The Israel Deception

Is the return of Israel in the 20th century truly a work of God, or is it a result of a cosmic chess move to deceive the elect by the adversary?

Showing posts with label silver. Show all posts
Showing posts with label silver. Show all posts

Friday, September 15, 2017

In what appears to be desperation to the growing power of the SGE, the LBMA will begin settling silver contracts in multiple currencies

For years the London Bullion Market Association (LBMA) sold physical silver and paper contracts in either dollar, euros, or pounds.  But in a new denominational change that almost reeks of desperation, the LBMA on Sept. 25 will begin settling silver contracts in over a dozen new currencies.

On September 25th, 2017, London silver will be priced in RUBLES, ONSHORE AND OFFSHORE YUAN, Rupees, and other currencies as sweeping changes are beginning now. Here’s the details so far… 
There are two parts to take into consideration on these sweeping changes.
First, there was a request for feedback on their proposed changes to the LBMA. Secondly, NOBODY made ANY feedback, and so the proposal will launch as stated on September 25th, 2017. 
The LBMA Silver Price is currently published in USD, EUR and GBP. The USD prices are published to 3 decimal places and the EUR and GBP prices are published to 4 decimal places. The price discovery in IBA’s Gold auction is in USD. At the end of the auction, the price for Gold in USD is converted into other currencies. These non-USD prices are published as indicative settlement prices at the end of the auction, or as benchmarks for reference in derivative contracts. The additional currencies in the LBMA Gold Price are Australian Dollars, British Pounds, Canadian Dollars, Euros, Onshore and Offshore Yuan, Indian Rupees, Japanese Yen, Malaysian Ringgit, Russian Rubles, Singapore Dollars, South African Rand, Swiss Francs, New Taiwan Dollars, Thai Baht and Turkish Lira. The LBMA Gold Price is available both in prices per ounce and in prices per gram. IBA intends to publish the LBMA Silver Price in the same currencies and in prices per ounce and prices per gram. - Silver Doctors
Over the past six months the LBMA has experienced an incredible amount of turmoil, especially with their contracted auction authorities leaving with more than two years remaining on their contract.  And in part this has led more and more business to flow Eastward to Shanghai where a much more transparent and regulated gold and silver market has flourished under Chinese control.

To suddenly shift towards the acceptance of a multitude of non-Western currencies speaks volumes on the rising growth and power of Eastern economies, and at a time when the dollar, euro, and British pound are losing ground in global settlement.  And what is most likely to occur is not that more investors will come to the LBMA to purchase metals contracts because of this new regulation, but that nations like China, Russia, and India will increase their buys of physical silver from Western market coffers, and will now do so without having to pay the middleman to participate in this market.

Return to gold or silver backed currencies continuing to gain steam as Mexico debates monetizing silver

Until 1971 most of the world was on a gold or silver backed monetary system.  But over the course of the past 46 years the transition to a debt based fiat currency system has now encompassed all economies.

The results of this have been hit or miss as artificial booms and busts have led some nations such as China and Japan to emerge as two of the top five economies in the world.  However for countries like Argentina and Venenezuela, who primarily export commodities rather than finished goods, the removal of gold from their currency has placed them in a difficult situation as monetary devaluation over time has crushed their economies and driven them at certain times into high or even hyperinflation.

So as the world looks into the abyss of nearly $250 trillion of global debt, a re-awakening of asset backed money is taking place in a growing number of spots around the world, and the newest country to take a serious look at returning to a gold or silver standard is Mexico.

