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Hugo Chavez Announces He Will Nationalize Venezuela's Entire Gold Industry

Tyler Durden's picture


The first (of many) 21st century expropriations of the only true money begins today, after Hugo Chavez just announced that he will "nationalize the gold industry, including extraction and processing, and use its output to boost the country's international reserves." And who can blame him: he is merely doing what FDR did so well back in 1933 with executive order 6102. Our only advice is that he should wait before he sells: with the only option for the central planners now that we are reentering the downslope of the depression, being, as always, to print more money (it can be called anything, but at the end of the day the principle is clear), there is little probability of gold declining substantially for the foreseeable future. As for foreign investors in Venezuela who opened gold mines, we can only hope they were not all that surprised: "The move follows a dispute between his government and foreign miners who say the rules limiting the amount of gold that can be exported from the South American nation hurt their efforts to secure financing and create jobs. The gold industry will be just the latest part of the economy to be put under state control by the socialist leader, who said he would issue the necessary decree in the coming days and called on the military to help control the sector." The good news: gold may finally dip modestly which will simply provide yet another entry point for everyone (increasingly more and more) who has taken Jeremy Grantham's advice and is now fighting the Fed.

From Reuters:

Toronto-listed Rusoro, owned by Russia's Agapov family, is the only large gold miner operating in Venezuela. It produced 100,000 ounces last year.


"I have here the laws allowing the state to exploit gold and all related activities ... we are going to nationalize the gold and we are going to convert it, among other things, into international reserves because gold continues to increase in value," Chavez said in a phone call to state television.


The announcement came a day after an opposition legislator revealed a report showing the government's top finance officials were recommending the repatriation of 90 percent of Venezuela's gold reserves held abroad.


The government has not commented on the report, which the opposition legislator said Chavez had yet to approve.


"We've managed to increase the international reserves. We have close to 12 or 13 billion dollars in gold reserves. We can't allow it to continue to be taken away," the president said, referring to reserves held in banks overseas.

Some more on why this move is very beneficial in the long-run:

Venezuela has some of Latin America's largest gold deposits, buried below the jungles south of the Orinoco river. According to official figures, formal mining in the country produces 4.3 tons a year.


Chavez agreed last year to let gold miners export up to 50 percent of production, from 30 percent previously. The other 50 percent must be sold to the central bank.


But that did not satisfy foreign companies like Rusoro, which said the limits made it much harder for them to secure financing abroad, develop projects and create local jobs.


One victim of the dispute has been a huge but long-troubled project called Las Cristinas. It has been in limbo since the government canceled a development license with another Canadian miner, Crystallex, in February.

Rusoro had expressed interest in Las Cristinas, which has not been developed since the 1980s but has reserves estimated at 17 million ounces. Locals once found a 1-kilo (2.2-lb) nugget there.

Net, net: millions in ounces of potential gold supply are about to be taken out of future circulation, courtesy of the uber-modern Venezuelan extraction and mining infrastructure. Which is why if gold does dip on expectations of Venezuelan dumping, don't expect said dip to last more than a few milliseconds.


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Wed, 08/17/2011 - 15:08 | 1569884 achmachat
achmachat's picture

i was going to ask why you think there's going to be a dip... then I read your last sentence.

Wed, 08/17/2011 - 15:10 | 1569895 Sudden Debt
Sudden Debt's picture

first a liquidation of existing stocks

than, no more gold will be mined and supply get's stuck and gold flies to the moon.

Does Venezuela have silver mines to?


Wed, 08/17/2011 - 15:11 | 1569903 TheTmfreak
TheTmfreak's picture

I think a "Who is John Galt?" is in order.

Wed, 08/17/2011 - 15:41 | 1570037 Frog-And-Toad
Frog-And-Toad's picture

+1 Francisco d'Anconia

Wed, 08/17/2011 - 15:44 | 1570085 Ahmeexnal
Ahmeexnal's picture


Wed, 08/17/2011 - 15:53 | 1570136 Frog-And-Toad
Frog-And-Toad's picture

It truly is eerie how much that novel is parallel to today's events... 
Can Atlas really be placed in the fiction section? Simply replace the names with modern-day crooks and you've got the same story.  Even islands where people are rebuilding society:



Wed, 08/17/2011 - 16:10 | 1570220 Troll Magnet
Troll Magnet's picture

i think a counter move by the US is in order.  first we should nationalize all lumber companies to secure our source of paper.  then we nationalize all printing companies...that'll show'em!

Wed, 08/17/2011 - 16:19 | 1570265 DaveyJones
DaveyJones's picture

then nationalize What is printed

Wed, 08/17/2011 - 21:37 | 1571142 PrintingPress
PrintingPress's picture

I stand behind this idea!

Wed, 08/17/2011 - 16:20 | 1570275 George the baby...
George the baby crusher's picture

I laughed until I stopped.

Wed, 08/17/2011 - 16:38 | 1570377 daxtonbrown
daxtonbrown's picture

I'm not sure if itAtlas Shrugged is eerie or just painfully truthful. A lot of people are going to be "Going Galt".

Wed, 08/17/2011 - 16:12 | 1570223 Thomas
Thomas's picture

Now we find out if Rickards is right: Is possession (of the gold) 9/10's the law? Will the repatriation of Venezuela's gold go off without a hitch? I have a hunch Hugo is wrong. The other question is whether Cesar Chavez will nationalize the grapes.

