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Updated: 4 hours 52 min ago

The euro may be riskier than you think

Fri, 02/27/2015 - 07:13
Finance ministers in the Eurozone appear to have had a free lesson in game theory from Professor Yanis Varoufakis, the Greek finance minister.

At the time of writing Greece's future in the Eurozone is far from secured, but it appears that Greece has achieved something.

He gave his fellow finance ministers a deal they dared not refuse, though it still has to be ratified by some parliaments, including Germany's today. Varoufakis almost certainly understands that the Eurozone is in a weaker position than the bureaucrats and finance ministers themselves believed. It was important for them to become aware of this reality, which was central to his approach. It appears that under the Lisbon Treaty, Eurozone states cannot expel Greece: she can only leave with everyone's unanimous agreement, including her own. And they probably didn't realise that playing hardball against Greece would force the ECB to write off debts approaching ten times her equity capital of only €10.8bn. This would require all member states to increase their capital subscriptions, including the other Eurozone states subject to austerity packages.

Equally, Varoufakis would have known that he could not push his opposite numbers too far because the Brussels establishment also have their national parliaments to consider and the positions of Italy, Spain, Portugal and even Ireland. A revolt against previously-agreed austerity packages by any of these other states would have untold ramifications not only for the future of the Eurozone, but the euro itself.

In the wake of this episode the status of the euro as money is likely to be increasingly questioned, not just in the foreign exchanges, but by its users as well. This should be put into context by referring to Ludwig Von Mises's regression theorem. Put simply, the theorem states that the validity of any currency as money is based on its history and the basis of the value it had before it was accepted as money. This unfashionable view is demonstrably true of gold and silver, but is it true of paper currencies?

The US dollar and pound sterling have both survived more than one hundred years, having based their original value on extended periods of gold convertibility, and in the case of sterling long before that on silver. This in the minds of the users gives them a pedigree few would question. However, they are very much the exceptions in today's fiat currencies which are the motley survivors of some 57 hyperinflations, and there are plenty of examples of how a lack of regression coincides with a temporary character. Look no further than the Ukraine, which is suffering its second hyperinflation in 25 years. After Britain gave her African colonies independence in the 1960s, the value of all their currencies fell sharply in black-market dealings (the sole exception being Botswana which didn't introduce the pula until long after independence).

Logic, if not familiarity, suggests that there is something in the regression theorem, which brings us back to the euro. Like the Kenyan shilling, the Zambian kwacha or the Ukrainian hryvnia, the euro lacked any pedigree on its creation. There was no period when people had a choice of national currencies to aid the transition. While bonds and financial instruments were denominated in euros from January 1999 onwards, notes and coins replaced national notes and coins three years later overnight.

So, if Von Mises's regression theorem has any validity, holders of euros should be considering their options. It is also unfortunate timing that the ECB is about to embark on its most aggressive bout of monetary expansion to date, which could end up sealing the euro's fate. If so, the euro will turn out to be the Achilles heel of the global monetary system.

Market Report: PMs steady, but watch the euro

Fri, 02/27/2015 - 06:53
The US dollar eased this week when Janet Yellen of the Fed gave her semi-annual report on monetary policy to Congress.

It was no surprise that Ms Yellen hinted at caution over interest rates due to external events, such as the outlook for the Eurozone and uncertainty over China, but overall she was careful to be non-committal.

Following her testimony an easing dollar provided support for precious metals with gold having tested the $1190 level twice, last Friday and Tuesday, forming a short-term double bottom. This indicates good technical support in the short-term at least. Silver followed this same pattern finding similar support at $16.00. Precious metal prices improved yesterday as the dollar rallied on some bear-closing and notable weakness in the euro. The result is gold and silver rose marginally on the week by early London trading this morning.

The chart below shows gold and its Open Interest on Comex.

Open interest improved this week, giving advance warning that buyers are beginning to accumulate gold contracts on dips. We saw a repetitive pattern of physical buying overnight in Asia and on the London opening, followed by futures selling during US trading hours. What is interesting is that the passing of the Chinese New Year was expected to reduce physical demand. Instead, bullion demand appears to have picked up, probably reflecting Russian and other central bank buying. Russia withdrew from the market in January, apparently unprepared to chase higher prices, which suggests that their strategy is to accumulate on dips.

The stubbornly high level of Open Interest in silver has at last reduced somewhat as shown in our second chart.

Some of the shorts have managed to reduce their exposure. However, intraday trading this week was still consistent with remaining short positions being squeezed.

Our last chart shows the performance of platinum and palladium so far this year. Palladium has been the better performer thanks to a strong rally this week. Could this be an indictation of things to come for gold and silver as well?

There was no report from the Shanghai Gold Exchange this morning, due to the Chinese New Year.

The euro
The euro's future could become an important factor. In today's analysis I point out that the euro's inherent weaknesses may undermine its credibility in coming months. This will have two effects: firstly, and most obviously, it increases economic and systemic risks for the Eurozone and therefore the rest of the world; and secondly, it is likely to lead to a new source of demand for physical gold. It is easy to forget that Europeans have a long history of being avid gold hoarders in troubled times.

Next week

Monday

UK: Nationwide House Prices, BoE Mortgage Approvals, Net Consumer Credit, Secured Lending, M4 Money Supply.
Eurozone: Manufacturing PMI, Flash HICP, Unemployment.
US: Core PCE Price Index, Personal Income, Personal Spending, Manufacturing PMI, Construction Spending, ISM Manufacturing.

Tuesday

Eurozone: PPI. US: IBD Consumer Optimism, Vehicle Sales.

Wednesday

Eurozone: Composite PMI, Services PMI, Retail Trade.
US: ADP Employment Survey, ISM Non-Manufacturing

Thursday

UK: Halifax House Price Index, BoE Base Rate.
Eurozone: ECB Deposit Rate.
US: Initial Claims, Non-Farm Productivity, Unit Labour Costs, Factory Orders.

Friday

Japan: Leading Indicator (Preliminary).
Eurozone: GDP. US: Non-Farm Payrolls, Trade Balance, Unemployment, Consumer Credit.