At the Forum we insisted on the proposal to give a stable value to the Mexican silver coin. I’ll explain in few words. 
The central feature of the proposal is that the Central Bank of Mexico (Banxico) shall determine a value in pesos for the “Libertad” silver ounce; and that this value shall be slightly higher (by a percentage that would be defined in the corresponding Law) than the price of silver in the international market, in order to provide Banxico with an assured profit in minting and placing these coins in monetary circulation. 
Today, for example, at the present rate of exchange and the present price of silver, the Mexican silver ounce is worth $320 pesos. Now suppose the Proposal requires an overprice of 10%. In that case, Banxico’s monetary quote for the “Libertad” silver ounce would be for $352 pesos. 
If the price of silver should plunge tomorrow to $250 pesos to the ounce, for example, the Mexican central bank would keep the monetary value of the “Libertad” ounce stable. In that way, the saver would not loose and the silver coin would remain “in circulation”. (Actually, the public will scarcely use the silver “Libertad” ounce as money, due to Gresham’s Law; practically all ounces will be held as savings for the long term or for emergencies, and the public will choose to keep on spending fiat money for daily needs, because it is money of no quality at all). - Mish Talk
Mexico's debate over monetizing silver is a not a complete return to a silver standard, but what it does is provide consumers, savers, and investors an alternative to bonds which today provide less yield than the rate of inflation.  And by keeping money stored in a precious metal that will be protected from global banker influence, it will alleviate much of the Mexican people's plight for holding or owning a fiat currency that is now at record levels of devaluation.

Wednesday, September 6, 2017

Hurricane Irma could lead to much higher gold and silver prices as storm could have severe effects for U.S. metal refiners

Over the past month the gold and silver markets have experienced a boon in prices due to geo-political events occurring over North Korea, and internal conflicts over the potential of a new government shutdown due to Congress's inability to deal with the upcoming debt ceiling.  However, there may be a new and potentially more destructive catalyst on the horizon for gold and silver, and it is intrinsically tied to what happens should Hurricane Irma reach the Florida coast.

Hurricane Irma could be temporarily devastating to physical gold & silver supplies. We’re not talking about panic buying either, that won’t come until later. This is about immediate concerns for refining, storage, importing/exporting, vaulting, transportation and logistics… 
First the good news: There is plenty of gold and silver right now available for purchase at great prices. 
The bad news is that under the radar, however, Irma could literally cause short term devastation to the physical supply of gold & silver.
Over the past three decades, all of Florida, and especially Miami and the entire eastern coast, has become a booming area for precious metal refiners. 
Last year (2013)— for the first time — gold was both the top import and export from the Miami Customs District, which includes airports and seaports from Palm Beach County to Key West. But the reality is most of the gold entered and left via Miami International Airport. 
More gold arrived in Miami than any other U.S. customs district last year and it ranked third in outbound shipments of gold. The most common routes take the glittery metal from mines in Colombia, Mexico, Bolivia and Peru and the gold trading center of Curacao, to Miami and then on to Switzerland, the United Arab Emirates and the Dominican Republic. 
South Florida is home to not only one of the largest precious metal refineries in North America — Republic Metals Corp. in Opa-locka — but it’s also a hub for bullion trading as well as assaying, refining, logistics and financing operations. - Silver Doctors

Tuesday, September 5, 2017

Cryptocurrency bubble? Who needs to wait for the cabbie to give investment advice when you have Paris Hilton pushing cryptos

Ever since the 1929 stock market crash, some investors have claimed that a market isn't a bubble until your cab driver or newspaper boy starts giving you investment advice.  And while this scenario isn't as prevalent today in the era of the internet and stock bulletin boards, perhaps where this paradigm has continued on is in the use of Hollywood celebrities to hawk certain asset classes or investment vehicles.

Tom Selleck hawks reverse mortgages.


William Devane pushes gold and silver retirement vehicle.


So with this in mind, would you care to fathom a guess who is taking the lead in pushing a new cryptocurrency to be known as Lydiancoin?  How about none other than Paris Hilton.