Thu, 08/18/2011 - 00:26 | 1571571 StychoKiller
StychoKiller's picture

One thing's fer sure, London is gonna have to cough up SOME Au (or a litany of lame excuses!)

Wed, 08/17/2011 - 16:14 | 1570240 A Nanny Moose
A Nanny Moose's picture

+1 Galt's Gulch

Wed, 08/17/2011 - 15:54 | 1570141 Moe Howard
Moe Howard's picture

Who is Ron Paul?

Wed, 08/17/2011 - 17:36 | 1570620 The Gooch
The Gooch's picture

Here's his new theme song!!!

Wed, 08/17/2011 - 19:34 | 1570911 Crack-up Boom
Crack-up Boom's picture

+  I like what you did there!

Wed, 08/17/2011 - 15:25 | 1569959 IQ 145
IQ 145's picture

Hugo Chavez; the friend of the poor; helps to create the workingmans paradise. I'm sure he promised them "change they could believe in". What a jerk-wad.

Wed, 08/17/2011 - 15:28 | 1569970 goldm3mb3r
goldm3mb3r's picture

If you cannot hold it, you do not own it. That is why I would never willingly buy gold stocks.

Wed, 08/17/2011 - 15:41 | 1570058 Smiddywesson
Smiddywesson's picture

Agreed, confiscation of your mining stocks is a lot more likely than confiscation of your physical gold.

Wed, 08/17/2011 - 16:04 | 1570182 sunnydays
sunnydays's picture

They don't want their gold to be confiscated by the U.S and England so Venzuela is getting all their gold back from England and the U.S along with their cash reserves.  11 billion worth of gold.

Wed, 08/17/2011 - 17:39 | 1570627 DeadFred
DeadFred's picture

My working hypothesis is that Hugo is acting as pointman for his friends in Beijing in their developing power play with the West. We'll know fairly soon if there is any truth to it. The comex is vulnerable. When Venezula pulls it's monetary reserves will others follow? With the comex in shambles and liquidity freezing up Beijing will be entirely justified in saying they don't like the game anymore, they're taking their ball and going home. I think the system would come apart at the seams. Do they believe they will come out of the rubble better tan others?

Wed, 08/17/2011 - 18:08 | 1570711 Flakmeister
Flakmeister's picture

Venezualan oil is at the core of the issue. It has not been divided up yet. So you are very correct that China is lurking behind this.

 The Au reserves represent 2.6 days of Venezulan oil production....just, some perspective

Wed, 08/17/2011 - 21:42 | 1571157 delacroix
delacroix's picture

very few refiners, can process the heavy crude, from venezuela. the chinese, have been financing  the construction, retrofit projects, closer to the source.  that capacity, will be subtracted, from the U.S. portion       soon?

Wed, 08/17/2011 - 23:38 | 1571459 Flakmeister
Flakmeister's picture

That my friends is the question...

Thu, 08/18/2011 - 12:56 | 1573593 DaveyJones
DaveyJones's picture

I missed this exchange yesterday. Good stuff

Wed, 08/17/2011 - 15:41 | 1570059 PY-129-20
PY-129-20's picture

Yes, but it is also safe to store it at a company or institution you trust. Like the FED in New York. (Oh German Gold where art thou?) :(

Wed, 08/17/2011 - 15:43 | 1570077 That Peak Oil Guy
That Peak Oil Guy's picture

Almost as interesting in the article as the nationalization bit was the repatriation bit:

"the government's top finance officials were recommending the repatriation of 90 percent of Venezuela's gold reserves held abroad"

Let's see the scramble for the physical begin soon!


Wed, 08/17/2011 - 15:57 | 1570153 fajensen
fajensen's picture

Well, all it took to get Hugo Chavez elected was a bit of that good ole austerity the IMF likes so much, for other people, not themselves of course. Chavez job is to say "Fuck You" to the "international community".

I smell a "humanitarian intervention" coming on ...



In February 1989, at the beginning of his second term as president, he accepted an International Monetary Fund proposal known as the Washington consensus. In return for accepting this proposal, the International Monetary Fund offered Venezuela a loan for 4.5 billion US dollars. This cooperation with the IMF came about weeks after his victory in the 1988 presidential election, and a populist, anti-neoliberal campaign during which he described the IMF as "a neutron bomb that killed people, but left buildings standing" and said that World Bank economists were "genocide workers in the pay of economic totalitarianism".[3] Poor economic conditions led to attempts to revolutionize the political and economic structure of Venezuela, but the implementation of the neoliberal reforms (and in particular the liberalisation of petrol prices, which caused an immediate increase in the cost of petrol to consumers and rises in fares on public transport[4]) resulted in massive popular protests in Caracas, the capital. Carlos Andrés Pérez crushed the protest with the national guard, causing a large number of deaths—estimates range from 500 to 3000, and resulted in the declaration of a state of emergency. The protest is now referred to as the Caracazo.



Wed, 08/17/2011 - 15:39 | 1570040 Smiddywesson
Smiddywesson's picture

Is it clear they are going to sell the gold?  He talked about converting it into reserves.  That doesn't necessarily mean they are going to sell it.  His other words indicate they are stacking gold reserves, so it may be he just phrased it indelicately. 

Why repatriate your gold if you intend to sell it?  You would just sell it in place.

