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January 19 2018

moneymetals

Chinese Physical Gold Investment Demand Surges While Americans Pile Into Stock & Crypto Bubbles

Chinese demand for physical gold investment surged in the first three-quarters of 2017 while Americans ditched the shiny yellow metal for increased bets in the crypto mania and stock market bubble market. Even though China’s Hang Seng Stock Market outperformed the Dow Jones Index last year, Chinese citizens purchased the most gold bar and coin products Q1-Q3 2017 since the same period in 2013, when they took advantage of huge gold market price selloff.

According to the World Gold Council, Chinese gold bar and coin demand increased to 233 metric tons (mt) in the first three-quarters of 2017 compared to 162 mt in the same period last year. Furthermore, if we include Indian gold bar and coin demand, China and India consumed nearly half of the world’s total:

Global gold bar & coin demand q1 - q3 2017

As we can see, China and India consumed 338 mt of gold bar and coin products which accounted for 47% of the total 715 mt Q1-Q3 2017. German gold bar and coin demand of 81 mt took the third highest spot followed by Thailand (49 mt), Turkey (47 mt), Switzerland (31 mt) and the United States (30 mt). Chinese gold bar and coin demand of 233 mt nearly equaled the total demand by German, Thailand, Turkey, Switzerland and the United States of 238 mt.


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January 15 2018

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The 2018 Stock Market Bubble vs. Gold & Silver

The U.S. Stock Market is reaching its biggest bubble in history. When the price of the Dow Jones Index only moves in one direction… UP, it is setting up for one heck of a crash. While market corrections aren’t fun for investors’ portfolios, they are NECESSARY. However, it seems that corrections are no longer allowed to take place because if they did, then the tremendous leverage in the market might turn a normal correction into panic selling and a meltdown on the exchanges.

So, we continue to see the Dow Jones Index hit new record highs, as it moved up 765 points since the beginning of the year. Now, if we go back to 1981 when the Dow was trading about 800 points, it took five years to double itself by another 800 points. However, the Dow Jones Index just added 765 points in less than two weeks. It doesn’t matter if the (1) point increase in the Dow Jones today is insignificant compared to a (1) point increase in 1981, investors feel rich when the numbers are increasing in a BIG WAY.

This is the same phenomenon taking place in the Bitcoin-Crypto Market. Crypto investors who are used to 10-20 baggers (10-20 times increase) no longer have the patience to invest in a real company that might grow on a 10-25% basis annually. Why the hell put money in a real business that employees a lot of people when you can turn $1,000 into $50 million in a few weeks?

Unfortunately, the Bitcoin-Crypto Market has destroyed the new Millennials ability even to consider making old fashion sound investments in real capital-intensive companies. Today, the Entrepreneurs rather make money trading Cryptos on their I-Phone, sporting a few thumbs-up Selfies, compared to the previous generation of business people doing deals out of their briefcases.

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January 05 2018

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Gordon Chang: Blowup w/ China or North Korea Could Change Almost Everything Overnight

Without further delay, let's get right to this week's exclusive interview. 

Gordon chang

Mike Gleason: It is my privilege now to welcome in Gordon Chang, author, television pundit, and columnist at the Daily Beast. Gordon is a frequent guest on Fox News, CNBC, and CNN, among others, and is one of the foremost experts on Asian economics and geopolitics, having written books on the subject and it's great to have him back on with us.

Gordon, it's a real honor to have you on again, and thanks so much for your time today. I know it's been a busy week for you given all of your media appearances, and we're grateful that you could join us today. How are you?

Gordon Chang: I'm fine, thank you, and thank you so much, Mike. I really appreciate the opportunity.

Mike Gleason: Well, there are many things to cover here given all that's going on right now. We certainly appreciate your expertise, particularly when it comes to the developments in Asia. There's a lot going on in that part of the world with big implications for investors. Let's start with North Korea. That's obviously been at the forefront of the news this week with tensions getting ratcheted up again.

Kim Jong-Un and President Trump are both bragging about their nuclear arsenals. The over the top posturing on both sides makes it hard to gauge just how seriously the threat of nuclear exchange should be taken. The market seems to have stopped paying attention for the most part. Please give us your thoughts on the matter. Is there any likelihood the disagreement over North Korea's nuclear weapons program will escalate beyond words, Gordon, or is this war only going to be fought on Twitter?

Gordon Chang: If you look at Twitter, this certainly is a matter of concern, but I think the reality is much different. Right now, Kim Jong-Un, the ruler of North Korea, is feeling sanctions. We saw a hint of that in his New Year's address where he referenced it, at least indirectly, and at one point he actually called the sanctions an existential threat.

