500,000 MJ/kg
(MJ = Megajoules),  *natural U

Silver........ 
http://agoracom.com/ir/ECU/forums/discussion/topics/436490-interesting-catch-by-bix-at-rr/messages/1427138

“My take: The Good Guys may be on a month-to-month assessment schedule as to when they are going to take the Bad Guys down. If we see another spike at the end of August they may have been given another month...if not it could be D-Day for our silver shorts.
 
I can't wait to find out if there is any fire in this cloud of smoke.”

Neither can I. I'm a buyer.

Thanks to sidewinder and his blog for helping me uncover this gem:

From The Economic Consequences of the Peace, John Maynard Keynes, 1920, pgs. 235-236:
Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, and important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become "profiteers," who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth getting degenerates into a gamble and a lottery.
Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

Keynes seems to have got something right then.

James Bullard, President and CEO of the Federal Reserve Bank of St. Louis puts it in his current paper “Seven Faces of the Peril”:  “The US is closer to a Japanese-style outcome today [i.e. outright deflation] than at any time in recent history

http://research.stlouisfed.org/econ/bullard/pdf/SevenFacesFinalJul28.pdf

ATB 

[sidewinder]

No doubt that Keynes was brilliant in some respects.  My indoctrination to economic philosophy and the major players throughout history came many years ago in college. 

The policies Keynes espoused in his "General Theory" were the 'go to'  policies of most western nations, and still are.  FDR, being the major factor in the US to embrace these theories. 

The current stimulus and "quantitative easing" (what bullshit) by the FED are Keynes' program.  Too, can the need for such actions be traced back to Keynes' book as the original cause. 

Coincidently,  that is when the major swing towards socialism and US government socialist policies began in earnest.  By then Great Britain was already in its strangle hold with the new Labour Party.

Young minds being taught these "disguised"  economic theories carried these ideas forward without  any understanding of true intent.  In fact my oldest daughter brought home as part of required study in her first year of college a copy of "The Worldly Philosophers"  by Heilbroner which was a pen name for Norman Thomas a self proclaimed Socialist Professor.  All in all a good book covering all the economic names of history but still if you read it one will leave "confused" as to the true intent and purpose. 

If we flash back to the McCarthy era and the "witch hunt"  we can tell that at least SOME saw what was potentially happening.  As they say "where there's smoke there's fire.

If you consider Keynes close association with the Fabian Socialist of the era and put all the pieces together anyone can clearly see how we have arrived at this point.  The educational systems have been the first to fall victim as well as governments by the orchestrated class struggles world wide.  He was right.  Not one in a million can diagnose it. 

Marx and his little book have been the cause of the deaths of millions world wide and the suffering  of many more.  Humans at some future point may point to this "Lavender Bolshevik" keynes and say the same thing.   

[MetalMeister]

Great day for gold and silver today.

JP Morgan may be getting out of the gold and silver manipulation business.  This story ran in Bloomberg today:

http://www.gata.org/node/8973

This is a very serious signal about failed suppression schemes and may signal that it is all over (unless some other entity takes over from JP Morgan) I have not gone from my cash into silver yet because I was expecting another knock down at the end of the month.

It did not happen.  This is/will be a 5 part series:

http://seekingalpha.com/article/223037-gold-and-silver-market-suppression-failures-flash-buy-signal

http://seekingalpha.com/article/223091-gold-and-silver-market-suppression-failures-flash-buy-signal-part-2

[onlooker]

Bangladesh buys 10 tons of IMF gold at peak price

September 11, 2010 7:20 PM EDT

The International Fund (IMF)reported last week that Bangladesh bought 10 tons of  Gold for $403 million. The gold was sold for the spot price as of Tuesday, the 7th of September, at around $1,250 per troy-ounce close, near an all-time high.

See:  http://www.ibtimes.com/articles/61474/20100911/bangladesh-buys-10-tons-of-imf-gold.htm

~   ~   ~

JDH’s September 11 quote:

•   $1,000 on March 17, 2008;
•   then gold dropped all the way to $705 on November 13, 2008

~   ~   ~

After India brought gold from the IMF at $1048 US per ounce in November 2009, the price of gold continued upward beyond $1048 US per ounce.