He may also be guilty of deception.  He might be hinting to the public that the gold will be sold for their benefit when in fact it is being horded.

Wed, 08/17/2011 - 16:33 | 1570342 Two Towers AU AG
Two Towers AU AG's picture

Silver Mines.. I dont know.. but someone should tell Hugo Chavez to deposit the nationallized gold with the Federal Reserve at fort KNOX. it will be in safe custody there... :) :) :) :)

He can then say with confidence.. "IN GOD WE TRUST"

Wed, 08/17/2011 - 16:54 | 1570450 rosiescenario
rosiescenario's picture

....yes, they appropriated Hecla's a few years ago...

Wed, 08/17/2011 - 15:28 | 1569969 DosZap
DosZap's picture


If anything, I see it going UP.

FEAR is a hell of a motivator..........................

A DIP here, makes no sense to me.....................unless folks get scared and SELL, thinking this same crap  will hit here SOON.

And they may be correct, we know it will happen, IF our DIP stays in Orfice.

Wed, 08/17/2011 - 15:08 | 1569886 Sudden Debt
Sudden Debt's picture


How is it possible :)

When will Amerika do the same and put it's people in the mines to mine the gold?


Wed, 08/17/2011 - 15:20 | 1569935 legal eagle
legal eagle's picture

Wasnt Gaddafi's government the owner of its gold?

Hugo baby, you betta watch your backside

Daddy US doesnt like such actions

Wed, 08/17/2011 - 15:50 | 1570118 DosZap
DosZap's picture


IMHO, this is the MAIN reason the Miners have been lagging Gold, smart investors likely were/are fearful this will be coming to a Theater near them soon.

Also, IF the US Gvt did this, the price would be in the toilet asap.(they would drop it to close to, or at retrieval/mining costs.

Would that slam the markets, and get folks into Treasuries and Bonds post haste?.

Uh, YES.

Wed, 08/17/2011 - 21:47 | 1571174 delacroix
delacroix's picture

the miners, are being shorted, on a massive scale, that can sure cause a lag

Wed, 08/17/2011 - 16:36 | 1570366 Two Towers AU AG
Two Towers AU AG's picture



Wed, 08/17/2011 - 15:09 | 1569893 DougM
DougM's picture

Just who does this indian think he is?!

Wed, 08/17/2011 - 16:13 | 1570173 Ahmeexnal
Ahmeexnal's picture

Your pathetic racist slurs are just about all you'll be able to do.

Then you'll be beggin for food.

Then you'll sell your ivory daugthers to them "indians" and "sand jockeys".

I'm no fan of Buggo Chavez. He's big mouth and little/no action.  Just like Soetoro.

Buggo repeatedly threatens to close the oil spigot to the US - his main customer. He's never done it.

He's getting poisoned by the Castro bros., who are on the Rockefeller payroll.

His sidekick Eggo Morales threatened to do the same with silver mines in Bolivia. In the end it only took a sixpack of Michelob and a cheap Vegas hooker to shut him up.

Let's see if Buggo follows through with his threats.


Wed, 08/17/2011 - 17:55 | 1570676 vocational tainee
vocational tainee's picture

The legitimate owner of the gold...

Wed, 08/17/2011 - 15:10 | 1569897 rahbii
rahbii's picture

God bless 'em.  He's got the Oil AND the Gold....

I'm sure Keynesian financial engineering will save us

Wed, 08/17/2011 - 15:11 | 1569898 John McCloy
John McCloy's picture

  There is no chance Ben can launch QE3 and we know he wants to. 

Between the Fed taking center stage in politics now, the failure of 2QE programs and gold going parabolic along with events such as this his hands are tied which is why Pres O has to now resort to some feeble attempt at creating temporary jobs to hike the unemployment number so have even a whisker of re-election. And that is why nobody will address the structural issues in our nation because all they can do is borrow, print and spend without questioning WHY the jobs are not returning. It is a repeating cycle because the core of capitalism has rotted. 

    This can only end in an attempt to pass Tarp 2 and there is no political will for this to occur. The bankers are about to fight back the only way they know terrorism, contracting the money supply and trying to bring the will of the people to their knees to ensure their livelihood of extraction continues.

Wed, 08/17/2011 - 15:58 | 1570158 Moe Howard
Moe Howard's picture

Where is this capitalism you speak of? I have not seen it in my 56 years on Earth.

Wed, 08/17/2011 - 15:20 | 1569937 Pladizow
Pladizow's picture

Jeah Nigga!

Wed, 08/17/2011 - 15:25 | 1569957 JW n FL
Wed, 08/17/2011 - 15:45 | 1570091 caerus
caerus's picture


Wed, 08/17/2011 - 15:11 | 1569902 caerus
Wed, 08/17/2011 - 16:21 | 1570277 bonderøven-farm ass
bonderøven-farm ass's picture

Ecstacy indeed......

Wed, 08/17/2011 - 17:04 | 1570506 caerus
caerus's picture


Wed, 08/17/2011 - 15:15 | 1569907 TruthInSunshine
TruthInSunshine's picture

The Bernank has busted out GASOLINE & IS TORCHING THE GLOBAL JOINT, bitchez.

