Thoughts on Markets

Tuesday, July 14, 2009

Precious Metals & Miners Are Up Today

Silver is still languishing below 13 and is now 12.89 up 0.07. Hopefully, it is showing some life in spite of the intervention which seems to be almost nonexisent at present. Temporarily, I am certain!

Meanwhile gold is showing some life today. It is 924.50 now up 3.70. It was a bit higher earlier, but still up from yesterday. Have you noticed how the metals are down on most Mondays? Interesting!
Our miners are showing life, as well. The longer trend outlined by the lavender lines on the graph, below, seem to be headed toward a conversion which would indicate a breakout in one direction or the other. However, the black down trend line shows that the miners have, today, broken out of the down trend. This is early in the day, and I prefer to examine the close, but this gives some encouragement. Here are some of the miners and ETFs >> AUY 8.98; CEF 11.38; DROOY 7.94; GLD 90.80; HL 2.62; HMY 8.91; SLW 7.79; SSRI 17.71, and VGZ 1.71. I have put in a 3% trailing sell stop on some of my DROOY to lock in some profit and gather some additional cash.
Richard Russell continues to point toward the very large head and shoulders in the DOW graph. This is shown below in lavender. Notice also the down trend trough outlined with black trend lines. This does not forebode well for the future action of the DOW. "Sell in May and run away, may have been a good idea.

We shall see as the summer progresses with the heat, dryness here in San Antonio. Almost makes ones believe in the prevalent lie about global warming; however, we must realize that we are "privileged" to cycles of heat with dryness and cool with rain. We should be earnestly praying for rain as we in San Antonio endure the political water shortage even though we are sitting on top of one of the largest aquifers in America. The politicos ever seek more power over the citizens. One wonders how we lost our initial small government which sought to only protect the life, liberty, and property of the citizens. Of course, back at that time, we were citizens of our respective states and the state legislatures appointed the senators. The state's task was to interposition itself between the state citizens and the federal government. The state was a protector of the citizens rights until they surrendered themselves to become arms of the feds.

From MineWeb.com:

U.S. Mint gold, silver coin sales 'temporarily suspended' - again

Sales and suspension of gold and silver coin or bullion coin sales by the U.S. Mint are becoming a regular part of doing business as overloaded refiners and mint facilities struggle to meet continuing high demand.

Author: Dorothy Kosich
Posted: Tuesday , 14 Jul 2009

RENO, NV -

Unprecedented demand, a shortage of blanks, and restrictive policies and regulations continue to exacerbate what is almost becoming a chronic shortage of gold and silver coins authorized by the U.S. Mint.

The U.S. Mint has again "temporarily" suspended sales of almost all of its gold uncirculated and proof coins, along with nearly all of silver uncirculated coins because of the limited availability of blanks.

The mint no longer offers for sale the American Buffalo Gold Proof fractional coins and four coin sets are no longer available. Meanwhile the mint will no longer offer American Buffalo Gold Uncirculated Coins. Read it HERE.

This is continued evidence of the shortage of physical metals. Without the intervention through the paper futures markets, gold and silver would be selling at a much higher price.

From MineWeb.com:

Chinese companies eyeing bargain Canadian miners for gold, coal, copper and uranium

With recent purchase of C$1.74 billion stake in Teck as an example, Chinese metals producers are said to be looking at Canada's resource companies to tie in commodity supplies with key targets said to be gold, coal, copper and uranium.

Author: By Pav Jordan
Posted: Monday , 13 Jul 2009

TORONTO (Reuters) - -

China's purchase of a C$1.74 billion ($1.5 billion) stake in Teck Resources may be just the opening move from the world's top resource consumer in a strategy to use its unique wealth advantage to become a key source of mining capital for Canadian firms.

Teck said last week it sold a 17.2 percent equity stake to state-owned China Investment Corp in a deal that allows the Canadian miner to pay down its massive debt while expanding China's portfolio of commodity investments.

The deal underscores how deep China's pockets are at a time when many sources of credit and financing have dried up in the global recession, even for the biggest miners. Read it HERE.

China still shopping the world and gaining more influence in international affairs. She wants to become the dominant economic force in the world and seems dedicated to this goal. The sea change coming is a shift of power from the west to the east. It seems that as the west sinks farther into socialism and the extreme cost of the welfare state, China is moving in the other direction. There is a great deal of economic freedom in China even though it is ruled as a communist state. Meanwhile back at home, we are losing our economic freedom as we become more totalitarian day by day.

From TownHall.com:

A Personal Inequity

Sometimes, when I hear about "disparities" and "inequities," I think of a disparity that applied directly to me-- the disparity in basketball ability between myself and Michael Jordan.

When I was in school, I was so awful in basketball that the class coach wouldn't even let me try out for softball, at which I was actually pretty good. Read it HERE.

From TownHall.com:

How to Handle Sonia

Republicans have been given fair warning.

Should GOP senators treat Sonia Sotomayor as contemptuously as Democrats treated Robert Bork, Clarence Thomas and Sam Alito, they should expect Hispanic hostility for a generation.

The chutzpah of this Beltway crowd does not cease to amaze.

They archly demand that conservatives accord a self-described "affirmative action baby" from Princeton a respect they never for a moment accorded a pro-life conservative mother of five from Idaho State, Sarah Palin. Read it HERE.

From Mirror.co.uk:

Spain seeks sunken treasure

Cash-strapped Spain has ordered its navy to look for huge gold reserves that were lost at sea in the 16th century.

Gold bullion and silver treasure worth an estimated £85billion - the size of the nation's current budget shortfall - lies on the sea bed off the coast of southern Spain.

The Inca and Aztec loot is believed to be in heavily laden vessels which hit the bottom of the sea in bad weather as they returned to Cadiz from South America. Read it HERE.

The Spanish Conquistadors are searching the oceans for more treasure. That is very interesting.

From Ron Paul's Straight Talk:

Fed Independence or Fed Secrecy?

Last week I was very pleased that hearings were held on the independence of the Federal Reserve system. My bill HR 1207, known as the Federal Reserve Transparency Act, was discussed at length, as well as the general question of whether or not the Federal Reserve should continue to operate independently.

The public is demanding transparency in government like never before. A majority of the House has cosponsored HR 1207. Yet, Senator Jim DeMint’s heroic efforts to attach it to another piece of legislation elicited intense opposition by the Senate leadership. Read it HERE.

Ron Paul is a lone voice crying the wilderness of Congress. We should support him in every way possible. Our prayers should be that the Lord will cause Ron's voice to be heard and heeded. Many in power fear the revelations of an audit of the Federal Reserve, because it would reveal the fraud and fallacy of paper "money" and the fractional banking system.

From NRAILA.org:

"Two-thirds of State Attorneys General
Support Second Amendment Incorporation

Two-thirds of the nation's attorneys general have filed a "friend of the court" brief asking the U.S. Supreme Court to hear the case of NRA v. Chicago and hold that the Second Amendment applies to state and local governments through the Due Process Clause of the Fourteenth Amendment. This bi-partisan group of 33 attorneys general, agrees with the NRA's position that the Second Amendment protects a fundamental individual Right to Keep and Bear Arms in the home for self-defense, disagreeing with the decision recently issued by a three-judge panel of the U.S. Court of Appeals for the Seventh Circuit."

We should pray that this action meets with success. Our fundamental right has been threatened ever since the Federal Government increased its unconstitutional power and become more intrusive.

From FT.com:

Central bankers return to gold and dollars

By Terrence Keeley

Published: July 9 2009 18:11 | Last updated: July 9 2009 18:11

The lessons of the past year for central bank reserve managers – overseers of $7,000bn in foreign exchange assets, four times the amount managed by their flashier cousins, the sovereign wealth funds – stand in stark contrast to the convictions they developed over the prior decade. As central bank forex assets quadrupled in the 10 years following the emerging markets crisis of 1998, reserve liquidity was deemed excessive and more diversified investment strategies compelling. With growing confidence, sovereign assets were shifted away from the US dollar, government bonds and gold to higher-yielding currencies, credit and even equity instruments. The government-sponsored enterprises Fannie Mae and Freddie Mac (and by second derivative, US homeowners) were primary beneficiaries of this trend; central bank holdings of GSE debt grew from about $100bn in 2001 to more than $1,000bn at their peak last year. Commercial banks also swelled with central bank deposits rising from $400bn to $1,400bn over the same period. Read it HERE.

From TheMoscowTimes.com:

Medvedev Shows Off Future World Money

13 July 2009By Alexandra Odynova / The Moscow Times

After months of pushing for a new world currency, President Dmitry Medvedev had more than an idea to tout at his G8 news conference. He had the real thing.

With a broad grin, Medvedev held aloft a shiny gold coin Friday that he said represented a “symbol of unity” and a possible “future world currency. Read it HERE.

I mentioned this yesterday and now here is the complete article on the show by President Medvedev at the time of the G8 meeting. This is still only saber rattling, but the rattling is becoming much louder and joined in by more nations.

Well, we are nearing noon on the trading day. It is always exciting and interesting. The challenge is great, but with the Lord's guidance, we can succeed given His blessing. We must pray that His people with rise to the task of taking dominion under King Jesus of all the world for Him.

Best to each, Doug

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