Indicator Shows Fed Could Act Again Soon

Gold Survival Gold Article Updates: Oct. 23, 2014

This Week:

  • Chinese and Indian Gold Buyers Are Back
  • Indicator Shows Fed Could Act Again Soon
  • Is Gold as Dead as Florida Hurricanes?
  • How Can There Not Be a Currency Crisis?

We’ve got 2 videos and 3 articles on the website this week, so scroll down to check all them out. We’ve updated our email format so hopefully this might read a bit better for some of you too.

Charts and Prices

Not a lot of change for gold from a week ago.

The price in USD last week was $1240.75 and we are up just $1.11 or only 0.08% to $1241.86 from then. You can see in the lower half of the chart below that USD gold has managed to get above the $1240 level but has struggled to get through $1250. Given the run higher from the triple bottom above $1180, it wouldn’t be a surprise to see a pull-back from here.

While in NZ dollars the gold price is up $12 or 0.77% to $1568. Care of the Kiwi dollar weakening around half a cent from 0.7974 down to 0.7920 today.

NZD Gold Chart

Silver in USD is down 29 cents or 1.66% to $17.17 after falling sharply overnight.

And the weaker Kiwi dollar did not prevent a loss for the week for silver priced in NZ Dollars either. It is down 22 cents or 1% to $21.68. So NZD silver remains right around the lows of the past 3 years. Good buying opportunity perhaps?

NZD Silver Chart

As the chart above shows silver has struggled to move up too much from it’s lows, while gold has jumped up a bit stronger. This has led the gold silver ratio (i.e. how many ounces of silver it takes to buy an ounce of gold) to reach 6 year highs.

Gold Silver Ratio Chart

Could we yet see it close in on previous highs around 80 and 88? Remember this doesn’t necessarily mean silver has to fall in price. It just could continue to lag gold.

Chinese and Indian Gold Buyers Are Back

It seems China and India thinks these prices are a good buying opportunity according to this report from mineweb.

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Chinese and Indian gold buyers back in market in a big way

“So gold hungry China and India continue to accumulate gold, between them at a rate which probably accounts for close to the full total of global mined supply. And there are another group of Asian nations with similar gold hoarding proclivities, not quite at the same scale, but cumulatively significant.

One may ask that, if indeed they are collectively accumulating more than global new mined supply, and with scrap supplies falling with the gold price, where all this gold is coming from. The gold bugs will tell you it is gold leased from the world’s central banks which now can never be returned because it now resides in strong hands – yet remains on their books because it is leased rather than sold. Last year it may have come from gold ETF liquidations which amounted to perhaps more than 700 tonnes, but although there have been some sales out of the gold ETFs this year they have been on nothing like the scale of 2013. So the conundrum remains. Demand has to be exceeding supply, yet the price keeps falling. Surely that has to end soon.

And, of course, there is the other big unknown in the gold market demand. Is China surreptitiously building its gold reserves, but not reporting the increase until it feels it is politically expedient so to do. There is a lot of evidence out there in speeches by top Chinese officials and academics (and in a tightly controlled country like China these would seldom be made without some kind of government approval) that China is looking to build its gold reserves to around 8,500 tonnes, thus topping the US’s 8,133.5 tonne official reserve figure. But no-one knows for sure.”

—–

These demand numbers seem to be backed up by Swiss customs data out this week, which showed huge September exports from Switzerland to China and India.

Luckily UBS has just come out with a report on it so saved us digging too heavily through the Spreadsheet. Here’s the main highlights:

—–

“UBS: Swiss Gold Exports At 7-Month High; Physical Demand Absorbing Investor Liquidations

Swiss trade data show gold exports hit a seven-month high in September and that the flow to Eastern from Western nations continues, says UBS. Swiss exports were 172.6 metric tonnes last month, the most since February. Gold shipments to China jumped to 12 tonnes after averaging around three tonnes during the previous four months.

Shipments to Hong Kong increased to 24.7 tonnes, the most since April. Switzerland exported 58.5 tonnes to India last month, the largest shipment year to date and nearly twice the average monthly volume, UBS says.

