We began this Gold Commentary in January 1996.
Due to many requests, we began to archive them in May 2000.
October 30 - Musings As We Near The End Of The "Lost Decade"
"Over the past decade, the Dow has been as high as 14000 plus and as low as 6600 minus. The US Dollar has inexorably fallen from decade plus highs to all time lows on a trade weighted basis. There have been booms and busts in almost any US market one cares to name. Gold too, has suffered big corrections over these past ten years, but every time it has turned around and gone higher."
October 23 - A 10000 Dow AND $US 1000 Gold
"Well well. For two days over this past week, that's just exactly what we had. On October 13, the spot future closing Gold price hit a new all time high of $US 1065.00. The next day, the Dow closed at 10015 - its first close above the 10000 level in just over a year."
October 16 - A 10000 Dow AND $US 1000 Gold
"Well well. For two days over this past week, that's just exactly what we had. On October 13, the spot future closing Gold price hit a new all time high of $US 1065.00. The next day, the Dow closed at 10015 - its first close above the 10000 level in just over a year."
October 9 - Ah Yes - But It's Only Going Up In $US Terms
"In percentage terms, the rise in the $US Gold price has been about 3.25 times the fall of the US Dollar so far this month. But desperate times call for desperate measures and, as the week progressed, more and more postings on the mainstream financial websites began to point out that Gold was going up ONLY in US Dollar terms."
October 2 - They Don't Want To Talk About It
"But nowhere in the communique, or in any of the reporting surrounding the Pittsburgh G-20 summit was a word spoken about money itself, either currencies in general or the world's reserve currency, the US Dollar, in particular."
September 25 - The G-20 Is "Safe" - For Now
"And Gold, after having "trespassed" above the $US 1000 barrier on a spot future closing level for nine straight days between September 11 - 23, is once back at a three figure $US price. Note the huge volume in the weekly table above on September 24."
September 18 - The $US Gold Bull Market - From 2002 - Re-Validated
"The most interesting aspect of Gold's breach of $US 1000 is that it comes not much more than a week before the Heads of State are due to meet at the G20 meeting in Pittsburgh to give their "seal of approval" to the much touted financial AND economic recovery from "the worst 'recession' since the 1930s."
September 11 - It's A New High - But It Ain't High Enough - Yet
"First of all, the Gold close on September 11 is a mere $US 2.10 above the previous high Gold close set on March 18, 2008. That's not nearly enough to be confident that the ceiling set in March last year and confirmed in February this year is broken."
September 4 - Here We Are Again
"Over that period, Gold has not been dragged up by soaring oil or commmodity prices. Nor has Gold been reacting to a fall in the US Dollar. Nor have there been any overt moves in US Treasury yields. No wars, no financial collapses, no bolts from the blue."
August 28 - The Last Straw For The US
"The only thing growing now is US federal government debt. The only thing which has delayed the real economic collapse is a gargantuan flood of US federal government debt. This is the very last "bubble", and like all bubbles, it will collapse."
August 21 - A New High For A Long-Term Indicator
"This week, the 200-day MA exceeded its old all time high set in October last year on August 19. By the close of trade for the week on August 21, the 200-day MA had gone on to climb above the $US 900 level for the first time ever."
August 14 - Safety In Numbers
"To question such economic and political orthodoxy is heresy. We who do so are heretics. The ones who do so by ridiculing the entire situation by exposing its essence are the worst of all. If you want to expose a folly, take it literally."
August 7 - The European Five Year Gold Plan - Mark III
"On September 25-26, 1999, nearly ten years ago, the G-7 conducted their annual meeting as a prelude to the IMF and the World Bank meetings in Washington DC. As this meeting was breaking up, the Europeans dropped a bombshell."
July 31 - The Fine Art Of "Whipsawing"
"The problem is that the futures markets deal with paper, and as the global borrowing and spending by government increases, the demand all over the world for Gold that is actually METAL continues to increase. At the same time, Gold production, like the production of almost everything else in the way of REAL economic goods, is falling."
July 24 - Suffering From "Sacrifice Overload"
"'We're seeing numbers - trillions here and trillions there. And so I think legitimately people are saying, 'look, we're in a recession. I'm cutting back, I'm having to give up things - and yet all I see is government spending more and more money'." (President Obama)
July 17 - Destroying The Economy To Preserve The "System"
"If you want a measure of which governments are most addicted to hanging onto their power no matter what, a good one is to observe which governments are the most reluctant to even discuss the process of "winding back" the huge stimulus programs now being administered all over the world. No government denies that - at some point - such a winding back of deficit spending and stimulus programs is necessary."