What he's trying to do right now with his overture to South Korea is to get the South Koreans to shovel money into his regime. What he would like in return for sending two figure skates to the winter Olympics in South Korea next month would be for South Korea to lift sanctions to resume inter-Korean projects, like the Kaesong Industrial Complex, and also for more North and South Korean aid.

I don't think that those expectations are realistic. Some of what he wants would be a violation of UN sanctions, and President Trump's policy has been to cut off the flow of money to Pyongyang so it can't launch missiles or detonate nukes. This is going into, I think, a very crucial period, because if you look back in history, and I'm talking seven decades, we have seen North Korea engage in military provocations shortly after making peace overtures. And this whole concept of the Olympics and his opening of dialog with South Korea, that's a peace overture.

Mike Gleason: We've got two huge wild cards at the forefront of all this with President Trump and Kim Jong-Un being rather unpredictable, to say the least. Is Trump's tit-for-tat responses to his adversary here going to make diplomacy harder to achieve as our allies might have a hard time joining in full force to combat the North Korean threat?

Listen/Read the entire podcast here: (source)

December 22 2017

moneymetals

David Smith: Cryptos Bringing Broad Attention to All Dollar Alternatives

Well now, without further delay, let’s get right to this week’s exclusive interview.

David smith

Mike Gleason: It is my privilege now to welcome back David Smith, Senior Analyst at The Morgan Report and regular contributor to MoneyMetals.com. David, Merry Christmas, and thanks for joining us again. How are you?

David Smith: Very good Mike, and thank you and the very same to you and yours.

Mike Gleason: Well, as we start out here, David, let's talk first about the setup as we finish up 2017 and move into the new year. There are a lot of similarities to last year, maybe the year before. We've had the Fed just announce a rate hike. The move was well telegraphed and all the selling in the metals happened prior to last week's FOMC meeting. Open interest in the futures got pretty extended about a month ago, and as often happens in that scenario, the speculative long buyers were taken out to the wood shed and punished as the bullion banks cashed in on their shorts. Now we're seeing a bit of a rally in the metals, so the situation in these regards is very similar to a year ago. What are you expecting from the metals markets in the weeks and months ahead? Are you looking for a rally to match last year's?

David Smith: I really think that we could be looking at a very similar set up to 2016 where the metals actually bottomed in December, and the mining stocks tried to put a lower low in in mid-January. And I'll never forget it, January 19th, and on an inter-day basis, they turned around, and then it was up and away for the metals and the miners for the next six months.

Then between then and now they gave back about 50% of it, which is what you'd expect on a retracement, and nobody can predict the future exactly, but I really feel pretty strongly that we're going to see a very strong, right out of the box, in January, on the metals and miners, and it may even turn before the new year, but there's so many technical indicators themselves, that when you add them all up, they become something larger, and so I think if a person is waiting to purchase their metal, they shouldn't be waiting too much longer if they had the same view I do.

And not only that, as you know, when the demand starts ramping up pretty quickly, the premiums go up too, so you would have a double whammy against you, buying at a higher price and paying a higher premium if you wait until a lot of other people kind of get the same idea.

Mike Gleason: Yeah, certainly a buyers’ market right now, both in terms of low spot prices, and also the premiums, as you mentioned. And the last couple years, we have had pretty strong, right of the gate, moves there in the metals and the miners, and maybe 2018 is going to have the same thing.

Now in your most recent article that we published this week in MoneyMetals.com, you make the case for physical metals and cryptocurrencies to coexist. Now we think that is a vitally important idea right now as people are working through questions about what the advent of Bitcoin and other cryptocurrencies will mean for gold and silver. It would be pretty easy for people to look at price charts and leap to the conclusion that metals are quickly becoming irrelevant. The reality is that the times we live in are desperately calling for honest money and that both cryptocurrency and metals both have important roles to play. They have very different strengths and weaknesses, however, so talk for a minute, David, about how these two asset classes are likely to coexist.

Read/Listen to the entire podcast here: (source)

December 05 2017

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December 04 2017

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Gerald Celente: Middle East Wild Cards Could Bring Down Markets, Drive Up Gold

Well now, without further delay, let’s get right to this week’s exclusive interview.

Gerald celente

Mike Gleason: It is my privilege now to welcome Gerald Celente, publisher of the renowned Trends Journal. Mr. Celente is perhaps the most well-known trends forecaster in the world and it's always great to have him on with us.

Gerald, thanks for taking the time and welcome back.

Gerald Celente: Thanks for having me on.

Mike Gleason: Well, Gerald, to start off here, we still have the equities markets ripping and roaring and there is seemingly no news that can derail the train. So, as we head into the end of the year, what does your forecast show for the crowd on Wall Street? Is the party going to end anytime soon?

