The Biggest Double Top in History - Chart

1971 to ?

The numbers are a bit fuzzy on the dates, but the left side of this graph starts in 1971.

Same year that the US severed the gold standard.

Coincidence?

I dont think so.

Do you see where the bottom is?

Gold / Dow Ratio of 1:1 at Gold $3500 and Dow $3500?

I dont know about you…but seems to be that all these people cant ALL be stupid, or naive.

Maybe there is something to this gold thing afterall.

Perth Mint Suspends Gold Sales Amid Unprecedented Rush

November 22, 2008
Article from: The Australian

FEARS of the unknown long-term effects from the global financial crisis have sparked a new gold rush.

With retail and wholesale clients around the world stocking up on the precious metal, the Perth Mint has been forced to suspend orders.

As the World Gold Council reported that the dollar demand for gold reached a quarterly record of $US32 billion ($50.73 billion) in the third quarter, industry insiders said the race to secure physical gold had reached an intensity that had never been witnessed before.

Perth Mint sales and marketing director Ron Currie said the unprecedented demand had forced the Mint to cease orders until January, with staff working seven days a week, 24-hour days, over three shifts to meet orders.

He said Europe was leading the demand, with Russia, Ukraine, Middle East and US all buying — making up 80 per cent of its sales. One European client purchased 30,000 ounces for $33 million.

“We have never seen this before and are working right at capacity. And we are seeing it from clients in the shop buying one ounce, right up to 30,000 ounces from overseas clients,” Mr Currie said.

Robert Jaggard, manager of bullion and rare coins dealer Jaggards, said business had picked up strongly and he expected it to increase further.

“All around the world there has been a heavy run on physical gold and there is a shortage of supply,” he said.

Mr Jaggard, who has been dealing in gold for 40 years and is an agent for the Perth Mint, said some clients were buying up to $1million worth of gold, paying a premium above the spot price.

Late yesterday afternoon, spot gold in Sydney was trading at $US747.30 an ounce, up $US8.15 on Thursday’s local close.

“Professional business people who have previously bought small amounts now want more gold because they are suffering in other markets,” Mr Jaggard said.

At a conference this week in Munich, delegates were lined up 30-deep to purchase physical gold. And reports out of the Middle East suggested that there had been unprecedented gold buying in Saudi Arabia during the first half of November, with an estimated $US3.5 billion purchased in recent weeks.

The World Gold Council, releasing its global demand trends yesterday, said identifiable investment demand, which incorporates demand for gold through exchange-traded funds and bars and coins, was the biggest contributor to overall demand during the quarter. It was up to $US10.7 billion, double last year’s levels.

The figures showed retail investment demand rose 121 per cent to 232 tonnes in the third quarter, with strong bar and coin buying reported in Swiss, German and US markets.

The quarter also witnessed widespread reports of gold shortages among bullion dealers across the globe, as investors searched for a haven. Overall, quarter three saw Europe reach an all-time record 51 tonnes of bar and coin buying. France became a net investor in gold for the first time since the early 1980s.

World Gold Council chief executive James Burton said gold’s universal role as a store of value had shone through during the quarter, helping attract investors and consumers to all forms of gold ownership.

“The rise in demand for gold bars and coins has been impressive,” he said.

Demand in India, the largest market for gold, recovered during the third quarter, encouraged by lower gold prices, a good monsoon and the onset of the festive season. At 250 tonnes, total consumer demand was 31 per cent higher than the same period last year. In value terms, demand hit the record quarterly sum of $US5 billion.

OPEC and Wall Street Duke it Out over Silver, Gold, and Oil

At least thats what I think this article should have been named.

I dont always accept what Mr. Chapman says as he has been known to be on the extreme end of the Doom and Gloom scale, even for me.

However, this article he just posted to goldseek.com holds water in my opinion.

I have thought for a time that once the Dubai based silver ETF launches, that Comex is in deep kim-chee in terms of silver inventory.

This very well could be the proverbial straw that finally breaks the back of the mighty, and some analysts say highly manipulated, Comex markets.

Articlefollows:

***

International Forecaster November 2008 (#6) - Gold, Silver, Economy + More

By: Bob Chapman, The International Forecaster

– Posted Thursday, 20 November 2008

US MARKETS

What you are now witnessing is the slow motion destruction of the CRIMEX, formerly known as the COMEX, a commodities futures market which is supposed to provide a means for producers to hedge their products, but which has morphed into a rigged casino where commodities that don’t exist are traded as if they did for prices that exist only in the fairytales woven by the Illuminati, who control the exchange.  This destruction is what happens when the credibility and integrity of the market owners and managers of the CRIMEX, together with the credibility and integrity of the market regulators, the CFTC, move from near zero to negative infinity.

