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baub
01:54:04 Sun
Feb 9 2014

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Why is Gold going up?

Lotsa rumors floating around out there about gold.

Up? Down? Chinese are buying all the gold to buttress their yuan. Many mining comps with high costs of production. Gold still hasn't bottomed, silver's better. My neighbor thinks it's overpriced. Fort Knox and other repositories are empty of gold but full of tungsten.

Opinions please.

b

  
cubsqueal
03:51:37 Sun
Feb 9 2014

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Re: Why is Gold going up?


  
Rod_Seiad
19:46:42 Sun
Feb 9 2014

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Re: Why is Gold going up?

Interesting figures for sure.

"In 2003, gold production costs averaged less than $200 per ounce. By 2013, it cost an average of close to $1,200 to bring an ounce of gold to market! Many mines can't produce gold profitably at today's prices."

The message is clear.....many new operations are fool's errands.

When Miners react to speculators prices, it's bluesky. Bad idea.



  
baub
22:28:42 Sun
Feb 9 2014

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Re: Why is Gold going up?

Production costs have gone up. Environmental concerns, limited easy minerals, commodities manipulators etc. No argument there.
Curious whether this is short term or a gradual trending upward.

  
Bonaro
03:56:49 Mon
Feb 10 2014

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Re: Why is Gold going up?

For some years now China has been attempting to establish a gold standard. This is why the Chinese have been buying gold like mad and much if it is coming from Africa. Once they back their plentiful Yen with solid gold in the bank they will have a stranglehold on the market.

Gold has prospered in the last decade because of the high Chinese demand. The lag over the last 2 years is due to other forces (like the fed) trying to regulate and control the market but it will soon spike again and may cross $2k before it peaks. After the Chinese establish their standard it will be a crapshoot



---
My Dredge Sucks...
 
 
geowizard
15:09:58 Mon
Feb 10 2014

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Re: Why is Gold going up?


From a recent article on the subject:

"China holds $2.85 trillion in foreign reserves, which means the country would need to buy roughly 66,000 tons of gold to fully back its currency. Even if the country upped the ante to just 3%, the country would need to buy 1,000 tons.

Technically, a full gold standard isn't an option. Under the IMF's first amendment to Article IV of Agreement, ratified in 1978, participating countries are not allowed to peg their currency to gold. "

- Geowizard

  
Bonaro
20:35:33 Mon
Feb 10 2014

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Re: Why is Gold going up?

The People’s Bank of China website reports China’s gold reserves at the end of December 2013 were 33.89 million fine troy ounces. The math puts this at over 1400 tons.

and in response to the IMF amendment .... The People’s Bank of China reported this same amount of gold reserve in April of 2009 which suggests they are sandbagging the actual amount on hand.

but you are probably right. After all, people and especially countries never break or bend any rules, certainly not when a huge financial windfall is at stake, right?

http://www.zerohedge.com/news/2014-01-19/shanghai-daily-china-expected-announce-it-has-more-doubled-its-gold-reserves



---
My Dredge Sucks...
 
 
geowizard
21:08:43 Mon
Feb 10 2014

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Re: Why is Gold going up?

Bonaro,

Yes, that's actually a "smidgen" over 1054 metric tonnes.

I have seen reports that China has been importing on the average 200 to 220 tonnes per month in recent months.

I just keep digging! :smile:

- Geowizard

  
baub
16:24:16 Tue
Feb 11 2014

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Re: Why is Gold going up?

Geo,

Then it's reasonable to conclude that the physical gold that we have in our reserves is not legally required to back the US dollar as the US is a member of the IMF?
If this is true, is there is reason to conclude that the gold in Ft Knox and other repositories is not needed and that it could be used in any way that the gov't wants ?

b

  
hoppingforpay
18:36:58 Tue
Feb 11 2014

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Re: Why is Gold going up?

Mining costs go from $200 to $1200 per ounce in 10 years?

Only way I see that as true is that most of the mines have decided to mine lower grades available to them.

  
dickb
19:01:14 Tue
Feb 11 2014

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Re: Why is Gold going up?

Hi Baub:

This may help you understand the dollar and the price of gold.

http://www.federalreserve.gov/faqs/currency_12770.htm

The price of an ounce of gold is based on how may dollars the buyer is willing to give the seller for it. Thus. the market sets the price of gold.

