Many view gold as a currency alternative as central banks print money and debase their currencies. Whether or not gold is a good investment is a matter of opinion versus other alternatives.
The following chart reflects my own view of conditions that are historically good and bad for gold. Central banks' money printing on an unprecedented scale also makes the case for gold as a currency alternative.
Among other issues that give investors pause is the apparent price manipulation in the gold and silver markets. Moreover, in the commodities markets, price manipulation isn't limited to precious metals. Last week, I posted an anecdote of price manipulation in the silver market in the 1960's: "Price Manipulation: Look for Motive."
In October 2010, Bart Chilton, a commissioner for the Commodities Futures Trading Commission (CFTC), announced an investigation into silver manipulation. In the video below, I said the Wall Street Journal wrote a nasty article about Chilton shortly thereafter. My memory was incorrect. It was much worse than that.
The article was about retiring CFTC Judge Painter after he issued an Order requesting that all of his seven open cases not be transferred to Judge Levine, another CFTC judge. Painter alleged that when Levine first took the job twenty years ago, he told Painter he had promised CFTC Chairwoman Wendy Gramm that he would never rule in favor of a complainant.
Judge Painter's order said that complainants, say, complainants about silver price manipulation or other commodities price manipulation, "run a hostile procedural gauntlet until they lose hope, and either withdraw... or settle for a pittance, regardless of the merits of the case." Painter stated that Levine "has fulfilled his vow."
It's ironic that Painter's Order referenced an earlier December 13, 2000, Wall Street Journal article about Judge Levin's appalling record: "If You've Got a Beef With a Futures Broker, This Judge Isn't for you - In Eight years at the CFTC, Levine Has Never Ruled in Favor of an Investor."
Angela ("Angie") Miles interviews Janet Tavakoli. First Business Morning News - January 25, 2012
28 January 2012
Registered Silver Ounces At the Comex
There are 49,436 contracts currently open for the next delivery month which is March 2012. Each contract represents 5,000 ounces. That is 247.18 million ounces of silver being traded for March delivery against a registered 36.56 million ounces. This is a subset of all the contracts going out over the year.
The is leverage of about 6.8 to 1. It 'works' because most contracts are speculative and settled for cash. Comex is not where one goes for the delivery of a large amount of silver.
I think that over time Comex will become increasingly less relevant as a price-setting mechanism for a number of commodity prices including the metals.
The failure of MF Global and the blatant cheating of the customers, both before and after the fact, will accelerate the process of failure.
It really is shocking, all the more so because so few people see it and understand its significance in the coming crisis of confidence in the US markets.
Great leaders see the big changes coming and harness them. There is no one on the horizon that fits that prescription. What I see is failure repeated, but as history indicates, not endlessly
The price of gold in the near future will drop so fast no one will sell it fast enough to make a good return on the stuff. And the people who will loose there a--s will try to sue any one they can or try to off load it on the US government (bail out)if this country ever gets. Back on it's feet the price of gold will have to fall as well they go hand and hand
Buying physical gold as an investment is like buying more gasoline when the price of oil goes up.
At least when you buy equities you are buying a share(s) of the company's earnings, which are real profits.
When you buy an ounce of gold it will never be more than what it is at that moment, unless people say it is worth something else.
No thank you.
I want my investments the old fashioned way: based on more than just say-so.
If you feel otherwise, that is fine, buy away, but leave me out of it.