Not only do the owners and regulators do absolutely nothing about obvious criminal manipulations and illegal concentrations of short positions, but also we believe that they conspire with the criminal operators, which we refer to as “commercial shorts,” to aid and abet their criminal mischief by divulging the precise nature of the trading positions of the “spec longs” who take the other side of the contracts, thus allowing pinpoint attacks on black-box formulations, especially where stops have been placed, thereby minimizing the cost of the manipulations by preventing the waste associated with overkill.  Also, the owners and regulators change margin requirements, and whitewash investigations of obvious illegalities, whenever it serves to protect the commercial shorts, thus making a mockery out of the exchange and transforming what are supposed to be free markets into crony capitalist, corporatist fascist systems of syndicated piracy.  This lack of integrity and criminal manipulation is the most pronounced in the gold and silver commodity markets, but many other types of commodities are under manipulation as well, especially oil, base metals and agricultural produce, meaning most of the rest of the exchange.

The despicable, nefarious dealings of the miscreant CRIMEX owners and regulators is quickly catching up to them in the precious metals markets of the exchange, and soon every one of the spec longs is going to pick up their toys and go home, and if the specs have any brains or sense of justice, they will take as much of the CRIMEX gold and silver with them when they leave by paying cash for it and taking delivery of it.

Since the end of October, when open interest for the December gold contract started a new series of decreases as the rollovers got off to any early start, the December open interest has fallen from 190,140 to this past Friday’s 122,902, yet total open interest has fallen from 305,451 to 285,219 during that same period.

Thus, of the 67,238 December contracts that have been terminated in the rollover thus far, total open interest has plummeted by 20,232 contracts, meaning that many of the contracts are not being rolled over, and are being cashed out instead.  If this 30% ratio persists, we could see gold open interest fall to under 250,000, a multi-year low, an astonishing drop of 58% from the peak of 593,953 contracts set on January 15, 2008.

This is an absolute disgrace for the CRIMEX owners and regulators, and we wish them well in the ensuing bankruptcies and criminal investigations that will occur after the exchange collapses.  No one wants to play in a game where the owners and sponsors are in cahoots with certain privileged players to make sure they come out on top.  In addition, we note that no commodities market can survive without speculators who provide balance to the markets by taking the other side of contracts and by keeping the pendulum of market momentum alternating between bulls and bears.  Otherwise the markets lean too far to one side or the other, and then bubble and/or collapse due to the lopsided positions.  Once the precious metals markets of the exchange collapse, all the other markets will soon follow, as everyone realizes that the whole system is rigged against them.  The CRIMEX will soon be ostracized from participation by honest market players.  The criminal manipulators will soon find themselves traipsing in and out of court in endless investigations, and they will be forced to sit in their bedrooms, lonesome, because their is no one left who wants to play with them.

In a stunning new development, the Dubai Multi-Commodities Center is now putting the finishing touches on the formation of an exchange traded fund for silver with a launch likely next month as demand for silver has surged in the past six months.  What may be happening here is that the OPEC nations, and possibly also Russia, are setting up a counterbalance against the collapse of oil prices.  You may recall from past issues that we discussed at length how we thought that sovereign wealth funds in oil-rich nations were tweaking gold and silver upward every time oil was smashed by the Illuminist manipulators.  The message was, you leave oil alone, or we will send gold and silver to the moon and expose your destruction of the US economy by killing the canaries in the coal mines, thus ringing the gold and silver alarm bells loud and clear.   This makes the Illuminists rabid, and induces collective myocardial infarctions among them, because precious metal suppression, especially of gold, is JOB ONE at the Fed.  The failure to cap the price of gold was Paul Volcker’s only regret as Fed Head during his handling of the inflationary crisis of the late 70’s and early 80’s, and the privately owned, Illuminist Fed does not intend to make the same mistake twice.

The Illuminati have made two major mistakes, and the Dubai exchange may be the OPEC solution to the oil takedown, which is the direct result of those mistakes.  The first mistake is that the Illuminati gave OPEC a taste of 147 oil, and then pounded it down to 55.  This will not be tolerated, especially after these nations got a chance to experience the huge profits generated by such lofty oil prices.  The second mistake is the trashing of silver prices in the face of growing shortages at a time when the above-ground silver stocks are at an all-time low and headed even lower.  The shortages are being caused by manipulated silver prices that are below the cost of production, thus causing a collapse in production, and the manipulation of base metals prices into the subbasement is adding to the loss of production because 70% of silver is produced as a by-product of base metal processing.  Due to these criminal price manipulations, the gold to silver ratio is now 77 to 1, when historically is should be around 15 or 20 to 1.  This huge price imbalance, growing shortage and all-time low levels of above-ground stocks has set up the greatest opportunity to corner a commodity market in the history of the world.