Dealing Desk: Prices rise but bullion investors go tactical

Thu, 02/26/2015 - 12:46
Gold prices have risen this week before setting back to exactly the same price as they were this time last week.

At GoldMoney, customers have been selling in a week that has seen their trading volumes fall by 45% on last week.

Gold Sales
Chinese buyers coming back into the market after their week long Lunar holiday helped boost the yellow metal's prices. Dealing Manager Kelly-Ann Kearsey says they've seen net selling in terms of value, 'I think our customers are being pro-active in the market. The latest thought process coming out of the Federal Reserve in the USA is that although a rate rise isn't imminent, it is being considered on a month by month basis. It could happen sooner rather than later. A rate rise will give strength to the dollar and usually hits the gold prices. Some GoldMoney customers are selling while prices are above the critical $1200 level, in the anticipation that they can buy back more cheaply in a few months.'

Value not Quantity
However, Kelly-Ann said, 'Although we have seen net selling in terms of value, there are still more buyers than sellers for gold, showing that overall sentiment remains positive for bullion buying. We have also seen a continuation of the trend for the selling to be out of UK and Swiss vaults, into our eastern locations such as Singapore.'
The chart below shows how the ratio of buyers to sellers has changed over the week.

Platinum and Palladium
Platinum is still below the $1200 support level, despite rising car sales in Europe, while the Palladium price is seeing some support. 'Both platinum and palladium are still viewed as industrial metals,' says Kelly-Ann, 'With platinum being used mostly in diesel cars and the desire to cut air pollution meaning that diesels are falling out of favour, this could be hitting its price. Concurrently rising car sales in the US and China where petrol is the favourite fuel, could be supporting palladium.'

Week on week price performances
26/02/15 16:00. Gold no change at $1,208.50, Silver up 0.9% to $16.57, Platinum gained 0.9% to $1,176.99 and Palladium rose 3.6% to $808.20.

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.

Visit: Goldmoney.com or view our video online

Market Report: Mid-week sell-off

Fri, 02/20/2015 - 05:53
In last Friday's Market Update I commented that it is easy for bullion banks with deep pockets to move markets and change sentiment.

This week's trading in precious metals was a text-book example, with all precious metals falling sharply during New York trading on Tuesday, setting up gold for a test of the $1200 level the following day. The news background, with Greece playing an alarming game of chicken against the rest of the Eurozone, and Ukraine still moving NATO and Russia towards conflict, would normally drive precious metal prices higher as perceptions of systemic risk increase; but that would have been costly for the bullion banks with short positions. By early this morning UK time, on the week gold fell by about $20 and silver $0.55.

The position has been particularly difficult in silver for bullion banks, which fell 6% during Tuesday's bear raid on gold. Meanwhile Open Interest on Comex continues to climb as shown in the chart below.

This tells us that buyers are buying despite price weakness. The tick down in the last few days has hardly dented the underlying picture. Another way of looking at it is since the peak on 23rd January, the fall in price has generated demand for the equivalent of an extra 50,000,000 ounces, which is very different from the hoped-for capitulation of the bulls.

Open interest in gold on the other hand has reduced sharply in line with the price in recent weeks, as can be seen in the next chart.

All one can say is that speculative positions in the futures market have been successfully reduced and no longer overhang the market. Not surprisingly, current market uncertainty plus the Chinese New Year has led to a decline in interest, echoed at GoldMoney's dealing desk where customer activity has been subdued.

I've already mentioned Ukraine and Greece. Of these two Greece is likely to have the greatest influence on gold and silver, because of potential damage to the euro. Bear in mind the ECB's subscribed equity is only €10.8bn, yet it has loaned the Greek banks over €65bn, mostly to cover deposit withdrawals, and it owns a further €27bn in Greek government bonds. It's the old adage about who has the problem, the customer or the bank. In this case it appears to be the ECB.
Furthermore a glance at settlements between the national central banks over the TARGET2 system* shows there is a bigger potential problem with Italy, with capital flight of €59.5bn during the second half of 2014. It therefore seems markets are being very complacent about the future of both the Eurozone and the euro itself, which is only fifteen years old and so barely established compared with the other major currencies.

For the Chinese the New Year of the goat commenced yesterday, so the talk in western markets is that gold demand from China has peaked for the moment. We shall see, but the old year went out with wholesale demand in the last full week totalling another 59 tonnes, making a total of 374 tonnes since 1st January. Perhaps there might be some bullion available for the Indian wedding season.

*TARGET2 is an interbank payment for the real-time processing of cross-border transfers throughout the European Union.

Next Week

Monday

UK: CBI Distributive Trades.
US: Existing Home Sales.

Tuesday

Eurozone: HICP.
US: S&P Case-Shiller Home Index, Consumer Confidence.

Wednesday

UK: BBA Mortgage Approvals.
US: New Home Sales.

Thursday

Eurozone: M3 Money Supply, Business Climate Index, Consumer Sentiment, Economic Sentiment, Industrial Sentiment.
US: CPI, Durable Goods Orders, Initial Claims, FHFA House Price Index.
Japan: Core CPI, Real Household Spending, Unemployment, Industrial Production, Large Retailers Sales, Retail Sales.

Friday

Japan: Housing Starts, Construction Orders.
UK: GDP (2nd est.), Index of Services.
US: Core PCE Price Index (2nd est.), GDP Annualised (2nd est.), Chicago PMI, Pending Home Sales.

 

Global economic outlook – update

Fri, 02/20/2015 - 05:36
As recently as 9th January I wrote an article suggesting that 2015 would turn out to be the year of the slump. The title ended with a question mark, but today we are closer to removing it in favour of a definite statement.

In recent weeks, it has become clear that key economic blocs are indeed heading for a slump, including but not limited to China, the Eurozone and Japan (allowing for the distortions of her aggressive money-printing). Between them they account for nearly 40% of global GDP. We know this because of the collapse in commodity prices, which is reflected in a global shift of preference in favour of the US dollar.