The ICO market just received an endorsement from the reality television star who tried to copyright the phrase "that's hot." 
Hotel-empire heiress Paris Hilton revealed on twitter that she’s joined the ICO party just as the Chinese government has announced harsh new restrictions that will make it virtually impossible for its citizens, some of the most voracious buyers of these coins, to participate in new offerings. 
Hilton said this weekend that she’s “looking forward” to participating in an offering called Lydiancoin. 
According to Business Insider, LydianCoin is a platform that wants to combine the blockchain with "targeted, AI driven digital marketing and advertising services." In its white paper (of course, the company launching the offering hasn’t actually built the product yet), advertising-tech company Gravity4 aims to raise $100 million by selling 20 million Lydian coins at $5 a pop. As BI reports, Gravity4's CEO Gubaksh Chahal pleaded guilty to assault in 2014 after being accused of beating his girlfriend, and was accused of violating his probation by assaulting another woman. - Zerohedge

Friday, September 1, 2017

Gold price closes out August up 4% and at highest level since just before last year's Presidential election

Gold closed out the month of August with a gain of 4%, and its highest level since November of 2016.  However what is even more important is the fact that gold has now held the $1300 for three consecutive trading days, turning that hard resistance level into a new support one.


Gold climbed Thursday, tacking on roughly 4% for the month to finish at an 11-month high, a day ahead of monthly data on U.S. employment that are expected to offer clues to the Federal Reserve’s next move on monetary policy. 
Gold prices have settled above the key $1,300-an-ounce level in each of the past three sessions, finding support from short covering, an increase in long positions and a generally positive price outlook for the metal, said Chintan Karnani, chief market analyst at Insignia Consultants. 
“For the first time in many years, traders and investors are asking me whether they can invest in gold,” Karnani said. “I have not seen such positive outlook to gold in the past two years.” - Marketwatch
In addition to gold, silver has forged ahead of its own hard resistance level of $17.50 and is now moving steadily towards $18 heading into September.

A final note of interest is that the gold-silver ratio is dropping, and now is below 75 for the first time in several months.

Monday, August 28, 2017

Mexican central bank rejects Bitcoin as being a currency

It should not be surprising when a sovereign state's central bank chooses to make a public statement denouncing Bitcoin (and other cryptocurrencies) as an actual currency, but this is exactly what has occurred on Aug. 28 within the country of Mexico.

In a statement made earlier this morning by the Governor of Mexico's central bank, Agustin Carstens argued that Bitcoin cannot be labeled or accepted as a 'virtual currency' because it does not have state or central bank backing to make it legitimate.

The governor of the Bank of Mexico, Agustin Carstens, has rejected adopting ‘virtual currency’ as the legal classification for bitcoin. Carstens has argued that the term ‘currency’ comprises an inappropriate classification for bitcoin due to the cryptocurrency’s absence of central bank backing or issuance. 
The governor of Mexico’s central bank has argued that cryptocurrency should fall under the governmental domain of cyber security, and not be viewed as a ‘virtual currency’ by the nation’s regulators. Carstens stated that cryptocurrencies “are not necessarily immune to hacking”, and argued that bitcoin’s greatest utility is “the fact that it offers users anonymity” - before warning that bitcoin comprises an attractive a monetary instrument to black market entities. - Bitcoin
Ironically, Mexico should be one of the most open countries for accepting Bitcoin into their economy as a medium of exchange, primarily because their currency is right now on a high inflationary run, and their citizens reside within one of the lowest standards of living in the second world tier.

But the real truth behind this announcement is the same as with most central banks... Bitcoin and cryptocurrencies threaten their existence by removing the middleman from the monetary system.  However, since Mexico is one of the richest silver producers in the world, perhaps one day it could create its own silver backed cryptocurreny for use as money, because that alone would remove the stigma of it being a de-centralized 'virtual currency'.

Gold and silver finally breakout over long fought resistance levels of $1300 and $17.50

In a matter of minutes during morning trading in the U.S. markets, gold suddenly shot up and broke through the long fought resistance level of $1300.  And should gold hold above this price level into the close and perhaps through the next few days, the technicals are very strong for a quick push back towards the highs of last year.