Meanwhile, September gold imports into Switzerland were also high at 194.6 tonnes. Inflows from the U.K. jumped to 63.3 tonnes from 8.6 in August. “This suggests that a good portion of investor liquidations in September, that pushed the prices through the $1,200 psychological level, were absorbed by physical demand, with metal making its way from London vaults into Swiss refineries for refining/recasting and ultimately shipped to physical buyers in Asia,” UBS says.

Source

—–

Indicator Shows Fed Could Act Again Soon

You may recall the stock market plunge was seemingly halted last week by comments from Fed member James Bullard commenting that the Fed could resume money printing soon. We saw an interesting post in the Daily Reckoning this week where an inflation indicator may well back this up. The humourously titled “Oh Sh*t” line! AKA – the “Fed’s five-year forward inflation rate.

—–

‘In fact, the Fed recently crossed the “oh sh*t” line. The very line that Jonas Elmerraji at our trading desk says predicated QE1, QE2, the so-called Operation Twist and QE3.

5 Year Forward Inflation Rate chart

“The Fed’s five-year forward inflation rate,” Jonas told me this morning, “has fallen below that 2.2% line for the first time since Operation Twist in 2011. Not only is this the lowest it’s been since Janet Yellen’s tenure as Fed chief started, and not only is it the lowest we’ve seen forward inflation drop since Operation Twist — so far, it’s actually the only time post-2008 that the Federal Reserve has allowed that inflation gauge to drop below 2.2% without announcing a massive quantitative easing program.”

“Either there’s a major change here, the economy is healthy and deflation doesn’t matter anymore,” concludes Jonas, “or we’re in store for a major Fed action soon.” Hmmn.’

—–

As noted in our silver chart last week, the weaker silver price compared to gold could be an indicator of worries over deflation. Silver’s industrial properties could mean less demand for it if indeed the global economy takes another downturn.

At home here in NZ inflation (at least according to government numbers) is expected to be fairly mute over the past quarter. ASB analysts “CPI data released here on Thursday will show a 0.5% increase over the quarter.”

So we continue to think that for all the talk both here and in the US of higher interest rates it simply isn’t going to happen anytime soon.

Ronald-Peter Stoferle’s latest piece for King World News also backs this view up. He analyses GDP versus Debt numbers and shows how Public Debt versus Government Revenue is a more accurate measure. This measure shows how rates simply can’t rise. Definitely worth a read this one. It’s pretty short too.

Still Concerned About The Gold & Silver Smash – Just Read This

So as Lawrie Williams of Mineweb noted above, “[Gold] Demand has to be exceeding supply, yet the price keeps falling. Surely that has to end soon.”

Indeed, it would seem like it should but who knows when is the trouble. But when it does we could likely see some large movements in price higher so it might be difficult to get aboard the train then.

These near record low silver prices in particular mean the chance to get a monster box of Canadian Silver Maples for just $13,160 delivered and fully insured. Check out the details below for other options or get in contact if you have any queries.

This Weeks Articles:

France

The Broken State and How to Fix It

2014-10-19 17:49:42-04

Here’s some more highlights from the recently concluded Casey Research Summit, including some thoughts from Doug Casey himself… The Broken State and How to Fix It By Casey Research The United States of America is not what it used to be. Unsustainable mountains of debt, continuous meddling by the government and Fed to “stimulate the economy,” […]

The post The Broken State and How to Fix It appeared first on Gold Prices | Gold Investing Guide.

Read More…
France

How to Invest in a Difficult Market

2014-10-19 18:01:32-04

How to Invest in a Difficult Market By Casey Research Many experts hold dim views of the current state of the US economy—but what’s a prudent investor to do to make a profit? Find out what the blue-ribbon faculty of economists and investment pros at the recently concluded Casey Research Fall Summit thought. Lacy Hunt, […]

The post How to Invest in a Difficult Market appeared first on Gold Prices | Gold Investing Guide.

Read More…
France

How Can There Not Be a Currency Crisis?

