AndersB

Gold

2030 posts in this topic

I can't see myself buying any more precious this year. RBA statement of Assets and Liabilities out this arvo, will be interested to see how much Christmas paper Stevens has been printing.

Perhaps the wrong thread, but does this mean the RBA has been buying government debt in the last week? If so is that our own version of QE?

Liabilities:

Australian Government +3,634

Assets:

Australian Dollar Securities +3,784

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Perhaps the wrong thread, but does this mean the RBA has been buying government debt in the last week? If so is that our own version of QE?

Liabilities:

Australian Government +3,634

Assets:

Australian Dollar Securities +3,784

Sorry I meant the US FED....gold could still fall in Aussie, if the USD drops somewhat. We are a drop in the ocean. Or if the US FED ups rates, gold will fall.

Yes it is true, we have our own QE, Almost 40 billion in the dollar securities. But the RBA isn't buying Federal debt. Its buying bank debt.

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The Precious has began a very steep climb. IMO, it will most likely need to take a rest. But on the other hand, if it does what the base metals did in 2005-6 (like Zinc), it could rise to US$2K. Gold in $A (which is what really matters to the locals) is also rising steeply.

Gold in $US might be starting an overdue correction after its sharp rise. Our currency is also correcting and hence gold in $A is still rising, though that sharp rise may correct as well.

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China Prepares To Increase Its Gold Holdings Tenfold

...We just came across a Bloomberg News article quoting an official from the state-owned Assets Supervision and Administration Commission (Ji Xiaonan, the Chief) as saying “we recommend China increase its gold reserves to 6,000 metric tons within three-to-five years and possibly to 10,000 tons in eight to 10 years.” China’s reserves, after a 76% buildup since 2003, currently stand at 1,054 tons, so we are talking here about the prospect of some pretty heaving buying in coming years....

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In our local rag a claim that gold is rising on the back of speculators, and no longer those who purchase simply for a safe haven.

Would be interested in your views on this.

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Probably more Wulfies thing but IMO it was probably being suppressed if anything in the previous months (Morgan Stanley I believe). Its dollar weakness unfolding. I've read that many short positions on the futures market are being covered and some paper speculation is unfolding.

I think there will be an ugly correction based on this sharp rally to overbought heights but long term its up there (as the USD is down there). $2000+ ($5,000???) is an eventuality, the problem is what will the AUDUSD be then?

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Solomon, some links...

http://jessescrossroadscafe.blogspot.com/2009/12/gold-chart-weekly-upated.html

Despite a very recent surge in popularity, gold and silver are hardly mainstream investments, and few understand them. This will change. But it has not changed yet.

We want to emphasize that 1225 is NOT our ultimate price objective or a top call. This is a minimum measuring objective from the breakout from an ascending triangle of 1225 on the weekly chart. IF you accept that an inverse H&S pattern can be a consolidation pattern, then 1275 is the minimum measuring objective.

What is our ultimate price? Well, to answer that, we would have to know how thoroughly the Fed and Treasury intend to debase the dollar. Further, we would need to have a honest accounting of the gold holdings of the US, and any allocations or encumbrances on them from leasing activity.

Without such knowledge forecasting a 'top' is difficult.

and...

http://www.zerohedge.com/article/79-protons-meltup-counter-1224oz

Gold is now the primary beneficiary of any and all dollar weakness (much more so than stocks or any other asset class) and any and all incremental excess liquidity. We hope members of Senate who read this post present the charts below and ask the Fed Chairman at what point will his debasement of America end.

Finally, on paper versus physical...

http://jessescrossroadscafe.blogspot.com/2009/12/gold-comex-and-exchange-for-physical.html

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rememberover on old forum i mentioned i got $10k out on loan at %10? well i worked out that it would have bought 8.6 oz f gold back about a month ago.

now it buys 7.6 oz of gold. not that i would gone and bought 8oz of gold but its interesting to lok at loans in terms of gold i should have asked for return of 0.86 oz of gold a year . not cash lol guess i woulda been told to naff off.

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In our local rag a claim that gold is rising on the back of speculators, and no longer those who purchase simply for a safe haven.

Would be interested in your views on this.

There may be a downward correction, but the China put will keep a floor under any (significant) drop - central banks are net buyers and will swallow any supplies IMO.

Something to consider - PoG YoY stats:

USD +57.2%

JPY +47.1%

GBP +39.8%

EUR +32.9%

CAD +31.9%

CHF +30.4%

AUD +10.5% (note: went from 908 AUD 16/08/08 to 1239 AUD 05/12/08)

How is your term deposit performing?

Fortunately a combination of carry trade hot money and higher comparative IRs has kept gold down in Aussie peso this year. I don't think that will remain the case for the next 12 months. I'm hoping for another dip early in the year but I think any dip would be accompanied with AUD weakness against the USD. I may have to look at silver instead... it's just a shame it has such a spread with bullion dealers.

Worth keeping an eye on the bond markets. An interesting thing I read that I haven't validated; under BASEL2 the ceiling that a company's credit rating can be (e.g., AAA) cannot exceed that of the nation. Hence, for example, if the UK is downgraded to BBB, that's the highest rating any UK company can have.

