We had a busy week last week with 2 days in Sydney for the 2012 Gold Symposium last week. Headlined by Jim Rickards author of Currency Wars, the event held at the Luna Park amusement park had grown from last year with about 700 in attendance.
We’ll get back to the Symposium shortly but first let’s cast our eyes over the NZ gold and silver charts and see what’s happened over the past week.
In our very abbreviated email last week we commented that both metals were closing in on their 200 day moving averages (MA), which as we’ve written about many many times in the past few years, is often a lower risk time to be buying as in a bull market the price more often than not bounces from here.
So what’s happened in the week since? Well we are closer to the 200 day MA now but haven’t quite touched it in NZD gold. In the 3 year chart below you can see 3 out of the last 4 times the price has dipped below the 200 day MA it has bounced back up and stayed up.
Silver has come very close to touching the 200 day MA. The RSI indicator at the top of the charts is close to oversold (a reading of below 30) but not quite there either. Silver in particular is giving the impression of bottoming out at this level.
But of course we never know until after the fact. As we’ve mentioned these levels have in the long run over the past few years been good buying opportunities. BUT – they don’t usually last for long and then people tell us – “Man, I should have bought last month!”.
Anyway back to the symposium. To be honest we didn’t learn anything earth shattering although did make some useful connections. Our feedback to the organisers was that they need to offer a bit more controversy to attract a few more non-gold people. Perhaps attract a few institutional investors along with a “cage fight”, err we mean debate, between a gold bug and a gold hater.
The panel discussion they had was a bit disappointing in that the one question at the end from a Mr B Bernanke “What advice would you give me?” that we’d have liked to have heard answered, didn’t elicit more than a few throw away comments of “resign” or “let the markets decide the interest rate”.
We’d have liked to have heard what the panelists saw as a realistic approach to get the global monetary system back on track, other than a full on reset and breakdown.
However while we may not have learnt anything groundbreaking, there were a range of opinions on what may be to come over the next few years. So we thought the most useful thing for you might be a summary of these opinions from the various presenters such as Rickards, Egon von Greyerz and Dan Denning of the Daily Reckoning Australia. So our feature article this week is:
We aim to write a bit more on the symposium over the next couple of weeks, so keep a look out for that.
Also this week we have a couple of articles from Darryl Schoon.
The first looking at how we are still in Stage 3 of the gold bull market. In this he discusses the impact of gold lease rates and how while we remain in stage 3 there will be more volatility up and down to come:
The second article outlines a methodology for timing the bull market which although familiar with Rick Ackerman we hadn’t come across before and so might be worth some more research:
Significant news just before we left for Sydney was that “GOLD has soared past coal as Australia’s second most valuable physical export to China, with sales up a whopping 900 per cent for the first eight months of the year, bringing in $4.1 billion.” Source.
Quoted in the story is Jack Klein head of Evolution Mining – a relatively new but also the 4th largest ASX listed Aussie gold producer and one we’ve kept an eye on in recent months. Mr Klein also gave a keynote address at the symposium so we’ll have more on that in the next week or so too. Suffice it to say that he believes after a few down years there is a resurgence brewing in the Australian gold miners.
China is also snaffling up ownership (be it full or partial) of many Aussie Gold mining companies. We heard reports from a number of these at the symposium where significant shareholdings were by Chinese companies. China remains very very hungry for gold.
While we were on our way back to NZ, new RBNZ head Graeme Wheeler was making his first official interest rate manipulation announcement or more commonly known as the official cash rate (OCR). No change made of course.
He did also state in a speech the next day that there was no need for Quantitative Easing in NZ as there is room to cut rates further yet if required. While some reports think Wheeler is more hawkish than Bollard we’ll reserve judgement.
We still think the odds are that if the global economy continues to limp along and money printing continues the world over, there will be more cuts to come and it wouldn’t surprise us to eventually see the RBNZ join the currency wars and some form of money printing. We wait and observe.
We’ll leave the final comment this week to Jim Rickards. While in Aussie for the symposium, Rickards again tweeted along the lines of an interview he made in Australia a few months back. That if the RBA thinks the Aussie dollar is overvalued, they should buy gold as it’s on sale at the moment due to the high aussie dollar.
As we commented previously with our high dollar his advice could still equally apply to NZ we reckon. So if you want to follow Rickards advice and buy while the kiwi dollar is high (and before any money printing starts locally!) get in contact. We’re happy to help out first time buyers:
1. Email: firstname.lastname@example.org
2. Phone: 0800 888 GOLD ( 0800 888 465 ) (or +64 9 2813898)
Have a golden week!
This Weeks Articles:
|Inflation vs Deflation vs Stagflation|
This week: Gold and Silver in an Interesting Place Gold Symposium Sydney Inflation vs Deflation vs Stagflation We’re making a habit of this – being late that is sorry. And we will likely be late next week too as we’ll be in Sydney. Read on to see why… Gold and Silver: An Interesting Place As […]
|Gold & Silver Down Sharply From Last Week|
We’re still in Sydney today with the Gold Symposium having finished yesterday. Unfortunately some workmen have dug through the phone line at our hotel so we’re trudging along slowly on mobile broadband and running out of time. So we’ll have to keep this very brief today. The Symposium was useful to attend – nothing earth […]
|GOLD: STAGE THREE – UP DOWN UP DOWN UP|
Darryl Schoon discusses gold lease rates and their impact on the price of gold, along with what stage of the gold bull market we are in… STAGE 3: The price of gold is subject to increasing highs and lows and large investment funds move in and out of gold as global uncertainties wax and wane, […]
|TIMING THE GOLD BULL|
Darryl Schoon outlines a methodology for timing when to buy gold… TIMING THE GOLD BULL Dreaming the impossible dream The question of when gold’s long awaited ascent will happen is not without precedence. A similar question is still being asked by the Jews concerning the appearance of the Messiah. Prediction has always been an inexact […]
|Gold Symposium 2012: What is the End Game for the Global Monetary Crisis?|
Thoughts from the presenters at the 2012 Gold Symposium in Sydney on how the monetary crisis may end: When 90% of the audience puts their hand up in answer to the question “who owns physical gold or silver?”, there was always going to be an element of “preaching to the converted” at an event titled […]
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.