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World Gold Council Q4 Gold Digest

Tyler Durden's picture





 

The world gold council has released its quarterly comprehensive investment digest, as usual chock full of actual data, and not just anti-gold speculation based on myth. Probably most relevant are the core facts: "The gold price rose by 29% in 2010. By comparison the S&P Goldman Sachs Commodities Index (S&P GSCI) rose by 20%, the S&P 500 rose by 13%, the MSCI World ex US Index increased by 6% in US dollar terms, and the Barclays US Treasuries Aggregate Index rose only by 6% over the year." The main reason for the jump: excess supply of paper currency alternatives, and surging investor demand. And while the recent pull back has been primarily driven by the flawed assumption that the Fed will not monetize any more debt and pump the "Yucca Mountain" of excess reserves (it will), many forget that the demand is actually still there. The chart below confirm this, and provide some other observations on the gold market.

The report's key findings:

  • Gold price volatility at 16% on an annualised basis in 2010 remained consistent with its long-term trend. By comparison, volatility on the S&P Goldman Sachs Commodity Index was 21% during the year, based on daily returns.
  •  Gold benefited from the continued contagion from European sovereign debt problems as investors’ hedge their currency risk.  This was evidenced by strong gold buying in ETFs, bars, coins and other investment vehicles in Europe and other parts of the world.
  •  Investors bought 361 tonnes of gold in the ETFs the WGC monitors in 2010, bringing total holdings to a new high of 2,167 tonnes, worth US$98 billion. This represents the second largest yearly inflow on record, after the 617 tonnes of net inflows experienced in 2009.
  •  During the first nine months of 2010, global jewellery demand totalled 1,468 tonnes, increasing 18% from the same period during 2009. Gold demand for technological and industrial applications continued to recover during the first nine months of 2010, registering a 19% increase over the same period in 2009. Complete full-year data for gold demand will be available in February when the WGC publishes its Gold Demand Trends report.
  •  Central banks became slight net buyers of gold for the full-year, after two decades as a steady source of supply to the market. The IMF successfully completed its gold sales programme of 403.3 tonnes without disruption to the market. The Fund sold 200 tonnes to the Reserve Bank of India, 10 tonnes to Sri Lanka, 10 tonnes to Bangladesh and 2 tonnes to Mauritius, all in off-market transactions executed at market prices. The remaining sales were conducted through on-market sales within the ceiling set by the third Central Bank Gold Agreement (CBGA3).

And the key charts to track the drivers of gold price moves:

First, Gold ETF holdings:

Next, the relative volatility of gold compared to other asset classes:

Comex net spec positions in gold:

Mint gold bullion sales:

Gold lease rates:

Oddly enough there is still confusion about this topic in the blogosphere. Below is the WGC's succint explanation of this mystery:

The implied gold lease rate is the difference between the US Dollar LIBOR and the equivalent duration Gold Forward Offered Rate (GOFO), the rate at which gold holders are willing to lend gold in exchange for US Dollars (also known as the swap rate). Gold lease rates remained negative throughout 2010, reaching an all-time low of -0.25% in the 3-month maturity on 15 December. Within two days of this landmark, other maturities also reached all-time lows with the exception of the longest maturity 12-month implied rate. Examining the components of the lease rates, both GOFO and LIBOR at 3-month maturity moved in relative tandem until Q4 2010 when GOFO started to marginally rise above LIBOR from about 0.35% to 0.50%. Although a rather insignificant move in magnitude, it nonetheless sent the implied lease rate to its record lows (Chart 8).

However, the significance of the lease rate has declined as the two main market participants – gold producers and  hedge funds – have scaled back their activity over the last decade. Furthermore, –the growth in gold investment vehicles and futures volumes has likely shifted the influence away from OTC forward agreements to exchange-based futures markets.