Bangladesh has recently brought gold at around $1,250 per ounce.  So, based on what happened after India’s gold purchase from the IMF, many holders of gold will predict that the future price of gold will NOT be less than $1,250.00 US per troy-ounce. 

On the other hand, there are economic watchers saying that deflation is on the way (e.g. a crash in the DOW is coming).  If deflation does come, then will gold along with other commodities and properties deflate like back in November 13, 2008?   

[sunseeker]

Hi OL

A good read:

http://www.virtualmetals.co.uk/pdf/ABNYB0810.pdf


Not gold, but I bought a piece of this today.
ERII
http://www.energyrecovery.com/

Even the TA's amoungst us might see some merit here.

Good to hear from you again.

ATB 

[MetalMeister]

Geeeeeez SS,

Can't you just provide some crib notes for that novel?

 

But your next statement reminded me of something I saw earlier in the evening about "a piece of this":

http://www.youtube.com/watch?v=KK3T8LKj4Ng

and left me wondering if desalination was the juiciest thing to digest?

Come on!!  Give us the crib notes!



PS  Chicken wings anyone?

Hi OL

A good read:

http://www.virtualmetals.co.uk/pdf/ABNYB0810.pdf


Not gold, but I bought a piece of this today.
ERII
http://www.energyrecovery.com/

Even the TA's amoungst us might see some merit here.

Good to hear from you again.

ATB  

[onlooker]

Hi SS:

I haven’t left the board.  I have turned into a BHSH lurker.

Thanks for your tip on Energy Recovery Inc. (Public, NASDAQ:ERII).  ERII’s technology is excellent, and its current price looks enticing low. 

But, I think that there will be another major stock market shake out.  After it occurs, I will then make use of my “buy (substantially) low, and sell high” investment strategy and Canadian cash holding for precious metals (most preferred), energy, and agricultural stocks.  I gotta have patience.   

I should change my avatar name from “Onlooker” to “Confirmed Wannabe Bottomfeeder”.   

~    ~    ~

Hi YC:

I also much prefer crib notes.

But, from time to time, I should exercise my mental faculty by reading something in its entirety.

Don’t want to get into the habit of skimming through lengthy documents and missing out important fine details like the mortgage holders signing sub-prime contracts (oops!), or congressmen reviewing proposed legislations, budgets, etc…(trillion oops!).     

[sunseeker]

Geeeeeez SS,

Can't you just provide some crib notes for that novel?

 

But your next statement reminded me of something I saw earlier in the evening about "a piece of this":

http://www.youtube.com/watch?v=KK3T8LKj4Ng

and left me wondering if desalination was the juiciest thing to digest?

Come on!!  Give us the crib notes!



PS  Chicken wings anyone?

Hi OL

A good read:

http://www.virtualmetals.co.uk/pdf/ABNYB0810.pdf


Not gold, but I bought a piece of this today.
ERII
http://www.energyrecovery.com/

Even the TA's amoungst us might see some merit here.

Good to hear from you again.

ATB  

Sorry YC............

I've got my work cut out getting my new computer set up with the programs and contacts that I had on the old one (which gave up on me, and lost so much info). Windows 7 doesn't support everything that I want on it. For instance KCAST doesn't work properly. Yes I've seen KCAST for Windows 7 download, but it's not on the official site so downloading it would more than likely pose a risk. I    have even had to harass  my broadband provider to supply me with a new router (free of charge) because the old one won't work with Windows 7. Microsoft always used to make new the versions compatible. Forcing unnecessary extra expense, and stimulating the economy by stealth?

Just returned from visiting ex colleagues, lunch and to stock up at the wine merchants.

Never Before Seen Banking Phenomena (with crib note).........

http://news.goldseek.com/RichardDaughty/1284444120.php

“I am going to give you a valuable little investment-timing nugget, courtesy of Mr. Lundeen’s research: “Since 1925, no DJIA bear market was over until it saw a 6% dividend yield.”

