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GoldMoney Promotion

Fri, 05/22/2015 - 13:42
Terms of the offer This offer is available from 17.00 UK time on 22nd May 2015 and expires at 23.59 UK time on 24th May 2015.

This promotion code is applicable for purchases of gold only.

To claim this offer, you must login to your GoldMoney Holding. Please click on "My Holding Menu" and click on "Buy Metal". Your Holding should have available funds to take advantage of this offer.

Please select the metal gold, the currency and the amount you wish to purchase and enter the 001FEE promotional code into the promotion box and click submit. Please then click Continue. The 0.01% buy fee will be calculated.

This offer cannot be used in conjunction with any other offer or discount.

Each customer can use this promotional code once only.

Employees of GoldMoney or their immediate family members shall not be permitted to take part in this promotion.

Any disputes arising in relation to this promotion will be governed by the laws of the Island of Jersey and the parties agree that the Courts of Jersey shall have non-exclusive jurisdiction.

Use of the promotional code is deemed acceptance of the terms of the promotion and of GoldMoney's Customer Agreement.

GoldMoney reserves the right to amend, vary, extend, or discontinue a promotion at any stage, for any reason, without notice.

GoldMoney takes no responsibility for any inability to enter, complete, continue, or conclude the promotion due to equipment or technical malfunction, busy lines, inadvertent disconnection, force majeure, or otherwise.

GoldMoney is the trading name of Net Transactions Limited, a company incorporated in Jersey, with its registered office at 32 Commercial Street, St Helier, JE2 3RU, Jersey.

BitGold announces acquistion of GoldMoney

Fri, 05/22/2015 - 12:28
We would like to advise you that on Friday 22 May BitGold Inc., a publicly traded Canadian company, entered into an acquisition agreement to purchase the operations and intellectual property of GoldMoney Network Limited and its subsidiaries (t/a GoldMoney).

GoldMoney will continue to operate as usual and offer an easy method for its customers to buy precious metals online and safely store them. Over time synergies between the two companies will be leveraged to improve the customer offering with new products and more competitive services and pricing.

Please find the press release for your information, and feel free to contact us if you have any questions.

 

 

334 Adelaide St. W., 3rd Floor
Toronto, ON M5V 1R4

May 22, 2015 TSX-V: XAU

BITGOLD INC. ANNOUNCES CAD 51.9 MILLION ACQUISITION OF GOLDMONEY.COM, INTEGRATING OVER CAD 1.5 BILLION IN ASSETS AND OVER 135,000 USER SIGNUPS ONTO THE BITGOLD AURUM NETWORK

Toronto, Ontario (May 22, 2015) – BitGold Inc. (TSX-V: XAU) ("BitGold"), a platform for savings and payments in gold, announces that it has entered into an Acquisition Agreement to purchase the operating and intellectual property assets of GoldMoney Network Limited ("GoldMoney"), subject to regulatory approvals and other customary closing conditions.

With over CAD 1.5 billion in assets under vault management GoldMoney is among the world's largest private managers of precious metal assets, renowned for its innovation and integrity in the gold market.

Upon closing of the Acquisition Agreement, BitGold will acquire the intellectual property and operating assets of GoldMoney in exchange for the issuance of 11,169,794 common shares in BitGold, valuing the transaction at CAD 51.7 million based on BitGold's CAD 4.65 closing price on May 21st. The transaction is expected to close on or around June 17th. Potential benefits to shareholders include:

• The integration of an innovative and high integrity precious metal manager onto the BitGold platform; preserving the relationships GoldMoney has established with its customers while enhancing GoldMoney services with payment technologies

• The addition of relationships and knowledge acquired over nearly a decade and a half operating an e-platform for global metal purchases and sales

• The addition of over CAD 1.5 billion in customer assets onto the Aurum ledger, BitGold's proprietary consolidated order book and trade engine

• The potential to develop new payment market relationships from over 135,000 signups on GoldMoney.com

• Applying new technology, analytics, and location intelligent language/currency engine to expand beyond the markets which have produced over GBP 3.1 billion in cumulative gross sales revenue for GoldMoney over the past decade

• Expected operating synergies from lower fixed overhead and lower working capital intensive technologies applied to GoldMoney operations, without compromising premium customer service

• The addition of a strong shareholder base and three GoldMoney directors to the combined Board of Directors

GoldMoney Network Limited is owned by well-established investors including James Turk, IAMGOLD Corporation, Fleming family and Eric Sprott, founder of Sprott Inc. GoldMoney headquarters are located in Jersey, British Channel Islands. GoldMoney is regulated by the Jersey Financial Services Commission (JFSC) as a Money Services Business. The JFSC is the main supervisory body that oversees and regulates Jersey's large financial services industry.

"We are thrilled by the potential of this BitGold and GoldMoney combination, two companies with shared values and a common vision and purpose," said Roy Sebag, BitGold CEO. "You will not find a precious metals asset manager with more integrity than the one built by Geoff and James Turk and the GoldMoney team. With the technology of the BitGold platform we can expand the GoldMoney legacy of trust, security, and a client centric purpose to new markets, growing from a much stronger base and benefiting all stakeholders. Combining the first global e-marketplace for gold with the latest and most innovative, we instantly become the world's largest and most active bullion money service."

GoldMoney is the registered business name of Net Transactions Limited, which provides metal storage services for its customers. GoldMoney's affiliate company, Net-Gold Services Limited, handles the purchase and sale of precious metals. Upon closing of the transaction, BitGold will acquire from GoldMoney Network Limited all of the issued and outstanding shares of its three operating subsidiaries Net Transactions Limited, Net-Gold Services Limited and Net Transactions (Jersey) Limited and all of the proprietary intellectual property of GoldMoney Network Limited in exchange for the issuance of 11,169,794 common shares of BitGold, for which GoldMoney shareholders will be subject to a 12-month lock-up. The parties have entered into an Acquisition Agreement and further announcements will be made on the status of the acquisition as it proceeds toward closing.