Audioslave Gasoline


Fisher says "I am going to whack Bernank" -

Fisher doesn't want to be hanged along with The Bernank (see Jim Grant or Rick Perry's comments about The Bernank referring to this):

08-17 15:02: Fed's Fisher says 'enormous costs' to a QE3 with little benefit

Wed, 08/17/2011 - 15:13 | 1569909 cowdiddly
cowdiddly's picture

Now if he will just talk to his homies over in Peru, Bolivia and Mexico it will be ON LIKE DONKEY KONG. The world it waking up to how Wall Streets paper games are screwing them out of their countries natural resources.

Wed, 08/17/2011 - 15:21 | 1569943 Sokhmate
Sokhmate's picture

In my version of the game, rock beats paper. Always played it this way and people just never like me.

Wed, 08/17/2011 - 15:14 | 1569914 johngaltfla
johngaltfla's picture

Wow, "deflationary" and "Traditonal" all in one shot.

Wed, 08/17/2011 - 15:14 | 1569915 Motorhead
Motorhead's picture

I think that chemo is finally getting to Chavez.

Wed, 08/17/2011 - 15:15 | 1569918 machineh
machineh's picture


With a socialist government running the mines, employment will grow to hundreds of thousands (many absent or deceased), as output drops to zero.

Supply vs. demand, bitchez!

Wed, 08/17/2011 - 15:37 | 1570025 Ricky Bobby
Ricky Bobby's picture

My thoughts exactly, He will appoint his ignorant corrupt cronies to manage the mines. 

Wed, 08/17/2011 - 15:16 | 1569919 gwar5
gwar5's picture


I read that at GATA earlier --  sounds like China Russia Brazil are advising and using Chavez as a proxy. Also means that Chavez will very soon be up to mischief. He is getting his gold and $$ out of the USA, ahead of putting intermediate Iranian missiles in Venezuela, to prevent his those monetary assets from getting frozen.

Still, effectively monetizes gold that much more.


Wed, 08/17/2011 - 15:19 | 1569934 JW n FL
JW n FL's picture

we will end up with his gold and oil!

and he will get a brand new country.. infrastructure PLUS! Brand New!!

Blow it up! Build it up!

Wed, 08/17/2011 - 15:31 | 1569980 gwar5
gwar5's picture


Take that back a little, I read at GATA today that Chavez wanted his $25 billion in vaulted USA gold and $$ repatriated back to Venezuela. 

Nationalization of gold mines is different story. But honestly, I thought Hugo had already done this years ago along with nationalizing the Marriott Hotel and the golf courses. 

No mas chemo por mi loco amigo. 

Wed, 08/17/2011 - 17:48 | 1570655 JW n FL
JW n FL's picture

I think this is the 3rd time.. he has taken back the industry from the suckers who invested down there with him.

he is high risk and everyone knew that walking in.. if they didnt?

I had an offer to invest.. I passed.. I like down south the people are nice.. but not him.

Wed, 08/17/2011 - 15:17 | 1569926 faustian bargain
faustian bargain's picture

Keep at it Hugo. Utopia is just around the corner.

/sarc, just to be sure

Wed, 08/17/2011 - 15:19 | 1569927 speconomist
speconomist's picture

Why will gold dip? Because of this?

My rationale is that after nationalization mines will have less output because they will not be run properly, gold will not go to the market, etc. therefore boosting price, so... why would gold dip?

Wed, 08/17/2011 - 15:28 | 1569966 SovietCong
SovietCong's picture

I also don't see it as necessarily bearish for gold. If the reason, at least the official one, behind nationalization is that Venezuelan gold miners wanted export more and Chavez prefers to hoard it in his vaults, it would be somewhat bullish (somewhat because Venezuela is not really a market mover in terms of gold production).

Perhaps some could identify as bearish the fear that the gold expropriation Chavez-style would spread and other socialists, such as Obamao, would warm up to the idea. Even if this event in facts works as a reminder of the confiscation risk, I personally view it as bullish for gold and even more bullish for the Swiss vaults.

Wed, 08/17/2011 - 15:36 | 1570013 DosZap
DosZap's picture

  "even more bullish for the Swiss vaults."


Not for Amercans...................................hell they are having no luck keeping Checking Accts there, even ExPats.

Americans/ExPat Americans (Need not Apply).

Not just in SwitZErland,but globally in any nation that the IRS has any say in.


Wed, 08/17/2011 - 15:29 | 1569972 Threeggg
Threeggg's picture

Some people didn't read the "whole" article ?

Net, net: millions in ounces of potential gold supply are about to be taken out of future circulation, courtesy of the uber-modern Venezuelan extraction and mining infrastructure. Which is why if gold does dip on expectations of Venezuelan dumping, don't expect said dip to last more than a few milliseconds.

Wed, 08/17/2011 - 15:47 | 1570098 Whalley World
Whalley World's picture

As I read it, Hugo will use production to increase international reserves.  Is gold not considered an international reserve.

He is too smart to turn his gold into paper in my opinion.  Unless it's Yuan or Rouble.  Just my take on this breaking story.

Wed, 08/17/2011 - 15:55 | 1570143 Threeggg
Threeggg's picture

Please remember who wrote these pieces, WSJ and Bloomberg.

Oh Please !

Wed, 08/17/2011 - 21:32 | 1571133 KowPie
KowPie's picture

I agree on his possibly converting into yuan or rouble, at least a portion. He has the trifecta between a cemented alliance, nationalization of the mines and oil holdings. The only fly in the ointment is his possibly getting fuked on the repatriation of metal. uncle sambo ain't gonna like that one.