Meanwhile, silver also broke through its own severe level of resistance of $17.50

Friday, August 18, 2017

Gold and silver pound on their hard resistance levels as $1300 and $17.50 ready to fall

In early morning U.S. trading on Aug. 18, gold temporarily crossed over the $1300 level as financial and geo-political events push the metal towards breaking its hard resistance level.  And while silver came close to $17.50 before pulling back, it will take little for both commodities to break through on the upside and open the door for much higher prices.

For the first time since early June, Gold has just broken back above $1300, continuing to mirror the ebbs and flows of USDJPY (which just snapped below 109.00). 
Gold is now outperforming The Dow year-to-date. - Zerohedge

Sunday, August 13, 2017

Gold interest from big institutional players point towards higher prices as shorts dump their Comex positions

While the weekly Commitment of Traders (COT) report isn't always the best indicator for the future direction of precious metals, it does provide a snapshot of what big institutional players are doing in regards to futures and interest.

On Aug. 13 the latest COT report came out showing that short covering is continuing in the futures markets as positions on the downside dropped to their lowest levels since September of last year, and just before the election.  In the meantime, long positions began to slowly increase, which when coupled with recent remarks from billionaire investors like Ray Dalio, signal that gold should continue to move higher and soon breach the $1300 price level.

The latest Commitment of Traders ((NYSE:COT)) report, showed another rise in speculative longs for the week, though it was a bit subdued. The big change in gold speculative positions came on the short side as speculative shorts lowered their own positions to around 29,000 contracts outstanding - the lowest levels of speculative gold shorts since last September when gold was well over $1300. 
Silver, the best performing precious metal on the week, also saw a similar drop in short interest as longs essentially stayed put. - Seeking Alpha

Thursday, August 10, 2017

Gold climbs back to two month highs and silver regains $17 handle as geo-political events push investors into safe havens

Aug. 10 has now seen both gold and silver climb solidly for two straight days, taking the precious metals from $1250 to $1288 on the gold side, and $16.50 to $17.33 on the silver side.

These moves have been precipitated by the growing volatility of geo-political events, especially in North Korea, and are quickly changing the dynamic for the precious metals back to being a primary safe haven asset.

Gold chart:


Silver Chart:

Gold rose to the highest in nearly two months on Wednesday, after North Korea said it is considering an attack on the U.S. Pacific territory of Guam and U.S. President Donald Trump boasted of the strength of the American nuclear arsenal. 
Bullion was on track for its biggest one-day rise in nearly three months. 
The tensions rattled global markets, sending investors out of equities and into the safety of the Swiss franc, government debt and gold. The VIX "fear gauge" of expected volatility on the S&P 500 hit its highest in more than a month. - Reuters

Wednesday, August 9, 2017

Gold price recovers over $20 and silver up nearly 3% after overnight plunge

Gold prices were slammed down during early to mid-morning trading in Asia on Aug. 9 due to growing currency chaos resulting from the unrest over North Korea's potential for a viable nuclear ICBM.  However, this decline in price not only recovered over the next 12 hours, but it in fact rose over $20 to settle around $1272 by the start of morning trading in New York.


In the meantime silver was not affected by gold's volatility overnight and has seen a steady climb up of nearly 3% to just under $17 per ounce.


As geo-political events continue to simmer in regards to North Korea, a potential trade war with China, and ongoing economic warfare against Russia, gold and silver should continue to move higher, and could soon break key resistance levels of $1300 for gold, and $17.50 for the white metal.

Monday, July 31, 2017

The Daily Economist update for July 31 2017 - Dollar, dollar, toil and trouble


Gold and silver both look to breakout as dollar falls below 93 and its lowest level in 13 months

It did not take long on Monday, July 31 for the dollar to break below the 93 handle and fall to its lowest level in 13 months.