"The combination of BitGold and GoldMoney has the potential to create significant value for the clients and shareholder of both companies," said James Turk, founder of GoldMoney. "We created GoldMoney with the vision of making gold accessible for savings and payments, a vision that BitGold is rapidly expanding in a new era of cloud computing and mobile technology. Together we will continue to operate GoldMoney with the same level of security, integrity and premium customer service, but GoldMoney clients will now have access to expanded payment options, a gold debit card, and the many applications and features being developed by this innovative team. Josh and Roy understand money and gold as well as anyone I've met. Their energy, vision, and dedication to expand this platform are truly remarkable. I am honored to be joining the combined board along with two of my fellow GoldMoney directors, Mahendra Naik and Hector Fleming."

BitGold and GoldMoney will host a joint conference call on Tuesday, May 26th, further information to be released.

About BitGold

BitGold's mission is to make gold accessible and useful in digital payments and secure savings. The BitGold platform provides innovative solutions to the challenge of transacting with fully allocated and securely vaulted gold. BitGold accounts are free and convenient to open by anyone, anywhere* in just minutes. BitGold provides users with a secure vault account to purchase gold using a variety of electronic payment methods. The platform will also provide transaction capability including: instant cross-border gold payments, merchant invoicing and processing for gold, debit card spending of gold at traditional points of sale, conversions to a customer's external digital-wallet or bank, and physical gold redemptions. All physical gold acquired through the platform is owned by the customer, stored in vaults administered by The Brink's Company, acting through Brink's Global Vault Services International, Inc. ("Brink's"), which insures gold through third party insurance providers.

BitGold is a Canadian corporation with offices in Toronto, Canada, and Milan, Italy. BitGold has partnered with established professionals in bullion dealing, vault security and web security, payment processing, and is committed to best-practice systems for compliance with all applicable laws and regulations regarding anti-money Laundering ("AML") and Know Your Customer ("KYC").

*The BitGold Platform will not initially be available to U.S. Residents and will be unavailable to residents of sanctioned countries

About GoldMoney

GoldMoney is a gold and precious metals vaulting business founded in 2001 by James Turk and Geoff Turk. GoldMoney has over 20,000 customers. GoldMoney offers an easy way to buy gold, silver, platinum and palladium online and safely store for customers these precious metals in five countries. It is GoldMoney's vision that the benefits and dependability of gold and silver should be easily available to everyone, while providing its customers with assurances of integrity so they know their money is safe.

For more information, please contact:

Josh Crumb
Co-founder and Chief Strategy Officer

BitGold Inc.
Tel.: 647-556-6370

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy of this release.

Forward-Looking Statements

This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities laws that are based on expectations, estimates and projections as at the date of this news release. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information and are intended to identify forward-looking information.

This forward-looking information is based on reasonable assumptions and estimates of management of the Company at the time it was made, and involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others: risk factors relating to the acquisition of GoldMoney, being completion of satisfactory due diligence, settlement of definitive documentation, satisfaction of closing conditions, receipt of regulatory approvals and, generally, the completion of the acquisition on the terms as described if at all; the Company's limited operating history; future capital needs and uncertainty of additional financing; the competitive nature of the industry; unproven markets for the Company's product offering; volatility of gold prices & public interest in gold investment; lack of regulation and customer protection; the need for the Company to manage its planned growth and expansion; the effects of product development and need for continued technology change; protection of proprietary rights; the effect of government regulation and compliance on the Company and the industry; network security risks; the ability of the Company to maintain properly working systems; foreign currency and gold trading risks; use and storage of personal information and compliance with privacy laws; use of the Company's services for improper or illegal purposes; global economic and financial market conditions; uninsurable risks; and those risks set out in the Company's public documents filed on www.sedar.com.

Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to revise or update any forward-looking information other than as required by law.

Market Report: Precious metal rally consolidates

Fri, 05/22/2015 - 05:06
Gold and silver rallied strongly last Friday and into Monday's overnight trading (UK time) before spending the rest of the week drifting lower from initial highs to consolidate above notional support at $1200 and $17 respectively. As of first thing this morning, UK time in US dollars gold is now up 2.2% and silver 10.2% on the year.

From observing price action, there appears to be continuing underlying physical demand, and on Wednesday the Russian Central Bank confirmed that it had taken the opportunity of sub-$1200 prices to add 300,000 ounces of gold to their official reserves last month. It is also reasonable to suggest that in times of increasing economic and systemic tensions in the Eurozone, some central banks will swap euros for gold to rebalance their reserves.

The Fed released April's Open Market Committee minutes on Wednesday, which on balance was little more than another holding operation on interest rates, not bringing them forward to June or putting them off to next year. Apart from some minor volatility on their release there has been little effect on precious metal prices.

The next chart is of the gold price in the other three major currencies since 31 December 2014.

 

In terms of gold prices, the best performance has been in weakening euros with gold up 11.4% so far this year. The European central Bank announced it would look to accelerate its bond purchases in the short-term, leading currency markets to conclude that economic conditions in the Eurozone are weaker than expected, and with the deteriorating Greek situation euro weakness should come as no surprise.

Finally, it is worth drawing attention to developments on the Hong Kong Stock Exchange, where first Hanergy Thin Film fell 47% on Wednesday, wiping $18.6bn off its capitalisation before trading was suspended. This was followed yesterday by a similar collapse in share price for Goldin Financial (Hanergy's broker) and Goldin Properties, together wiping out a further $16.6bn.

These events are typical ahead of a speculative blow-off in markets, and while Hong Kong's Hang Seng Index appears to have risen broadly in line with major equity markets, other smaller markets in the region reflect excessive speculation. For example, on the Shenzen Market equities are trading at an average of 67 times earnings, having risen by 12% this week alone, and there are instances of new listings rising more than ten or twenty times in less than a month of trading.

Therefore, there is a growing risk that Hong Kong and Chinese equities could become a financially destabilising risk in the region and possibly further afield, adversely affecting other markets and potentially precious metal demand.


