September 2012 - foorex2day

Interview with Al Korelin

Did an interview yesterday with Al Korelin on China. I don't have much time to listen to podcasts, but Al's is on my daily download list. Also, unusual for websites these days, his readership and comments are free from trolls and other idiots and you will usually find some insightful remarks. Worth …

Negative lease rate confusion, again

<div style="text-align: justify;">Jeff Nielson again (see <a href="http://goldchat.blogspot.com.au/2009/10/slv-and-jeff-nielson.html">here</a> for previously) proves he knows little about the gold market with this <a href="http://silvergoldbull.com/blog/analysis-fraud-of-negative-lease-rates/">post</a> on negative lease rates. See this comment of Jeff's for a seriously confused guy:</div><i><div style="text-align: justify;"><blockquote class="tr_bq">Let me explain this one more time.<br /><br />GOFO is the "nominal" lease rate. As you (and others) have observed, you SUBTRACT LIBOR from that number to get the "real" lease rate.<br /><br />Understand that LIBOR is a PROXY for inflation here. So this calculation essentially strips out inflation to tell us the REAL rate at which the banksters are leasing their gold...and when that (real) rate is negative it implies a fraud on the market.</blockquote></div></i><br /><div style="text-align: justify;">LIBOR = inflation, GOFO = nominal lease rate, huh? My response:</div><i><div style="text-align: justify;"><blockquote class="tr_bq">Jeff, GOFO is not a nominal lease rate and LIBOR is not a proxy for inflation.<br /><br />GOFO is a gold foward (ie future) rate. It is not a lease rate, nominal or real. Technically, as per http://www.lbma.org.uk/assets/OTCguide20081117.pdf it is "rates at which the Market Making Members will lend gold on swap against US dollars". What many people do is focus on the "will lend" and miss the "on swap".<br /><br />I also don't get how you think LIBOR is a proxy for inflation. Are you seriously saying that 1 year inflation rates are 1%? Shadow Stats I think would disagree with you. LIBOR is the "cost of borrowing unsecured funds" as per http://www.bbalibor.com/<br /><br />Finally, the Perth Mint does actually borrow gold from bullion bankers from time to time and I can confirm that we are not being paid to do so.</blockquote></div></i><br /><div style="text-align: justify;">As at today, no counter response by Jeff even though the livefyre commenting system is showing him as "listening". Same MO as my Seeking Alpha exchange with him - just ignore the comment when its is clear you've lost the argument.</div>

Jeff Nielson again (see here for previously) proves he knows little about the gold market with this post on negative lease rates. See this comment of Jeff's for a seriously confused guy:Let me explain this one more time.GOFO is the "nominal" lease rate. As you (and others) have observed, you SUBTRAC…

Can US Govt seize Perth Mint client gold?

<div style="text-align: justify;">You may be interested in <a href="http://gyroscopicinvesting.com/forum/index.php?topic=3173.msg43451#msg43451">my response</a> to this comment left in the <a href="http://gyroscopicinvesting.com/forum/index.php?topic=3173.0">Permanent Portfolio Discussion Forum</a>:</div><div style="text-align: justify;"><br /></div><div style="text-align: justify;"><i>"Perth is good, but I trust Australia less than Uncle Sam. ... If I put my assets in Australia, I not only need to worry about Australia's government seizing my assets in times of their need... but I also have to worry about the US State Departments ability to basically extradite the assets back (and me personally) to the United States under the guise of fraudulent transfer or tax evasion when Uncle Sam is in need."</i></div><div style="text-align: justify;"> </div><div style="text-align: justify;">It in I discuss the one occurance we have had of a request by US authorities for a client's gold to be handed over to a US court.</div><div style="text-align: justify;"> </div><div style="text-align: justify;">Unrelated - this is my new favourite blog <a href="http://www.papermoneyshield.com/">Paper Money Shield</a> who's mission is <i>"Defending paper money from the rigorous attacks of precious metal advocates."</i></div>

You may be interested in my response to this comment left in the Permanent Portfolio Discussion Forum:"Perth is good, but I trust Australia less than Uncle Sam. ... If I put my assets in Australia, I not only need to worry about Australia's government seizing my assets in times of their need... but …

SLV bars found in Bullionvault and Goldmoney!