For the avoidance of doubt, money should be regarded as a good, and each currency as a different good. When this point is grasped, the context of the dollar’s rise against both commodities and other currencies becomes clear. Both commodities and currencies are priced in dollars, so markets are showing that banks, consumers and businesses have been changing their preferences in favour of increasing their dollar balances.

Modern macroeconomics fails to adequately explain the importance of these developments. A quick look at the index in Keynes’s General Theory makes no mention of changes in preference for money versus other goods. It lists and defines liquidity preference which is a different topic. Once you accept money is a good, supply and demand will always balance as predicated in Say’s Law, otherwise known as the Law of the Markets.

Something has spooked consumers in markets around the world into spending less on other goods and to increase their holdings of dollars. The explanation can only be that prices for all other goods have been too high relative to dollars, so they have had to fall. There can be no clearer signal that there is a slump in global economic activity.

The largest source of exported physical goods is China. Demand from other countries for China’s goods is declining, confirmed by the Baltic Dry Index* which is plumbing new lows. This slow-down in economic activity could easily burst the bubble of bank credit, which is in danger of collapsing under the massive burden of bad debts. December’s slow-down in new loan demand coupled with declining trade flows can only be temporarily resolved by China devaluing the renminbi, thereby lowering her export prices. The breathing space this gives China is only as long as it takes for her manufacturing costs to rise to reflect the devaluation. If it occurs, a renminbi devaluation would quickly put more downward pressure on prices for local manufacturers in her export markets.

Turning to China’s trade partners, we see the Eurozone’s economy ex-Germany beginning to contract which is panicking the ECB into money-printing in a desperate attempt to maintain too-high prices. Japan has been doing this for some time, and is labouring under a mountain of debt that makes even Greece look responsible.

The signals are clear: the world has already entered a downturn in economic activity. Therefore we can expect accelerated money-printing and the imposition of more negative interest rates in a forlorn attempt to avert economic reality.

A shipping and trade index created by the London-based Baltic Exchange that measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. The Baltic Exchange directly contacts shipping brokers to assess price levels for a given route, product to transport and time to delivery (speed).

 

* A shipping and trade index created by the London-based Baltic Exchange that measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. The Baltic Exchange directly contacts shipping brokers to assess price levels for a given route, product to transport and time to delivery (speed).

 

Dealing Desk: Indian market to open up

Thu, 02/19/2015 - 13:12
Uncertainty across the global markets led to a quiet week for precious metal trading but the prospect of a reduction in gold import duty in the key Indian market has led to renewed expectations.

The Reserve Bank of India has proposed reducing the levels of duty on gold imports in a key reform that would reverse the previous government's policy. And with the Indian wedding season about to begin Dealing Manager, Kelly-Ann Kearsey, said that the easing of restrictions in a key gold consumer market was a promising sign.

She said: 'The rate of duty on gold imports was increased by the previous government to 10% in 2013, but a key policy of Narendra Modi's BJP party has been to reduce that rate.

That would lead to an increase in demand in what is a key gold consumer market, and the timing with the Indian wedding season running from March to July looks to be perfect.'

The news comes just as uncertainty in global markets – particularly over the question of Greece's negotiation with EU partners over their continuing financial problems, and the impact that outcome will have on the position in Spain and Italy – has led to a quiet week for precious metal trading.

'Volumes are down this week for a variety of reasons, mostly down to uncertainty but also down to Chinese New Year which has slowed down activity,' said Kelly-Ann.

'We have seen positive figures in activity within our Canada and Singapore vaults, and there are positive signs from the US Federal Reserve about interest rates as they take a more dovish approach.

'In the next week we're expecting more data from the US on existing home sales, consumer price index and consumer confidence.'

Week on week price performances
19/02/15 16:00. Gold down 1.1% to $1,208.50, Silver fell 2.3% to $16.43, Platinum lost 2.9% to $1,166.95 but Palladium increased 1.4% to $780.05.

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.

Visit: Goldmoney.com or view our video online

Unemployment and groupthink

Fri, 02/13/2015 - 06:17
On Friday 6th February the American Bureau of Labor Statistics (BLS) released its employment estimates for January, which being better than the market expected, caused Treasury bond yields to rise and precious metals to be marked sharply lower.

Earlier that week Jim Clifton, Chairman of Gallop wrote "The official unemployment rate as reported by the US Department of Labor is extremely misleading."

His comments attracted notice, not least because Gallop is an independent company whose business is statistics. Furthermore, it is unusual for a senior business figure to criticise a government department so openly. His basic point is that if you are unemployed and have stopped looking for work in the last four weeks you are no longer classified as unemployed.
Furthermore if you perform a minimum of one hour of work in a week and are paid at least $20, you are deemed to be employed. And so on.

This is hardly news to those of us who have been sceptical about official statistics. The fact is there are even on BLS numbers 102 million adults deemed not in the labour force or officially unemployed. Then there are those who are only partially employed, but counted by the BLS as employed. As Jim Clifton points out if we add these 34.7 million people to the BLS's 102 million figure, only 44.2% of US adults are actually employed for 30 hours or more per week; in other words fully employed by any common-sense definition.

This is the true indication of the state of employment in the US. The BLS could be more up-front in presenting its numbers, but being a government department we have to accept that it presents these figures in the best possible light. However, they are completely open about their methodology, and any member of the public can make his own assessment. So assuming caveat emptor should apply, the fault for accepting the BLS headline without question lies with the investing public, careless enough to be egged on by sell-side analysts and the media.

The result is markets move on what amounts to state-sponsored disinformation. Unemployment statistics are only one example of the fodder for the groupthink that has become the bedrock of macroeconomics and financial analysis. Groupthink is "a psychological phenomenon that occurs within a group of people in which the desire for harmony or conformity in the group results in an irrational or dysfunctional decision-making outcome". This definition from Wikipedia describes the relationship between US government statistics and financial markets to a tee.

It is a shame: employment statistics have the potential to be the one number in macroeconomics that tells us the true state of the economy. The two other major variables, GDP and price inflation, are badly flawed. Nominal GDP tells us the quantity of transactions, not quality, ranking wasteful government spending equally with consumer-driven economic progress. Furthermore, government statisticians use every trick in the book to under-record rising prices, otherwise no growth in real GDP would have been recorded since the Lehman crisis.