With calculator in hand, I see that for the current level of dividends ($281.20) to be 6% of the price of the DJIA, indicating the bottom of the bear market, the index would have to drop to 4,687 from today’s 10,447! Yikes!”

“For this reason, I just buy gold, silver and oil, which are guaranteed to go up in response to the debasement of the dollar thanks to insane levels of government spending and monstrous increases in the money supply by the Federal Reserve...............”

Let's not forget food/agriculture and water.

Hi OL

Good to know that you're still with us.

But, I think that there will be another major stock market shake out.  After it occurs, I will then make use of my “buy (substantially) low, and sell high” investment strategy and Canadian cash holding for precious metals (most preferred), energy, and agricultural stocks.  I gotta have patience.

Sidewinder has on occasion mentioned the VIX....

http://www.wikinvest.com/index/Volatility_Index_(VIX)

http://www.investmentu.com/2010/September/index-to-gauge-markets-mood.html

Because each time the VIX has traded in the mid teens, it’s represented a major opportunity to short the market, since that level has historically proved to be the bottom of the volatility range.

And that range – if we ignore only the most extreme bullish and bearish events as aberrations – is between 13 and 49.

~ At 13: This means investors are very complacent. You should buy the VIX and sell stocks.

~ At 49-Plus: This means investors are panicking. You should sell the VIX and buy stocks.

On that basis we're getting real close to Onlooker's shake out.

ATB 

[punter]

Greetings from Maui. I am glad to see our gold juniors are finally taking off after languisihing for so long...in fact we were shorted out of the market for several years...I didn't get chased out but it was hard to look at the facts and then look at the market in the next breath. Lo and behold..the shorts have been brushed aside by a tsunami of fundamentals. We called for this day over the past several years didn't we.

The leverage is fantastic..much more explosive than the bullion at this point. YRI for example is 50% below bullion all things considered. The micros of course are cocked and loaded. It should be an intersting fall as seasonal, supply, and the scary macro are the impetus for gold stocks.

Will gold become bubblicios..yes...but not at this stage....the stocks have barely started to move and are massively oversold..this is all supported by a continued improevment in the macro ( too many issues to detail and you've already heard the facts I'm sure).


What will Mr Market do?? Good question. My read is the same as it has been since the early 2000's..the micros will rise 70's style when the general public has no other bubble aternatives to invest in.....mass psycholgy all over again. Rea Estae is dead, bonds are dead...cash is trash....gold juniors are more accessible that are the softs. The lemmings are beginning to work themselves into a stampede, the cost of entry is very cheap with explosive upside. Money has to go somewhere..right? I think gold ,markets are going to start running hard.

With RE markets crashing in China there will be a billion people looking for a place to invest...they have few options...and they are very greedy...and herd like....get them running and be ready. Central Banks are buying big time as are funds. September to November are gold juniors traditional months....we could see a run past the spring if gold bullion beats the $ technicals ..it shows every reason to do that.

Good luck...I'm already in..have been for years as you all know. Lets hope the nascent increases in Uraniums will turn postive after three years in the dog house.

[punter]

BTW

http://gonzalolira.blogspot.com/2010/09/was-stagflation-in-79-really.html

[sunseeker]

Hi Punter
WELCOME BACK. YOU'VE BEEN MISSED.

Still in “Maui” then. Not bored with paradise I suspect.  
I still hold ALEX (http://www.alexanderbaldwin.com/) and you're in their backyard. Any opinion from a man on the ground would be welcome. I am looking at Nat Gas again. An opinion there would also be welcome since I made a nice profit by following your lead last time. I trust that you're well shod in those Gucci shoes by now.

BTW

http://gonzalolira.blogspot.com/2010/09/was-stagflation-in-79-really.html

Next stop Zimbabwe?

Zimbabwe was pretty self sufficient before uncle Bob (Mugabe) took over. The US could easily become self sufficient again.

From http://sidewindersview.blogspot.com:

http://www.visualeconomics.com/gdp-vs-national-debt-by-country/

http://2.bp.blogspot.com/_FRL3k36WQ-E/THBFXaBetPI/AAAAAAAAAMQ/_vAmyRP0Mj0/s1600/Debt+by+country+chart8-21-2010+5-25-03+PM.png

The US is not alone by any means.