Nevertheless, negative lease rates do not necessarily suggest that lenders of gold, usually central banks, are paying  lessees, bullion banks. As gold leasing is an opaque, OTC market, it is difficult to ascertain whether or not implied rates are reflective of the actual transacted rates. Furthermore, central banks incur costs associated with storage, so lending  gold at a low lease rate – perhaps even a periodically negative one, could still be advantageous. Such a transaction might not provide a central bank with a gain, but would reduce their carrying costs. Suggestions that this may be  indicative of diminishing global storage capacity and with it, rising costs, are also unfounded. In fact, new vaulting capacity has recently appeared both in Singapore’s Freeport area and in Hong Kong. One conclusion that can be drawn from the data, however, is that lease rates are very low and a profitable leasing environment currently does not exist. As the leasing process will more often than not involve the sale of physical gold in the spot market, to ensure a riskless hedge for bullion banks, the current environment should also be supportive of the gold price.

And lastly: Demand. Yes Demand.

First, Jewerly:

And next Industrial:

Full report:

 

And for the reading challenged, there is a video:

 


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Wed, 01/26/2011 - 15:11 | Link to Comment NOTW777
NOTW777's picture

1326 is approx 38.2 retrace using july lows; could be due for a bounce

Wed, 01/26/2011 - 16:03 | Link to Comment NOTW777
NOTW777's picture

nice reversals in many PM names

Wed, 01/26/2011 - 15:15 | Link to Comment Arius
Arius's picture

it looks like we past the top and now we are rolling over...yeah, well...

Wed, 01/26/2011 - 15:15 | Link to Comment bigdumbnugly
bigdumbnugly's picture

uh yeah... thanks for the video.

i wonder if his tie is real gold.

16% volatility in 2010.  seemed like much more, but prices are higher so probably just seems that way...

 

Wed, 01/26/2011 - 15:16 | Link to Comment russki standart
russki standart's picture

Where will Gold be in 2 years from now....I think I will buy more if the market breaks below 1321. I can only wish.

Wed, 01/26/2011 - 15:29 | Link to Comment txapela
txapela's picture

it won't. so buy the fucking dip or it'll pass you by.

Wed, 01/26/2011 - 15:17 | Link to Comment NOTW777
NOTW777's picture

hilarious - the recovery is on track but zero rates and fed buying forever

Wed, 01/26/2011 - 17:24 | Link to Comment gravitas
gravitas's picture

no kidding...

We've been hearing about this 'accelerating recovery' for so damn long, the economy should be moving along at warp-9 by now.

I swear that if I hear/read 'recovery' one more time, I'm going to go kick some puppies.

 

 

Wed, 01/26/2011 - 15:18 | Link to Comment bob_dabolina
bob_dabolina's picture

Silver is having an interesting day. Big candles.

Wed, 01/26/2011 - 15:38 | Link to Comment Deathtöngue
Deathtöngue's picture

While gold has done nothing. That makes it more interesting. Probably a stampede back to risk-on. Still a lower high.

Wed, 01/26/2011 - 16:32 | Link to Comment tmosley
tmosley's picture

Yep.  I went ahead with my monthly purchase a bit early this month.  I usually like to wait for the last day of options/futures expiration, or even for the day after, but the big move up today seems to indicate large buying interest which may overwhelm the Blythe Movement.  Better to be early than late in this instance.

Wed, 01/26/2011 - 17:20 | Link to Comment The_Euro_Sucks
The_Euro_Sucks's picture

Me to, bi monthly after expensive december. BTFD! (physical ofc, no offence turd)

Wed, 01/26/2011 - 17:36 | Link to Comment tmosley
tmosley's picture

Buy Turd Fergison's Dip?

:D

Wed, 01/26/2011 - 18:07 | Link to Comment The_Euro_Sucks
The_Euro_Sucks's picture

I like his blog and made a good case why the bottom was in. I just dont buy paper/didgets anymore. Getting more and more allergic to them (smiley). Keeping a feeling with the market ofc makes lots of sense.

Wed, 01/26/2011 - 17:21 | Link to Comment The_Euro_Sucks
The_Euro_Sucks's picture

double

Wed, 01/26/2011 - 15:22 | Link to Comment Dr. Porkchop
Dr. Porkchop's picture

Kent Conrad was on cspan saying that there was no choice but to raise the debt limit. Deficits must continue for two years to keep the recovery going. Two years is a magic number!

