It's 1984

Citi Sells Stake to Abu Dhabi Fund- AP
Citigroup said late Monday that the Abu Dhabi Investment Authority will invest $7.5 billion in the nation's largest bank, offering needed capital to offset big losses from mortgages and other investments.

Dow Closes Up 215 After Citi Secures Capital- AP
Wall Street rebounded Tuesday after the Abu Dhabi Investment Authority said it will invest $7.5 billion in Citigroup Inc. -- a vote of confidence for the nation's largest bank, which has suffered severe losses amid the ongoing crisis in the mortgage market.

OK... So let me get this straight: The world's largest bank is teetering on the brink of destruction...THE WORLD'S LARGEST BANK...and so desperate to save itself, that it accepts a pithy 7.5 billion Dollars from an Arab investment group to help it stay solvent. THE WORLD's LARGEST BANK accepts what amounts to charity from a bunch of rich Arabs and suddenly the whole world credit crisis is resolved? You have got to be pulling my leg. WAKE UP you dumb asses on Wall Street! If you ever needed proof that this "crisis" is worse than anybody can conceive, this is it. This "investment" is not "good" for anything. This is a sign of how bad things are, and how much worse things are going to get.

So the stock market goes up because Citibank has been saved with a $7.5 billion ? Ha! Where's the next $7.5 billion going to come from? And the next $7.5 billion after that? Bank of America "invested" $2 billion in Bear Sterns three months ago. The stock market "rose as a result". Today, Bank of America has seen all but a tiny portion of that $2 billion investment vaporize. Not to mention the fact that the stock market is a lot lower now than it was three months ago...AND Gold a lot higher. Abu Dhabi could throw every last Dollar they have at Citibank, and it won't change a thing. Parlor tricks and lunchroom magic are NOT going to save the world financial system. The Great Gold Sale continues...buy more now, while supplies last.

Oil Off on Economy Fears, OPEC Forecasts
NEW YORK (AP) -- Oil prices plunged Tuesday, picking up downward momentum amid concerns that a slowing economy might reduce demand for crude just as OPEC members are considering an increase in production. Prices were also pressured by apparent progress at the Mideast peace summit in Annapolis, Md.

Look fools, the price of Oil hasn't risen to within a whisper of $100 a barrel because there is a "production" problem. Oil is knocking on the $100 door because the value of the US Dollar has all but collapsed. Even IF the Arabs could produce more Oil [they are already producing as much as they can] it won't make the Dollar rise in the Forex markets. The price of Oil has doubled this year alone, AND DEMAND HAS NOT FALLEN. Gasoline demand in this country has actually risen this year along with the rise in the cost of gasoline at the pump. These headlines are a load of crap, and only are intended to deceive and give false hope to the sheep that stare at the evening news for their daily dose of doublespeak.

A Brewing Storm
Gold Poised to Move in 2008
BY TONY ALLISON

Events are aligning to provide a bullish fundamental foundation that could push gold significantly higher in 2008. While volatility will likely remain a feature of the metals market, the price could begin to march higher as the markets react to gold’s strong fundamentals. The cable channel “experts” keep calling for a top in gold, much as they have for oil all the way from $20 per barrel on up. Once again it appears this is wishful thinking more than analysis based on the fundamentals.

“Tony Fell, chairman of RBC Capital Markets, said the world money supply has been growing by 5-10%, while the stock of mined gold has been rising by 1.6%, creating a mismatch that must be covered. Mr. Fell says the total debt burden in the US has exploded to 340% of GDP, in stark contrast to the steady levels of around 150% in the post-War era. It almost insures further dollar debasement. ‘We’re in the very early phases of a prolonged bull market,’ said Fell. RBC argues that the global dollar system known as Bretton Woods II is ‘coming apart at the seams’ as Asian, Middle East, and Latin American states start to break down their dollar links to avoid importing US inflation. The result is to resurrect gold, which is fast regaining its role as the world’s benchmark currency.”