 A US (official) default on it's debt obligations would be a bigger disaster for those other countries that can't be self sufficient. Russia defaulted on it's debt and they look to be economically stronger for it now.
China can't grow enough to feed itself. If those foreign reserves became near worthless they'll be glad that they are the number one gold producing country, and that they bought more gold (Coated Tungsten. LOL).

Recalling a program some years back when Donald Trump pointed towards a vagrant in the street and said something on the lines of :
See that man? Well he's worth “X” Billion dollars (the amount he was in debt at that time) more than I am.
His creditors could have put him in the gutter with the vagrant but they funded his (lavish) lifestyle so that they could see some of their money back again.

Hmmmm.

ATB  

[punter]

SS, thanks for the welcome. I have been taking a lot of personal time since the market crashed last time. I have written several fiction novels over the past couple of years and a series of text books. You can see them a www.smileyseries.com. I write my fiction under the name of J.West Hardin. My work is also available at Amazon.com ( and every other on line book store), read a taste and leave a comment ranking if you care to. The works are varied in genre from Distopian to Thiller. The text books are selling fairly well through Canada's major retailer...Chapters..although physically in only one store Chapters Richmond BC.

I left the chips to fall where they may and have seen a general dicsovery, I have amassed more cash in the meantime because I see the market being as walking a razors edge...plenty of risk to go around and the reasons given for the rise in the indexes are more hype than right. Cash pays nothing but its a good thing to have a war chest if things do go for a shit again. With the exception of gold I haven't bought anything lately...but its due to the weather in Maui rather than an absolute fear of the markets. Maybe its this way....I feel no pressing need to invest for little return and a high risk ratio.....patience is a bitch.

As Uranium didn't recover but absoutley will given the macro surrounding that issue I am still waiting patiently to recover the money I left there. I'll wait the possible five years or so we may have to wait while tax treating any losses with off setting capital gains. I have 24 junior U's....it only takes one to go from $1 to $20 and the losses  are all made up. I believe there a several players..like Paladin, Denison etc that have the potential to do that.

Its totally the wrong season for Nat Gas...wait for November when the brokers who live in New Jersey have the first dump of snow in their driveways.

I had carried gold for several years and plenty of frustration until the macro caught up with that, the profits are serving to balance the U file. In my mind there is no way we don't see another spike in U at some point because of fundamentals and the fact that commodities are running ahead of inflation and depreciation...the traders will eventually rotate back to U.....they will have to.

I am seeing the same bubble rotation in precious metals now, I also expect that will continue for at least a couple of years yet as the stocks are just beginning to move.


I haven't worn shoes for quite some time now....ya I know...terrible times. My theory is to invest in the macro and let the market come to me...the trading thing got a little old for me...I don't like to have to work that hard anymore.

[MetalMeister]

SS,

That's an old, old, old chart man!

The US cannot become self sufficient.  Maybe you are forgetting the oil import problem?

If the US defaults then you have to remember that the US and entities owns over 66% of it's debt.  What are we going to do, just default on foreign obligations? 

http://www.ustreas.gov/tic/mfh.txt

What you see in this report is that China is quickly getting out of US debt but they have a long ways to go.

The UK has MASSIVELY added to their holdings in the last year and I did not know that.  They are in the tank.

THE UK IS THE ONLY REASON THE US PONZI SCHEME IS STILL GOING.

Hong Kong is getting out, no surprise.

Other countries are slowing down their purchases as the US national debt will go over 13.5 trillion in a few days.

If the US were to default on everything, the hardest hit would be the UK, Japan, and of course total disaster in the US which will soon be

Next stop Zimbabwe?

Zimbabwe was pretty self sufficient before uncle Bob (Mugabe) took over. The US could easily become self sufficient again.

http://2.bp.blogspot.com/_FRL3k36WQ-E/THBFXaBetPI/AAAAAAAAAMQ/_vAmyRP0Mj0/s1600/Debt+by+country+chart8-21-2010+5-25-03+PM.png

The US is not alone by any means.