Gerald Celente: Well, as they go through with this tax deal, it's just going to bring more money to the bigger corporations and you saw what the corporations have done with the profits from the past, what do they do with them? They reinvested them into the stock market rather than building their companies and investing in capital improvements.

So, giving them more money will give them more stock buybacks. The more stock buybacks, the higher the market goes. I mean that's the reality of it. So, if the tax breaks go through the way they're being planned, we're going to see more stock buybacks, more cheap money to reinvest back into the markets.

Again, we're looking at a very small segment of the population that's really playing the markets. For example, only 10% of Americans are in the markets at the range that makes any difference, so that 10%, for example, that's playing, they have about in equity about $350,000 (on average). The rest of society that has money into it, the so called middle class, of those that have any money in it, and again the 10% own over 90%. For the rest of the society, they only have about $15,000 in equity.

So, the markets are just going to keep going up if the cheap money keeps existing. Again, that's going to also see what happens when they raise interest rates, which are about a 99% sure shot now, later in December. And if the cheap money flows stop, then the markets stop. It's as simple as that, but we don't think a 25 basis point increase is going to have much of an impact.

Mike Gleason: Clearly the world has a problem with crooked bankers and corrupt politicians. We talked about this a bit when we had you on back in August. The two aren't unrelated, of course. Bankers and politicians have a very long and dark history of collusion.

On one hand, if history is a guide, there isn't much reason to expect anyone will be held to account for their crimes. "They are too big to jail," as former Attorney General Eric Holder might say. On the other hand, we can't help but be a little bit hopeful. It looks to us like some of these crimes, such as the Uranium One deal, are getting harder to ignore.

What do you make of the recent news? Are you feeling any more optimistic about some of these crooks actually going to prison?

Gerald Celente: No, quite the opposite. Look at the new Fed chair that's coming in. He's already saying that the banking regulations in place now are too tough and tough enough. So, if under the current regulations nobody went to jail and they soften them, they could steal more, and get fined, and also accused of less crimes.

So, no, it's going in the opposite direction. Under the new administration, they're not draining the swamp, they’re just filling the swamp with different swamp creatures. I mean look at the Trump White House. Who's running it? Mnuchin and Cohn on the financial end and those are both Goldman Sachs guys. It's just more of the same.

Mike Gleason: The rise of cryptocurrencies, Bitcoin in particular, is making waves in the precious metals markets. Some of the demand for gold and silver has been diverted to Bitcoin. People see it as another form of honest money and there is plenty of excitement over the huge price gains. Lots of people are wondering what the rise of Bitcoin might mean for precious metals over the longer term.

Now, our take is that Bitcoin offer hope as honest money and we are certainly fans of anything that can circumvent central bankers. Gold and silver, on the other hand, are proven stores of value with a track record extending back thousands of years and they are totally off the grid. Physical metals work with or without electricity or an internet connection and they can be used without leaving digital tracks behind.

What are your thoughts on the relationship between Bitcoin and bullion?

Read/Listen to the full podcast here: (source

November 30 2017

moneymetals

How to Choose a Firm to Set Up Your Precious Metals IRA

Self directed IRAs are increasingly popular as investors discover they can use them to escape the ring fence represented by traditional IRA accounts.

Banks and brokerages successfully cultivated the idea that IRAs should contain only conventional securities – stocks, bonds, and mutual funds. The truth is that they get paid handsomely for selling those paper assets, so that is all they put on the menu.

But word is getting out that it is perfectly legal and easy to own tangible assets, including real estate and precious metals, in an IRA. Investors just have to leave Wall Street and find a custodian which specializes in self-directed IRA plans. Today, there are a number of firms offering this sort of plan, so it is worth covering how an investor might go about choosing one.

Secure Your Retirement with a Precious Metals IRA | Learn More  />

You’ll want to start by evaluating the basics. Choose a firm with a reputation for providing great service at competitive fees. You might give extra points for a firm which is well established in the industry. There has been a fair bit of consolidation and changes in the space recently.

We would not recommend custodians charging more than $150 in annual fees or those charging more than $50 for each transaction. There are some very good firms with fees significantly below those levels.

The capability to enroll, view and manage transactions online should be a big consideration if you prefer the convenience of managing affairs electronically. Those people who prefer to deal in person should inquire by phone to see if you can reach a service rep easily and get good care.

Continue to the full article (source

November 27 2017

moneymetals

November 22 2017

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November 13 2017

moneymetals

The Dangers of Zero

Inline image 1

Zero is an important number in the psychology driving demand for bullion. There are periods when investors find the argument that gold or silver prices “will never go to zero” compelling.