Peak Gold
The global demand for gold is clearly outstripping supply. Global gold production was down 3% in 2006 and is nearly flat this year. South Africa’s output is down to its lowest level since 1932. According to Barrick Gold CEO Gregory Wilkins, “There’s not much gold out there.” Barrick recently told industry analysts that gold production will fall 10-15% below market expectations over the next three to five years. There appears to be a growing price-inelasticity for gold, as higher prices are not bringing more gold to market. (In addition, any future de-hedging by hedged producers like Barrick will add to gold buying demand.)

Investors are beginning to understand that massive global money creation may just lead to massive currency depreciation. New gold demand is created as buyers are looking at gold as an alternative currency and a store of value. Yet the supply of gold continues to grow very slowly in relation to demand. This is precisely the mirror opposite of the fiat dollar. This supply/demand imbalance will underpin higher gold prices in 2008.

While it is true that western central banks could begin dumping gold onto the market, who would be the buyers? China, Russia, the Middle East, and India would likely be enthusiastic buyers to hedge against their large dollar reserve positions. Selling a scarce and appreciating asset to cap the price for a few months may not seem logical, but it’s happened before. And it may happen in 2008, but as in the past, the effects will be short-lived. The longer lasting effects may be on the western central banks as they sell their legacy of tangible wealth on the cheap once again.

Gold mining shares should profit from higher gold prices, but higher mining costs, estimated at 15% annually, have taken a toll the last few years. But as gold continues to climb, the quality producers will likely enjoy substantial leverage over the price of gold. Another group to look at would be the gold and silver royalty companies, which have no exposure to higher mining costs or liabilities.
http://www.financialsense.com/Market/allison/2007/1126.html

With up being down, and down being up in 1984, chart analysis would seem a bit ridiculous at this time. We all know Gold AND Silver should be substantially higher than they are today. Sit tight, be right, and ignore this noise. It will pass shortly. Suffice it to say: Gold and Silver remain at sale prices relative to inflation. Buy now while supplies last, and laugh later.

Bullshit Reigns Supreme

MUMBAI: A weaker rupee coupled with rising international gold prices have led domestic gold prices to an all-time high of Rs 10,695 on Monday. Gold prices in the global market continued to move up as investors, fearing a credit crisis, stocked up on the yellow metal as a safer resort.

International gold prices hit a two-week high, as concerns over a weakening dollar spurred buying activity. The dollar traded near a record low against the Euro and crude oil prices in New York rose for a second day to above $98 a barrel.

Spot gold prices in London touched $836.70 a troy ounce in day trade, the highest since November 9, when they broke a 28-year record hitting $845. Gold prices are up 30% this year as the dollar has fallen 11% against the Euro and crude prices have soared 61%.

In Asia, the precious metal rose 4.8% last week, the biggest weekly increase since July 2006, as bullion is also seen as an alternative asset and hedge against inflation.
http://timesofindia.indiatimes.com/Gold_touches_all-time_high/articleshow/2573629.cms

But in New York, where physical Gold is a myth and paper futures contracts are used to rig the price, Bullshit Reigns Supreme. Each Day the US Dollar inches towards another new low, yet the price of Gold is held in check by the hucksters on the NY COMEX. The Dollar was down all day today, the stock market gets whacked by the mushrooming credit crisis, and Gold gives up all it's gains made overnight in Asia? Nobody sold any Gold in America today, just pieces of paper that represent Gold that doesn't even exist. It is criminal, it is disgusting, it is infuriating! But do not despair. Hold tight to your metal and mining shares. Every effort to date to stop the rise in the price of Gold has failed. Inevitably these COMEX Clowns will be destroyed.

Gold support remains at 817. Silver must close above 14.90 to recapture it's mojo. The stage is set. Gold, the Truthsayer, will destroy all that attempt to hide the truth.

The Jig Is Up

WORLD LOSING CONFIDENCE IN U.S. CURRENT ACCOUNT DEFICIT LOAD?