We cannot claim that the true state of the US labour market is concealed from us. We need to think for ourselves and not dismiss from our minds comments by the likes of Jim Clifton of Gallop. That we do is evidence that "irrational or dysfunctional decision-making outcomes" drive our statistical interpretation and therefore all financial markets, and should not be confused with rational analysis.

 

Market Report: Strong US dollar sets market tone

Fri, 02/13/2015 - 05:53
This week the US dollar moved strongly upwards against the other major currencies, at the same time weakening gold and silver along with most industrial commodities, before some profit-taking set in yesterday.

The effect on precious metals is a change from previous weeks when a flight into dollars also supported gold and silver prices. Instead, gold and silver were noticeably weak until this morning, when prices recovered $8 and $0.13c respectively in early London trading. So what’s changed?

On examination very little has, other than a determination by liquidity providers in the futures markets to contain their short positions. In a market where speculators have little or no ability to judge value, emotion sets prices. This makes it easy for bullion banks with deep pockets to move the market and change sentiment. On Comexi this has led to a sharp reduction in outstanding gold open interest over the last fortnight as shown in the chart below.

The chart clearly shows the tight relationship between open interest and the gold price since late-December and suggests that on purely technical grounds there is still some limited scope for lower prices. Interestingly attempts to shake out bulls in silver have been less successful, as illustrated in the next chart.

Moment to moment silver trading imparts the impression that the market is systemically short, and there have been many occasions when gold has drifted lower that the silver price has gained on balance.

Meanwhile Greece continues to dominate financial headlines, with deposits being withdrawn from the banks, so much so that the ECBii has had to extend its Emergency Liquidity Assistance by an extra €5bn to €64.5bn. The European Financial Stability Facility for Greece expires at the end of this month, and in March a series of IMFiii loans and T-bills mature. The pressure for Greece to compromise is building rapidly.

At the same time banks in central Europe have been adversely affected by potential losses on Swiss franc mortgage exposure and sanctions against Russia. The combination of these troubles plus Greece has not so far supported the gold price, though there are reports that Greek citizens are buying British sovereigns. There are also reports from Switzerland that negative interest rates are similarly creating demand for physical bullion.

For the moment gold traders are ignoring the potential demand for precious metals from negative interest rates. Sweden’s Riksbank has cut its repo rate to -0.1%, and the Bank of England warned that prices might actually fall, signalling the possibility that it might have to take more easing action to prevent deflation. The trend towards negative interest rates continues which should underwrite precious metals.

Next week

Monday

Japan: Capacity Utilisation, Industrial Production (final).
UK: Rightmove House Price Index.

Tuesday

UK: CPI, Input Prices, ONS House Prices, Output Prices.
Eurozone: ZEW economic Sentiment.
US: Empire State Survey, NAHB Builders Survey, Net Long-Term TICS Flows.

Wednesday

UK: Average Earnings, BoE MPC Minutes, Claimant Count Change, ILO Unemployment Rate.
US: Building Permits, Housing Starts, PPI, Capacity Utilisation, Industrial production.
Japan: Customs Cleared Trade, BoJ MPC overnight Rate.

Thursday

Japan: All Industry Activity Index, Leading Indicator.
Eurozone: Current Account.
UK: CBI Industrial Trends.
US: Initial Claims, Leading Indicator, Philadelphia Fed Survey.

Friday

Eurozone: Flash Composite PMI, Flash Manufacturing PMI, Flash Services PMI.
UK: Public Borrowing, Retail Sales.
US: Flash Manufacturing PMI.

i COMEX, (Commodity Exchange, Inc.) a division of the New York Mercantile Exchange (NYMEX)

ii ECB, European Central Bank

iii IMF, International Monetary Fund

Dealing Desk: Silver overshadowed as gold comes back into favour

Thu, 02/12/2015 - 12:48
Gold demand might be at a five year low, according to the latest World Gold Council demands trend report, but this week the yellow metal returned to favour with GoldMoney's customers.

Demand for Gold

Dealing Manager Kelly-Ann Kearsey said, 'Gold was the favourite among our customers with silver having lost its appeal. The slight fall in the gold price this week might have prompted some opportune buying, while its more volatile sister, silver, fell out of favour a little seeing slightly more sellers than buyers. We have had some fairly large orders of gold this week, although overall volumes are slightly down, suggesting some are seeing this as the right time to diversify their portfolios for the longer term.'

The chart below shows the gradual shift in behavior among customers in the last three weeks, as gold takes over from silver as the metal being bought.

Where and why?

Kelly-Ann reports that Singapore is once again the favourite destination for new metal purchases, continuing the west to east flow, 'The strength of the US Dollar and the news that the European Central Bank (ECB) won't start its quantative easing until March, have weighed on gold sentiment in the general market. The recovery in the oil price might also have hit general prices, but that hasn't been a major consideration for GoldMoney customers.'

Where to next?

The positive news of a Ukraine ceasefire will lessen the geopolitical factors for gold, and next week sees a lot of economic data – particularly for the USA – which is likely to be reflected in the market. 'Monday will be Europe's day with the ECB meeting and further indications with regard to the Greek situation and will they or won't they exit? Wednesday though is likely to be the biggest day in terms of a swathe of US economic data and the Federal Open market Committee Meeting minutes being released. It could mean a fairly quiet market up until mid week, unless there is some startling news out of Europe.

'Overall though as the World Gold Council report shows, investment demand is on the up and while the general market might sometimes lose interest in the yellow metal, our customer data shows there are still many, including the Central Banks themselves, who are buying to spread their risk and hedge against inflation.'

Week on week price performances

12/02/15 16:00. Gold down 3% to $1,222.55, Silver slipped 1.5% to $16.81, Platinum dropped 2.8% to $1,201.60 and Palladium decreased 2.0% to $769.30.

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.