The 2008 financial crisis and the years immediately following it are the most recent example. The fear of conventional securities and even the fiat dollar becoming worthless was palpable for many in the metals markets. Bullion demand hit record levels.

Left behind

Investors have chased bull markets
for fear of being left behind.

While demand for gold ETFs and futures contracts has been strong in 2016 and 2017, some investors in the physical market for coins, bars, and rounds seem to have overlooked the modest gains of the past two years and are anxious instead to participate in bull markets elsewhere. If they are worried about anything, it is the possibility of missing out.

Gold and silver’s appeal as a safe haven is in temporary eclipse.

The metals markets are awaiting the moment when investors lose their conviction about ever higher stock prices and once again grapple with the idea that prices do fall.

Indeed, the value of some securities can, and does, fall all the way to zero. Companies miss expectations or fail outright. Bond issuers occasionally default and fiat currencies eventually die. Investors discount risk in the euphoria of a bull market.

Continue reading: (source)

November 06 2017

moneymetals

November 03 2017

moneymetals

Bitcoin or Gold: Which One's a Bubble and How Much Energy Do They Really Consume

Inline image 1

If you are investing in either Bitcoin or Gold, it’s important to understand which asset is behaving more like a bubble than the other. While it’s impossible to understand how the market will value these two very different assets in the future, we can provide some logical analysis that might remove some of the mystery associated with the market price of Bitcoin vs Gold.

I’ve read some analysis on Bitcoin profitability and energy consumption that seemed unreliable, so I thought I would put my two cents in on the subject.

For example, many sites are using the Digiconomist’s work on Bitcoin energy consumption. However, I believe this analysis has overstated Bitcoin’s energy consumption by a large degree. According to the Digiconomist, Bitcoin’s annual electric use is approximately 24 TerraWatts per year (TWh/yr):

Digiconomist bitcoin energy consumption

In a recent article that was forwarded to me by one of my readers, How Many Barrels Of Oil Are Needed To Mine One Bitcoin, the author used the information in the chart above to calculate the energy cost to produce each Bitcoin. He stated that the average energy cost for each Bitcoin equals 20 barrels of oil equivalent. Unfortunately, that data is grossly overstated.

Read the full article: (source)

October 24 2017

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October 03 2017

moneymetals

U.S. Mint Bullion Coin Sales Dip As Buyers Take Advantage Of Secondary Market

The U.S. Mint is on track for the lowest sales of American Eagle coins in almost a decade. The 2008 financial crisis began a historic ramp up in sales that lasted for years. 20,583,000 silver American Eagles sold that year, more than double the 2007 total of 9,028,036 coins.

In all but one year thereafter the Mint set a new record. Sales peaked in 2015 at 47,000,000 Silver Eagle coins – 5 times the number sold before the world discovered just how rickety the global financial system actually is.

Memories are short, however, and investor complacency is setting in.

Sales to date in 2017 are just short of 16 million coins and are set to finish the year very close to the 2008 totals.

U.S. Mint sales are viewed as a proxy for bullion sales in the broader market. There isn’t much else available in the way of published data. However, Mint statistics don’t tell the whole story.

While retail buying activity is still stronger than retail selling, we’ve seen a meaningful increase in customer selling of coins, rounds, and bars over the past year. A lot of the American Eagles traded today are therefore resale coins which don’t show up in the Mint’s reporting of new minting activity.

Government Mint Bureaucrats Don’t Respond to Market Conditions

Private mints and refiners are responding to weaker sales by lowering premiums on rounds and bars. The government bureaucrats which run the sovereign mints, including the U.S. Mint, largely ignore these competitive forces. To date, they have not adjusted pricing.

Demand for government-minted products therefore suffers the most as buyers take advantage of significant premium discounts available in other products and secondary market items.

While retail bullion demand in the U.S. is certainly weaker overall, it is way better than the Mint's statistics might imply. In a sense, the bullion markets are more balanced. National dealers like Money Metals Exchange make more of a two-way market, both buying from and selling to clients.

That is good news for buyers. The days when new production Silver Eagles were strictly allocated and supply fell hopelessly short of demand are behind us, at least for now. Investors can get those coins for around $2.50 over melt value, instead of paying up to $6.00 and waiting for delivery – which has been the case on a few occasions over the past 5-7 years.

Any buyer who doesn’t have to have a sovereign coin will find plenty of other silver products with premiums under a buck – such as rounds and bars. Gold premiums and availability are also improved.

Premiums could go even lower if retail demand does not increase despite the renewed bull market in precious metals that began in late 2015.

