Gold rallied 2% following news that China’s state holdings of the metal have been quietly raised by 76% since 2003. Rumours and speculation about Chinese buying have been rife for years, but many market participants remained in denial until this irrefutable proof was given. China is not only the world’s largest mine producer of gold, but also the fifth-largest individual country holder of gold with 1,054t.
The Financial Times published a relevant and interesting article by Nassim Nicholas Taleb, a veteran trader, a distinguished professor at New York University's Polytechnic Institute and the author of The Black Swan: The Impact of the Highly Improbable. 1. What is fragile should break early while it is still small. Nothing should ever become too big to fail. Evolution in economic life helps those with the maximum amount of hidden risks – and hence the most fragile – become the biggest.
Adrian Douglas of Market Force Analysis writes that in his experience, most ordinaly people have difficulty understanding why gold is the investment opportunity of a life time. Blaming the messenger, he explains it in simple terms, making a distinction between consumables and collectables:
Moneyweek's Dominic Frisby writes that he is detecting a certain amount of bullishness in the UK housing market. People with cash are talking about buying to take advantage of lower property prices and interest rates. Nevertheless, he says,
There have been a spate of articles in the press recently including the Personal Finance section of the Irish Times touting jewellery and diamonds as safe haven “rock solid” investments. Rock solid investment Looking for a rock-solid investment? A girl's best friend and a smart way to invest This is dangerous nonsense and irresponsible journalism of the highest order. Investors have lost enough money in recent years due to appalling investment “advice” regarding equities and property and it is important they do not compound that by “investing” in diamonds and jewellery. As ever real diversification in all asset classes is essential.
Excerpts from The Financial Times' View from the Markets online interview with Jim Rogers: FT: It’s a year since we last interviewed you.
ARROYO GRANDE, Calif. (via MarketWatch) -- A record 130 million voters are predicted to head to the polls Tuesday. The bad news: 65 million, roughly 50% of all voters, will be miffed, mad at, angry with, even hate the new president ... no matter who wins! Half against Obama, half against McCain. Either way, half of America will be angry, for at least four years. And that 50% will get even angrier as the recession deepens, sweeping aside all the grand upbeat promises of the campaign. Think things are bad now? Just wait, they'll get far worse before a recovery. Washington's in hock $11 trillion. Next, pile on all the gluttonous bailout billions and lost revenues and soon we'll be pushing $15 trillion even $20 trillion as this global meltdown spreads. Worse yet: All that debt's guaranteed to force new taxes and huge cutbacks, no matter what the winner promised. Last week I predicted this dark future, a "Great Global Depression" by 2011. Fortunately, there are still optimists out there. See previous Paul B. Farrell. For example: In a story in the latest Newsweek, "Nightmare on Pennsylvania Avenue: The Scary Challenges Facing the Next President on Day One," Richard Haass, president of the Council on Foreign Relations and author of "Opportunity: America's Moment to Alter History's Course," had this warning for the next president: "This is not the world you've been discussing on the campaign trail," that was a "caricature." But he added, the "American people are ready to be leveled with" -- even ready for the pain of moving in a bold new direction. After warning of domestic dangers in his Newsweek "Memorandum to the President Elect," New York's Mayor Michael Bloomberg hit a high note about the future: "This is a competition we should relish, because we continue to enjoy all sorts of advantages: the best universities, the most advanced factories and health care, the most entrepreneurial workers and the best quality of life. But like a champion who has gotten complacent and sloughed off on workouts, the federal government -- paralyzed by partisan gridlock and special-interest pandering -- has let America slip out of top fighting form." McCain? Obama? The 535 members of Congress? Plus 42,000 special-interest lobbyists? Maybe they'll "level with" you. Don't count it. Besides, it doesn't matter. Campaign's over. "They" got the power. For the next four years the only person you can control is you. Try shifting into survival mode. What if you're stranded on a mountain climb in a storm? Marooned on a desert island? Lost in a jungle? Shipwrecked, drifting in the Pacific? For the next four years! It's not "you versus them." Not "you versus nature." Surviving is "you versus you." Laurence Gonzales has been researching how people behave in accidents for 35 years, and he tells us in "Deep Survival: Who Lives, Who Dies, and Why." He discovered "an eerie uniformity in the way people survive seemingly impossible circumstances. Decades and sometimes centuries apart, separated by culture, geography, race, language, and tradition, the most successful survivors -- those who practice what I call 'deep survival' -- go through the same patterns of thought and behavior, the same transformation and spiritual discovery, in the course of keeping themselves alive. Not only that but it doesn't seem to matter whether they are surviving being lost in the wilderness or battling cancer, whether they're struggling through divorce or facing a business catastrophe -- the strategies remain the same." And we are clearly facing a historic political and economic catastrophe today, so listen closely: We can adapt Gonzales' incredible "12 Rules of Adventure" as a road map for Americans, especially investors, in the uncharted waters ahead for four years with the new president. Yes, he calls it an adventure: "Survival should be thought of as a journey, a vision quest of the sort that Native Americans have had as a rite of passage for thousands of years. Once you're past the precipitating event -- you're cast away at sea or told you have cancer -- you have been enrolled in one of the oldest schools in history. Here are a few things I've learned that can help you pass the final exam." The 12 tips that will work if you want to avoid a deep depression, both personally and as a nation: 1. Attitude: 'perceive and believe' Economist Nouriel Roubini predicts "the worst is yet to come," with stocks going over a cliff, along with currencies, next year.