July 10 - If We Don't Talk About It - Will It Go Away?
"For the whole of this year, there have been growing rumbles coming out of more and more nations concerning the unsuitability of the US Dollar to continue its role as the world's 'reserve currency'. These rumbles never see the light of day when the Heads of State get together for one of their ever more frequent 'Summits'."
July 3 - We Won't Talk About The US Dollar!
"When the US became a NET international debtor in 1985, the Treasury's funded debt totalled about $US 1.9 TRILLION. Today, it totals about $US 11.5 TRILLION. That means that Treasury funded debt has increased by just over FIVE HUNDRED PERCENT in the 24 years since the US became a net international debtor."
June 26 - What An Unlovely Monetary Mess
"With the exception of a short-lived aberration a couple of weeks ago in the lead up to the G-8 Finance Ministers' meeting and when the US Treasury was selling off a weekly record $US 130 Billion in new debt paper, the world has been getting more and more publicly "dissatisfied" with the status of the US Dollar ever since the start of this year."
June 19 - The Longer It Takes - The Tighter The Spring
"As you can see, the Gold "ATMs" or "vending machines" are a hit in Germany. It will be fascinating to see how they do if and when they actually are set up in Britain. It would be even more fascinating to see what would happen if they "crossed the pond" to the US."
June 12 - The Longer It Takes - The Tighter The Spring
"As the last two weeks show so clearly, the $US 1000 level for Gold is a very big deal indeed. For the second week in a row, Gold has retreated in $US terms this week. And because the US Dollar is down itself this week (despite its upward bounce back above the 80 level on the USDX on June 12) - Gold has retreated still further against most other major world currencies"
June 5 - Surreal Shenanigans
"The yield on Treasury 2-year paper SOARED 34 basis points to 1.29 percent - its highest level since July 11, 2008. Back then, the Fed Funds rate stood at 2.00 percent - well above the two-year Treasury yield. Today, there is no Fed Funds rate - the Fed has a "target range" of between 0.00 and 0.25 percent."
May 29 - Third Time Lucky?
"And now we have a third accelerating approach to that elusive $US 1000 level for Gold, this one coming not much more than three months after the previous one in late February this year. Yes, the US Dollar is falling rapidly now just as it was in March 2008."
May 22 - An "ATM" That Spits Out Money!!
"First of all this is a first foray towards putting Gold back into general circulation. Granted, these gold pieces are not officially "money", but it would not take a HUGE change for them to become money."
May 15 - Can't Spend - Can't Save - Need MONEY!
"In the English-speaking nations in particular but to varying degrees all over the world, "saving" is a concept which has been all but obliterated over the past three decades. Less than forty years ago, the exchange rates between currencies were actually fixed. In the twenty years before that, prices in most advanced economies were relatively stable."
May 8 - Of Dollars And Dollar Debt
"This week, we have seen the two biggest markets in the world, the market for Treasury debt paper and US Dollars, take a severe hit. Treasury yields have been rising inexorably since the Fed lowered its rates to the vanishing point last December. This week, that rise accelerated. That proved too much for the exchange value of the US Dollar which plummeted this week."
May 1 - The Grotesque Size Of Government
"If present government expenditures were reduced by 99 PERCENT, that would take US federal government spending down to $US 37.5 Billion or per capita spending of $US 123.35. That is still more than THREE TIMES HIGHER than it was in 1933, when government power and spending SKYROCKETED to "protect" Americans from the 1930s depression."
April 24 - The Value Of Money
"There is only one cure for what currently ails the world's economies. That is the re-introduction of two things. The first is a proper respect for money. The second is a money worthy of respect. In all of history, only Gold has earned that respect."
April 17 - The Return Of "Risk Appetite"
"In reality, of course, there was very little in the way of "risk appetite" over the 25 years (1982-2007) when paper assets - stock market assets in particular and real estate in the later stages - were in their great boom. Most of the participants in these markets didn't see themselves as taking risks at all."
April 9 - A Time Bomb - Global Stock Markets
"In ALL of these stock markets, the huge falls of 2008 which accelerated into the second week of March this year did NOT stampede most people out of the stock market. Examination of retirement portfolios and other types of mass investment vehicles everywhere have shown that the majority of people have NOT sold out of their stock investments."