And with the dollar so far losing around 9% of its strength since the beginning of the year, even mainstream analysts are predicting that this trend could very well send gold and silver prices much higher.
The price of gold could see substantial upside as the U.S. dollar index continues sliding in value, some strategists are forecasting. 
The greenback has declined nearly 9 percent against a basket of foreign currencies year to date as the likelihood of parts of President Donald Trump's economic agenda getting underway has been called into question, and the prospect of further interest rate hikes from the Federal Reserve has pulled back. 
The dollar index could certainly drop to the 92 mark (about 1.5 percent below its closing price Wednesday of 93.40), said Phillip Streible, senior market strategist at RJO Futures. And though these levels are important to watch in the dollar, what's more interesting to him is the impact on gold prices and other commodities. 
"We could really see other markets, like gold, push up through that $1,300 level. We could see silver recapture $18. We could see oil prices — they've already got some bullish fundamentals buoying them — but with the dollar selling off like this, you are probably going to see that … recapture $50 again," he said Wednesday on CNBC's "Trading Nation."
And analysts at CNBC are not the only ones forecasting a breakout for gold and silver.

Gold:


Gold hit its highest in almost seven weeks on Monday, boosted by a struggling dollar and U.S. economic data that has cast doubt on whether the Federal Reserve will raise rates again this year. 
Spot gold was down 0.1 percent at $1,267.7 an ounce at 1337 GMT from an earlier $1,270.98, its highest since June 14. It is on course for a two percent rise this month. 
"Dollar weakness is driving the gold price. It's not just against the euro, it's against most major currencies," said Commerzbank analyst Eugen Weinberg. "U.S. politics is a mess and U.S. data has not been inspiring." 
"We think that there is more upside on gold," said INTL FCStone analyst Edward Meir in a note. "A combination of a weaker dollar and falling U.S. bond yields should propel the precious metal higher, with North Korea being a wild card." - Reuters
Silver:

Chart courtesy of SD Bullion
What a difference a week makes.  After struggling early on last week, after a hesitant Fed and a lip-sticky pig GDP estimate for the 2nd quarter, the silver price is breaking out here early Monday morning in the pre-market action.  Rally possible as early as today. 
Silver solidly punched through and closed above the 50 day moving average on Friday.  Today looks to be a gap-up at the open.  Silver can break-out to the upside in a big way here! - Silver Doctors

Friday, July 28, 2017

Gold breaches $1270 and silver up over 1% following disappointing GDP numbers and prior quarter revisions

Is it any wonder that Janet Yellen intimated earlier this week that the Fed may be done with interest rate hike program following today's very disappointing Q2 GDP numbers and subsequent revisions lower for prior quarters?  Perhaps the economy is not as 'transient' as Mother Felon believes.

Needless to say, this economic outlook here on July 28 didn't do much to boost stocks or the dollar, which are both moving lower in the markets, however it seems to have sent a nice signal to gold and silver, which has so far moved decently higher in early and mid-morning trading.


In the latest double negative whammy for the economy, not only did Q2 GDP print fractionally less than expected, at 2.6% vs consensus expectations of 2.7%, but Q1 GDP of 1.4% was also revised slightly lower, from 1.4% to 1.2%, while the Fed's favorite inflationary metric, core PCE, tumbled from a downward revised 1.8% to 0.9%. 
PCE rose 2.8% and was the biggest contributor to growth. Business investment, net exports and federal government spending were also positive. Inventories, residential investment and state and local government spending were drags on growth 
The BEA also released its annual update of GDP figures using "newly available and revised source data" for the 2014 - 2016 period. From the fourth quarter of 2013 to the first quarter of 2017, real GDP increased at an annual average rate of 2.1 percent, the same as previously estimated. For all of 2016, GDP was revised down slightly to 1.5%, from 1.6% previously. For 2015, growth was revised from 2.6% to 2.9%. for 2014, GDP was revised to 2.6 from 2.4% previously 
GDP prints starting in Q3 2016 and through Q1 2017 were all revised lowerOne amusing finding here is that following the revisions, Q3 2014 GDP is now said to have been 5.2%, while that abysmal Q1 2015 GDP print which was blamed on the weather is now 3.2%. - Zerohedge

Tuesday, July 25, 2017

China's LME will soon be publishing their own gold and silver fix prices in parallel to London

On July 25, officials from the Hong Kong owned London Metals Exchange (LME) announced they would soon be publishing their own daily gold and silver prices in parallel to the long-standing London Gold Fix.