2014-10-19 18:28:43-04

Below you can see well known financial blogger Mish Shedlock’s full presentation from the recent Casey Research Summit. He covers a lot of ground including will we see inflation or deflation, velocity of money and why he thinks there’s no chance of hyperinflation, and what to buy to prepare. He also makes a mention of New […]

The post How Can There Not Be a Currency Crisis? appeared first on Gold Prices | Gold Investing Guide.

Read More…
France

Is Gold as Dead as Florida Hurricanes?

2014-10-21 16:17:59-04

Here’s a great post that compares holding gold to being prepared for a hurricane. Just because one hasn’t hit for a while does’t mean you no longer need to remain prepared. It also touches on how much of your wealth to consider holding in gold and also other related assets like gold mining company shares. Some useful info […]

The post Is Gold as Dead as Florida Hurricanes? appeared first on Gold Prices | Gold Investing Guide.

Read More…
France

Max Keiser & Prof Fekete: The Bond Market, Deflation & Depression

2014-10-21 19:59:24-04

Max Keiser interviews of Professor Antal Fekete of FeketeResearch.com about how the 1921 bond market collapse led the US Federal Reserve & Treasury conspiring to illegally introduce open market operation, leading to a situation in which profits in the bond market are risk free while profits in the commodity market are NOT risk free. The […]

The post Max Keiser & Prof Fekete: The Bond Market, Deflation & Depression appeared first on Gold Prices | Gold Investing Guide.

Read More…
As always we are happy to answer any questions you have about buying gold or silver. In fact, we encourage them, as it often gives us something to write about. So if you have any get in touch.

  1. Email: orders@goldsurvivalguide.co.nz
  2. Phone: 0800 888 GOLD ( 0800 888 465 ) (or +64 9 2813898)
  3. or Online order form with indicative pricing

Today’s Spot Prices

Spot Gold

NZ $ 1568 / oz

US $ 1241.86 / oz

Spot Silver

NZ $ 21.68 / oz

NZ $ 697 / kg

US $ 17.17 / oz

US $ 552.02 / kg

7 Reasons to Buy Gold & Silver via GoldSurvivalGuideToday’s Prices to Buy

1oz NZ 99.99% pure gold bar

1oz NZ Gold Ingot

$1621.31

1kg NZ 99.9% pure silver bar

1 Kilo NZ Silver Bar

$766.70 (price is per kilo for orders of 1-4 kgs)

$759.59 (price is per kilo only for orders of 5 kgs or more)

1oz PAMP Suisse 99.99% pure gold bar

PAMP Gold

$1667.88

1kg PAMP 99.9% pure silver bar

PAMP Silver

$816.70

1oz Canadian Gold Maple 99.99% pure gold coin

Gold Maple

$1685.60

 

1oz Canadian Silver Maple 99.99% pure silver coin (Minimum order size tube of 25 coins)

Silver Maple Silver Box

Tube of 25 $688.25

Box of 500 $13160

(Fully insured and delivered)

Note:

  • Prices are excluding delivery
  • 1 Troy ounce = 31.1 grams
  • 1 Kg = 32.15 Troy ounces
  • Request special pricing for larger orders such as monster box of Canadian maple silver coins
  • Lower pricing for local gold orders of 10 to 29ozs and best pricing for 30 ozs or more.
  • Foreign currency options available so you can purchase from USD, AUD, EURO, GBP
  • Note: Your funds are deposited into our suppliers bank account only. We receive a finders fee direct from them only.

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Our Mission

  1. To demystify the concept of protecting and increasing ones wealth through owning gold and silver in the current turbulent economic environment.
  2. To simplify the process of purchasing physical gold and silver bullion in NZ – particularly for first time buyers.

We look forward to hearing from you soon.

Have a golden week!

David (and Glenn)

GoldSurvivalGuide.co.nz

Ph: 0800 888 465

From outside NZ: +64 9 281 3898

email: orders@goldsurvivalguide.co.nz

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The Legal stuff – Disclaimer:

We are not financial advisors, accountants or lawyers. Any information we provide is not intended as investment or financial advice. It is merely information based upon our own experiences. The information we discuss is of a general nature and should merely be used as a place to start your own research and you definitely should conduct your own due diligence. You should seek professional investment or financial advice before making any decisions.

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