Has the U.S. current account deficit grown so large that the world has finally decided not to finance it any longer? The deficit has been growing steadily for well over a decade, and is about $800-billion (U.S.), or just over 5.5 per cent of the size of the U.S. economy. It has long been considered to be unsustainable the moment the world loses confidence in the ability of the United States to carry such a load. Has that moment come?
http://www.theglobeandmail.com/servlet/story/LAC.20071124.MKSTAT124/TPStory/Business


Heads we Win, Tails you Lose

As internal debates in the Gulf and Asian nations intensify over the need to continue propping up the U.S. economy, dangerous signals this past week from the Fed, Freddie Mac, and Wall Street may be pushing them to finally let go of the lifelines that have kept America afloat. Despite clear signs of surging prices in the U.S., the Fed took a major step in undermining its own credibility with its most recent forecast that inflation would remain below 2% for the next three years. As the forecast clearly paved the way for additional Fed rate cuts, Wall Street ignored its absurdity and heralded the announcement as legitimate good news. The celebration is likely infuriating foreign governments, who must be dumbstruck that the Fed can claim contained inflation at home while the declining dollar is fueling massive inflation problems around the world.
http://news.goldseek.com/EuroCapital/1195830000.php


Gold and the U.S.$ Today

In such a climate there is absolutely nothing to stop the price of gold in all currencies from trending higher and higher and higher still.

The trigger to this rise is the awful loss of confidence in the banking system and the investments they have engineered. It is called “risk aversion”, but it is more serious than that. Harsh lessons are being learned from bitter experiences that have shocked even the most experienced of investors. Will the crisis go away we are told, not for some time to come? In fact, it could worsen as the structures on which confidence stands stumble under the doubts and fears.

Then it becomes simply a matter of prudence and wisdom for investors of all types in all parts of the globe to protect themselves against this turmoil in something that is not an obligation, a promise, something not dependent on the performance of people or any other hope. Where can they go? They need something they can know will not evaporate as quickly as a changing exchange rate, something they can grip in their hands, something solid that has proved itself in just these sort of times - gold.
http://news.goldseek.com/GoldForecaster/1195833225.php


Don't be deceived by "news" of "strong holiday sales" this past weekend. Everything is "on sale" in an effort to salvage something from the "holiday shopping season". And nothing brings out the plastic like a sale. Americans are addicted to buying, and binge buying on the "plastic" is the rule of the day. There will be NO profit from these sales, just an increase in our national mountain of debt.

The world has caught on to the lie that is the US Dollar, the US Federal Reserve, and the US Treasury. The jig is up. The world is on the cusp of a Gold Rush. The Comex shorts are on the eve of destruction.

Gold and Silver began trading this evening in Asia strong. Silver has banged on the first Fibonicci line of resistance at 14.90. The Gold Bulls remain in control, with support at 817. Every effort will be made to halt Gold's rise back towards the magic $850. Today is Monday, and it never fails that the Dollar opens the week with a bid. Of course it is quickly kicked aside by those anxious to sell this toxic waste. The magic recovery of the Dollar Friday is only a snapshot of the desperation the central banks face in trying to keep the Dollar from plunging dramatically. One more trip down for the Dollar like Friday's visit to the low 74s, and Gold is on it's way to 900.

Moderate Inflation Is A Bald Faced LIE

Bull riding is a rodeo sport that involves a rider getting on a large bull and attempting to stay mounted for at least 8 seconds. The rider tightly fastens one hand to the bull with a long braided rope. It is perhaps the most famed of all the rodeo sports.

A rider mounts a bull and grips a flat braided rope. After he secures a good grip on the rope, the rider announces he is ready. The bucking chute (a small enclosure which opens from the side) is opened and the bull storms out into the arena. The rider must attempt to stay on the bull for at least eight seconds, while only touching the bull with his riding hand. His other hand must remain free for the duration of the ride.

The bull bucks, rears, kicks, spins, and twists in an effort to throw the rider off. This continues for a number of seconds until the rider bucks off or unties after completing his ride. A loud buzzer announces the completion of an eight second ride.