Next week


Monday

Japan: CSPI, BoJ Monthly Report.

Tuesday

UK: CBI Distributive Trades.
US: Durable Goods, FHFA House Price Index, S&P Case-Shiller Home Price Index, Consumer Confidence, New Home Sales.

Wednesday

Japan: Large Retailers Sales, Retail Sales.

Thursday

UK: Nationwide House Prices, BBA Mortgage Approvals.
Eurozone: Business Climate Index, Consumer Sentiment, Economic Sentiment, Industrial Sentiment.
US: Initial Claims, Pending Home Sales.
Japan: CPI, Unemployment, Industrial Production.

Friday

Japan: Constrction Orders, Housing Starts
Eurozone: M3 Money Supply.
UK: GDP (2nd est.), Index of Services.
US: GDP (2nd est.), Chicago PMI.

Dealing Desk: Gold emerges as the anchor in uncertain waters

Thu, 05/21/2015 - 12:08
It has been a good week for gold on the worldwide markets, although GoldMoney customers have been indulging in a spot of speculation and profit taking.

Kelly-Ann Kearsey, Dealing Manager at online precious metals dealer, GoldMoney says it has been an interesting week for customer behaviour, 'The Federal Open Market Committee (FOMC) minutes on Wednesday took a more doveish stance which supported the gold price at the expense of the dollar, but what is interesting is that we noticed our customers buying gold on the Tuesday, before selling after the FOMC announcement. This looks like it could be a bit of speculation and profit taking.'

 

The dollar has today, Thursday, made some advances which have weighed negatively on the gold price, but the yellow metal remains above the $1200 psychological level.

'Most of our selling has been out of the UK and Switzerland, as usual,' says Kelly-Ann, 'with Hong Kong and Singapore vaults the focus of buying. The gold/silver ratio is still high in the 70s, and the scarcer platinum remains below its yellow cousin in price.

What next?
Gold has slipped slightly today, but it is certainly not looking sickly. The recent World Gold Council report showed gold demand slipped modestly at the start of this year and shows that despite a bullish dollar, the precious metal has not lost its sheen. While prices are not rising dramatically, they are at a three month high and the market looks to be well supported. With increasing concerns about the strength of the US and Chinese economies, and the threat of another recession appearing on the horizon, gold support is likely to stay firm.'

Week on week price performances

21/05/15 16:00: Gold down 1.3% to $1,205.71, Silver down 1.3% to $17.15, Platinum down 0.9% to $1,146.60 and Palladium down 0.4% to $773.85.


Ends

NOTES TO EDITOR


For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je


GoldMoney

GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis International (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.


Further information:
Visit: Goldmoney.com or view our video online

Inaccurate statistics and the threat to bonds

Thu, 05/21/2015 - 05:11
Statistics have become very misleading: in particular we are being badly misled into believing that the US is teetering on the edge of price deflation, because the US official rate of inflation is barely positive, a level that US bonds and therefore all other financial markets have priced in without accepting it is actually significantly higher.

There are two possible approaches to assessing the true rate of price inflation. You can either reverse all the tweaks government statisticians have implemented over the decades to reduce the apparent rate, or you can collect a statistically significant sample of price data independently and turn that into an index. John Williams of Shadowstats.com is well known for his work on the former approach, but until recently I was unaware that anyone was attempting the latter. That is until Simon Hunt of Simon Hunt Strategic Services drew my attention to the Chapwood Index, which deserves wider publicity.

This is from the website: "The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation." It is, therefore, statistically significant, and it consistently shows price inflation to be much higher than that indicated by the Consumer Price Index (CPI).

The table below shows this difference since 2011, and how it affects real GDP.

Sources: Chapwood Index, US Bureau of Labor Statistics and Bureau of Economic Analysis. Figures may not total due to rounding.

The Chapwood number in the table is the simple arithmetic average of the 50 cities. The year-in, year-out 10% inflation rate is notable. Furthermore, Chapwood shows cumulative inflation rate as shown by the CPI for the four years to be understated by 39.9%, and using Chapwood numbers in place of the GDP deflator, real GDP has slumped a cumulative total of 21.4% over the four years.

No wonder the poor in America are suffering: when their wages and benefit increases have been aligned to the CPI, they have fallen nearly 40% in real terms over the last four years. The resulting decline in business on Main Street revealed by these figures explains why Wal-Mart are laying people off and closing stores, and why trade associations continually issue disappointing trading assessments.

Understated price inflation fundamentally distorts everything that is macroeconomic, from monetary policy to economic commentary. It misleads central bankers into thinking they are missing their inflation targets when they are in fact exceeding them by a dangerously wide margin. It misleads analysts into thinking we are on the brink of a deflationary slump with prices maybe about to collapse. And most worryingly of all, bond markets have become more mispriced than even hardened bears realise, something that's very likely to be corrected through a financial shock.

Just think of all those bonds that the banks have acquired as zero risk investments under Basel III rules 1. If bond markets discounted, as the Chapwood Index suggests they should, a US inflation rate consistently around 10%, the 10-year US Treasury bond should yield at least that, possibly more. The price would halve to meet those redemption yields, and lesser credit-worthy bonds would fall even more, a development for which all financial markets are wholly unprepared, not to mention the knock-on effects on stocks, derivatives and of course, mortgage rates.

 

1Basel III (or the Third Basel Accord) is a global, voluntary regulatory framework on bank capital adequacy, stress testing and market liquidity risk

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Customer private site enhancements

Fri, 05/15/2015 - 09:37

Here at GoldMoney we are committed to delivering continuous service improvements. Following customer feedback, we are delighted to reveal an updated design to our private customer login area of the website.

We have designed it with a streamlined customer experience in mind so that our customers will find it easier to navigate. We have created a personal 'Dashboard' which will provide customers with a convenient summary of their Holding. From here, customers can buy and sell metal, view their Holding balance, the vaults in which metal is stored, see their Holding inbox and much more. At any point, customers have access to the 'My Holding Menu', which provides access to other areas of the Holding.