The LME had until recently applied to the LBMA to take over the daily metals benchmark pricing following the CME and Thompson-Reuters early exit from their price fixing scheme, but the LBMA instead chose the Intercontinental Exchange (ICE) earlier this month to take over the London Gold and Silver Fix.

The London Metal Exchange (LME) will start publishing gold and silver reference prices, the exchange told Reuters on Tuesday, potentially challenging the dominance of benchmarks administered by Intercontinental Exchange (ICE). 
Precious metals producers and consumers around the world use benchmarks owned by the London Bullion Market Association to price contracts. 
Intercontinental Exchange (ICE) sets the LBMA Gold Price twice a day via an electronic auction, and was selected this month to administer the LBMA Silver Price, defeating a rival bid by the LME. 
The LME will publish alternative prices based on trading of its gold and silver futures, launched earlier this month. "Following a number of requests from key precious metals market participants, the LME intends to publish intraday reference prices for its gold and silver contracts," the LME told Reuters. - Straits Times
In the end, how this will affect the paper and futures price has yet to be seen, however the LME recently was given a license to conduct its own futures contract in gold and silver, and this means that the potential for a parallel price mechanism that is divergent from the one conducted by the LBMA each day is highly probable.  And as we have seen over at the Shanghai Gold Exchange, where the price in the world's largest physical market is often higher than the paper price determined daily in London and New York, the chances of the LME siphoning off businesses from the Comex into their own contracts could facilitate an arbitrage, and an eventual usurpation of the LBMA's control over the prices of gold and silver.

Thursday, July 20, 2017

More information revealed about Andrew Maguire's call for a 250 ton gold purchase and a new gold backed cryptocurrency

More than a month ago, well known metals analyst and industry whistleblower Andrew Maguire dropped a bombshell during an interview with King World News that an entity was going to come into the gold market seeking to purchase 250 tons of metal in one fell swoop.  Later discussions and interviews seemed to assert that this buying would be done by one or more sovereign governments, but on July 20, there appears to be a secondary outlet tied to Maguire's information that is requiring massive amounts of physical gold and silver to facilitate the creation of a new metals backed cryptocurrency.

We have been following the somewhat cryptic comments that London metals trader Andrew Maguire has made about an event coming in the gold market that he suggests will be significant. We submitted a brief written set of questions to his representative to get more details, but have not heard back yet. We believe Mr. Maguire has probably been traveling and working on activities related to the launch of the new product he has hinted at. If he does get time to reply, we will publish his answers to the questions. 
Meanwhile, we did a little sleuthing and actually have found quite a bit of information about this new gold backed cryptocurrency. David Gibson of Goldvu.com confirmed by email that this is the new product Andrew was talking about. It will be called Bullioncoin. Here is quite a bit more detail about it. Below are some key bullet points from the web site on how it will work and then a few added comments. 
SIMPLE SUMMARY OF HOW IT ALL WORKS 
The following is a simple overview of the whole BCX and BullionCoin process: 
1.Primary market participants buy physical precious metals at the wholesale contract rates & hold Title of Ownership to it 
2.  Those participants then authorise for BullionCoins to be created/minted against their precious metals 
3.  Minting / creating BullionCoins is just a process of digitisation of the Title of Ownership to that metal 
4.  Primary market participants then sell those digital coins into the secondary (retail) market 
5.  That sale, is the selling of the Title of Ownership from the primary market participant to multiple retail investors 
6.  The digital coins that those investors now hold, act as an electronic Bearer’s Title to the physical gold & silver that’s backing it 
7.  Coin holders can use them in transactions and trades, in the same way that you use fiat currency 
8.  As the coins are electronic Bearer’s Titles to the physical precious metals backing them, investors holding those coins can then redeem them at any time in exchange for the equivalent quantity of physical gold & silver that those coins represent