Wed, 01/26/2011 - 15:27 | Link to Comment Arius
Arius's picture

why a magic number, or because it makes you a nutcase if you are able to see that far? :-)

i will stick w/ my weekly forecast here at ZH

Wed, 01/26/2011 - 15:28 | Link to Comment earnyermoney
earnyermoney's picture

Fascists put on a faux election in two years.

Wed, 01/26/2011 - 15:26 | Link to Comment Atch Logan
Atch Logan's picture

Despite all, commodities (including oil), metals and natural resources are the only places to put ones' money.  The dollar is worth shit.  Inflation is here.

These fuckers can mess with their financial manipulations, black swans/pool, HFTs, etc., but in the LONG RUN, where I live, my commodities, metals and natural resources will be here. 

I am to the point that Obama and his buddies can just kiss my white ass.

Wed, 01/26/2011 - 15:36 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

Wed, 01/26/2011 - 15:28 | Link to Comment Sudden Debt
Sudden Debt's picture

I stopped reading after

 ...primarily driven by the flawed assumption that the Fed will not monetize any more debt...

Wed, 01/26/2011 - 15:31 | Link to Comment Sudden Debt
Sudden Debt's picture

Oké I did read more...

The IMF successfully completed its gold sales programme of 403.3 tonnes without disruption to the market

 

DING DONG!

ANYBODY HOME!!

without disruption to the market!...

Wed, 01/26/2011 - 20:00 | Link to Comment Hephasteus
Hephasteus's picture

Mythical gold sales aren't disruptive.

Wed, 01/26/2011 - 22:05 | Link to Comment unununium
unununium's picture

Mythical, everlasting, oft-repeated, and obfuscated.

Wed, 01/26/2011 - 15:32 | Link to Comment Atch Logan
Atch Logan's picture

All you little trolls are wringing your hands and anguishing over what you are hearing on CNN and the other MSM.  You are being manipulated big time.

You slept thru high school, so now wake up and grow up--tell your mama good-bye.

Wed, 01/26/2011 - 16:56 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

You slept thru high school

 

The worst part was waking up with that pool of spittle on the desk when the bell rang.

Wed, 01/26/2011 - 15:55 | Link to Comment bankrupt JPM bu...
bankrupt JPM buy silver's picture

$1800 by Novemeber, $60 Silver...inflation is out of control.  I cant imagine what hyperinflation is....I just went to the grocery store and shit my pants at the bill.25% higher than usuall, buying same shit.  FML.  Side Note, those looking for junior mining exposure, you better be looking at TK.V Tinka Resources, onve they receive permits, its a $1 stock.  Oh and the usual "Eat my shit Blythe"...fuck you, and have a nice day.

Wed, 01/26/2011 - 17:52 | Link to Comment RockyRacoon
RockyRacoon's picture

That's an interesting response to high food prices.  Did you go back to the toiletries section and add some TP to your basket?

Wed, 01/26/2011 - 19:34 | Link to Comment DosZap
DosZap's picture

I have found it less embarrassing if I wear a DEPENDS, before a Grocery store visit.

Wed, 01/26/2011 - 16:06 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Press Release

==========

 

DoChenRollingBearing is pleased to announce that he is DONE with his Precious Metals Buying Program, which had been in effect since the 1980s.  Having reached 10% of his assets in PMs (mostly in gold), he has reached his goals.

So as to not be a hypocrite, the Bearing will no longer be inflicting any "Buy Gold" mantras on the long-suffering ZH community.

The Bearing hopes to never sell his PMs.  He hopes to give them away...

Wed, 01/26/2011 - 16:12 | Link to Comment Horatio Beanblower
Horatio Beanblower's picture

Rapturous applause!

Wed, 01/26/2011 - 16:24 | Link to Comment Hulk
Hulk's picture

Congratulations bearing on your PMBP. Where does the line form for your giveaway progrm???

Wed, 01/26/2011 - 16:33 | Link to Comment tmosley
tmosley's picture

After me ;)

Wed, 01/26/2011 - 16:44 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Although Hulk and tmosley are very deserving of the Bearing's gold, it will go to our daughter and/or (in the future?) grandchildren.

You two guys have no need of mine, you get the picture.

...

DoChenRollingBearing would like to clarify a point or two.  The Bearing remains in the "FOFOA Tribe", but as no brainless Bearing (look, there is a HOLE in the middle) can accurately predict the future, he will just hold his little pile.