Dickb

  
geowizard
21:54:41 Tue
Feb 11 2014

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Re: Why is Gold going up?

baub,

In 1971, President Nixon, removed convertibility of dollars for gold.

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

He recognized we had more dollars in circulation than gold to back them up.

- Geowizard
[1 edits; Last edit by geowizard at 21:55:43 Tue Feb 11 2014]

  
baub
03:45:25 Wed
Feb 12 2014

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Re: Why is Gold going up?

Enlightening. Thanks guys.

So Ft Knox etc could be empty, and it could be legal?


b

  
geowizard
04:29:27 Wed
Feb 12 2014

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Re: Why is Gold going up?

baub,

I'm not sure how or why you are formulating a conclusion that supports those questions.

The U.S. Treasury has responsibility for the bullion stored at Ft. Knox. There's no reason to speculate on or question the fact that the gold stored there amounts to the stated inventory.

http://en.wikipedia.org/wiki/United_States_Bullion_Depository#Gold

There are too many people involved with the process for a conspiracy to loot Ft. Knox to take place without someone spilling the beans.

- Geowizard
[1 edits; Last edit by geowizard at 04:30:04 Wed Feb 12 2014]

  
baub
16:17:54 Wed
Feb 12 2014

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Re: Why is Gold going up?

Hmmm.
I must disagree with you there Geo. There is enough concern in the general publics mind, not just mine, to suggest that an independent audit is necessary to quell such doubts.

b

  
geowizard
17:32:36 Wed
Feb 12 2014

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Re: Why is Gold going up?

baub,

The list of checks and balances are extensive. There are internal audits, there are peer audits. There are processes that check (test) the processes. There is for all practical purposes, little or no possibility of fraud.

http://www.treasury.gov/about/organizational-structure/ig/Pages/OIG-Office-of-Audit.aspx

- Geowizard

  
Rod_Seiad
18:39:56 Wed
Feb 12 2014

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Re: Why is Gold going up?

Have governments tricked it's citizens before?

"Yes, they have, and to use Rome as the example, its empire collapsed when the currency was debased. Worryingly, after the collapse of the Roman Empire, the world went into the so-called Dark Ages. Countries grow and prosper on sound money. They dissipate and eventually collapse when money becomes unsound. This pattern recurs throughout history."

"Rome of course did not collapse overnight. The debasement of their currency cannot be precisely measured, but it lasted over 100 years. The important point we need to recognize is that the debasement of the dollar that began with the formation of the Federal Reserve in 1913 has now lasted over 100 years too. A penny in 1913 had the same purchasing as a dollar has today, which interestingly is not too different from the rate at which Rome's denarius was debased."---unknown



If history teaches anything, our dollar is lowering while at the same time it causes the appearance of gold exchange rate to be rising.

If that's the case, why does the contents of Ft. Knox matter? We used to believe that gold is money. It isn't money any longer. It's much better than money.

Money on a worldwide scale, is a derivative of gold futures. Derivatives, or the belief of make-believe gold, are currently speculated to be running at the tick near 10/1 or 10 paper gold contracts equal 1 piece of gold in the hand.

Hold your own gold, Ft. Knox or Hong Kong can never satisfy the need for security.

  
hoppingforpay
19:59:08 Thu
Feb 13 2014

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Re: Why is Gold going up?

Naw, nothing to be seen here....

Guest Post: Another Episode In The History Of Failed Manipulations

here ) that the same could be conceived to happen with the manipulation in the price of gold. This ... market and keep the official manipulation at bay. This is not the case with the global gold market today, ... the gold market upon the insinuation that Cyprus would sell its gold…” I am back from a brief ...

Story - Tyler Durden - 05/20/2013 - 18:40 - 32 comments - 0 attachments
Sprott: Why SocGen Is Wrong About Gold's Imminent 'Demise'

Latest Gold Report Société Générale (“SocGen”) recently published a special report entitled “The end of the gold era” that garnered far more attention than we think it deserved. The majority of the report focused on SocGen’s “crash scenario” for gold wherein they suggest that gold could fall well below ...