I said to Warren he needed to sex up his post titles but he declined - I suppose it detracts from the serious approach he is taking to this ETF bar list analysis project. Doesn't stop me from using a headline grabbing title however. Another interesting post on what goes on inside the secretive LBMA …

Empty Letter

<div style="text-align: justify;">Received a letter from the US yesterday addressed - GCORP ATT: Bron Sucheki - and sent air mail with four First Class Forever 2009 dated stamps on it.</div><div style="text-align: justify;"> </div><div style="text-align: justify;">Funny thing is, it was empty. Don't know if this was meant as some symbolic message (I'm an empty person) or USA goons have intercepted it and removed the offending letter.</div><div style="text-align: justify;"> </div><div style="text-align: justify;">Very weird.</div><div style="text-align: justify;"> </div><div style="text-align: justify;">While on the topic of unusual letters, in December 2008 we received a series of four letters addressed to "The Director" just signed Michael. Some samples (I kept them, of course) from the letters:</div><div style="text-align: justify;"> </div><div style="text-align: justify;"><em>"Gold is going into the stratosphere once the Central Bank controlled, fractional reserve, fiat paper, thin-air monetary and banking system collapses very soon."</em></div><div style="text-align: justify;"><em></em> </div><div style="text-align: justify;"><em>"Are you happy as Director of the Perth Mint to be parting with gold (and silver) at a price that bears no resemblance to the underlying demand? A price that is doctored by the Illuminati banking shysters to prop up their iniquitous fiat paper money extortion racket against the human race?"</em></div><br />

Received a letter from the US yesterday addressed - GCORP ATT: Bron Sucheki - and sent air mail with four First Class Forever 2009 dated stamps on it. Funny thing is, it was empty. Don't know if this was meant as some symbolic message (I'm an empty person) or USA goons have intercepted it and remove…

China has 6,355 tonnes of gold

Further to my article on Chinese gold imports, I have a follow up analysis of China's gold stock at the corporate blog.OK, 6355 tonnes is a little too precise given the opaque nature of the gold market, but the point is that a reasoned approach means that China holds circa this number. I also estima…

Deutsche Bank explains why we hoard gold

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Gold hoarder dies alone - RIP Walter Samasko Jr.

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Perception vs. Reality Open Forum

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Go Slow on Silver

<div dir="rtl" style="text-align: right;" trbidi="on"><div style="text-align: justify;">Screwtape Files guys have a good post on silver cautioning that silver may be primed for a correction.<br /><br />I've been following the story of Israel Switt and the 10 x 1933 Saint-Gaudens double eagle coins he "acquired". ABC is reporting his family lost an appeal in the Eastern District Court of Pennsylvania. They will be appealing to the 3rd Circuit. For $80million I would be too.<br /><br />Finally, the Reserve Bank of India continues on with their "socio-cultural revolution" against gold: <i>"Because interest rates are very low, people are investing in gold. But the poor should never invest in gold for whenever they have purchased gold, it either lands up in the temple or in the hands of the moneylender or, at the most, it may be given away during a daughter's marriage."</i><br /><br />Maybe they should have a chat to their mates in Vietnam, who have given up on verballing and just taken over the gold market, with the State Bank of Vietnam saying <i>"it had taken over gold bar production in late May, making Saigon Jewellery Company (SJC) the national brand. Since then, all production of gold bars in the country has been exclusively handled by the government."</i></div></div>

Screwtape Files guys have a good post on silver cautioning that silver may be primed for a correction.I've been following the story of Israel Switt and the 10 x 1933 Saint-Gaudens double eagle coins he "acquired". ABC is reporting his family lost an appeal in the Eastern District Court of Pennsylvan…

Take Gold With You On Your Journey Into The Unknown

Have a post up on the corporate site about the Deutsche Bank's latest long term asset return study, subtitled A Journey into the Unknown.Any analysis that looks at asset returns in gold terms is worth a read. It is interesting in that it has an ambivalent view of gold - usually when people write abo…

Chinese imports not all they seem

<div style="text-align: justify;">Interesting bit of market intelligence from <a href="http://share.thomsonreuters.com/assets/newsletters/GFMS/InsideGFMS-Issue43new.pdf">GFMS</a>:<br /><br /><i>Reviewing the available customs data reveals bullion flows from Hong Kong to mainland China posted a massive increase this year, with total volumes in the first five months rising over 700% year-on-year. On first glance, this may suggest that demand in China has continued to strengthen with these imports destined for fabricators producing jewellery and investment products. However, our information collection from various trade sources indicated that these Hong Kong export numbers have been highly inflated by growing round tripping between mainland China and Hong Kong whereby local companies used gold to engage in currency and interest rate arbitrage transactions.</i><br /><br />I can't get any further details on this from our contacts, nobody wants to talk about it, which is a pretty good indication GFMS is on to something here. Will be interesting to watch China-HK volumes in the coming months, these arbitrages usually don't last.</div><br />

Interesting bit of market intelligence from GFMS:Reviewing the available customs data reveals bullion flows from Hong Kong to mainland China posted a massive increase this year, with total volumes in the first five months rising over 700% year-on-year. On first glance, this may suggest that demand i…