April 3 - The Old Chestnut - IMF Gold Sales
"Now, in the wake of what was a damp squib of a G-20 Heads of State summit, the sale of this IMF Gold has raised its head again, just as it does almost every year. On April 2, the Heads of State meeting in London reportedly "approved" the IMF plan to sell this 403 Tonnes of Gold. This is, as the US Treasury was quick to point out, subject to Congressional authorisation."
March 27 - Calls For A New Reserve Currency
"The growing insistence that the world needs a new "anchor" for its monetary system is not going to go away. With every new $US TRILLION stimulus and/or bailout program that the White House or the Treasury or the Fed or the FDIC proposes, the drumbeat will become more insistent. The rest of the world cannot, even if they wanted to, "finance" the insatiable debt demands now pouring out of the Obama Administration."
March 20 - End Game - Printing The Reserve Currency
"It is one thing for the central bank of Japan, the UK or anywhere else to embark on what is now quaintly referred to as "quantitative easing". It is another thing entirely for the central bank of the nation which provides the world with its RESERVE CURRENCY to do so."
March 13 - Trying To Kick Start A Dead Horse
"The governments of the US and the UK are absolutely determined to destroy their financial systems and the money they rest on rather than remove their hands from the levers of political power. They are well aware that the fundamental means by which they "run" their economies and thereby the lives of their citizens is their monopoly control over what their citizens must, by law, use as money."
March 6 - Weimar - Zimbabwe - Great Britain??
"... the move by the BoE was explained by a newsreader on our local (Australian) evening news as follows. Please note, this is a paraphrase, not a quote. "It didn't work in what was called the 'Weimar Republic' in 1923. It didn't work in Robert Mugabe's Zimbabwe. But Bank of England Governor Mervyn King is going to try it anyway. He is going to start printing money to rescue Britain from its worst recession since the 1930s."
February 27 - Foiled Again?
"So, after visiting the $US 1000 level for the second time ever - the first was in March 2008, Gold has recoiled in horror, just as it did in March 2008. This has, of course, led to legions of "analysts" crowing at the top of their lungs that the Gold bull is finished."
February 20 - The Last Hurdle - $US 1000
"It is impossible to know in advance if Gold will stage another retreat from $US 1000, and if it does, how long that retreat will last and how low it will go. It is certain that the monetary and banking powers that be both inside and outside the US will do whatever they can to bring about such an outcome."
February 13 - Waiting For The Stimulus Package
"As we said here last week, Gold is simply "waiting in the wings". It's call to centre stage may come with the announcement of Mr Obama's stimulus package early next week. It may come in the aftermath of Secretary of State Clinton's visit to China late next week. Or it may come when the Fed finally bites the bullet and starts to actively monetise the debt paper pouring out of the US Treasury."
February 6 - The Revolt Of The Masses?
"A poll taken by an Australian paper shortly after it was announced asked Australians if they "approved" of the "stimulus" package announced by their Prime Minister. Fifty-one percent of those responding said no. In the UK, the announcement by the Bank of England this week that they were cutting official rates another 0.50% - to 1.00% - was met by a STORM of protest! The Bank was accused of an assault on savers."
January 30 - A Tale Of Two Currencies
"In terms of most of the other major currencies in the world (other exceptions being the Chinese Yuan and currencies 'pegged' to the US Dollar), Gold has been scaling all time highs for the past two weeks. That includes the Euro, the other potential global 'reserve' currency. The reason for this is, of course, that all these currencies have been falling in exchange value against the US Dollar for the past six or seven months while the US Dollar has, in its turn, been falling against the Yen over the same period."
January 23 - Gold Going UP - Treasuries Going DOWN
"But THIS week (January 19 - 23) the yield on the US Treasury's 30-year debt paper has SOARED - rising from 2.87 percent to 3.31 percent! That has led to the biggest plunge (don't forget with debt paper, yields and prices on the secondary markets go in opposite directions) in the 30-year bond since 1982!"
January 16 - The Latest US Banking Crisis
"Modern money creation methods are almost totally dependent on inducing people to borrow and spend, and the banks are the vital middlemen in this process. The problem for the government is acute when their banking system can no longer perform this vital function."
January 9 - 2009 - The Year For Gold?
"Given any amount of comprehension of what is now going on in global financial and political circles in general and the US in particular, it would be very difficult NOT to be "bullish" on Gold. Even if this comprehension was lacking, the mere fact that Gold weathered the commodities bloodbath of the second half of 2008 so much better than anything else is a powerful mark in its favour."