Visit: Goldmoney.com or view our video online

Market Report: Consolidation continues

Fri, 02/06/2015 - 05:22
This week precious metals continued to consolidate January's gains in volatile financial markets, with both gold and silver range-bound. Platinum and palladium are up on the week, noticeably stronger than gold and silver. Physical and paper markets appear to have been behaving differently, with prices tending to be firm in London (where physical deliveries take place) and weaker in New York (which is overwhelmingly derivative trading), though at the close of trading in New York prices appeared more often than not to steady ahead of the Asian markets opening.

The US dollar has also been consolidating its recent strength, roughly in phase with the gold price. The logical conclusion from this action is that for the moment, sellers of the other paper currencies are hedging into both gold and the US dollar, which from the point of view of a non-US person faced with a weakening currency makes sense. So long as this relationship persists, it should also give us a clue on the timing of gold's next move, which will be when the overbought position in the dollar is unwound enough to support its next rise. We may already be there after yesterday's pronounced dollar weakness, which was technical in nature with the euro strengthening sharply despite a deteriorating Greek situation.

On Comex precious metal traders and bullion banks have been fighting a paper battle, and traders' positions have now normalised, as shown in the chart below, which is of the short positions of the Managed Money category in gold:

 

The dotted line is the long-term average short position, which after the extreme volatility of the last two years is where we are today. This return to normality has resulted in the largest four traders (basically the bullion banks) increasing their net short position, which is shown in the next chart.

 

This is still well above the average since 2006, but with physical liquidity low, the bullion banks are unlikely to be able to tolerate escalating shorts to the extent they have in the past, so they might be forced to capitulate if buying increases much more. Until that moment we should expect them to make every attempt to shake out long positions by triggering stop-loss positions.

It will be important to watch big macro events, such as the possible fragmentation of the Eurozone, a run on Greek banks, particularly if it threatens to destabilise the euro or other Eurozone banks, as well as the developing crisis in Ukraine.


Tensions over Ukraine have rapidly escalated this week, and might become a factor for gold and silver prices next week if America sends military equipment, Russian tanks start rolling, or both. We must hope the Merkel/Hollande peace initiative defuses the situation.


Next week


Monday

Japan: Consumer Confidence, Economy Watcher's Survey.
Eurozone: Sentix Indicator

Tuesday

Japan: M2 Money Supply, METI Tertiary Activity Index.
UK: Industrial Production, Manufacturing Production, NIESR GDP Est.,
US: Wholesale Inventories.

Wednesday

US: Budget Deficit.
Japan: Key Machinery Orders.

Thursday

Eurozone: Industrial Production.
UK: BoE Quarterly Inflation Report.
US: Initial Claims, Retail Sales, Business Inventories.

Friday

UK: Construction Output.
Eurozone: GDP, Trade Balance.
US: Import Price Index

 

Sovereign Bonds

Fri, 02/06/2015 - 05:02
Today's obvious mispricing of sovereign bonds is a bonanza for spending politicians and allows over-leveraged banks to build up their capital. This mispricing has gone so far that negative interest rates have become common: in Denmark, where the central bank persists in holding the krona peg to a weakening euro, it is reported that even some mortgage rates have gone negative, and high quality corporate bonds such as a recent Nestlé euro bond issue are also flirting with negative yields.

The most identifiable reason for this distortion of free markets is bank regulation. Under the Basel 3 rules, a bank with sovereign debt on its balance sheet is regarded by bank regulators as owning a risk-free asset.

Unsurprisingly, banks are encouraged by this to invest in sovereign debt in preference to anything else. This leads to the self-fulfilling second reason: falling yields. Central bank intervention in the bond markets through quantitative easing and commercial bank buying leads to higher bond prices, which in turn give the banks enormous profits. It is a process that the banks wish would go on for ever, but logic says it doesn't.

Don't think that there is an economic justification for negative bond yields: there isn't. Even if price inflation goes negative, interest rates in a free market will always remain positive. The reason for this cast-iron rule is interest rates are an expression of time-preference. Time preference is the solid reason that possession of money today is more valuable than a promise to give it to you at some time in the future. The future value of money must always be at a discount to cash-in-the-hand, or put the other way, to balance the value of cash today with cash tomorrow always requires a supplementary payment of interest. That is always true so long as interest rates are set by genuine market factors and not set by a market-monopolising central bank, and then distorted by banking regulations.

So we have arrived close to the logical end-point in falling yields, and in some cases we have gone beyond it. We must also conclude that negative yields are a signal that bond prices are so over-blown that they are vulnerable to a substantial correction. Furthermore, when the tide turns against bond markets the downside could be considerable. The long-term real yield on high quality government bonds has historically tended to average about three per cent, which implies that sovereign bonds would crash if central banks lost control of the market.

Bond bulls are on weak ground from another angle. If history tells us that real yields of three per cent are the norm, has government creditworthiness changed for the better, justifying a lower yield? Well, no: the accumulation of debt across all welfare economies is less sustainable than at any time in the past, and demographics, the number of retirees relative to those in work and paying taxes, are rapidly making the situation far worse.

Macroeconomists will probably claim that so long as central banks can continue to manage the quantity of money sloshing about in financial markets they can keep bond prices up. But this is valid only so long as markets believe this to be true. Put another way central banks have to continue fooling all of the people all of the time, which as we all know is impossible.

Dealing Desk: Silver glistens and gold slips

Thu, 02/05/2015 - 13:02
It was a quieter week for GoldMoney customers, with the online precious metal trader seeing net selling of gold, and more interest in buying silver, in line with the trend in recent weeks.

Dealing Manager Kelly-Ann Kearsey said, ‘There is uncertainty in the markets, which traditionally has bolstered gold as a safe haven investment. This week has seen data from the US and announcements in relation to the developments in Greece post-election, which has added a little more stability to the overall picture. At the moment, investors are looking to silver for an investment with a quicker turnaround, while gold remains the long-term choice, and we are seeing an overall impact from the changes in the crude oil price.’