The Bearing also wishes to remind those Invitees to the Party (when gold reaches a FOFOA target $50,000 / oz) that said Party is still ON.  City to be determined later, although I have a great candidate in mind...

Wed, 01/26/2011 - 17:53 | Link to Comment RockyRacoon
RockyRacoon's picture

The party has been planned for some time now.  Please do tell us the venue you had in mind?  Davos?

Wed, 01/26/2011 - 18:18 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Not now Rocky, it would betray a confidence.

When the candidate city is revealed, other wonders will be revealed (well, one anyway), and the choice will make perfect sense.

Wed, 01/26/2011 - 18:38 | Link to Comment Acidtest Dummy
Acidtest Dummy's picture

DCRB, Au has an affinity for Au. Don't be mistaken -- your lump wants to 'katamari'.

PMs have a history of manupulating carbon and oxygen. Anyway, your lump will either want to expand or migrate towards a larger lump. It will not be content. 

Wed, 01/26/2011 - 18:46 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

THIS will be a great time to test your theory Acidtest!

We are on record.  I will be very curious to see how it works out.

Mine will not be going anywhere...

 

A question for you: Does platinum work the same way?

Wed, 01/26/2011 - 20:02 | Link to Comment delacroix
delacroix's picture

DoChen, you're hooked. what's with the( I can quit anytime I want to)? that's what drug addicts say. how will you resist the temptation to convert other inferior assets into pm's, in the future?  repeat after my. it's okay to be a goldbug.

Wed, 01/26/2011 - 20:24 | Link to Comment StychoKiller
StychoKiller's picture

Just say "NO!" to PMs!  Tried that, they would NOT take "no" for an answer! :>D

Wed, 01/26/2011 - 23:44 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

delacroix, Stycho,

I need to save my money for something else:  a .338 caliber Lapua!  Although that is not a done deal...  Long range, bitchez!

If my paranoia meter starts running extra-hot, and should I ever get back into buying gold again, the "tell" will be when I once again start to howl about buying more...

:-)

THANKS to all my friends here at ZH!  I spend more time here than any other place on the 'Net (duh...).

 

EDIT:  It is possible that JW n FL and the Colonel challenged my bona fides the other evening re the .338 Lapua (although I may have misinterpreted what they wrote, hey I was drinking).  In case you two friends did not see my response, I am thinking of buying the gun for defense against HELICOPTERS...

Wed, 01/26/2011 - 23:47 | Link to Comment savagegoose
savagegoose's picture

if you look at the price history charts plat took a massive hit during the GFC as its mainly an industrial metal. pricey cuz its rare and useful. but i think plats recovery from gfc was more stunning than either gold or silver, but if the econ acctually gets hammered, not like it ever really recovered. then i expect pt and silver to both take a hammering, but not so sure about gold, its known as a store of wealth , other two not so much.

 

juast my own take and look at the charts, kitco has good historical price charts

 

Wed, 01/26/2011 - 16:40 | Link to Comment saulysw
saulysw's picture

Just because you have reached your goals, doesn't make you a hypocrite to advance the "buy gold" message.

Anyway, feel free to give them away to me!

Wed, 01/26/2011 - 16:47 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

I may re-enter to buy gold if:

1)  Gold goes to $1050 (the "India Put" as one bright ZH-er put it)

and

2)  Johnny Bravo (or alias) comes back preaching doom to buyers of gold.

Wed, 01/26/2011 - 16:56 | Link to Comment JonNadler
JonNadler's picture

Buyers of gold, you are all doomed!

Well it's not the Jonnybravo screen name but it's me nontheless.

You have to buy now, at least .1 ounce a week just for good luck

Wed, 01/26/2011 - 17:09 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Fail!

A mere JonNadler does not meet Condition 2 above.  You need MINIONS buddy.

Wed, 01/26/2011 - 17:29 | Link to Comment Hook Line and S...
Hook Line and Sphincter's picture

Hey DCRB, I didn't get to answer your question on the other thread.

by Hook Line and S... 
on Wed, 01/26/2011 - 12:59
#906579

These ideas are being formed by synapse diluting dumptruck loads of empirical evidence (including our 'friend' Brzezinsky 667 neighbor of the beast, Harvey, FOFOA, Jesse, Rickards [who is right most the time but smacks of a controlled opposition], and an honest assertion of everyone I know), and a only recently quieted mind that lets the intuitive side put it together.