In addition to these visual changes, the customer login area will be fully optimised to be responsive to desktop and mobile devices and bandwidth. This means the page loading speed is faster and the layout will automatically resize and re-flow depending on the customer's device.

It has been a little while since we last updated the look and feel of the private customer login area so we have developed a few helpful video guides to support customers through the buy and sell metal processes. You can find these video guides within the 'Tutorials' area of the customer login website.

As always, we welcome your feedback with the enhancements we have made.

Geoff Turk
CEO

Market Report: Dollar weakens

Fri, 05/15/2015 - 07:02
The US dollar continued to lose ground this week, contributing to a firmer trend for precious metals. Gold rose over $40 to $1223, and silver by $1.13 to $17.45, though prices initially opened a little lower in early European trading this morning, perhaps anticipating some pre-weekend profit-taking.

Gold has now risen over 3% on the year, marginally beating the S&P 500 Index, which is up 2.5%, but far better than bonds, the US 10-year Treasury price being down about 4%.

On the Comex futures market there appears to be increasing demand for gold and silver, with both volumes and open interest rising with the price. The next chart is gold.

If the rise was fueled by bear closing, open interest would tend to contract. While there is almost certainly bear closing involved, it is clear that new buying is the dominant feature. Similarly, open interest in silver has recovered towards the record levels seen last month. This is illustrated in the next chart.

There has been significant volatility in bond markets this week, with yields along the curve steepening, and the difference between two and ten year Treasury yields increasing from 1.2% to 1.6% since early February. A widenining differential (known as a steeper yield curve) is normally associated with bond markets discounting higher rates of inflation, or increased financial uncertainty, or both. So if the yield curve continues to steepen, the dollar is likely to weaken further so long as the Fed is reluctant to raise interest rates. I expect this topic to receive growing attention in the coming months.

Gold has fared less well priced in sterling and euros, which have also risen against the US dollar, but it is still up by 1.5% and 9% respectively on the year. The attraction to Eurozone residents was recorded in this week's release from the World Gold Council's Gold Demand Trends for the first quarter of 2015, which showed a 20% increase in gold bar and coin demand from German citizens.

There are two obvious reasons for Eurozone citizens to buy gold.The first is the prevelance of negative short-term interest rates coupled with the banks' reluctance to pay out large amounts of physical cash, making gold an attractive alternative. The second reason is the continuing tragedy that is Greece.
Meanwhile, in Greece ordinary people are reported to be buying motor cars in order to dispose of bank deposits, with German manufacturers presumably benefiting most. The thinking must be that a mobile asset is a good thing to own at a time of financial crisis instead of bank deposits, confirming they have lost all faith in the banking system.

Next week

Monday

Japan: Capacity Utilisation, Industrial Production. US: NAHB Builders Survey.

Tuesday

UK: CPI, Input Prices, ONS House Prices, Output Prices. Eurozone: HICP, Trade Balance, ZEW (Economic Sentiment). US: Building Permits, Housing Starts. Japan: GDP.

Wednesday

Japan: Leading Indicator (Final). UK: BoE MPC Minutes.

Thursday

Japan: All Industry Activity Index. Eurozone: Current Account, Flash Composite PMI, Flash Manufacturing PMI, Flash services PMI, Flash Consumer Sentiment. UK: Retail Sales, CBI Industrial Trends. US: Initial Claims, Existing Home sales, Leading Indicator, Philadelphia Fed Survey

Friday

Japan: BoJ Policy Statement. UK: Public Sector Borrowing. US: CPI, Flash Manufacturing PMI.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Dealing Desk: The safehaven shimmer returns to gold

Thu, 05/14/2015 - 12:53
It has been a very interesting week for gold's fortunes with mixed news coming from the USA, and even mainstream analysts beginning to get nervous about where the world's economy is heading.

Head of Dealing and Settlements, Roland Khounlivong, said, 'It has resulted in a return to gold's safe haven appeal with bargain hunters heading back into the market to protect their wealth.'

Customer activity
In terms of GoldMoney customers, Roland says it has been a week of stability, 'We've seen a low turnover with our customers looking to be holding on to their metal rather than seeing a big profit-taking sell-off. What movement there has been is the usual west to east flow, with some metals moving out of the UK to Singapore, in particular.

This week's pressure points
'The return to favour for gold has come on the back of the mixed news from the USA', says Roland, 'US employment has stabilized, but there's been a downwards revision of non farm payroll. The Popular Bank of China's move to cut interest rates has also sent a further message about the state of China's economy and yesterday's US retail sales figures show consumers are holding back, with numbers down on expectations.

'To cap it all Stephen King, Chief Economist at HSBC, has been reported as likening the world economy to the Titanic. He has warned of several factors which can bring on another recession which will be worse than the last.

'All of this news has put pressure on the US dollar, which is now at levels not seen since February, and with crude staying above $60 a barrel, we've seen a sell off in the bond markets as government bonds experience a sharp increase in yields. It's not surprising that investors are looking around for a safe home in a diversified portfolio.

'Gold is now trading above its $1200/oz support level and the gold to silver ratio is high, standing at 70.26, showing the more industrial metal, silver, as being relatively cheap. Platinum, another precious metal that has industrial demand, has been at levels under the gold price for some time, proving again that the yellow metal's safe haven appeal is winning the day.'

Where next?
'The Federal Open Market Committee minutes are due out on Wednesday, as too are the European Central Bank's the following day, amid the continuing fears over Greece's economy. It will also be tomorrow's US industrial production figures, and next week's US Home starts and existing home sales, that will give further indications where the US economy is heading, and just how the central banks are going to deal with it.'