 A US (official) default on it's debt obligations would be a bigger disaster for those other countries that can't be self sufficient. Russia defaulted on it's debt and they look to be economically stronger for it now.
China can't grow enough to feed itself. If those foreign reserves became near worthless they'll be glad that they are the number one gold producing country, and that they bought more gold (Coated Tungsten. LOL).

[MetalMeister]

Are you investing in paper gold or physical?

With the exception of gold I haven't bought anything lately...but its due to the weather in Maui rather than an absolute fear of the markets. Maybe its this way....I feel no pressing need to invest for little return and a high risk ratio.....patience is a bitch.

[sidewinder]

Some years ago G. Edward Griffin did an interview with Mr. Norman Dodd.  Dodd was the staff director in the “Reese Committee”, a Congressional investigation into Tax Exempt foundations.  This video will set the stage for understanding what has been going on in this country for a very long time.  

http://www.youtube.com/watch?v=gZqZGEBkX1s&feature=related

I’m not a conspiracy theory guy but, there is no denying these events took place and Dodd made these statements as to what he discovered many years ago in the course of the Congressional investigation which was basically swept under the rug.  

After view that one would do well the watch the Below to grasp the understanding of how this all works.  

http://www.youtube.com/watch?v=dE38dLxapVo

 Yuri Bezmenov a former high level KGB agent explains the purpose of ideological leftist in this short video.  There is a series of interviews with him and I suggest watching the one labeled 1 through 9 for a full understanding if Bezmenov and “the system” but this is a start.  His whole story part 1 is here:  

http://www.youtube.com/watch?v=o_xdBnFPqOI&feature=related

You will need to click for part 2 and so on to view the entire interviews.

Regardless of your political leanings, one should view these and give some consideration to what these men are telling you.  Look at what you can see happening around you and the division between ordinary citizens and the origin of the divisions from an unbiased as possible view.   Then think a bit.  

I just attended the SOAR (Special Operations Association Reunion) as a guest of my buddies in Delta team B-52.  It was an honor of a lifetime to even be allowed into the room with these guys. Only over the last few years have any of the after action reports been declassified.  As I sat there having beers and talking about our times in Vietnam I was reminded in our purpose of being there in the first place.  The one message that struck me in the head was what the VC did to ordinary people in Hue  during a very short period of the Tet offensive of 1968.  My rage at Karl Marx has returned fully over the last few days.  Then I remembered the Bezmenov interview and how he described the way the machine works and actually mentioned Hue and what happened to the populace. In case anyone is unaware, they murdered thousands upon thousands of ordinary citizens simply because they were considered "recalcitrant towards the revolution".  Of course this went on all the time in villages and hamlets all over but because it was never really covered by mainstream media folks back home saw very little other than Rusty Calley and Mei lai.  

More than 40 years have past and I see so many on other webs and chats who see "nothing wrong with a little socialism".  At first, I chalked it up to young and idealistic who would grow out of it, but it is far more dangerous for America than most will accept.  There is no question that we are at war, but, it is economic, education, and morals that are the front line .... for now.   We are about one more "crisis" from watching this whole thing unravel and some say we will have another crisis before the end of the year.  I can't say I would discount some kind of failure within the next 9 months.  

So, what does all this have to do with precious metals.  Well, the Vietnamese who had some gold were about the only ones who were able to "bug out".  That is a double edge sword because in times of great confusion and panic many of those holding the metal were killed and robbed.  So, while gold and silver will provided one with the means to "get out of the way"  it also becomes problematic in the security of the individuals for whom it was suppose to protect.  

I am not predicting some "mad Max" scenario but I am saying that the possibility of some disorder in North America and globally has never been more possible with conditions as we find them today.

I watch these futures and gold trying to make at least some sense out of all this but honestly, it's just the market doing what markets do.  Or is it?  The volume is down, who's trading?  Silver is up 6% and gold 3 over the past week.  I do expect a failure and will go deep in the metals on the failure.  If a disconnect between metals and the market occurs I will have to really review my plans for where I want to be physically.