Wed, 01/26/2011 - 17:44 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Thanks Hook!  I follow many of the above.

Wed, 01/26/2011 - 16:59 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Betelgeuse!

Betelgeuse!

Betelgeuse!

Wed, 01/26/2011 - 17:51 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

The Bearing would like to thank the below people in helping him (egging him on?) reach his goal:

--  ZeroHedge paticipants too many to thank individually (I would probably name only 10 - 15 and leave out many others, also I am too lazy...).

--  ZH gold trolls, who showed me the value of being contrarian to stupidity!

--  FOFOA and his community

--  My good friend "JPR"

--  My awesome cousin B.

...

Just because I have attained my goal does not mean that I will not mouth off at will on any subject I choose to my heart's content!  So there.

Wed, 01/26/2011 - 19:47 | Link to Comment DosZap
DosZap's picture

Do,

I commend you kind sir.

Congrats!, Myself if I see a deal  I will BTFD, I will still not let it pass.Even though I am at my "Hold" level for now.

But, unlike you I have in light of the road ahead, decided to  go to double figures+, and stay on the watch, if I feel it needs adjustments.

Wed, 01/26/2011 - 16:11 | Link to Comment ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

I've seen lots of interesting theories about the gold market over the last three weeks.

 

It seems to me that the simplest explanation might be the best - that people are selling their gold to buy the assets that the State is (more or less) ordering to go up.  They think that when the current pattern ends, they will cycle back into gold.

 

Hope it works out for em.  I am far too simple a man to attempt it myself.

 

 

Wed, 01/26/2011 - 16:16 | Link to Comment Temporalist
Temporalist's picture

With gold up after the Fed minutes it seems that the momos thought there would be a rate increase...no surprises for those that are awake.

Wed, 01/26/2011 - 16:18 | Link to Comment TJW
TJW's picture

Gold has been bouncing around 1370 (+/-) 50 for a couple months now. No biggie. I bought at 925, and I'm not worried. In fact, I'm thinking of buying this dip, though I've also got silver and there's a limit to the percentage of my portfolio that I want in hard Au/Ag.

Wed, 01/26/2011 - 16:33 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

Keep in mind gold dropped 7% from the end of June 2010 to the end of July 2010, only to then rally to 1400.

The daily chart in gold still looks pretty lousy though, although it's about to bump up against the 100-day.

If I eat gold, will I clog up my toilet?

 

Wed, 01/26/2011 - 17:56 | Link to Comment RockyRacoon
RockyRacoon's picture

It won't get as far as your toilet.  Do you have a good gastroenterologist?

Wed, 01/26/2011 - 16:40 | Link to Comment proLiberty
proLiberty's picture

My wife participates in a crowd-source weekly survey of prices of groceries and household supplies.  This morning she told me that today's report showed a +9% price rise on their basket of groceries.   That is +9% (absolute not annualized) over a period of 3 months.

Barron's daily news email for yesterday had the following entry:

"By RANDALL W. FORSYTH
Fed liquidity expansion boosts financial assets instead of housing revival."

(See, we don't even call it money any more.  It is "liquidity"!)

 

It also appears that some of that 'boosting" went into commodities and that rapidly bid up food prices.

 

 

Wed, 01/26/2011 - 16:42 | Link to Comment ms1408
ms1408's picture

Gold rising after options expiry once again - what a surprise. Kass can kass my arse!

Wed, 01/26/2011 - 17:41 | Link to Comment Threeggg
Threeggg's picture

To the minute textbook take down in PM's the last 3 weeks into expiry.

Anybody watch the battle 5 minutes before the close. ?

Insane !

I would love to know how many naked short contracts had to be used in the last 5 minutes to drive it down.