Week on week price performances
14/05/15 16:00. Gold up 3.3% to $1,221.13, Silver up 6.6% to $17.38, Platinum up 2.6% to $1,157.30 and Palladium down 1.1% at $777.00.
Ends

NOTES TO EDITOR

For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis International, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: Goldmoney.com or view our video online

The trouble with cash

Thu, 05/14/2015 - 10:38
When interest rates are zero and it costs a bank to look after your money it becomes an unattractive asset. Banks in some jurisdictions (such as Switzerland, Denmark and Sweden) are even charging customers interest on cash and deposits. And if you go to your bank and withdraw large amounts in the form of folding notes to avoid these charges you will be lucky if you are not treated as a sort of pariah. For the moment, at least, these problems do not extend to sound money, in other words gold.

There are two distinct issues involved with government-issued currency: zero-to-negative interest rates, which all but eliminate any interest turn on deposits for the banks, and a systemic issue that arises if too many people withdraw their money from the banking system. The problems with the latter would become significant if enough people decide to effectively opt out of holding money in the banks.

Conversion of bank deposits into physical cash increases reserve ratios, restricting the banks' ability to create credit. However, while the banks are contractually obliged to supply physical cash to anyone who wants it, a drawdown on bank deposits is a bad thing from a central bank's point of view. A desire for physical cash is, therefore, discouraged. Instead, if the option of owning physical cash was removed and there was only electronic money, deposits would simply be transferred from one bank to another and any imbalances between the banks resolved through the money markets, with or without the assistance of a central bank. The destabilising effects of bank runs would be eliminated entirely.

In the current financial climate demand for cash does not originate so much from loss of confidence in banks, with some notable exceptions such as in Greece. Instead it is a consequence of ultra-low or even negative interest rates. The desire for cash is therefore an unintended consequence of central banks attempting to inject confidence into the economy. The rights of ordinary individuals to turn deposits into physical cash are therefore resisted by central banks, which are focused instead on managing zero interest rate policies and supressing any side effects.

Central banks can take this logic one step further. Monetary policy is primarily intended to foster investor confidence, so any tendency for investors to liquidate investments is, therefore, to be discouraged. However, with financial markets getting progressively more expensive central bankers will suspect the relative attraction of cash balances are increasing. And because banks are making cash deposits more costly, this is bound to increase demand for physical notes.

Monetary policy has now become like a pressure cooker with a defective safety-valve. Central bankers realise it and investors are slowly beginning to as well. Add into this mix a faltering global economy, a fact that is becoming impossible to ignore, and a dash-for-cash becomes a serious potential risk to both monetary policy and the banking system.

There is an obvious alternative to cash, and that is to buy physical gold. This does not constitute a run on the banking system, because a buyer of gold uses electronic money that transfers to the seller. The problem with physical gold is a separate issue: it challenges the raison d'être of the banking system and of government currencies as well.

This is why we can still buy gold instead of encashing our deposits, for the moment at least. It can only be a matter of time before people realise that with the cash option closing this is the only way to escape an increasingly dysfunctional financial system.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Tutorials

Mon, 05/11/2015 - 12:55

We have developed a series of helpful tutorials and educational video guides to support you through the step by step process of buying gold or silver in the currency or vault of your choice. Pleace click on PDF or Video to view.

 

1. Overview of GoldMoney Holding dashboard   Video 2. How to add a bank account PDF   3. How to add funds PDF   4. How to buy metal PDF  Video 5. How to sell metal PDF  Video 6. How to remove funds PDF  

 

If you require any further assistance or have any queries, our dedicated GoldMoney Customer Support team is available from 09.00 to 17.00, UK time Monday to Friday: UK & International +44-1534-633-933 / Toll Free: USA & Canada 1-855-583-GOLD(4653), by email customersupport@goldmoney.com or via our secure messaging service.

 

Dealing Desk: Return of gold’s safe-haven lure?

Fri, 05/08/2015 - 09:10
The appeal of gold as a safe-haven is beginning to resurge, after weeks in which the improving economic conditions in the US have dented prices.

A complicated international picture looks likely to support gold prices, with uncertainty the only definite outcome of the UK General Election, continued questions about Greece's ability to make debt repayments and the impact of their potential default on the rest of the Eurozone, and rising oil prices.

According to Kelly-Ann Kearsey, a poor US jobs report has weakened USD against a basket of currencies – another development that has led to speculation that the Fed could put off an interest rate hike beyond next month.

She said: 'We are still seeing the same geographical trends in terms of selling out of UK and Swiss vaults, and buying into our Singapore vaults. Although gold has stayed under the psychologically-important $1,200 benchmark for the last seven days, we are starting to see signs that could push that safe-haven factor.

'Investors are hanging on for tomorrow's non-farm payroll report from the US – that data will be scrutinised closely to see if we can get a hint of intentions in the US about that all-important interest rate decision.

'If oil continues to rise beyond the $70 per barrel price, then we might see more interest in gold from buyers, who traditionally use it as a hedge against oil-led inflation.'

In the coming seven days, we're expecting to see a lot of data coming out of the US and China – the US has employment, retail and the producer price index; while China is set to publish trade balance data, along with a consumer price index and industrial production stats.

Week on week price performances
7/05/15 16:00. Gold effectively unchanged at $1,182.28, Silver up 2% to $16.31, Platinum down 0.9% to $1,127.50 and Palladium up 2% to $785.97.

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: Goldmoney.com or view our video online

Market Report: Bond yields rise and Greece failing

Fri, 05/08/2015 - 06:28

The prices of gold and silver initially rallied this week from the lows of $1170 and $15.93 respectively last Friday to challenge the $1200 level for gold and $16.70 for silver on Wednesday, before losing about half these gains yesterday.

On the year gold, is now hardly changed while silver is up 5% and is one of the best performing assets in financial markets over this timescale.

Precious metals appear to be locked into the same torpor as other markets, but there are two developing stories. At the beginning of this week government bond yields were low with negative rates commonplace, despite record government borrowing. Rational investors are barely involved in bond markets, remaining for the most part side-lined in the knowledge these distortions cannot last forever.

However, as the week progressed, a reaction in US Treasuries set in with the yield on the US 10-year Treasury rising sharply to 2.29%, shown in the chart below (though a reaction to 2.19% set in this morning). The dotted line is the neckline of a head-and-shoulder reversal chart pattern now completed, suggesting Treasury yields might be at risk of rising significantly higher, taking other bond markets and lower-grade bonds with them.