Throughout the ride, bull fighters move about the bull in an effort to influence its movements and enhance the ride. When the ride ends, either intentionally or not, the bull fighters move in to protect the rider from harm.

http://en.wikipedia.org/wiki/Bull_riding

Several days ago I began to warn of the growing threat of increased volatility in the Precious Metals markets. That threat is now reality. Moves up like we saw today, and moves down like we saw on November 11 are about to become MUCH more common. From the description above it is not a stretch to understand the Gold Bulls primary objective: to throw you off the ride. If you want to get to the moon on this ride, you will have to stick to your convictions, and hang on to your positions through the exhilarating run ups, and the gut wrenching whooshes.

WASHINGTON (AP) -- The Federal Reserve reported Tuesday that it expects slower economic growth and a slight bump up in unemployment next year due to the housing slump and a credit crunch. The board also said, however, that it thinks inflation will remain moderate.

Inflation is going to accelerate at a pace that is going to SHOCK people...The Fed is going to lie about inflation until the day they are disbanded. Why? Because they are the root cause of inflation. Inflation is NOT rising prices...rising prices are just a "symptom" of inflation. Inflation IS a rising "money supply". And the Fed along with the US Treasury are printing money like it's going out of style. Think about it like this...how could the Fed continue to cut interest rates to prop up the stock market if they admitted there was an inflation problem on the horizon. The Fed has to continue to cut interest rates, and devalue the Dollar, if the US ever hopes to pay off it's never expanding debt to the world. The Dollar may be our Achilles heal, but it is the rest of the world that may feel the most pain from it's demise.

Net US capital flows failed to meet the current account deficit for the third month in a row. The Treasury International Capital System (TICS) accounted a net loss in totals flows of $14.7 billion; the September figure was revised up to -$150.7 billion from -$163.0. Net long term securities transactions were positive at $26.4 billion; in August the flow was reversed at -$70.3 billion. The current account deficit, commonly called the ‘trade gap’ has averaged a little more than $59 billion per month this year. Long term securities flows have collapsed in the third quarter averaging -$24.7 billion per month; in the first half of the year they measured +$85.9 on average per month. Since mid June the Dollar has depreciated 10.6% against the Euro. Europeans are the largest overseas investors in the United States economy.

The falling Dollar is forcing foreign investors to dump their Dollar related assets, and a big portion of that big dump is going to be US Stocks. Dollar loses in the stock market in New York is only multiplied when the foreign investor repatriates his money home. Stock price losses, combined with currency exchange losses add up to a bad investment. And the USA is quickly becoming a bad investment for foreigners.

You don't have to look far to find ever more reasons to buy and own Silver and Gold.

POPPYCOCK!

Gold, Silver Fall as Citigroup Downgrade Sparks Risk Concerns

Nov. 19 (Bloomberg) -- Gold and silver fell as a drop in U.S. stocks curbed investments in riskier assets such as commodities.

U.S. equities declined after Goldman Sachs Group Inc. placed a ``sell'' rating on shares of Citigroup Inc., the largest U.S. bank by assets. Japan's currency rose as traders repaid yen- denominated loans that had financed investments in higher- yielding assets. Before today, gold had gained 23 percent this year, reaching a 27-year high of $848 on Nov. 7.

``Risk aversion continues and that hurts all investments, including gold,'' said Leonard Kaplan, president of Prospector Asset Management in Evanston, Illinois. ``Investors are taking huge losses so they're not eager to invest in anything.''

I'm sorry, but NOTHING could be further from the truth. If you believe this drivel, sell ALL your Gold and Silver now, and NEVER buy it back.

The timing of the Citigroup downgrade to Sell (i.e., with Citigroup already down 30% from its October high), and a warning from reinsurer Swiss Re that it lost nearly $1.1 billion on two credit default swaps, played on investors' concerns that it is premature to think the financial sector has hit bottom.

In a somewhat ironic twist, Citigroup on Friday raised its rating on the U.S. banking sector to Overweight from Market Weight citing, among other things, awful investor sentiment.

A Billion and one reasons to own Gold and Silver...