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While Turkey has assured the U.S. government it will cut purchases of oil from Iran by 20% this year, its total trade with the Islamic Republic increased 47% to $4.8 billion in the first quarter from a year earlier. Sanctions aimed at isolating Iran because of its nuclear program, combined with revolutions in the Middle East, have spurred a tripling in the region’s purchases of Turkish precious metals and jewels to $942 million in the first three months, from $282 million in the same period last year. This 30% increase in demand is contributing to gold remaining above $1,600/oz in what has all the hallmarks of another period of consolidation prior to higher prices. “Turkey is exporting massive quantities of gold to Iran and Arab Spring countries as citizens in those countries switch to portable wealth,” Mert Yildiz, chief economist for Turkey at Renaissance Capital, told Bloomberg on April 30. The increase in trade with Iran comes as sanctions make it harder for trading partners such as Turkey, India and China to pay in dollars and euros. Iran said in February it would accept payment in any local currency or gold. Reuters report today that Iran is accepting payments in yuan for some of the crude oil it supplies to China, the Iranian ambassador to the United Arab Emirates said on Tuesday. "Yes, that is correct," Mohammed Reza Fayyaz told Reuters when asked to comment on an earlier report in The Financial Times.

Here I issue an old school challenge to Goldman Sachs, both the Morgans, and the tabloidal MSM in regards to the Facebook IPO and simple fundamental valuation!!! Have at Thee!

There are deepening concerns in Switzerland about the debasement of the Swiss franc. The SNB has pegged the franc to the euro and is engaged in the same ultra loose monetary policies as the Federal Reserve, BOE and the ECB. The SNB won't allow the franc to rise above an arbitrary “ceiling” against the euro Walter Meier himself said on April 5 that the SNB is ready to buy foreign currencies in "unlimited quantities." Meier’s comments regarding the vastly depleted Swiss gold reserves came after Bayram Dincer, an analyst at LGT Capital Management in Pfaeffikon, Switzerland, called on the SNB to disclose where its gold is stored, in a letter published in the respected Swiss publication Finanz und Wirtschaft. Meier said that the SNB holds its physical gold reserves “domestically and internationally, with provisions for a crisis scenario being a main factor in the decision for this decentralized storage”.  “The criteria for the storage countries are: appropriate regional diversification, exceptionally stable economic and political environments, immunity for central bank investments, access to a gold market where stocks could be liquidated if necessary,”  he continued. He concluded by saying that “such a decentralized storage is still preferable to an exclusive storage in Switzerland. The listed factors can change over time and that’s why the central bank is reviewing and adapting the storage locations periodically.” The SNB’s monetary policies have been imprudent in recent years and their gold sales have lost the Swiss people a lot of money. 

Americans feel “gold is the safest long term investment” today, a Gallup survey has found. Gold was favoured over four other types of investments perceived as the best long term choice for American investors today. 28% of the American public choose gold as their favoured investment of choice today.  Real estate followed in second place, with 20% seeing it as the best long term investment. Paper  assets were less popular with savings accounts and certificates of deposits (CDs) tied with stocks and mutual funds at 19%. Bonds came last at 8%.  This suggests that the American public may not be as uninformed when it comes to investing as is often suggested. According to Gallup, "investing in gold has gained in popularity in recent years as low interest rates have made traditional savings instruments less attractive, and instability in the stock and real estate markets has undermined the mass appeal of those options."  "Meanwhile, the rising trajectory of the price of gold over the past several years apparently offers more of the returns and stability investors seek." While some may find the Gallup poll findings worrisome from a contrarian perspective, it is not.

In the shady underground world of banking, doing wrong means doing right, up is down, and left is right.

CFTC data from Friday showed that money managers cut long positions on Comex gold futures and options in the week ended April 24 to the lowest level in more than three years. Managed funds slashed 2,225 long positions, or bets prices will rise, and added 2,450 short positions, or bets prices will fall.  The managed-fund net long position was cut by 4% and now represents around 10.7 million troy ounces of gold. This took their net position down 4% to 107,600 long contracts, from 112,275 long contracts. That's the lowest in CFTC data since the week ended Jan. 20, 2009. The low in January 2009 corresponded with the low in the gold price for 2009 - monthly low of $807/oz - prior to seeing gains which saw the gold price rise more than 50% to above $1,200/oz in late November 2009 (see chart below). A similar price gain would see gold rise from $1,663/oz today to $2,494.50/oz in the coming months. Also of note is the fact that large commercial traders have greatly cut back their short positions in gold and especially in silver. This has often been a sign of a bottom and suggests that they do not expect gold and silver to fall much further. In Comex silver futures and options, these traders added 248 long contracts and 2,883 short contracts. This reduced their net long position by 20% to 10,756 contracts, from 13,390 contracts the previous week. The net silver position represents around 53.7 million troy ounces of silver.