Since early February 10-year Treasury yields have risen 37%, implying large portfolio losses for the banks loaded up with sovereign debt. This week has seen similar rises in other key sovereign bond yields, and the losses in investment-grade and junk bonds have been correspondingly greater. The importance of this development for precious metals is that deteriorating bond markets increase the likelihood of new rounds of quantitative easing.

It could be that at last bond markets are beginning to discount the growing likelihood that Greece will default on its debt and that the Greek banks will fail. This is the second developing story, also likely to affect gold and silver.


Professor Steve Hanke of John Hopkins University recently pointed out that at the end of last year the book value of bad debts on the Greek banks' balance sheets exceeded the sum of tangible bank equity and reserves by between 22% in the case of the National Bank of Greece, to as much as 165% in the case of Piraeus Bank, with other banks falling in between these extremes. Furthermore in the last five months deposit withdrawals have accelerated, making the position worse. This being the case, not only are Greece's banks insolvent, but Greece has the potential to be Europe's "Lehman moment", with all the unintended consequences implied.

Greece's default and the failure of its banking system now seem inevitable. The remaining question is what monetary support the ECB will offer to prevent other Eurozone bond yields from rising further, and what assistance it will extend to highly-geared Eurozone banks whose own viability may be threatened.

Lastly, the UK's unexpected election result this morning initially boosted sterling. Whether or not it holds this rise only time will tell.

Next week

Monday

UK: BoE Interest rate decision, BRC Retail Sales Monitor.

Tuesday

Japan: leading Indicator (Prelim.), Bank Lending Data, Current Account.
UK: Industrial Production, Manufacturing Production, NEISR GDP Est.

Wednesday

UK: Average Earnings, Claimant Count, ILO Unemployment Rate.
Eurozone: GDP (1st est.), Industrial Production.
US: Import Price Index, Retail Sales, Business Inventories.

Thursday

Japan: M2 Money Supply, Economy Watchers Survey.
US: Initial Claims, PPI

Friday

Japan: Consumer Confidence.
UK: Construction Output.
US: Empire State Survey, Capacity Utilisation, Industrial Production, Net Long-Term TICS Flows

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Controlling copper and silver prices

Fri, 05/08/2015 - 05:11
There is an unwarranted assumption that market prices are always right, and represent "fair value". In the case of commodities, particularly metals, this is not necessarily true, because regulated financial markets make it too easy for government agencies and large banks to game the system.

Take the case of a country like China, which is the largest consumer of copper. Does it passively buy its copper through the market? No. Instead it strikes a price with a supplier, such as a Zambian copper mine, based on the London market price, bypassing the market entirely. If China plays no part in setting the reference price in London, the Zambians can be satisfied the price is fair; but if China or her agents suppressed the price of copper in the market before the price is set, the Zambians would be right to be upset.

Now, we do not know if China or her agents drive the copper price down, by placing a relatively small paper order so that the large off-market physical deal is priced favourably, but it is obviously in her interest to do so. Another metal where this could apply is silver.

We need to bear in mind three things about China and silver. She is the world's largest industrial user, she is almost certainly the world's largest refiner, and the government owns all the refineries. China imports large quantities of doré 1 and also base metal ores containing silver. So how she goes about this business is highly relevant to the silver price, and the following is an example of how it works.

In the case of foreign silver mines a qualified agent assesses the silver content of concentrates or doré on site and agrees a payment figure with the mine manager. Two further considerations then arise: the mine manager will want payment upfront because he has wages and other costs to meet; and the agent will look for the most cost-effective refining option. The first consideration is addressed by getting a bullion bank to advance the money against delivery of the concentrates or doré when refined, and the second will often involve a government-subsidised Chinese refiner.

There now exists a relationship between the Chinese government and the bullion bank, because the former has to deliver refined silver to the latter, or it must alternatively provide paper cover as may be subsequently agreed between them. As owner of the refining industry, China's interest is primarily strategic rather than profitability. Whether it is to subsidise the solar cell industry, or to build a strategic stockpile matters not; the temptation to suppress the price is the point.

The problem with price suppression is that it only works when buyers stand aside. But as we saw in the 30 months following October 2008 when the silver price ran up from under $9 to nearly $50, when buyers step in huge price moves can occur relatively quickly.

To the extent such price suppression does occur, today's commodities must be under-priced, just as bond and stock prices have become overpriced through central banks and other government agencies interfering with the markets. In any event investor opinion is bearish for commodities and bullish for the US dollar. Therefore, in a general market correction of valuation extremes commodities should recover strongly, how strongly will depend on whether or not prices have been artificially supressedsuppressed in the way described in this article.

Deflationists should take note: when markets crack, after initial confusion the prices of key commodities such as silver could rise more strongly than imaginable if they have been artificially suppressed, making them the only game in town.

 

1 A doré bar is a semi-pure alloy of gold and silver, usually created at the site of a mine. It is then transported to a refinery for further purification.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Market Report: Bond yields rise and Greece failing

Fri, 05/08/2015 - 05:05

The prices of gold and silver initially rallied this week from the lows of $1170 and $15.93 respectively last Friday to challenge the $1200 level for gold and $16.70 for silver on Wednesday, before losing about half these gains yesterday.

On the year gold, is now hardly changed while silver is up 5% and is one of the best performing assets in financial markets over this timescale.

Precious metals appear to be locked into the same torpor as other markets, but there are two developing stories. At the beginning of this week government bond yields were low with negative rates commonplace, despite record government borrowing. Rational investors are barely involved in bond markets, remaining for the most part side-lined in the knowledge these distortions cannot last forever.

However, as the week progressed, a reaction in US Treasuries set in with the yield on the US 10-year Treasury rising sharply to 2.29%, shown in the chart below (though a reaction to 2.19% set in this morning). The dotted line is the neckline of a head-and-shoulder reversal chart pattern now completed, suggesting Treasury yields might be at risk of rising significantly higher, taking other bond markets and lower-grade bonds with them.