Looking ahead

‘The figures that everyone is watching out for are in US payroll data,’ says Kelly-Ann. ‘These figures are a barometer for the strength of the economy, and with continuing speculation about the first interest rate hike in several years, it’s fair to say that there’s a significant level of interest. The other statistics over the next week regard US Retail Sales, again, that’s a significant indicator about the health and prospects of the US economy.

Week on week price performances: 5/02/15 16:00. Gold down 0.3% to $1,260.75, Silver fell 0.5% to $17.06, Platinum rose 2% to $1,1,236.50 and Palladium increased 1.5% to $784.98.

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 worlds 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.

Historic Revolt

Tue, 02/03/2015 - 05:47
James Turk spoke to King World News to say that a historic revolt against corrupt Western banksters is now underway. He also cautioned that a "ticking time-bomb" is set to explode and discussed what this will mean for the world.

To read the article, please click here.

More euro-tragedy

Fri, 01/30/2015 - 06:41
Despite the uncertainties ahead of the Greek general election, the European Central Bank (ECB) went ahead and announced quantitative easing (QE) of €60bn per month from March to at least September 2016.

What makes this interesting is the mounting evidence that QE does not bring about economic recovery. Even Jaime Caruana, General Manager of the Bank for International Settlements and who is the central bankers' central banker, has publicly expressed deep reservations about QE. However, the ECB ploughs on regardless.

The Keynesians at the ECB are unclear in their thinking. They are unable to answer Caruana's points, dismissing non-Keynesian economic theory as "religion", and they sweep aside the empirical evidence of Keynesian policy failures. Instead they are panicking at the spectre of too little price inflation, the continuing fall in Eurozone bank lending and now falling commodity prices. To them, it is a situation that can only be resolved by monetary stimulation of aggregate demand applied through increased government deficit spending.

This is behind the supposed solution of the ECB's QE, most of which will involve national central banks in the euro-system propping up their own national governments' finances.

The increased socialisation of the weaker Eurozone economies, especially those of France, Greece, Italy, Spain and Portugal, will inevitably lead to unnecessary economic destruction. QE always transfers wealth from savers to financial speculators and other early receivers of the new money. Somehow, the impoverishment of the working and saving masses for the benefit of the central bankers' chosen few is meant to be good for the economy.

Commercial banks will be corralled into risk-free financing of their governments instead of lending to private enterprise. This is inevitable so long as the Single Supervisory Mechanism (the pan-European banking regulator) with a missionary zeal is discouraging banks from lending to anyone other than governments and government agencies. So the only benefit to employment will come from make-work programmes. Otherwise unemployment will inevitably increase as the states' shares of GDP grow at the expense of their private sectors as the money and bank credit shifts from the former to the latter: this is the unequivocal lesson of history.

It may be that by passing government financing to the national central banks, the newly-elected Greek government can be bought off. It will be hard for this rebelling government to turn down free money, however angry it may be about austerity. But this is surely not justification for a Eurozone-wide monetary policy. While the Greek government might find it easier to appease its voters, courtesy of easy money through the Bank of Greece, hard-money Germans will be horrified. It may be tempting to think that the ECB's QE relieves Germany from much of the peripheral Eurozone's financing and that Germans are therefore less likely to oppose the ECB's QE. Not so, because the ECB is merely the visible head of a wider euro-system, which includes the national central banks, through which there are other potential liabilities.

The principal hidden cost to Germany is through the intra-central bank settlement system, TARGET2, which should only show minor imbalances. This was generally true before the banking crisis, but since then substantial amounts have been owed by the weaker southern nations, notably Italy, to the stronger northern countries. Today, the whole of the TARGET2 system is being carried on German and Luxembourg shoulders as creditors for all the rest. Germany's Bundesbank is owed €461bn, a figure that is likely to increase as the debtors' negative balances continue to accumulate.

The currency effect

The immediate consequence of the ECB's QE has been to weaken the euro against the US dollar, and importantly, it has forced the Swiss franc off its peg. The sudden 20% revaluation of the Swiss franc has generated significant losses for financial institutions which were short of the franc and long of the euro, which happens to have been the most important carry-trade in Europe, with many mortgages in Central and Eastern Europe denominated in Swiss francs as well. The Greek election has produced a further problem with a developing depositor run on her banks. Doubtless both the carry-trade and Greek bank problems can be resolved or covered up, but problems such as these are likely to further undermine international confidence in the euro, particularly against the US dollar, forcing the US's Fed to defer yet again the day when it permits interest rates to rise.

This was the background to the Fed's Open Market Committee (FOMC) meeting this week, and the resulting press release can only be described as a holding operation. Statements such as "the Committee judges that it can be patient in beginning to normalise the stance of monetary policy" are indicative of fence-sitting or lack of commitment either way. It is however clear that despite the official line, the US economy is far from "expanding at a solid pace" (FOMC's words) and external events are not helping either. For proof of that you need look no further than the slow-down of America's overseas manufacturing and production facility: China.

The consequences for gold

Until now, central banks have restricted monetary policy to domestic economic management; this is now evolving into the more dangerous stage of internationalisation through competitive devaluations. We now have two major currencies, the yen and the euro, whose central banks are set to weaken them further against the US dollar. Sterling, being tied through trade with the euro, should by default weaken as well. To these we can add most of the lesser currencies, which have already fallen against the dollar and may continue to do so. The Fed's 2% inflation target will become more remote as a consequence, and this is bound to defer the end of zero interest rate policy. So from all points of view competitive devaluations should be good for gold prices.

This is so far the case, with gold starting to rise against all major currencies, including the US dollar, with the price above 200-day and 50-day moving averages in bullish formation. To date from its lows gold has risen by up to 13% against the USD, 18% against the pound, 30% against the euro, and 32% against the yen. The rise against weaker emerging market currencies is correspondingly greater, fully justifying Asian caution about their government currencies as stores of value.

We know that Asian demand for bullion has absorbed all mine production, scrap and net selling of investment gold from advanced economies for at least the last two years. Indeed, the bear market in gold has been a process of redistribution from weak western into stronger eastern hands. So if there is a revival in physical demand from the public in these advanced economies it is hard to see how it can be satisfied at anything like current prices, with physical bullion now in firm hands.

