Our Active God - Metals Strong - Dollar Weak - China Concerned

God's hand is active in every sphere of our lives on an intimate, daily basis. We continue to live, because of His grace and providence. He is an involved God working through men and situations toward His goal in everything. By the sacrifice of His Only Begotten Son, Jesus Christ, He has paved the way for the reconciliation of His people with Him. It is only through the grace and love of God through Jesus Christ that any of us sinners can ever be justified before the God who is to pure to even look upon sin. We must praise Him daily for sustaining us and loving us enough to bring us to Himself in the one way which is through His Son as the justification earned by Christ is applied to us by the Holy Spirit. Praise the Lord! Another day He has granted that we might work diligently to glorify Him and enjoy Him forever.

Silver continues to out perform gold. Both are bouncing back after being capped time and time again. See the articles on actions of the gold (& silver) cartels and the impact upon the precious metals ETFs. Beware of these ETFs, because they are managed by the boyz who have a vested interest in controlling precious metal prices.
The gold miners are holding near the top of the trough as the prices continue to move upward. Here are some of the important ones in my portfolio: DROOY 9.87; HL 3.86; HMY 12.02; SLW 10.84, and VGZ 2.45 (VGZ is the only one off today and it is down only 0.04). They continue to hold very strongly and are running up with every opportunity. The DOW is bouncing around 20-24 up today.
Similar to silver, there is buying in gold after every hammer blow. Of course, the boyz have the backing and deep pockets to do their damage. However, as China moves farther into gold and as investors climb on board the gold wagon, at some point the boyz will be over run. Gold is 983.20 up 8.60 on the day and silver is 15.85 up 0.25 today. Both are on up ticks.
Our proxy for gold, GLD is holding strongly at the upper limit of the trough traced on the graph below. The price of gold appears to be extending its May rally into June.
Looking at the nasty chart for the dollar, below, we see that the dollar, as of yesterday, was again testing the lower side of the trough. There is a great deal of downward pressure on the dollar. There have been substantial losses in the Treasury Issuances as the interest rates have been steadily increasing for new issues. As I discussed in Economics 101 (Bonds) a few posts ago, increasing interest rates knock the market value of bonds downward. This is bothering China BIG TIME. This is their greatest fear and a stimulus for them to get out of dollars are replace them with gold and other currencies, mainly, the Euro.

This from Casey's Daily Resource: "There was no news from the U.S. Mint or the ETFs...either GLD or SLV. All I can tell you is that both the GLD and SLV are owed a lot of metal. Ted figures that the SLV alone is owed in the neighbourhood of 25 million ounces...so the boys and girls at SLV are shorting the shares since they don't have the physical. It will be interesting to see how long it takes them to get it...unless their custodians [JPMorgan in silver and HSBC USA in gold...the ring leaders of the gold cartel] can engineer a horrific sell-off in both metals so that it never has to be delivered. If you think that reeks of conflict of interest...you would be right about that! And lastly, silver inventories at the Comex-approved warehouses fell 271,411 ounces yesterday." (Color added)

This is the game that the gold cartel is playing with investors in these ETFs. The charters for the ETFs are being violated at the expense of investors. The gold cartel (boyz) must be playing the game in concert with, and maybe even the direction of, the Fed and Federal Government. Central banks and governments hate the precious metals, because the price of precious metals reveals the fraud of the unbacked paper currencies.

Article on GM by Karl Dinenger of The Market Ticker:

Told 'Ya So (GM: ZERO!)

"The other one hundred thousand+ bondholders, including individuals who had their children's college funds and personal retirement savings in this debt, had no say, did not vote for this action, and in fact oppose it.

They will be wiped out, recovering about ten cents on the dollar.

Under bankruptcy law it is generally true that a "significant" majority of the debtholders must agree to restructuring, not a razor-thin majority. Of course the law doesn't seem to matter any more in this country when it comes to bankruptcy (or any other kind of law for that matter) so long as the government wants things to go a certain way, and neither Democrat or Republican parties can take the high road on this matter - they both stink.

The really ugly part of this mess is that had GM been forced into bankruptcy last year when it started reporting monstrous (integer-level) negative earnings recovery would have been decent. It was only through the profligate lies and fraud promulgated by "propping up" the company that the remainder of the value that could and should have been recovered by the bondholders was squandered.

My view of this entire mess is that GM had no business operating past last summer. In the 2nd quarter of 2008 GM reported a loss of more than $27 dollars a share, a number that exceeded their share price at the time by nearly twice." (Color Added) Read the article HERE.