Since early February 10-year Treasury yields have risen 37%, implying large portfolio losses for the banks loaded up with sovereign debt. This week has seen similar rises in other key sovereign bond yields, and the losses in investment-grade and junk bonds have been correspondingly greater. The importance of this development for precious metals is that deteriorating bond markets increase the likelihood of new rounds of quantitative easing.

It could be that at last bond markets are beginning to discount the growing likelihood that Greece will default on its debt and that the Greek banks will fail. This is the second developing story, also likely to affect gold and silver.

Professor Steve Hanke of John Hopkins University recently pointed out that at the end of last year the book value of bad debts on the Greek banks' balance sheets exceeded the sum of tangible bank equity and reserves by between 22% in the case of the National Bank of Greece, to as much as 165% in the case of Piraeus Bank, with other banks falling in between these extremes. Furthermore in the last five months deposit withdrawals have accelerated, making the position worse. This being the case, not only are Greece's banks insolvent, but Greece has the potential to be Europe's "Lehman moment", with all the unintended consequences implied.

Greece's default and the failure of its banking system now seem inevitable. The remaining question is what monetary support the ECB will offer to prevent other Eurozone bond yields from rising further, and what assistance it will extend to highly-geared Eurozone banks whose own viability may be threatened.

Lastly, the UK's unexpected election result this morning initially boosted sterling. Whether or not it holds this rise only time will tell.

Next week

Monday

UK: BoE Interest rate decision, BRC Retail Sales Monitor.

Tuesday

Japan: leading Indicator (Prelim.), Bank Lending Data, Current Account.
UK: Industrial Production, Manufacturing Production, NEISR GDP Est.

Wednesday

UK: Average Earnings, Claimant Count, ILO Unemployment Rate.
Eurozone: GDP (1st est.), Industrial Production.
US: Import Price Index, Retail Sales, Business Inventories.

Thursday

Japan: M2 Money Supply, Economy Watchers Survey.
US: Initial Claims, PPI

Friday

Japan: Consumer Confidence.
UK: Construction Output.
US: Empire State Survey, Capacity Utilisation, Industrial Production, Net Long-Term TICS Flows

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Dealing Desk: Return of gold’s safe-haven lure?

Thu, 05/07/2015 - 12:40
The appeal of gold as a safe-haven is beginning to resurge, after weeks in which the improving economic conditions in the US have dented prices.

A complicated international picture looks likely to support gold prices, with uncertainty the only definite outcome of the UK General Election, continued questions about Greece's ability to make debt repayments and the impact of their potential default on the rest of the Eurozone, and rising oil prices.

According to Dealing Manager at GoldMoney, Kelly-Ann Kearsey, a poor US jobs report has weakened USD against a basket of currencies – another development that has led to speculation that the Fed could put off an interest rate hike beyond next month.

She said: 'We are still seeing the same geographical trends in terms of selling out of UK and Swiss vaults, and buying into our Singapore vaults. Although gold has stayed under the psychologically-important $1,200 benchmark for the last seven days, we are starting to see signs that could push that safe-haven factor.

'Investors are hanging on for tomorrow's non-farm payroll report from the US – that data will be scrutinised closely to see if we can get a hint of intentions in the US about that all-important interest rate decision.

'If oil continues to rise beyond the $70 per barrel price, then we might see more interest in gold from buyers, who traditionally use it as a hedge against oil-led inflation.'

In the coming seven days, we're expecting to see a lot of data coming out of the US and China – the US has employment, retail and the producer price index; while China is set to publish trade balance data, along with a consumer price index and industrial production stats.

Week on week price performances
7/05/15 16:00. Gold effectively unchanged at $1,182.28, Silver up 2% to $16.31, Platinum down 0.9% to $1,127.50 and Palladium up 2% to $785.97.

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: Goldmoney.com or view our video online

Controlling copper and silver prices

Thu, 05/07/2015 - 08:29
There is an unwarranted assumption that market prices are always right, and represent "fair value". In the case of commodities, particularly metals, this is not necessarily true, because regulated financial markets make it too easy for government agencies and large banks to game the system.

Take the case of a country like China, which is the largest consumer of copper. Does it passively buy its copper through the market? No. Instead it strikes a price with a supplier, such as a Zambian copper mine, based on the London market price, bypassing the market entirely. If China plays no part in setting the reference price in London, the Zambians can be satisfied the price is fair; but if China or her agents suppressed the price of copper in the market before the price is set, the Zambians would be right to be upset.

Now, we do not know if China or her agents drive the copper price down, by placing a relatively small paper order so that the large off-market physical deal is priced favourably, but it is obviously in her interest to do so. Another metal where this could apply is silver.

We need to bear in mind three things about China and silver. She is the world's largest industrial user, she is almost certainly the world's largest refiner, and the government owns all the refineries. China imports large quantities of doré 1 and also base metal ores containing silver. So how she goes about this business is highly relevant to the silver price, and the following is an example of how it works.

In the case of foreign silver mines a qualified agent assesses the silver content of concentrates or doré on site and agrees a payment figure with the mine manager. Two further considerations then arise: the mine manager will want payment upfront because he has wages and other costs to meet; and the agent will look for the most cost-effective refining option. The first consideration is addressed by getting a bullion bank to advance the money against delivery of the concentrates or doré when refined, and the second will often involve a government-subsidised Chinese refiner.

There now exists a relationship between the Chinese government and the bullion bank, because the former has to deliver refined silver to the latter, or it must alternatively provide paper cover as may be subsequently agreed between them. As owner of the refining industry, China's interest is primarily strategic rather than profitability. Whether it is to subsidise the solar cell industry, or to build a strategic stockpile matters not; the temptation to suppress the price is the point.

The problem with price suppression is that it only works when buyers stand aside. But as we saw in the 30 months following October 2008 when the silver price ran up from under $9 to nearly $50, when buyers step in huge price moves can occur relatively quickly.