Wed, 08/17/2011 - 15:37 | 1570029 oldmanagain
oldmanagain's picture

I agree this is bullish.  Most countries wll keep the gold, increase reserves, then use it to lever paper issuance.


Wed, 08/17/2011 - 15:18 | 1569929 buzzsaw99
buzzsaw99's picture

Hey Hugo, There is a lot more money to be made in the illicit drug trade.

Wed, 08/17/2011 - 15:32 | 1569987 Pladizow
Wed, 08/17/2011 - 16:27 | 1570308 pazmaker
pazmaker's picture

Buzzsaw, he's got that market cornered as well.

Wed, 08/17/2011 - 15:19 | 1569932 PaperBear
PaperBear's picture

Good luck finding competent people to do the work of the executives and management of your gold mines, Mr President.

Wed, 08/17/2011 - 15:35 | 1569999 Pladizow
Pladizow's picture

All the American/Canadian dollar whores will stay on board for even the slightest pay raise - if not replacements will easily be found.

Now that Chavez will own all the gold, along with the oil, what will he care about a fiat pay raise?!?!

Wed, 08/17/2011 - 22:00 | 1571215 KowPie
KowPie's picture

"Good luck finding competent people to do the work of the executives and management of your gold mines, Mr President."

Who needs competent management when you have an inexhaustible supply of expendable drones to dig with?

Wed, 08/17/2011 - 15:20 | 1569939 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

Silver too?

Wed, 08/17/2011 - 15:37 | 1570027 Sudden Debt
Sudden Debt's picture

65% of all silver in the world comes from Zaire.

The Chinese have got their hands on it so their industrial needs are covered like FOREVER!


Zaire does have a Tyran to :)

A greedy one for that :)

So if Silver goes up even more, Zaire... no the President could claim all the silvermines for himself and become the richest man on earth.

And if the President doesn't do it... the rebels will.


Wed, 08/17/2011 - 15:56 | 1570149 DosZap
DosZap's picture

SD@ 15:37,

Never happen, wanna see WAR # 7 start?.

We are "An Equal Opportunity Bombing Entity."

Wed, 08/17/2011 - 16:02 | 1570169 Sudden Debt
Sudden Debt's picture

ehe... another Jungle war... where will you guys get the soldiers from? enlist all the 12 year olds to?


Wed, 08/17/2011 - 16:23 | 1570280 Ahmeexnal
Ahmeexnal's picture

65% of all silver in the world comes from Zaire


Really? I do not remember the complete list of silver producers. But I do remember the top three: MEXICO, PERU, CHINA.

So...if Zaire produces 65%, and in the hypothetical case Zaire is the worlds fourth silver producer (I'd have to look up the data), then...MEXICO, PERU and CHINA must produce at least...66% of "all the silver in the world" each.

Damn, just those four countries produce 263% of all the silver in the world.  I guess that's why silver is so cheap! You can have OVER UNITY production!!!!!  Better than FREE ENERGY!!!

You'd better lay off the mayo on them vlaamse frittes.  Or the Gouden Carolus Tripel.

Wed, 08/17/2011 - 16:26 | 1570301 A Nanny Moose
A Nanny Moose's picture

Somebody has to fly the drones. They are the only ones with the skills. Perhaps if we put them on the job we migh stop bombing weddings

Wed, 08/17/2011 - 17:00 | 1570483 Mysteron
Mysteron's picture

"65% of all silver in the world comes from Zaire."


Interesting, but SD, what is your source for that statistic? I have never seen that mentioned before.  E.g. Zaire not even in this  list of the top 20 countries by production Thanks

Wed, 08/17/2011 - 18:01 | 1570698 vocational tainee
vocational tainee's picture

He just got drunk early....

Thu, 08/18/2011 - 00:10 | 1571546 Hamsterfist
Hamsterfist's picture

83% of the time that is wrong all the time.

Wed, 08/17/2011 - 15:21 | 1569941 FranSix
FranSix's picture

Venezuela touted as having world's largest oil reserve:

Financial Post

Wed, 08/17/2011 - 15:21 | 1569944 New American Re...
New American Revolution's picture

A few milliseconds might not be possible, this market looks like it is straining at the bit and I'd say it's about to take off,... in my humble opinion of which I've been told I have none.

Wed, 08/17/2011 - 15:32 | 1569985 Threeggg
Threeggg's picture

I agree, based on the fact metals options expire this Friday I think they are trying to hold the line ! Can't have those terrorist "in the money" who knows they might buy guns and IED's with them !

It's a WAR !

Wed, 08/17/2011 - 15:55 | 1570142 Smiddywesson
Smiddywesson's picture

I agree, the gold market looks like the polar opposite of the stock market.  Gold is straining to rise, and stocks are straining to fall.  The one important difference is the central banks can keep stocks from falling, but they can't stop gold from rising.  Why????

Because they are the demand.  They are buying.

Chavez is not gong to dump his gold.  Maybe two years ago, but the gold game is much too obvious now.  

As I have said before, repatriation of gold reserves is a canary in the coal mine that the new system is nearing.

Wed, 08/17/2011 - 16:15 | 1570245 hunglow
hunglow's picture

I think I smell something too!

Wed, 08/17/2011 - 15:22 | 1569946 JW n FL
JW n FL's picture

Russia challenges US dominance with Venezuela naval wargames ...