The gold price is an early warning of future monetary and currency troubles, and it is now becoming apparent how they may transpire. The ECB move to give easy money to profligate Eurozone politicians is likely to have important ramifications well beyond Europe, and together with parallel actions by the Bank of Japan, can now be expected to increase demand for physical gold in the advanced economies once more.

Market Report: Consolidating gains

Fri, 01/30/2015 - 06:13
Gold and silver prices consolidated recent gains this week, both having become overbought short-term, and they now appear to be building a base before an attempt to convincingly attack higher ground, though yesterday's price reaction was quite sharp.

The recent slightly overbought situation for gold is shown in the chart below, which is of the Comex Managed Money category net position:

The dotted line is the average net long position (since 2006), so we can see that net longs are slightly higher than that average. This tells us that fund and hedge fund managers have undergone a huge shift in sentiment over the last two months.

Silver tells a similar story:

Again, the dotted line is the long-term average net position, indicating that silver's strong rally needs some consolidating. Any pause in the news flow is an opportunity for the bullion banks to mark the price down in the hope they can close some of their short positions, and that is what happened yesterday, with gold driven down over 2% and silver by nearly 6%.

Last time the Managed Money category was as bullish was in July last year, when gold ran up to $1330 and silver to $21. Gold and silver then fell back to new lows, so will this happen again?

Time will tell, and there is no doubt some of the large trading banks have a vested interest in seeing lower prices. But in mid-2014 markets were coming to terms with the end of the Fed's quantitative easing programme; this time we have the ECB's QE about to be implemented.

So background monetary fundamentals for gold and silver appear to be improving, with the ECB having announced this month quantitative easing of €60bn per month from March onwards. Ahead of this announcement the Swiss National Bank decided to abandon its peg to the euro, injecting a high degree of currency instability into European markets. These developments are more likely than not to produce European buyers for gold over time, and it is worth noting that, priced in euros, gold is already some 25-30% up from its recent lows.

Also in Europe there have been significant losses from the Swiss franc reaction, and the Greek banking system is suffering depositor withdrawals. It would, however, be wrong to expect too much impact on gold and silver from these events, until there is firmer evidence they could be systemically destabilising.

The bigger news is currencies. With both the Bank of Japan and the ECB determined to weaken their currencies against the US dollar, we have the makings of a return to deliberate devaluations, which is more likely to encourage Japanese and European buyers for bullion.

In other news, the Shanghai Gold Exchange has been delivering large quantities of gold into the wholesale markets, with a further 70.63 tonnes last week, making a total of 201.67 tonnes for the first three weeks of January. Note how rising prices have not deterred Chinese demand.

Next week

Monday

Eurozone: Manufacturing PMI.
UK: CIPS/Markit Manufacturing PMI.
US: Core PCE Price Index, Personal Income, Personal Spending, Manufacturing PMI, Construction Spending, ISM Manufacturing.

Tuesday

UK: CIPS/Markit Construction PMI.
Eurozone: PPI.
US: Factory Orders, IBD Consumer Optimism, Vehicle Sales.

Wednesday

Eurozone: Composite PMI, Services PMI, Retail Trade.
UK:CIPS/Markit Services PMI.
US: ADP Employment Survey, ISM Non-Manufacturing

Thursday

UK: Halifax House Price Index, BoE MPC Base Rate.
US: Initial Claims, Non-Farm Productivity, Trade Balance, Unit Labour Costs.

Friday

Japan: Leading Indicator.
UK: Visible Trade Balance.
US: Non-Farm Payrolls, Private payrolls, Unemployment, Consumer Credit.

Dealing Desk: Silver slumps and gold glistens

Thu, 01/29/2015 - 13:44
It was a quieter week for GoldMoney customers ahead of the Federal Reserve Open Market Committee (FOMC) meeting on Wednesday, although activity increased slightly after with a marked change in direction with regard to silver.

Silver loses its physical shine
After several weeks of buying from the online precious metals dealer's customers, silver has lost its shine according to Dealing Manager at GoldMoney, Kelly-Ann Kearsey, 'Customers have been actively tracking the markets this week as we've seen silver selling ahead of the FOMC meeting. Obviously silver is an industrial metal and prone to more volatility, so our customers have decided that now is the time to sell some of the white metal, and instead we've seen a return to gold fever.'

The graph below shows the complete turnaround in gold and silver buying interest from GoldMoney's customers compared to last week:

Gold glistens again
'We saw a big order of gold into our Swiss vaults, for the second week in a row.' Says Kelly-Ann, this is again a change from the recent trend of selling out of the western vaults and into our eastern ones, particularly Singapore. That's not to say that Singapore wasn't a big recipient, it was, with UK vaults seeing the selling. Gold prices have dropped a little since the FOMC meeting as gold's inflationary hedge attraction declined. However, following the weaker than expected US Durable Goods orders, and amid continued fears about Europe and the Greek economy, we're seeing buying interest from those wishing to protect their portfolios against potentially more price sensitive investments.

Where to Next?
'There have definitely been more buyers than sellers this week despite the quieter trading, and there are clearly some concerns around the industrial precious metals. Platinum has remained below gold's price. The stronger US Dollar and lower oil prices are countering gold's appeal generally, but while economic robustness remains in question, it will still see continued interest from those seeking a safe haven for their money.'

Week on week price performances
29/01/15 16:00. Gold down 2.7% to $1,264.06, Silver fell 6.1% to $17.14, Platinum lost 5.3% to $1,212.75 but Palladium increased 1.0% to $773.60.

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, 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

Schools and nurseries line up for the Easter bunny

Thu, 01/29/2015 - 06:21
For the third year, GoldMoney are sponsoring the Grace Crocker Bunny Run. A team of runners dressed as rabbits, will visit schools and nurseries across the island to deliver chocolate eggs at Easter in aid of the charity.

The run is not only a fun way for children to celebrate Easter, but also raises funds and awareness of the Grace Crocker Family Support Foundation. It has already given £6,750 to the charity, and this year looks like being the biggest yet with entertainment support from registered sports coaching and playcare club, Sports Bugs.