Satudarah is expanding to Antwerp and Duisberg as its clubhouses are shut down in many parts of the Netherlands. They are reportedly strengthening ties with the Outlaws and Bandidos. 

http://www.nrc.nl/nieuws/2012/04/29/omstreden-motorclub-satudarah-krijgt-afdeling-in-antwerpen/

Here is a thought for an eager Facebook investor: Google revenue - $40 billion; market capitalization $200 billion (plus $40 billion of cash).  Facebook revenue $4 billion; market capitalization $100 billion. So Facebook has to grow revenue 10x for you to double your money.  Good luck!

Whatever one thinks of the practical implications of the Kalecki equation (and as we pointed out a month ago, GMO's James Montier sure doesn't think much particularly when one accounts for the ever critical issue of asset depreciation), it intuitively has one important implication: every incremental dollar of debt created at the public level during a time of stagnant growth (such as Q1 2012 as already shown earlier) should offset one dollar of deleveraging in the private sector. In turn, this should facilitate the growth of private America so it can eventually take back the reins of debt creation back from the public sector (and ostensibly help it delever, although that would mean running a surplus - something America has done only once in the post-war period). This growth would manifest itself directly by the hiring of Americans by US corporations, small, medium and large, who in turn, courtesy of their newly found job safety, would proceed to spend, and slowly but surely restart the frozen velocity of money which would then spur inflation, growth, public sector deleveraging, and all those other things we learn about in Econ 101. All of the above works... in theory. In practice, not so much. Because as the WSJ demonstrates, in the period 2009-2011, America's largest multinational companies: those who benefit the most from the public sector increasing its debt/GDP to the most since WWII, or just over 100% and rapidly rising, and thus those who should return the favor by hiring American workers, have instead hired three times as many foreigners as they have hired US workers. Those among us cynically inclined could say, correctly, that the US is incurring record levels of leverage to fund foreign leverage, foreign employment, and, most importantly, foreign leverage.

The Fed’s promise to use more QE should the economy falter is supporting gold.

The global economic picture remains grim, with euro zone economic sentiment falling more than

expected in April and the US job market recovery showing signs of a slowdown.

Apple earnings and the tech boom and indeed possible tech bubble remains one of the primary

drivers of continuing irrational exuberance and risk appetite.

The poor and deteriorating economic backdrop is gold supportive.

I have to confess, I am tired of writing "structured" articles, the ones where I have to limit my thoughts to 800 words.  So with this one I am taking a break.  This is an unstructured stream of thought, in no particular sequence.  

All eyes will turn to the Fed and the Fed statement. I think we get a slightly more dovish statement. More language that the economy shows signs of weakening and that the Fed is vigilantly watching the data to determine if additional actions are necessary. No change in low rates for extended period, though maybe their they soften the language further hinting that it could go on longer than 2014 if moderate economic growth continues. I don’t think they will say anything new on inflation, though they might try to hint that it is moderating in their eyes, again, paving way for more QE. So I suspect a dovish statement, but no QE. I think the market will initially like that, but we will see the enthusiasm wane as that seem very well priced in, and without QE, and once AAPL stabilizes, we can get back to focusing that on the whole the data here has been weak, and that the situation in Europe is deteriorating rapidly.

While gold demand from the western investors and store of wealth buyers has fallen in recent months, central bank demand continues to be very robust and this is providing strong support to gold above the $1,600/oz level. IMF data released overnight shows that Mexico added 16.8 metric tons of gold valued at about $906.4 million to its reserves in March. Russia continued to diversify its foreign exchange reserves and increased its gold reserves by about 16.5 tons according to a statement by its central bank on April 20. Other creditor nations with large foreign exchange reserves and exposure to the dollar and the euro including Turkey and Kazakhstan also increased their holdings of gold according to the International Monetary Fund data.Mexico raised its reserves to 122.6 tons last month when gold averaged $1,676.67 an ounce.Turkey added 11.5 tons, Kazakhstan 4.3 tons, Ukraine 1.2 tons, Tajikistan 0.4 ton, and Belarus 0.1 tonnes, according to the IMF. Ukraine, Czech Republic and Belarus also had modest increases in their gold reserves. Central banks are expanding reserves due to concerns about the dollar, euro, sterling and all fiat currencies.

“We must hold the bailed out banks accountable for their harmful, unlawful fraud which has so deeply infected our county’s economy, security, and hope for the future”