Investment/Trends

Indian gold imports set to resume after 4-week halt as export rule clarified

"A resumption of imports would ease tight domestic supply and prices ahead of a festival and wedding season that kicks off next month. Indian imports would also support benchmark international gold prices, which hit a two-month high on Monday. The confusion centred on a rule that required importers to re-export at least 20 percent of all imports, known as the 80/20 rule. Last week, the Reserve Bank issued detailed guidelines on how the rule would work, but the complexity of the rule had prevented banks from importing immediately. Banks are the main importing agencies for gold into India." Continue reading →

Continue ReadingIndian gold imports set to resume after 4-week halt as export rule clarified

Asians Buy Gold. Westerners Sell It.

"American investors did not buy physical gold, but instead bought ETFs — promises to pay money, not gold — because commissions were lower than coins. But the commodities futures organizations are now facing the lowest inventories of deliverable gold ever. If the owners of contracts for future deliveries — 'longs' — start taking delivery, the exchanges will have to deliver digital dollars instead. Westerners like George Soros and John Paulson have been selling their paper gold positions. Asians are taking delivery of physical gold. You can’t make jewelry out of digits. Who is selling physical gold? No one in the industry knows." Continue reading →

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Federal Reserve Issues a Toothless Report on the Big Banks

"Yesterday, the FED issued a report on the lack of capital — too much leverage — of America’s largest banks. In its evaluation, the Federal Reserve found that firms needed to improve a number of aspects of their capital planning processes, including their accounting for risks most relevant to the specific business activities, their methods of projecting the effect of certain stresses on their capital needs, and their governance of the capital planning processes. The banks 'need to improve on a number of issues'? They do? And if they don’t, what will the FED do about it? It will issue another report." Continue reading →

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Consumer demand for gold jumps 53%

"According to WGC there is renewed interest in gold due to its falling prices, which has brought total purchases of gold jewellery, bar and coins to 1,083.2 metric tons. Jewellery demand reached its highest level in 5 years, increasing by 37% to 576 tonnes. Chinese demand was up 54% compared to the same period last year, while India bought 51% more gold ornaments than in 2012. Bar and coin investment surged by a significant 78% across the world and topped 500 tonnes in a quarter for the first time. The WGC statistics come on the heels of India’s recent measures to curb gold purchases because it is the most costly non-essential item that the country imports." Continue reading →

Continue ReadingConsumer demand for gold jumps 53%

Playing The Surge In Precious Metals, II

"The top buys in the PM sector in my view are SAND, ABX, Goldcorp (GG), Yamana Gold (AUY), TAHO, SILJ and SLW. The top performer since the June 26 bottom has been FNV, a gold and energy royalty company with no debt and $900 million cash and equivalents. They can fund distressed miners and then sell their inexpensive gold into a rising market. They have excellent management and are a top pick. and should be strong going forward, as should Eldorado Gold (EGO) which has producing sites in Turkey and China and sites nearing production in Greece and Romania. Like them, SSRI and IAG remain good choices to buy on a dip with limit orders." Continue reading →

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Funds Build Bullish Positions In Precious Metals Futures, Options

"A price rally inspired speculators to build bullish positions in precious metals futures and options traded on the Comex division of New York Mercantile Exchange and the Nymex, confirming many market participants’ expectations that speculators shed short positions when prices rose. The gains in the data released Friday by the Commodity Futures Trading Commission came via a mix of short covering, that is buying back of previously sold positions, and newly added long positions as noted in both the disaggregated and legacy reports. In copper, speculators sheared short positions, and [..] turned net-long for the first time since February." Continue reading →

Continue ReadingFunds Build Bullish Positions In Precious Metals Futures, Options

Peak Gold

"The resource sector has had a sober awakening, and now we see many companies changing their priorities from expansion to profitability, which depends on many parameters in addition to grade. As for Peak Gold, if that does indeed turn out to be behind us, the big, bulk-tonnage low-grade deposits that are falling out of favor today will become prime assets in the future. It'll either be that or go without. Times may be tough, but the story of the current gold bull cycle isn't done being written. The better companies will survive the downturn and thrive in the next chapter. Identifying these is the ongoing focus of our work." Continue reading →

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What The 25% Collapse In Homebuilder Stock Prices Tells Us

"The most important factor that sets the fate of the homebuilder stocks is the housing market. If the housing market has growth potential ahead, then you can bet on homebuilder stocks to provide a stunning performance to the upside. If it’s the opposite scenario, with the housing market looking shaky, then homebuilder stocks usually tank. In other words, homebuilder stocks are very fickle, but they are also a great indicator of future activity in the housing market. Since mid-May, the Dow Jones Home Construction Index has plummeted roughly 25%, and it’s in negative territory year-to-date." Continue reading →

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California adds 500,000 renters while homeownership declines amidst a boom

"The California housing market is providing us with two different pictures. First, home prices have surged and inventory is still very low. However, the homeownership rate continues to decline from the peak reached in 2006 of 60.2 percent. Since 2007 California has added a net of 500,000 renter households while losing a net of 233,000 homeowners. Yet the market continues to boom in the face of a declining homeownership rate. As we look at the market today we start seeing a slowdown in the speed in which flips are being accepted and inventory is rising. With higher interest rates and the fall season just before us, will the market thaw or continue to accelerate?" Continue reading →

Continue ReadingCalifornia adds 500,000 renters while homeownership declines amidst a boom

You Have To Use This Checklist When Buying A House

"There's no way to predict if housing is going up or down. So you need to get Death, Debt, or Divorce on your side. These are basically the ONLY ways you can guarantee you are getting a better deal than anyone else. If every house in an area is going for $400,000 then you want to make sure you don't pay more than $200-250,000. That's called 'good investing'. Good investing is not about predicting the future, it's about getting a deal. This is an important concept no matter what you are investing in and it's the concept everyone forgets. Don't buy a house unless you are getting a deal, even if you've convinced yourself you will living there for 30 years." Continue reading →

Continue ReadingYou Have To Use This Checklist When Buying A House