Organisers Rachel and Pete Wright say 16 schools and nurseries are signed up, but are calling for more to come forward and take part in this island wide event. Pete is Chief Financial Officer at GoldMoney, 'Each year the bunny run has been getting bigger. Last year we had our bunnies judging Easter egg decorating and Easter bonnet competitions, we held mini sports days with egg and spoon races, with the help of Sports Bugs, and there were lots of other Easter themed games at the different schools and nurseries. We can organise as much or as little as each school wants, all we ask is that parents donate at least £1 towards the Grace Crocker charity and in return their child will receive a chocolate egg and have lots of fun.'

Grace Crocker was born in Jersey with hypo-plastic left heart syndrome and had open heart surgery at just five days old. Grace's family had to move to Southampton for three months to be with her, but sadly Grace died aged just 11 weeks. The charity aims to help other families who have to go off island when a child is seriously ill, and gives financial and emotional assistance.

Geoff Turk, Chief Executive Officer, GoldMoney said the company is pleased to be again supporting the Bunny run: 'The Grace Crocker foundation is a very worthwhile charity, which any parent will be able to relate to. Pete and Rachel have come up with a fantastic way for children to enjoy Easter and raise funds for the charity, and GoldMoney is delighted to be able to once again support them. It would be lovely to see every school and nursery in Jersey getting in touch and taking up this wonderful opportunity.'

Sports Bugs will be on hand to help organise games and activities at each school/nursery. The experienced coaching team at the local sports development company, can also loan equipment for sports games such as the egg and spoon race.

If a school or nursery would like a visit from the Bunny you can contact Pete at: r_r.wright@yahoo.co.uk, or via the Facebook page: The Grace Crocker Bunny Run.

Further information about the charity and donations can be made through their website: www.gracecrocker.org

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, 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

Is The Gold Price About To Repeat One Of Its Greatest Upside Moves In History

Mon, 01/26/2015 - 11:24
James Turk spoke to King World News, ahead of this Wednesday's FOMC announcement, about why gold is about to repeat one of its greatest upside moves in history. He also included a fantastic 5-decade chart to go along with his powerful interview. James Turk: "We should not be too surprised that gold and silver have begun the week with some downward price pressure, Eric. The Greek election results are now known, so there has been some "buy the rumor, sell the news" pressure from that.   Read the full interview here.

 

Dealing Desk: Gold’s star rises, eclipsing platinum’s shine

Thu, 01/22/2015 - 12:43
It was a well anticipated rise for the gold price following confirmation from the European Central Bank that it is to start quantative easing, and the increase in interest has been reflected at GoldMoney.

Double volume

Dealing Manager at GoldMoney, Kelly-Ann Kearsey said, 'Volumes more than doubled this week, compared to last, registering a 119% increase. It's definitely in favour of the buyers with gold returning to the top slot knocking the recent favourite, silver, into runner-up position - although its still receiving plenty of interest too. The increase in buying came after the Swiss National Bank's decision, last week, to end its cap against the Euro. We have also seen more interest this week for our Swiss vault along with the more usual flow into the east and Singapore.'

Platinum struggles

The other phenomenon on the precious metals markets this week has been the gold price rising above its rarer cousin, platinum. 'The lower platinum price in comparison to gold's reflects platinum's industrial use and gold's safe haven status. With economic uncertainties once again rumbling round the world the industrial metals are losing favour although silver's relatively under-priced status of the past few weeks has seen it gain the most in percentage terms this week.' said Kelly-Ann. 'The last time we saw platinum fall below gold was in April of last year. We've also seen a large sell order on palladium this week'.

Where to next?

There is a general feeling that more faith is going back into gold according to Kelly-Ann, 'The yellow metal's rise beyond $1300 has boosted confidence in the metal's direction and the next week will give further impetus with a swathe of figures coming out of the US and the Federal Open Market Committee meeting. A clearer indication of where the US economy is heading could give further drive to gold buying as a safe haven and asset protector.'

Week on week price performances
22/01/15 16:00. Gold up 3.1% to $1,299.06, Silver increased 7.0% to $18.25, Platinum gained 2.0% to $1,280.45 but Palladium decreased 0.6% to $766.25.

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

Dealing Desk: Gold’s star rises, eclipsing platinum’s shine

Thu, 01/22/2015 - 12:43
It was a well anticipated rise for the gold price following confirmation from the European Central Bank that it is to start quantative easing, and the increase in interest has been reflected at online precious metals dealer, GoldMoney.

Double volume

Dealing Manager at GoldMoney, Kelly-Ann Kearsey said, 'Volumes more than doubled this week, compared to last, registering a 119% increase. It's definitely in favour of the buyers with gold returning to the top slot knocking the recent favourite, silver, into runner-up position - although its still receiving plenty of interest too. The increase in buying came after the Swiss National Bank's decision, last week, to end its cap against the Euro. We have also seen more interest this week for our Swiss vault along with the more usual flow into the east and Singapore.'

Platinum struggles

The other phenomenon on the precious metals markets this week has been the gold price rising above its rarer cousin, platinum. 'The lower platinum price in comparison to gold's reflects platinum's industrial use and gold's safe haven status. With economic uncertainties once again rumbling round the world the industrial metals are losing favour although silver's relatively under-priced status of the past few weeks has seen it gain the most in percentage terms this week.' said Kelly-Ann. 'The last time we saw platinum fall below gold was in April of last year. We've also seen a large sell order on palladium this week'.

Where to next?

There is a general feeling that more faith is going back into gold according to Kelly-Ann, 'The yellow metal's rise beyond $1300 has boosted confidence in the metal's direction and the next week will give further impetus with a swathe of figures coming out of the US and the Federal Open Market Committee meeting. A clearer indication of where the US economy is heading could give further drive to gold buying as a safe haven and asset protector.'

Week on week price performances
22/01/15 16:00. Gold up 3.1% to $1,299.06, Silver increased 7.0% to $18.25, Platinum gained 2.0% to $1,280.45 but Palladium decreased 0.6% to $766.25.

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

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