Nov 24, 2008 – A Russian navy task force will sail into Venezuela tomorrow as President Medvedev undertakes a tour of Latin America to challenge the ...

  • Russia, Venezuela to hold naval war games - CachedSimilar

    Sep 11, 2008 – Russia and Venezuela will hold joint naval war games in what could be a Russian response to a NATO naval build-up in the Black Sea. ...

  • Russian navy conducts war games in Caribbean - Telegraph - Add to iGoogle

    Nov 25, 2008 – Russian warships have arrived in the Caribbean for war games with Venezuela in their first military exercise in the region since the end of ...

  • Russian Navy Coming to Caribbean for War Games With Venezuela ... - Cached 

    Sep 10, 2008 – Russian warships are set to join Venezuela for war game exercises at the end of the year. (Reuters/Stringer). Russian Navy Coming to ...

  • Wed, 08/17/2011 - 16:05 | 1570183 Miss Expectations
    Miss Expectations's picture

    Then there's this from 2009:

    "The United States is massively building up its potential for nuclear and non-nuclear strikes in Latin America and the Caribbean by acquiring unprecedented freedom of action in seven new military, naval and air bases in Colombia."

    Wed, 08/17/2011 - 17:50 | 1570661 JW n FL
    JW n FL's picture

    Columbia from the 1980's until now is night and day.. our Money built that Country up.. what is nice as much as the new is there the old towns are still there right next to the new build stuff. Great Country, for Americans.

    Wed, 08/17/2011 - 17:54 | 1570673 JW n FL
    JW n FL's picture

    "Old Town Cartagena" Jeffsadventures's photos around Cartagena, Colombia (cartagena old town)

    verses this...


    Wed, 08/17/2011 - 17:55 | 1570675 JW n FL
    JW n FL's picture

    think San Juan PR but the building are finished in a timely fashion.. LOL!

    Wed, 08/17/2011 - 20:43 | 1571028 Bananamerican
    Bananamerican's picture

    "Great country, for americans"

    The country has received military aid worth $4.6bn (£2.8bn) from the US since 2000, despite its poor human rights record. Colombian forces regularly kill the country's indigenous people and other civilians, and last year raided the territory of its southern neighbour, Ecuador, causing at least 17 deaths.

    ...The Colombian forces, for many years notorious for atrocities inflicted on civilians, have cheekily suggested that with US help they could get into the lucrative business of "instructing" other armies about human rights. Civil strife in Colombia meant some 380,000 Colombians were forced from their homes last year, bringing the number of displaced since 1985 to 4.6 million, one in ten of the population. This little-known statistic indicates a much worse situation than the much-publicised one in Islamist-ruled Sudan where 2.7 million have fled from their homes.

    Amnesty International said: "The Colombian government must urgently bring human rights violators to justice, to break the links between the armed forces and illegal paramilitary groups, and dismantle paramilitary organisations in line with repeated UN recommendations."

    Palanquero, which adjoins the town of Puerto Salgar on the broad Magdalena river north-west of the capital, Bogota, is one of the seven bases that the government of President Alvaro Uribe gave to Washington last month despite howls from many Colombians. Its hangars can take 100 aircraft and there is accommodation for 2,000 personnel.

    Wed, 08/17/2011 - 15:22 | 1569947 greased up deaf guy
    greased up deaf guy's picture

    so which publicly traded miners will be affected by this? or did they all know better to invest in properties there? thanks in advance...

    Wed, 08/17/2011 - 15:23 | 1569948 nah
    nah's picture

    communist bitchez

    Wed, 08/17/2011 - 15:23 | 1569949 anynonmous
    anynonmous's picture

    RML tanks on the news

    from 15 cents to 14

    Wed, 08/17/2011 - 15:23 | 1569951 The Deleuzian
    The Deleuzian's picture

    Gold Standard (the Stock) amex??  Lost rights to the big big resource in Chavez-land circa 5 years ago. Las Christinas mine??  Would not touch Venezuela with your DICK, Collapse already happened--just the details pending.............

    Wed, 08/17/2011 - 15:34 | 1569997 IQ 145
    IQ 145's picture

    The beatings will continue until morale improves.

    Wed, 08/17/2011 - 15:24 | 1569955 Instant Wealth
    Instant Wealth's picture

    Best thing for Venezuela would be him to denationalize himself.

    Wed, 08/17/2011 - 15:35 | 1570012 IQ 145
    IQ 145's picture

    Suicide would be excellent. then they could have a statue to him. Statues hardly ever cause any serious problems.

    Wed, 08/17/2011 - 17:53 | 1570665 Strider52
    Strider52's picture

    Through early morning fog I see
    visions of the things to be
    the pains that are withheld for me
    I realize and I can see...

    That suicide is painless
    It brings on many changes
    and I can take or leave it if I please.

    I try to find a way to make
    all our little joys relate
    without that ever-present hate
    but now I know that it's too late, and... 

    The game of life is hard to play
    I'm gonna lose it anyway
    The losing card I'll someday lay
    so this is all I have to say.

    The only way to win is cheat
    And lay it down before I'm beat
    and to another give my seat
    for that's the only painless feat. 

    The sword of time will pierce our skins
    It doesn't hurt when it begins
    But as it works its way on in
    The pain grows it grin, but... 

    A brave man once requested me
    to answer questions that are key
    'is it to be or not to be'
    and I replied 'oh why ask me?'