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Gold in $US might be starting an overdue correction after its sharp rise. Our currency is also correcting and hence gold in $A is still rising, though that sharp rise may correct as well.

A decent drop overnight for gold, a decent rise for the $US index and long term US interest rates.

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I think there will be an ugly correction based on this sharp rally to overbought heights but long term its up there (as the USD is down there). $2000+ ($5,000???) is an eventuality, the problem is what will the AUDUSD be then?

Yoiks. -$49in one session on rumours of a possible fed rate hike in 10. USD AND Dow rising.

We'll now resume normal programming.

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In short, a stabilization in the jobs market does nothing to improve the balance sheets of zombie banks. An

improvement in the big bank balance sheets is the prerequisite which would allow the Fed to mop up the

excess liquidity, not am improvement in the jobs market. So, in short, the Gold market has probably

overreacted a bit, and may continue to trade lower into the next jobs report. When market participants are

reassured that the Fed is in a box and that the excess liquidity must stay in the system for the foreseeable

future, gold prices will resume its trend higher and currency carry trades will be put back on.

Full report:

http://www.zerohedge...20in%20Gold.pdf

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yeah is this just small break or a turn to down trend?

It's a healthy correction.

I'll buy more if it drops below US$1100/ounce :-)

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US mint suspends most gold coins " till further notice "

http://mineweb.co.za/mineweb/view/mineweb/en/page34?oid=94091&sn=Detail

U.S. Mint now suspends all one ounce gold coin sales due to shortage of physical gold!

Once again the U.S. mint has had to suspend sales of all its one-ounce gold coins, and some fractional ones too, as its supplies of physical gold cannot meet the demand.

Author: Lawrence Williams

Posted: Monday , 07 Dec 2009

LONDON -

"The United States Mint has depleted its inventory of 2009 American Buffalo One Ounce Gold Bullion Coins. ... No additional inventory will be made available. As additional information becomes available regarding 2010-dated American Buffalo One Once Gold Bullion Coins, you will be notified." So said a memorandum issued Friday to authorized purchasers of U.S. Mint gold coins and reported by Jim Sinclair..

Mineweb reported only two weeks ago, on November 25th, the suspension of sales of American Gold Eagle coins by the Mint - U.S. Mint suspends American Eagle 1-ounce gold coin sales - again, which, at the time, reckoned such sales would be resumed early this month - but in the event, not only is the suspension of the Gold Eagle coin sales continuing, but also now the American Buffalo one ounce gold coin sales have also been suspended, with no new sales now planned until some time in 2010 - although the current sharp fall in the gold price may provide the Mint with a bit of respite from its supply/demand woes.

But supply problems also persist with smaller gold coins, particularly given the enormous demand for fractional sized gold coins following the suspension of the one ounce Gold Eagles. Thus the Mint was forced to issue a second memo on Friday saying "the American Eagle Gold Tenth-Ounce Coin inventory was depleted" and that "inventory for the half-ounce and quarter-ounce coins remains very limited." Following the sale of these remaining gold coins on Friday, the Mint anticipated that it would again offer all fractional sizes by mid-December, but in an allocation process.

On a more positive note for the Mint, the resumption of American Silver Eagle bullion sales will resume today. These silver coins were suspended along with the one ounce gold coins a week ago - also due to depletion.

The Mint had been trying to control sales by not releasing the 2009 coins for sale until late in the year - they are usually available throughout the year, but demand has proven to be enormous. This doesn't mean though that coins are not available to the U.S. public as some authorized dealers will continue to hold stocks, although these are being depleted rapidly and premiums charged on sales are increasing.

According to a report on website Coinupdate.com "The US Mint began sales of fractional weight American Gold Eagle bullion coins on December 3, 2009.... These fractional Gold Eagles are typically available throughout the year, but this year the Mint delayed the release to focus production on the one ounce bullion coins. After only one day of availability, the US Mint recorded sales of 56,000 of the one-half ounce coins, 58,000 of the one-quarter ounce coins, and 260,000 of the one-tenth ounce coins. They have indicated that the inventory for one-tenth ounce coins has already been depleted and the inventory for one-half and one-quarter ounce coins is limited. The remaining limited inventory will be offered via the US Mint's standard allocation process and additional inventory is expected to be available in mid-December."

While the shortage of U.S. Mint offerings due to demand exceeding supply is, in reality, not that significant in terms of global gold sales it does demonstrate the extent to which demand for easily available physical gold has increased over the past two years. Some of this has been the ever increasing interest by the U.S. public in gold in general and also a certain amount of distrust generated by some commentators as to whether the various ‘paper gold' offerings were secure

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The Precious is correcting its sharp rise. Ideally, it should hold A$1,200.

FWIW, I think major support for the precious is just below US$1100/ounce and just below A$1200/ounce. Probably will bounce back before hitting those targets.

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Rumours on Blogs is that the big banks (JPM, GS etc) are pounding AU. Another interim bottom?

Hope so, I was in the city yesterday so bought a couple oz. My database has been complaining that my planned savings numbers were low in that area.

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