Wed, 01/26/2011 - 16:51 | Link to Comment sgorem
sgorem's picture

Had a dream the other night that BlankenStein, et al, were all draped in cloaks in the darkness, shaking the Golden (GLD) leaves off the Gold tree and raking them in like a coven of grave robbers. Too bad they can't rake up the REAL thing. Hold on to your hard asset, it's days are coming as the Satanic Government/Banksters wage war to own not only your gold and silver, but your souls too....................

Wed, 01/26/2011 - 16:55 | Link to Comment saulysw
saulysw's picture

I am thinking of buying some more gold -- so a top of some kind is probably in.

Wed, 01/26/2011 - 17:01 | Link to Comment Temporalist
Temporalist's picture

"A Decade of Gaining 18% A Year - Some "relic"" - John Embry

http://www.sprott.com/Docs/InvestorsDigest/2011/MPLID_012811_pg003Emb.pdf

 

or visit GATA for same article

 

John Embry: 'Manufactured' gold correction will produce lowest price for year

http://www.gata.org/node/9539

 

Wed, 01/26/2011 - 17:09 | Link to Comment apberusdisvet
apberusdisvet's picture

In addition to all the other circling black swans, I wonder how many here understand that returning troops from the 2 wars may prove to be a problem to this Administration.  Will the realities of the new normal employment or increased living costs for their families be an issue?

Wed, 01/26/2011 - 17:16 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Jim Willie CB has a new piece at 24hgold.com.  Next stop!

Wed, 01/26/2011 - 18:20 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

His major point this week is that China will get bunches of gold via EuroBonds.

Wed, 01/26/2011 - 19:53 | Link to Comment DosZap
DosZap's picture

They best hurry, cause the Euro is DOA, Capeche, its headed for the dumpster, very soon.

See where Ireland is getting out of the EU?

Wed, 01/26/2011 - 17:33 | Link to Comment Math Man
Math Man's picture

ETF buying was 361 tons last year.

So far, nothing but selling this year.

Not sure if the price can go up this year w/ out the ETFs.

Wed, 01/26/2011 - 17:36 | Link to Comment Clint Liquor
Clint Liquor's picture

Finally reached your goal of 10% net worth in Gold? Congratulations, you now have 10% of your net worth protected.

Wed, 01/26/2011 - 18:27 | Link to Comment gmrpeabody
gmrpeabody's picture

+20%

The Bearing should consider 20 to 30 percent as some protection. Not sure 10% gets the job done.

Wed, 01/26/2011 - 18:52 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Gee Mister,

4 years ago I was at 2% - 3%.  10% PMs is plenty for me.

Also, if you count LIQUID assets that I have full control of and can get my hands on pretty much right away, that would be 15% or better.

No worries mates!

Wed, 01/26/2011 - 19:56 | Link to Comment DosZap
DosZap's picture

Do, ONLY you know where you need to be................

Some here are in 100%, some more, some less...........

We shall all eat at the same table, but the amount of pie may vary.(the sheeple with ZERO PMs), are screwed.

Wed, 01/26/2011 - 23:23 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

The man-who-is-legend Chumbawamba once told us that he was OVER 100% in gold!

I think what that meant was not only was he 100% in, but he borrowed money to buy even more.  Since the man of mystery is back among us, perhaps we will hear how that all turned out.  The price of gold was MUCH LOWER when he informed our little community here, so it could have worked out GREAT for him!

Thu, 01/27/2011 - 01:39 | Link to Comment saulysw
saulysw's picture

Don't confuse Chumbawumba with Chumbawamba. There are a few "clones" here. You need to pay close attention to username spelling.

Wed, 01/26/2011 - 17:43 | Link to Comment buzlightening
buzlightening's picture

Just keep accumulating physical PMs monthly to hedge against the USD; dollar devaluation to hit the poop shoot '11!! Been doin it for 3 years now and the price in dollars is comical!  Gold/silver aren't going up fiat currency gone wild is going down!! If it burns?  You're not holding real money!

Wed, 01/26/2011 - 18:24 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Clint, buz,

That 10% allows me to sleep serenely at night.  On those nights I don't sleep well, that is due to not drinking enough...

Many of my other assets are hard or close (eg, our bearing business in Peru).

It is important, of course, to note the (low IMHO) possibility that gold could go down.  Diversification...  One of my favorite words.  Agility as well, it was ZH-er Gully Foyle who passed that one along to me.