From MineWeb.com:

Where the smart money's been going in global mining

How and why the prices of 100 particular mining stocks have risen by an average of more than 500% (each) in the past seven months.

Author: Barry Sergeant
Posted: Tuesday , 02 Jun 2009

JOHANNESBURG -

Yesterday's news, and perhaps tomorrow's, is that the dollar is in a bit of a funk that may extend for months; the more useful news is that global stocks, in general, have risen now to seven month highs, as illustrated by the level of the benchmark MSCI world equities USD index. This broad measure, buoyed by the effect of strongly rising emerging market stocks, has outperformed the likes of the Dow Jones Industrial, S+P 500, and DJ Stoxx 600.

Within the global stock markets universe, listed mining stocks have staged the leading recovery, in percentage terms, from price troughs, generally seen during October and November 2008. This is a notable performance, given that banking stocks, especially in certain well know countries, were severely sold down; some disappeared or were swallowed up by bigger rivals. The world's biggest 100 mining companies, by market value, have now bounced by 141% on average, measured on a weighted average basis. Confidence in mining stocks has increased for fundamental reasons; among the latest, China's manufacturing has expanded for a third successive month, and the country has increased fuel prices. Read it HERE.

We are seeing more articles on gold and mining these days. As the publicity grows, the interest in the miners and precious metals will rapidly increase bringing on the third phase of the precious metals.

Following is a gem from Bloomberg.com:

Northwestern Mutual Makes First Gold Buy in 152 Years

By Andrew Frye

June 1 (Bloomberg) -- Northwestern Mutual Life Insurance Co., the third-largest U.S. life insurer by 2008 sales, has bought gold for the first time the company’s 152-year history to hedge against further asset declines. Read it HERE.

A notable quote reported by Casey's Daily Resource Plus: "The American people will never knowingly adopt socialism. But under the name of ‘liberalism’ they will adopt every fragment of the socialist program until one day America will be a socialist nation without knowing how it happened... I no longer need to run as a Presidential candidate for the Socialist Party. The Democrat Party has adopted our platform. - Norman Thomas, six-time U.S. presidential candidate for the Socialist Party, 1944."

And here we are today, and moving more quickly toward total socialism. We have forgotten what it is to be free. We have forgotten that it is up to "we the people" and the states to constitutionally protect our freedom.

From MineWeb.com:

Why May's metal price gains can continue

After an excellent month for commodities and markets, John Derrick, Director of Research at U.S. Global Investors feels that June could also see similarly strong erformance.

Author: John Derrick
Posted: Tuesday , 02 Jun 2009

SAN ANTONIO, U.S. Global Investors -

The book is closed on May, and what a great month it was for commodities, precious metals and emerging markets. And there are several good reasons to believe that the strong performance will continue in June and beyond.

The price of oil rose nearly 30 percent in May to close above $66 a barrel. This was oil's biggest monthly gain since March 1999, when it climbed more than 36 percent. Natural gas picked up 14 percent, reversing its negative trend so far in 2009.

Gold was up more than 10 percent in May, its best month since November, and is once again nudging close to the $1,000-per-ounce mark. Silver turned in its best monthly showing in more than two decades - the futures contract for July delivery rose 27 percent. Read it HERE.

At this point in time, the upward move is being reinforced daily. We will have to watch the markets and see what time reveals.

From Agora Financial's Rude Awakening:

"“The borrower should keep their promises,” China’s Yu insists. “The U.S. should be a responsible country.”

It should be, but it’s not. The nearby chart, based on data provided by ShadowStats.com, tracks the explosive growth of America’s national indebtedness over the last few years. This chart presents America’s indebtedness in terms of both cash-based accounting and GAAP-based accrual accounting. The latter of these two methods is the one that every corporation in America must use. As such, GAAP is real-world accounting, which would include things like the present value of the Social Security liability and the Medicare liability. At $12 trillion for year-end 2009, the cash-based deficit is bad enough; but at $74 trillion, the GAAP-based numbers are a catastrophe.

$74 trillion is about five times GDP, which is a ratio that would put America well within emerging market parameters. The only problem is; we aren’t emerging. We are submerging…at least from the standpoint of national indebtedness."

This clearly demonstrates that China is fully aware of the way we have squandered the reserve currency of the world. We have seriously violated the trust that was placed in us. China recognizes this and will not support our debt much longer. Perhaps, they will go elsewhere this year. They are already buying natural resources, including gold. They are using the dollar for many of these purchases.

Thanks be to God for another day to behold the wonders He is working for our eventual good.

Best to each, Doug