[caption id="" align="alignnone" width="518" caption="Click for larger (readable) version"][/caption] Yet Gold is off $28 and Silver $1.20 today. What is going on in the futures market?
Research by Skandia has revealed that the majority of IFAs intend to shift away from commission-based remuneration over the next three years.
It seems that Wall St. are trying to blame the straw for breaking the camel's back.
The Bank of International Settlements, which seems to be the only institution that tracks the derivatives market, has recently reported that global outstanding derivatives have reached 1.14 quadrillion dollars: $548 Trillion in listed credit derivatives plus $596 trillion in notional/OTC derivatives. Yes, that is Quadrillion. One and 15 zeroes!
GI believe all investors should have a precious metals allocation of at least 25% to silver and either buy silver outright now or should transfer from gold to silver at the earliest possible opportunity. We believe $50 per ounce
Following the Thursday night RTE documentary on Irish Financial Advisers, Gold Investments' Wealth Management Division, Wealth N, would like to issue the following statement: - The misleading, unethical and disturbing financial 'advice' seen in last night’s excellent Primetime programme may only be the tip of the iceberg and we call upon the Financial Regulator to become more proactive in protecting investors, young and old alike, from the predatory, dishonest commission driven financial ad
The Telegraph is reporting today on the 'New Gold Rush': With the discovery of gold there in 1848, the California Gold Rush brought 300,000 people into the state, transforming what was then a backwater into the embodiment of the American Dream.
It might not be morning again in America but Bush hopes to wake up the economy via his Economic Stimulus Act of 2008. The stimulant – pumping more than $152 billion (or about 1% GDP) into the economy via tax rebate cheques - will start arriving in the mailboxes of Americans over the next three weeks. The plans proponents are optimistic. Hank Paulson, in a speech confirming that no second stimulus plan would be undertaken, believes the $152-billion stimulus plan could create 500,000 jobs this year. Americans would have to spend their money wisely for the plan to have maximum impact. But what if the rebate money is already owed?
"We know we're already in negative equity," said Emma Linnane, a 31-year-old university administrator. She bought a cozy, one-bedroom apartment in the Dublin suburbs with her fiancé, Paul Colgan, in May 2006, at the peak of the market. They paid €365,000, or $575,000 - at least $100,000 more than it would fetch today. The bad news regarding the American housing market continue apace. BusinessWeek are reporting that Existing Home Sales Drop for Seventh Straight Month with the national median existing home price dropping 7.7% from a year earlier. That a bubble has burst is clear. What is not so clear is how much of the contagion has spread worldwide.
The London Independent leads with the headline "The Great Depression" today. 1.1 million Ohio residents alone recieve food stamps, nearly 10% of the Ohio population, and more are elegible. ...and this is no April Fools.
Jim Grant, founder and editor of the highly respected Grants Interest Rate Observer and one of the world's leading experts on US and international interest rates and financial markets appeared on Bloomberg's "Taking Stock" on Tuesday, March 24.
Ron Paul appeared on CNBC's Kudlow & Company last week; making his case to abolish the Federal Reserve and work back towards the gold standard: Michelle Cabrera shouldn't sound so incredulous, didn't Jim Rogers appear on CNBC just recently saying the same thing? Int