    'Cause suicide is painless
    it brings on many changes
    and I can take or leave it if I please.
    ...and you can do the same thing if you choose.

    Wed, 08/17/2011 - 15:28 | 1569961 Black Forest
    Black Forest's picture

    Our only advice is that he should wait before he sells



    Wed, 08/17/2011 - 15:28 | 1569964 Jasper M
    Jasper M's picture

    This is actually a pretty bad sign for gold, as governments tend to decide to acquire gold at the worst possible times. They are the ultimate herd, and once they are in, there are few others that can follow to sustain the trend.  

    And note that this capitualtion barely moved gold. It looks exhuasted.

    Throw in all the highly leveraged hedge funds holding gold (More than most central banks), the fact that their gold holdings will be one of the few liquid contracts the can sell vs. the losses they will take in equities, and I believe you have a recipe for a substantial decline. 


    Wed, 08/17/2011 - 15:43 | 1570020 Threeggg
    Threeggg's picture

    Problem is the words "holding Gold" as they are all holding paper !

    At some point there will be a Physical scramble (history will repeat itself)

    Wed, 08/17/2011 - 15:39 | 1570036 kito
    kito's picture

    venezuela is not acquiring gold. you cant "acquire" something that already belongs to you. 

    Wed, 08/17/2011 - 18:58 | 1570849 RockyRacoon
    RockyRacoon's picture

    You'd be right IF their gold is physically out there to be repatriated.  That remains to be seen...

    Wed, 08/17/2011 - 15:42 | 1570065 oldmanagain
    oldmanagain's picture

    I doubt he sells the gold but just issues more paper, which makes the paper better than most.

    Wed, 08/17/2011 - 16:20 | 1570271 Smiddywesson
    Smiddywesson's picture

    Right, all the central banks and governments in the world are buying gold, the very people who control everything and know what is coming, is a bearish sign for gold.

    Gold, which just shook off two margin increases and is now back knocking on the $1800 level looks exhausted?  LOL

    Then short it.  I dare you.

    Equities are going exactly nowhere, but they are doing it real fast.  That is because the Fed is supporting the stock market and buying gold.  Go ahead and short it.  All the people in the know will probably stop buying, all at the same time.  Sure.

    Wed, 08/17/2011 - 15:29 | 1569965 Cognitive Dissonance
    Cognitive Dissonance's picture

    I expect more and more countries will nationalize their PM mines......even if "nationalization" only takes the form of demanding that all PM production remain within the country. China for example.

    End Game baby.

    Wed, 08/17/2011 - 15:36 | 1570021 DaveyJones
    DaveyJones's picture

    Obama's gonna ease us in. He'll start with earrings, then nationalize cuff links. Then all of a sudden, whoosh.  

    Wed, 08/17/2011 - 15:38 | 1570031 Cognitive Dissonance
    Cognitive Dissonance's picture

    Then all of a sudden, whoosh.


    National security end game baby.

    Wed, 08/17/2011 - 15:42 | 1570064 gwar5
    gwar5's picture

    Exactly CD.

    That's why I don't invest in miners.  They're wide open to confiscation by other means. They have the risk of being nationalized outright for "Strategic reasons," or environmental reasons (without compensation), or being taken over in a soft nationalization through windfall profits taxes, without warning.

    In, Australia, the last PM got tossed out a month after he said he wanted to impose a tax of 40% on the miners. The miners said they didn't need a partner who didn't share their risk, so they got him sacked. The new PM has backed off.



    Thu, 08/18/2011 - 05:36 | 1571795 ItsEvolutionBaby
    ItsEvolutionBaby's picture

    Yeah backed off right down to only 30%, ontop of state royalties, money paid to the natives and all the other usual taxes.

    Now the same Australian government are imposing a 'carbon tax'. llolol 

    Wed, 08/17/2011 - 15:29 | 1569973 PaperBugsBurn
    PaperBugsBurn's picture

    Ecuador is next. What's worse is tgat their economy was dollarized. Oh hell, no way to plan a long term mine.

    Gold, bitchez?

    Wed, 08/17/2011 - 15:35 | 1570002 kito
    kito's picture

    @paper --tis not true. ecuador will not nationalize their mines. they havent nationalized any major industry since correa took over. he is not a socialist like chavez. correa understands how markets works. stop listening to mainstream media. 

    Wed, 08/17/2011 - 15:38 | 1570030 DosZap
    DosZap's picture


    You are far too kind, Chavez is not a Socialist, he is a friggin Fascist.

    Cross him, and see.

    Wed, 08/17/2011 - 15:42 | 1570070 kito
    kito's picture

    tis true doszap, tis true

    Wed, 08/17/2011 - 16:35 | 1570347 pazmaker
    pazmaker's picture

    nah Correa just likes throwing journalist in Jail...for writing an op ed piece critical of him...he's not a socialist!  


    Maybe you should stop listening to lefty news!


    Wed, 08/17/2011 - 18:29 | 1570762 kito
    kito's picture

    @paz--since you know so much about the slander case involving el universo and president correa, and since you are obviously well versed in the laws involving slander and the relentless onslaught against correa by large ecuadorian corporate interests who refuse to allow a free market sytem to prevail in ecuador, and instead suck the system dry of any progress, maybe you can shed some light? 