My added comments: Now that we see how this new gold backed cryptocurrency product will work, a question in my mind was if the 250 tons of gold buy orders that Andrew Maguire has talked about recently might tie in to the launch for this new product. I am advised by David Gibson of GoldVu (see email exchanges below) that the two events are likely separate and that as far as he (David Gibson) knows the 250 tons of sovereign gold buy order does not relate to the launch of the new gold backed cryptocurrency - only Andrew can confirm that. 
This is an interesting new product. It appears to actually combine block chain technology with a new cryptocurrency coin 100% backed by physical gold and silver. The gold Bullioncoin will be equivalent to one gram of gold while the silver Bullioncoin will be equivalent to 50 grams of silver. (note: 1 troy ounce = 31.1 grams) - Larry White via Silver Doctors

The gold versus Bitcoin debate is really about obsession rather than fundamentals

With Bitcoin and many other cryptocurrencies seemingly draining potential monies that would have in the past gone into gold and silver, there has been a raging debate among the alternative media sphere over which is better, and even over which is more relevant following the advent of the Blockchain.


In fact, there has been a very recent back and forth between silver advocate Chris Duane regarding his beliefs that Bitcoin as not a viable currency or store of wealth for the future, and Bix Weir, who claims in his refutation to this that Duane lost his clients and subscribers 'billions' by not giving them the 'facts' on the cryptocurrencies.



Yet with all the rhetoric, and the 'red lines' being drawn among both sides of the gold/silver vs. Bitcoin debate, what are the facts?  And more importantly, what do each separate asset provide savers and investors in their portfolios?

Gold and silver have been a proven and accepted store of wealth for thousands of years, and at certain times in history both have been used and accepted as money.  Bitcoin, Ethereum, and the myriad of cryptocurrencies on the other hand have a track record going back just eight years in human history, and according to how they are both seen and traded in the market place, do not at this time function as either a currency or as a store of wealth.

Now to be absolutely fair here, cryptocurrencies do act as a medium of exchange, but not in the same way currencies such as the dollar, euro, and yen do.  Instead they function as a medium of exchange similar to the way U.S. Treasuries do, which as AAA rated instruments, are as 'good as dollars' but must go through a third party conduit to function as a medium of exchange.

Ie... when XXX retailer in the U.S. buys manufactured goods from a company in China, they send over Treasuries rather than pallets of dollar bills.

It is the same way with Bitcoin for the most part.  When someone wants to use Bitcoin to pay for a product or service at Target for example, they cannot simply send an amount from their Bitcoin wallet to the cashier of the retailer, but instead must fund an exchange or card service that does the conversions for them from Bitcoin to dollars, and then use those conduits to pay for whatever item they want to purchase.

Additionally, when you go into a store like Target they do not have their items priced in both dollars and Bitcoin, so the reality is the business isn't really accepting Bitcoin as payment, but only dollars as payment with the third party conduit converting one's Bitcoin to dollars.
"Today, there are a number of billion dollar businesses that accept Bitcoin as a form of payment. These include Dell, Reddit, Expedia, PayPal, and most recently, Microsoft. So for the uninitiated who have not yet grasped what Bitcoin and other cryptocurrencies are, you ought to catch up." 
In other words, Hey haterslook at all these huge companies that are accepting bitcoin! How can you ignore that kind of support? 
Well, there's just one problem there: Almost none of the businesses mentioned above technically accept bitcoin. Instead, they partner with a middleman—generally either Coinbase or BitPay—who takes a customer's bitcoin, immediately converts it into cash, and then deposits the cash in the company's bank account. 
In other words, DellExpedia, Microsoft, and Time, Inc. don't actually "accept" bitcoins, per se. They accept U.S. dollars. It's their bitcoin processing partners who accept bitcoin. They, in turn, make money on transaction fees (in the case of Coinbase), or by selling their software and services as a subscription (in the case of BitPay). - Time Magazine
So what exactly does Bitcoin and other cryptocurrencies function as in the economy and in the market?  According to several Wall Street analysts who are now researching and monitoring the crypto sphere for their clients and brokerage houses, they have labelled Bitcoin as a speculative investment, but also something that has the power through the Blockchain to one day soon replace the entire financial structure of how businesses are financed, and how equities may be traded on Blockchain exchanges instead of in antiquated 'stock markets'.