Story - Tyler Durden - 04/05/2013 - 21:24 - 252 comments - 0 attachments
Chris Martenson Explains How Gold Is Manipulated... And Why That's Okay

Submitted by Chris Martenson Gold Is Manipulated (But That's Okay) The ... appears to be the US authorities, as the manipulation is most apparent in the US open gold market. For the ... discussing how a belief such as 'gold is not being manipulated' gets promoted and inserted into the popular ...

Story - Tyler Durden - 03/28/2012 - 15:27 - 108 comments - 0 attachments
The FT Goes There: "Demand Physical Gold" As One Day Paper Price Manipulation Will End "Catastrophically"

Now all the manipulations in Now all the manipulations in the Gold market and constant ... investigation of the manipulations in the Gold market - it was already reported that precious metals ... that not only might the Bundesbank's offshore held gold be severely "diluted" (follow our 2012 exposes ...

Story - Tyler Durden - 01/25/2014 - 19:32 - 330 comments - 0 attachments
German Gold Manipulation Blowback Escalates: Deutsche Bank Exits Gold Price Fixing

Germany's blowback against gold manipulation is accelerating. Following yesterday's report ... How Gold Price Is Manipulated During The "London Fix ." And sure enough, with Germany already very ... matter of time before any German involvement in gold manipulation escalated to the very top. ...

Story - Tyler Durden - 01/17/2014 - 21:31 - 337 comments - 0 attachments
Guest Post: Gold Manipulation, Part 3: "The Systemic Risk Of Gold Manipulation"

systemic impact of gold manipulation. The first one would be to examine how the same affects the relevant ... prices involved in the manipulation From the second article, we know that central banks “… hold gold ... loans) be called a manipulation? There is nothing different between the creation of fiat gold out of ...

Story - Tyler Durden - 03/16/2013 - 13:22 - 32 comments - 0 attachments


  
hoppingforpay
20:09:07 Thu
Feb 13 2014

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Re: Why is Gold going up?

The above is from ZeroHedge as is this article on todays break of 1300!

http://www.zerohedge.com/news/2014-02-13/gold-breaks-above-1300

Most read it for the comments.I am new to this stuff, helps me understand the articles. Not for everyone though.

  
baub
20:39:50 Thu
Feb 13 2014

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Re: Why is Gold going up?

It would be easy to fool the goldielockers. Checks and balances become routine, people are hired at low wages, boredom sets in. Are the bars that are there really 999? Have they been drilled thru and checked? Are there practices in place to periodically check the individual bars?When Germany requested some of its gold back, they got it back, but not in the form it was in when deposited. They did NOT get what they deposited. Think safety deposit box.
Multiple checks and balances only provide the illusion of security and genuine gold by reinforcing what you did last week.
Geo, the real gold could have been substituted some time ago. Germanys problem suggests at least it could have been altered..

b

  
geowizard
21:33:46 Thu
Feb 13 2014

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Re: Why is Gold going up?

baub,

Even worse, it may have been "rehypothecated".

- Geowizard

  
baub
23:33:53 Thu
Feb 13 2014

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Re: Why is Gold going up?

I like that word. Mind if I borrow it?

b

  
geowizard
01:51:30 Fri
Feb 14 2014

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Re: Why is Gold going up?

baub,

Sure. But if you use it for collateral on a loan to borrow money, please let me know how many loans you take out against it.

(no tongue-in-cheek emoticon)

- Geowizrd
[1 edits; Last edit by geowizard at 14:08:57 Fri Feb 14 2014]

  
Rod_Seiad
17:14:22 Fri
Feb 14 2014

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Re: Why is Gold going up?

Please use the word often when discussing a miner's viewpoint on native gold versus paper gold.

Re-hypothecation occurs when banks or broker-dealers re-use the collateral posted by clients such as hedge funds to back the broker's own trades and borrowing.
In the UK, there is no limit on the amount of a clients assets that can be rehypothecated,[2] except if the client has negotiated an agreement with their broker that includes a limit or prohibition. In the US, re-hypothecation is capped at 140% of a client's debit balance.---wiki

I carry a 10 dwt placer nugget in my Levi pants pocket. I've carried it for several years. It always reminds of what is real.

  

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