    Thu, 08/18/2011 - 11:52 | 1573286 pazmaker
    pazmaker's picture

    I've lived there(ecuador),  I have family that lives there still as well as part of our family living in Caracas, Venezuela so if you truly are open minded and want to  know the truth form someone who has experienced it first hand let me know.


    Otherwise I won't waste my time casting pearls to swine.


    by the way, groups like amnesty international (that may be considered liberal by some)has even criticized Correa for puttng the journalist in jail.


    If you posted a pic or link I can't see it due to firwall

    Wed, 08/17/2011 - 15:29 | 1569976 granolageek
    granolageek's picture

    Dear Tyler,

    ROFL. Gonzalo Lira, disappeara. Attacked any good Falklands lately?

    Wed, 08/17/2011 - 15:30 | 1569977 pan
    pan's picture

    Gold bitchez!

    Wed, 08/17/2011 - 15:33 | 1569989 JohnFrodo
    JohnFrodo's picture

    Ok Bitches for those of you who missed it Canada renamed its armed forces yesterday. Now they are proud again at being called Royal. So our gun canoes will be kicking some Venny butt any day now.

    Wed, 08/17/2011 - 15:33 | 1569990 Catullus
    Catullus's picture

    Now if he could only get the utilities industry to actually support a mining operation... Haha

    Wed, 08/17/2011 - 15:33 | 1569992 Chappaquiddick
    Chappaquiddick's picture


    Wed, 08/17/2011 - 15:34 | 1570001 Gringo Viejo
    Gringo Viejo's picture

    And if I thought I was havin' a bad day........

    at least I wasn't invested in Crystallex Mining.

    Wed, 08/17/2011 - 15:35 | 1570003 JohnFrodo
    JohnFrodo's picture

    If he sells Citgo you know the shits going to hit the fan.

    Wed, 08/17/2011 - 15:35 | 1570009 bernorange
    Wed, 08/17/2011 - 15:36 | 1570015 Dangertime
    Dangertime's picture

    So now are they going to raise their "official reserves" and put it into the "Deep Storage Gold" account?

    Wed, 08/17/2011 - 15:36 | 1570016 anynonmous
    anynonmous's picture

    On Bloomberg just now via Pimm Fox - possibility

    Fed to buy treasuries using excess bank reserves

    Wed, 08/17/2011 - 15:39 | 1570039 Everybodys All ...
    Everybodys All American's picture

    Have they not already been doing this?

    Wed, 08/17/2011 - 15:36 | 1570017 High Plains Drifter
    High Plains Drifter's picture

    attention blackwater security, now known as Xe services.  please proceed to venezuela according to plans discussed. it is a green light. this tape will self destruct in 10 seconds. if you are caught or captured this nation will disavow any knowledge of your actions. good luck

    Wed, 08/17/2011 - 15:37 | 1570028 BlackSea
    BlackSea's picture

    "The good news: gold may finally dip modestly" ????

    I would think that physical gold price would increase on supply shortages, whereas miners would be sold based on risk of nationalization.

    Wed, 08/17/2011 - 15:42 | 1570042 Threeggg
    Threeggg's picture

    This comes out today and then I hear Ghadaffi is sick ?

    on the same day ?

    a connection ?

    Wed, 08/17/2011 - 15:41 | 1570057 High Plains Drifter
    High Plains Drifter's picture

    wascally al quaeda threatens new attacks............oh my............

    Wed, 08/17/2011 - 17:05 | 1570509 Cathartes Aura
    Cathartes Aura's picture

    Sabotage by an insider at a major utility facility, including a chemical or oil refinery, could provide al Qaeda with its best opportunity for the kind of massive Sept. 11 anniversary attack Osama bin Laden was planning, according to U.S. officials.


    Wed, 08/17/2011 - 15:41 | 1570060 carbonmutant
    carbonmutant's picture

    Hugo can now treat his mines as banks, and he gets to brag about his awesome gold reserves.

    Wed, 08/17/2011 - 15:42 | 1570066 baby_BLYTHE
    baby_BLYTHE's picture

    All faith is being lost in paper currencies

    Wed, 08/17/2011 - 15:43 | 1570074 macholatte
    Wed, 08/17/2011 - 15:43 | 1570078 The Deleuzian
    The Deleuzian's picture

    The less physical Au coming to market will only make the suppy/demand curve favor higher prices! No need to venture into extremities for result

    We all in ZH-ville know this .... Why think anything different.. Contrarian explainations!! Pfffffffffffff

    Wed, 08/17/2011 - 15:43 | 1570079 JB
    JB's picture

    will Chavez find out that Frisco D'Anconia has spiked the mines???

    Wed, 08/17/2011 - 15:45 | 1570090 sbenard
    sbenard's picture

    It never ceases to amaze me how a people can be so foolish as to elect a dictator, just as Venezuela has done and the Germans did when they elected Hitler.

    But then, Americans did the same thing when they elected America's Dictator nearly 3 years ago! All hail Emperor Obama!

    Wed, 08/17/2011 - 16:55 | 1570461 Flakmeister
    Flakmeister's picture

    Not much of a dictator when noone does what he tells them to do..... try again...

    Note, this not a defense of BO, call it more like an adjustment of rifle sights....

    Wed, 08/17/2011 - 17:50 | 1570662 DaveyJones
    DaveyJones's picture

    well said

    Do NOT follow this link or you will be banned from the site!