The Hunt Brothers would be drooling right now.  When they were trying to the corner the market, it was much, much larger by many billions of ounces, and prices were being driven much, much higher, topping $40 per ounce, because there was far less manipulation of those markets than there is today (yes, believe it or not, we once had something bordering on free markets).  The Dubai silver ETF may pick up where the Hunt Brothers left off.  Since there are only about a billion ounces of above-ground silver stocks left, and because silver is trading at a ridiculous sub-10, ten billion could clean out the entire above-ground silver stock.  This is chump change for these wealthy oil sheiks and their sovereign wealth funds.  So get ready to rumble as the evil Illuminist scum and the price-gouging sheiks of OPEC prepare to “get it on” in an oil-silver showdown, complete with some very spectacular fireworks to come.  Both oil and silver are headed much higher, and gold will tag along for the ride as silver vaults to new heights.

In the end we expect some sort of compromise, as $150 oil would take down the entire world economy, which is now teetering on the brink.  We should soon see $80 to $100 oil and $15 to $20 silver.  Silver may go much higher than that depending on how stubborn the Illuminists become about the price of oil.  This is starting to get very interesting, so stay tuned, as one of the greatest financial battles of all time gets under way.

Instead of foolishly pumping money into insolvent, zombie banks, the sheiks may well have decided to go after the silver market.  Imagine what will happen as those who require silver to make their products see the COMEX gold and silver being funneled to Dubai’s ETF.  All we can say is, if you were waiting for some precious metals fireworks, get ready, because it’s coming.  It is now time to load up on precious metals, especially silver.  Oil will do well also.  As some form of confirmation, we also note the growing open interest in the February gold options and futures contracts.  Let the Battle of the Titans begin.

Great article just went up over at Numismaster.com

Here is an excerpt:

On Aug. 1, 2008, the Zimbabwean government dropped eight zeroes from their currency, so this is equivalent to the current Zimbabwean $10 note. At the current foreign exchange rates, it takes somewhere from 13,000 to 16,000 Zimbabwean dollars to be worth one U.S. dollar.

In other words, the government of Zimbabwe has taken a valuable commodity like paper, slapped some ink on it, and made it worthless. Actually - not quite worthless. Instead, it is more valuable being used as an artist’s canvas than as a medium of exchange.

Gold, on the other hand, has never become worthless through government inflation. Gold coins and bars have been made into jewelry and other forms of art because the gold represented a long-term store of value. Gold has never been worth zero, and it never will be.

You can see the whole article here:

Numismaster.com

Apparently its not just the US, the Middle East, and Europe Scrambling for gold, but also China, according to a recent article in the Shanghai Daily.

Investors going for gold as a safe haven

By Zhang Fengming  |   2008-11-20  |     NEWSPAPER EDITION

DEMAND for gold in China rose 18 percent in the third quarter as consumers turned to the precious metal as a safe haven for their cash, the World Gold Council said yesterday.

Demand rose to 109 tons in the third quarter, the majority of which is attributed to a strong rise in the Chinese mainland, the council said yesterday, citing figures complied by researchers GFMS Ltd.

Demand from the mainland rose 20 percent to 99.8 tons. In Hong Kong it increased 7 percent to 3.8 tons while demand in Taiwan shrank by 6 percent to 5.4 tons.

China’s gold jewelry demand grew 9 percent to 92.5 tons in the quarter as sharply lower prices persuaded consumers to overcome their reluctance to spend in the gloomy global economic environment.

Gold prices hit a yearly high of more than US$1,000 an ounce in March and then fell to the current US$740.

The retail investment market was particularly animated in China and demand from the segment more than doubled to 16.5 tons as gold’s safe-haven status appealed to investors in a time of financial crisis.

Over the next quarter, the outlook for gold across China is mixed, the council said.

The arrival of the Chinese wedding season may provide some support for jewelry purchases, particularly if the gold price steadies at the lower levels seen in recent weeks. However, the global economic slowdown is also likely to restrain consumer spending on gold jewelry.

Investment demand, however, is likely to benefit from continued uncertainty.

The strong rise in demand from China, India, Middle East and Indonesia has boosted global gold demand in dollar terms to a quarterly record high. Dollar demand for gold reached an all-time quarterly high of US$32 billion in the third quarter. That was 45 percent higher than the previous record in the second quarter.

“Gold’s universal role as a store of value has shone through during this quarter helping attract investors and consumers to all forms of gold ownership. The rise in demand for gold bars and coins has been impressive as has the record rise in gold ETF (exchange traded fund) inflows,” said James Burton, chief executive officer of the World Gold Council.

http://www.shanghaidaily.com/article/shdaily_sing.asp?id=381278&type=Business&page=0