Much will depend on spot prices. Many people are impatient with the seemingly gradual rise in gold and silver prices off the 2015 bottom. If prices accelerate upwards, investors will finally start believing in the new bull market.

Perhaps an even bigger variable is the atmosphere of complacency in the markets and how much longer that will persist. Our view is that virtually all markets are severely underpricing risk. More investors should be buying safe-haven assets rather than selling.

It is hard to reconcile the world we find ourselves in today with record stock market prices, at least not without the artificial forces of central bank stimulus in massive amounts and algorithmic trading. Those forces are formidable, to be sure. But how much longer can bankers (both central and Wall Street) forestall the ultimate reckoning for all of their excesses?

Investors asking the same question should take advantage of the buyer’s market in metals while it lasts.

Article Source

moneymetals

David Morgan: The Fed’s Tightening Because the Dollar Is in Big Trouble

Well now, without further delay, let’s get right to this week’s exclusive interview.

David morgan

Mike Gleason: It is my privilege now, to welcome back our good friend David Morgan, of The Morgan Report. David, it's always a real pleasure to have you on with us. How are you, sir?

David Morgan: Mike, I'm doing well. Thank you for having me.

Mike Gleason: Well, first off, let's discuss what's been driving the recent pullback in your view. Gold was over $1,350 not too long ago and is now is decisively back under $1,300, as we're talking here on Wednesday afternoon. Silver has pulled back, and is moving toward the lower end of its year-long trading range, and has a 16 handle, once again. So what do you make of the recent market action, and what's behind it David?

David Morgan: Well, it's a lot of, algorithms that trade all these markets. You can't get around that fact. The second thing is, a lot of people are -- in my view -- been on the lazy side, which means they just generally off the technical analysis doesn't work, because it's a manipulated market. Well, actually it works fine, if you ever took the time to read The Silver Manifesto, with my co-author, Chris Marchese, you would definitely find out that technical analysis is a tool. It's not perfect, but it's something to pay attention to.

So, when we have a support or resistance level, it normally takes three tries to get through that level, either from the upside or the downside. Recent times, $1,300 was the level that had to be tested three times, for gold to have that $1,300 breakout. It did it. Third try it went through. It got up to $1,350. I warned my members at that time that normally, a breakout level is tested at least one time, and forecast it would see $1,300 or below. And it was moving higher, higher, higher, and there were a lot of articles about gold is at a 11-month high, gold is at a 12-month high.

And I don't want to say I get it right every time. I'm not trying to imply that. What I'm trying to imply is that technical analysis does have some benefit, and that there are some general principles that work most of the time, this being one of them. The last one that cinched it for me, and this is one that you've got to combine as much knowledge as you can, and throw out the junk and keep the diamonds, then that is what the Commitment of Traders look like. And the Commitment of Traders look very unsatisfactory at the time that gold was getting in this 11-month, 12-month high area.

It looked to me like, based on the COT, that it was also due to come back. So, that's the reason ... I mean as trite as it sounds, it's absolutely the most honest and truthful thing you can say about why a market was up or down, it's because there's more sellers than buyers, that's why the market goes down, or there's more buyers than sellers and that's why the market moves up. I don't care if it's wheat. I don't care if it's rice. I don't care if it's a stock or an ETF, gold or silver. It does not matter.

If there's buying pressure, it goes higher. If there's selling pressure, it moves lower. It's that simple. What everyone wants to know is why, and that is too difficult to announce, because there could be individual reasons. Someone might have an emergency and they sell a bag of silver because that's all the savings they have, or whatever. So I don't want to go down this rabbit hole too far, Mike, but I want to state, is you can generally say, "Oh, yes. The Fed announced they're going to raise rates and they're going taper back on their balance sheet," and all this stuff, and everyone says, "Well, that's the reason."

Well that's a reason, and it may be one of the major reasons, but it's not necessarily all reasons. So I'll leave it at that.

Mike Gleason: Well, I know you don't want to thump your chest too hard, but I'll sing your praises a little bit, here. You've been very good at calling both short term tops and long-term tops, and people that follow you will know that as well.

I'm curious to get your read on sentiment in the broader precious metals community, because while we're definitely still seeing more retail customers buying than selling, we are seeing an increase in people selling metal than we're accustomed to. Around the world, though, particularly in Asia, physical demand is strong and may even be increasing.

Now, you interact with traders and investors in the futures markets, and you talk regularly with mining industry executives and shareholders, which gives you an even broader perspective. You often talk about how these markets tend to either wear you out or scare you out. Is that happening, or are you seeing some optimism, here?

Read/listen to the entire podcast: (source)

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September 12 2017

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August 28 2017

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