In the end, Bitcoin and other cryptocurrencies have the potential to do many things in the financial system that gold and silver cannot do.  However, at this point in time these cryptos also do not perform in the same capacity that gold and silver do as wealth protection, and as a true representation of money.  So the bottom line is to treat each as they are rather than as we might want them to be, and invest accordingly in each in relation to the risks and attributes that are intrinsically tied to these individually unique asset classes.

Saturday, July 15, 2017

Since most Americans now invest on momentum over value, don't expect many to begin buying gold until the price rises much higher

There is a reason why Warren Buffett is one of the richest men in the world and 99.9999% of investors are not... because he is the ultimate contrarian to the way most Americans invest in the markets.

By this I am referring to the fact that Buffett is the quintessential value investor while the majority of retail and Wall Street investors buy on MoMo (momentum), and only when an asset is going up in price.

Even the world's richest family (Rothschild) promotes a strategy of buying assets when there is 'blood in the streets', because that is when you can buy the most for the least cost, and reap the benefits when the markets as a whole raise all boats.

Yet because Americans are programmed to buy on momentum rather than on value, it is very unlikely that U.S. investors will be buyers of gold and silver now that the price has fallen well below their all-time highs of six years ago, and have remained beaten down despite the fact that the Fed is now raising rates, and the dollar has fallen nearly 9% since the beginning of the year.

So far in 2017, stocks have been under significant control of the “momo” (momentum) crowd. The momo crowd does not care about the economy or fundamentals. Momo simply buys because the price is going up. 
It is no different now. Momo is totally oblivious to the weak economic data. In contrast, the “smart money” (professional investors) cares about the economic data.
Investing along with momo is a fine technique but investors must be careful about two things. 
• Playing with momo is like playing musical chairs. Sooner or later, the music stops and someone is left standing. 
• From the large number of emails I have received from investors and social media, the momo crowd is driven only by price. Often such investors do not even have a good grasp of what a company does, yet they buy large quantities based on price momentum. 
Investors who are not especially nimble may consider staying away from this approach. - Marketwatch
Despite the fact that much of the rest of the world (UK, China, India, Russia, Dubai) are buying gold at high levels, Americans will be the last to the table when the economic reasons behind owning precious metals reveal themselves in shocking fashion.  And if we thought the shortages in silver that led to the price going as high $50 in 2011 were spectacular, just wait until individuals rush towards the door for gold and silver this time as there will be little left available, no matter how much momentum is driving the price up.

Friday, July 14, 2017

Gold up 1% and Silver 2% following economic data showing more retail spending declines and probable recession

On July 14 the latest report was published regarding retail sales for the month of June, and in nearly all instances the data was both negative, and lower than analyst's expectations.
This is not the data the Fed was looking for: after the 4th consecutive miss in CPI data, moments ago the Census Bureau also reported June retail sales which was unexpectedly poor, missing across the board once again, and judging by the surge in bonds, suggests that the Fed's rate hike intentions and narrative is now on indefinite hold.
The details, as shown below, missed in every category: 
  • Retail sales down -0.2%, Exp. +0.2% after falling 0.1% in May
  • Retail ex-autos -0.2%, Exp. +0.2%
  • Retail sales ex-autos and gas -0.1%, Exp. 0.4%
  • Retail sales control group -0.1%, Exp. +0.3%
Furthermore, the steep disappointment in the control group, suggests that Q2 GDP estimates are about to be revised sharply lower. - Zerohedge
In response, gold and silver both moved higher by 1 and 2% respectively, and the dollar fell 40 bps to 95.22 and its lowest level since January of 2015.

Gold Chart:


Silver Chart:


Dollar Chart: