Thoughts on Markets

Thursday, May 05, 2011

US Dollar - Sillver Support Levels - Currencies - Miners - Put Trust in the Lord

Once again we need to remind ourselves that we can not put our trust in men and men's governments nor can we trust in unbacked paper dollars or even gold. The only one who has earned our complete trust and faith is Jesus Christ, the Only Begotten Son of the God, the Father. The Holy Spirit calls His people to life and leads them through the Scriptures to God, the Son for salvation. Praise Him daily >> The Triune God of all.

Market Watch:
Asian trio to study dollar alternative: report
HONG KONG (MarketWatch) — Officials from China, Japan and South Korea agreed on Wednesday to study a proposal to use their own currencies for regional trade settlement instead of the U.S. dollar, according to a Dow Jones Newswires report. More folks bailing from the falling dollar. Brief report HERE.

Mexico went from 7 to 100 tonnes in a flash; Russia, Thailand bought too
LONDON -- Mexico's central bank purchased almost 100 metric tons of gold in February and March, another signal that emerging markets are likely to steadily raise their gold reserve holdings, industry participants say.  More nations are adding gold to replace dollars as reserve. HERE.

Mexico makes third largest Central Bank gold purchase of past ten years. 
By buying 93 tonnes of gold during February and March, Mexico has busy been converting what it sees as a weak dollar into the world's prime hard asset. This is a bit more on the purchase which was neglected by the broad media. HERE.
The dollar may be oversold at present and due for a short term upward bounce. We shall see as the Lord unfolds the markets before us. 

Mine Web:
Gold imports set to soar in India and China on falling prices 
As concerns about rising inflation in both countries increases the appeal of gold as a store of value, traders and investment bankers maintain that imports are set to surge this year. Even greater demand at the lower prices. HERE.

Mine Web:
Positive on upward trends for gold and silver on long-term basis 
Encompass Fund Party politics in America are pushing up the gold price, according to Encompass Fund Comanagers Malcolm Gissen and Marshall Berol. And that's playing right into their hands. Gold Report interview.  I always take a long term perspective on the precious metals and mining stocks, because I see the long term prospects for the dollar are down in purchasing power. It pays for me. HERE.

Mine Web:
Harmony CEO reckons gold to hit $1800 next year 
Graham Briggs, CEO of South African gold major Harmony, sees the yellow metal reaching $1800 an ounce in 2012. If 1800 is reached, expect much more. HERE.

Zero Hedge:
Silver’s Paper Driven Sell Off To Be Confronted By Continued Significant Physical Demand
Gold stabilised in Asian and early European trading prior to a 1% fall, while silver’s sharp price fall continues and silver is now down 20% in USD terms in 5 days. The huge and unprecedented increase in margin in the paper silver market has forced some weak hands out of the silver market and allowed the concentrated shorts on Wall Street to press their advantage to the downside. Could this be more than a normal correction? Many are wondering. The demand for silver jewelry has been increasing as many find gold to pricey for the fancy stuff. HERE.

Peter Schiff's Gold Report:

In this issue, Mary Anne and Pamela Aden argue that precious metals will continue to outperform US stocks. Jeff Clark talks about how to think like a "smart money" investor. And I herald a new rush of major institutional investors into not just major gold purchases - but physical gold purchases. (Perhaps they've been reading this newsletter.)
For the month of April, gold rose 8.25% and silver rose a jaw-dropping 29.5%. This confirms my February forecast that silver would continue to outperform gold, even as both metals outperform the US stock market. Of course, the first few days of May have seen a 17% correction in silver from its highs; but even taking this drop into account, silver is still up 128% in the last twelve months. He goes to state that a correction in, particularly, silver was long over due as silver hit the 1980 high of $50. While I realize that the report is designed to sell the newsletter, the report contains interesting comments. I am not suggesting that you buy the newsletter. The report is HERE.

Miners from Scottrade:

Currencies from KitCo:

Some Prices: DOW off 72 to 12851.60; S&P off 6 to 1341.28; NASDAQ up 0.40 to 2828.78; Gold off 13.1 to 1503.10; Silver down 2.63 to 36.76. I am holding on all miners and metals at present. make your own decisions based upon whether or not you have the metals and miners and your cash position and risk tolerance.
Best, Doug


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