Wed, 01/26/2011 - 19:59 | Link to Comment DosZap
DosZap's picture

Do,

Pls do not give out the secret locale of the STEEL BALLS!!

Wed, 01/26/2011 - 23:18 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Good Friend DosZap!

Our best seller in Peru has 9 steel balls, but OK, I will not tell ANYONE where they, or any other things are.

Wed, 01/26/2011 - 20:18 | Link to Comment DosZap
DosZap's picture

Too good from Mr.Summers to pass up.

http://www.kitco.com/ind/Summers/jan262011.html

Wed, 01/26/2011 - 20:51 | Link to Comment rocker
rocker's picture

Tyler, a PDF if possible would have been super great.  Have a Great Day.

Wed, 01/26/2011 - 21:46 | Link to Comment OCTOPVS
OCTOPVS's picture

remember this gem?...i increased my stake after they aired this on the super bowl 2 years ago.....sheeple....get....slaughtered....

http://www.youtube.com/watch?v=TrNipeP4HvQ

Wed, 01/26/2011 - 23:01 | Link to Comment CD
CD's picture

For a truly tasteless spoof of the same:

http://www.youtube.com/watch?v=UtRUY_AH458&feature=related

Wed, 01/26/2011 - 22:09 | Link to Comment JW n FL
JW n FL's picture

link to the physical report? anyone?

Thanks in advance for the help fight club!

JW

Wed, 01/26/2011 - 23:21 | Link to Comment CD
CD's picture

JW, try this, though I am not sure it's the one you mean:

http://www.gold.org/publication/archive/gold_investment_digest/ 

They also have a current report on gold reserves, available here (though you have to register):

http://www.gold.org/media/publications/

To save the next reader the trouble of doing so, here it is:

http://www.scribd.com/doc/47636618/World-Official-Gold-Holdings-January-2011

Thu, 01/27/2011 - 03:11 | Link to Comment JW n FL
JW n FL's picture

Thanks CD!!! Fight Club Citizens are the BEST!

Wed, 01/26/2011 - 23:38 | Link to Comment ak_khanna
ak_khanna's picture

One thing I fail to understand is that why most analysts are recommending the purchase of Gold as a safe investment? The problem today is that the price of Gold is not derived by it's physical demand or supply but more by the speculative positions standing long or short on the commodity exchange like any other traded commodity, stock or currency.

The basic mechanism of price discovery (based on demand and supply for actual use) of anything traded on an exchange has been terminally infected by speculators having access to unlimited funds and super fast computers for trading leading to volatile price swings. This has been made worse by the launch of ETFs for anything and everything under the sun by the financial community.

The price of everything including Gold is likely to suffer when the speculators unwind their positions due to some event that they have not anticipated or foreseen.

http://www.marketoracle.co.uk/Article24581.html

Wed, 01/26/2011 - 23:51 | Link to Comment CD
CD's picture

You seem to ascribe an indefinite longevity to the unit of account that serves as the "price" of gold. The "price" of EVERYTHING including gold is likely to undergo massive changes when the (now seemingly inevitable) date of expiration is reached, then exceeded.

Not that I disagree about paper driving the price of precious metals in a large speculative fashion.

But in the end, the purchasing power of gold will remain much more stable than the purchasing power of ANY paper, including FRN or any other fiat tender.

Thu, 01/27/2011 - 12:35 | Link to Comment DosZap
DosZap's picture

Correct, the purchasing power of Gold to fiat has never changed,gold stays the same, fiat changes in relation to gold.

Always has always will.

Thu, 01/27/2011 - 12:33 | Link to Comment DosZap
DosZap's picture

Get ready to load your wagons, add to positions, or get in.

I think the charts are showing the prrice of gold may pull back SHORT term to 1275,1300, Silver, $25.00/$22.00.

So FWIW ..............buckle up.

Also, and the most important, the USDX, we are as you know decending down a tad, look for maybe a bounce into the 80/82 range, and then a GOOD possibility of what we have been waiting for , a drop thru the 74 floor, Capeche,Fini' its over for the Dollar when it does that.

Can you spell COLLAPSE.

DO NOT be caught holding FRNS!!!!!!!!

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