To the extent such price suppression does occur, today's commodities must be under-priced, just as bond and stock prices have become overpriced through central banks and other government agencies interfering with the markets. In any event investor opinion is bearish for commodities and bullish for the US dollar. Therefore, in a general market correction of valuation extremes commodities should recover strongly, how strongly will depend on whether or not prices have been artificially supressedsuppressed in the way described in this article.

Deflationists should take note: when markets crack, after initial confusion the prices of key commodities such as silver could rise more strongly than imaginable if they have been artificially suppressed, making them the only game in town.

 

1 A doré bar is a semi-pure alloy of gold and silver, usually created at the site of a mine. It is then transported to a refinery for further purification.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Rethinking the dollar

Tue, 05/05/2015 - 08:12
Listen to an interview with James Turk, Founder of GoldMoney, with Rethinking The Dollar. James discusses the state of the economy and his book The Collapse of the Dollar.

Click here to see the video.

Rethinking the dollar

Tue, 05/05/2015 - 07:38
Listen to an interview with James Turk, Founder of GoldMoney, with Rethinking The Dollar. James discusses the state of the economy and his book The Collapse of the Dollar.

Click here to see the video.

Market Report: Bear squeeze come and goes

Fri, 05/01/2015 - 06:35
This week started with a sharp bear squeeze, which took gold from $1178 to $1214, and silver from $15.70 to $16.71.

These higher prices on Wednesday proved to be the peak for both metals, before they fell back sharply yesterday (Thursday) on better than expected US initial jobless claims. The Federal Open Market Committee's (FOMC) minutes, which admitted the US economy is softening, had little effect when released yesterday.

We can be fairly sure the rise in the gold price on Monday and Tuesday was due to bears being squeezed, because Open Interest on Comex fell some 18,000 contracts, with the biggest drop on Monday when the market was at its strongest. If instead Open Interest had increased on rising prices it would have signalled that buyers are opening new positions; but this was clearly not the case, and the next chart illustrates this very clearly.

The market-makers on Comex would have been fully aware that there were weak hands short of gold contracts and susceptible to being squeezed. Equally, having successfully sold these nervous bears some expensive contracts on this squeeze the market makers had every incentive to mark prices down subsequently, so that they can book profits and show a favourable price (to them) on a mark-to-market basis at the month end. And this is precisely what happened.

The pattern in silver differed slightly, because this less liquid market has a larger element of bulls and bears taking more entrenched positions, but the same pattern can be seen.

In silver's case Open Interest had run up to record highs before last week while the price was falling. Buyers (mostly commercial users of the metal) were obviously taking the opportunity of lower prices to add to their positions. If you are buying for commercial reasons you are a more solid player than the hedge funds evident in the gold market.

However, the Commitment of Traders Report disclosed that the hedge funds' short positions in silver had increased by nearly 15,000 contracts (75 million ounces) last month, presumably on the basis that this was a geared play on shorting gold. So it was those weak hands that were squeezed into closing their positions this week, with the serious buyers stepping back.

This action appeared to be at odds with the sudden unwinding of long US dollar positions, leading to the dollar falling significantly. The weakening dollar was actually consistent with a subdued statement from the FOMC, the conclusion from which must be that interest rate rises are to be delayed further, possibly until next year. The long-term inflationary effect and the benefit to precious metals prices are being ignored for the moment.

Given that the highly technical nature of trading this week is now coming to an end with the commencement of a new month, there is reason to hope that the futures markets for gold and silver might respond more to fundamental factors, including growing political uncertainties in Europe, over the coming weeks.

Next week
Monday

Eurozone: Manufacturing PMI, Sentix Indicator. US: Factory Orders

Tuesday

UK: Halifax House Price Index, CIPS/Markit Construction PMI. Eurozone: PPI. US: Trade Balance, IBD Consumer Optimism, ISM Non-Manufacturing

Wednesday

Eurozone: Composite PMI, Services PMI, Retail Trade. UK: CIPS/Markit Services PMI. US: ADP Employment Survey, Non-Farm Productivity, Unit Labour Costs

Thursday

US: Initial Claims, Consumer Credit

Friday

UK: Trade Balance. US: Non-farm Payrolls, Private Payrolls, Unemployment, Wholesale Inventories

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Dealing Report: Surprise US improvement hits gold price

Fri, 05/01/2015 - 06:22
Unexpected improvement in US economic fortunes have dented gold prices over the last seven days, with news of unemployment dropping by a surprising 34,000 leading buyers away from safe haven investments.

The late shift followed a relatively steady week for gold prices – even despite the continuing uncertainty over Greece's debt talks, their continued position within the Euro, and strong rhetoric from European leaders.

According to Dealing Manager at GoldMoney, Kelly-Ann Kearsey, 'Gold was above the psychologically-important threshold of $1,200 for most of the week, but the two key factors for the latter part of the week were the signal from the Federal Reserve towards a US interest rate rise in June for the first time since 2006, and the jobless figures coming out of the US.

'The unexpected good performance more than compensated for disappointing US growth figures for the first quarter of the 2015, which saw annualised growth of 0.2% compared to 2.2% in the previous quarter.

'Over the coming days, we expect to see anticipation building on the position of Greece ahead of the 12th May deadline for a further IMF repayment falling due. And of course, speculation about the UK election is continuing to mount, and there is a possibility of drawn-out negotiations following an inconclusive result, that would lead to some uncertainty.'
Overall, the week saw net buying of gold, platinum and palladium, with sales of silver.

Again, the geographical trends are continuing, with sales out of UK and Swiss vaults, and buying into GoldMoney's vault in Singapore.

Week on week price performances
30/04/15 16:00. Gold down 0.4% to $1,181.88, Silver fell 2.4% to $15.99, Platinum lost 1.7% to $1,137.50 and Palladium dropped 0.6% to $770.47.

 

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis International (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: www.Goldmoney.com or view our video online
Follow us on @goldmoneynews

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