Bullion Buzz July 12
Posted by Anthony Hendriks The latest edition of the Bullion Buzz is out. A number of good articles for your to view including this:
In this recent CNN interview, Harvard Professor Niall Ferguson predicts that, barring a radical change in policy, “nasty fiscal arithmetic” will send the U.S. into a “death spiral.” Some representative quotes:
“Fiscal tightening is baked in the cake. Tax increases are coming and coming soon… The US has a kind of stay of execution while the European crisis unfolds, but at some point the nasty fiscal arithmetic will get everyone, including the U.S… Treasuries are a safe haven the way Pearl Harbor was a safe haven in 1941. It’s safe until it’s not safe anymore.”
Here is part 1 of his video:
Here is part 2:
And for more Bullion Buzz, go here: BullionBuzz
Comex Dirty Tricks
A good article on Commodities Reporter. This from the guys at Bullion Vault. They point out again, how tenuous holdings in many precious metals ETF's are. I continue to hammer on that theme. A lot of people are going to get really hurt by the antics being pulled with their gold. Point is, most physical bullion that investors believe is there, really isn't. It's just a paper promise and another exercise in fractional banking. Here's an excerpt: "Everyone knows the concept behind a “fractional” banking system, right? You have $1 in deposits and you lend out $10. The Romans invented the concept and it is widely understood to have been one of the ingredients that led to Rome’s demise.
As per the electrifying CFTC hearings on March 26, and a fact that GATA has long understood, the Big Banks which deal in gold and silver, also known as “Bullion Banks,” apply and utilize the fractional banking system to bullion dealings.
In 2007 Morgan Stanley settled a class-action lawsuit in which Morgan Stanley was selling silver to customers and charging them for storage. It turned out that Morgan Stanley was selling and storing silver that didn’t exist. One of MS’s defense arguments was that it was common industry practice to sell and store metal that didn’t exist. And as long as the customer buys and sells thru MS without asking for the metal to be delivered, MS can get away with it because the round-trip transaction is cash in/cash out. The scheme crumbled when some investors asked for serial numbers and weights. Details are here, if you are interested: LINK" Read the full story here: Commodities Reporter
Time to cash in your ETF shares and contact me for real bullion!
Is Bullion at Bank of Nova Scotia Safe?
I received an email from an investor this morning. Basically he was concerned about an interview on King World about an empty vault at the Bank of Nova Scotia. Did it affect bullion holdings for clients of Bullion Management Group? Here is the King World release, followed by a response from Nick Barisheff of BMG (bottom line is that your gold is safe):
BOMBSHELL RELEASE – Harvey & Lenny Organ & Adrian Douglas: Drop Another Bombshell In What Could End Up Being The Largest Fraud In History – King World News was contacted again by Adrian Douglas, Board of Director for Gata with stunning new information involving the man he testified with at the CFTC meeting Harvey Organ. Harvey, who was invited by the CFTC to testify and his son Lenny describe another piece of the puzzle in what could turn out to be the largest fraud in history. This time a large international bank with almost 15 million customers in 50 countries around the world becomes part of this unfolding saga.
http://www.kingworldnews.com/
Response from Nick Barisheff:
I have listened to the interview and it completely lacks any credibility. Either Harvey Organ was in something other than the main vault or he is lying.
To begin with, is it remotely plausible that, if in fact there was no gold in the Scotia vault, that Scotia would take someone inside to show them an empty vault? Scotia has extensive procedures in place including criminal background checks before anyone is allowed inside the vault and the whole process is documented. Even our auditors have to comply with these procedures.
I have personally been in the vault at least a dozen times both with clients, advisors and auditors and not only is the $300 million that BMG holds on behalf of clients but at least 4 times that amount is held for other clients as well as Scotia’s inventory. Scotia has had to expand the vault because if anything they may run into capacity constraints and they are considering expanding the vault again.
Scotia’s 2009 financial statements show $5.580 billion in precious metals assets (about 1% of their total assets) and $3.856 billion in precious metals liabilities. The liabilities represent the certificates and unallocated accounts. Bullion that is held for clients in allocated accounts does not appear on Scotia’s Financial statements as it belongs to their clients.
In the case of BMG, we have unallocated accounts for each metal that are used to facilitate the purchase and sale of bullion to meet purchase and redemption requests. These accounts vary between $500,000 and about $1 million each. When the unallocated accounts reach about $1 million we have Scotia debit the unallocated accounts and deliver bullion to the allocated account. Scotia then issues an updated report showing the holdings in the allocated account. These reports identify each bar held by refiner, exact weight and purity and serial number. At the end of each year KPMG as the Fund’s auditor as well as BMG’s auditor verifies the holdings and reports accordingly in the Annual Report. This is set out on page 43 of the 2009 Annual Report.
In conclusion, I have no concerns about the security of the bullion as my family holds most of our retirement investment in the BMG funds, my son’s RESP and my mother’s retirement funds and we own bullion bars as well.
Regards,
Nick Barisheff
President & CEO
BULLION MANAGEMENT GROUP INC
60 Renfrew Drive, Suite 280
Markham, ON L3R 0E1
John Embry on Gold
John Embry – Canadian gold expert talks to The Gold Report on his view of gold in 2010. The bottom line? A big rise. Here is an excerpt: "The Gold Report: John, in Investors Digest of Canada you recently said you're expecting gold to gain another 30% this year.
John Embry: I would say at least 30%. I said that I thought it would be the best year to date. We've had nine years consecutive higher year-end prices and the best year in that span for a year's return was 31%. I think this will be the year that we exceed it in this, the 10th year of the bull market.
TGR: What's driving this? Why is this year going to be the best year?
JE: I think we're getting very close to the point when a greater proportion of the public realizes the degree of difficulty that sovereign debt is in. And at that point, when you can't depend on your government paper as a safe haven, I think that fact puts gold in a much better light in more people's eyes." Read more here: Gold will rise
Gold Sales vs COMEX Alchemy
A good article by JS Kim writing on Seeking Alpha about the continued manipulation of gold and silver through COMEX. The focus in this is the recent announcement by the IMF on its planned sale of gold. Here is and excerpt: "The recently announced IMF sale of 191.3 tonnes of its gold reserves, though it caused an immediate sharp knee-jerk reaction in gold futures markets, will have a negligible effect on the long-term price of gold. Here’s why.
In December, 2009 the commercial bullion banks that serve as agents for the leading Western Central Banks were net short 303,791 contracts of gold. Each COMEX gold futures contract represents 100 troy ounces, so the Commercials were net short 30,379,100 troy ounces of gold. With the average price of gold $1,134.72 per troy ounce in December 2009, this net short commercial position represented $34.47 billion worth of gold. There are 32,150.74533 troy ounces in one metric tonne. So 30,379,100 troy ounces/ 32,150.74533 troy ounces = 944.90 metric tonnes of gold. Since gold contracts are supposed to be good for physical delivery, the commercial bullion banks that were short nearly 38% of annual world production of gold this past December should have had 944.90 physical metric tonnes of gold in their vaults to back up their short position at that time. In reality, this situation never exists." Read more here: IMF Gold Sales
Bullion Management Group Adds New Gold Bullion Mutual Fund
BMG has added a new mutual fund to its lineup. This one is an open-ended mutual fund like its current BMG BullionFund, which invests only in gold, silver and platinum bullion. The new fund will invest only in gold bullion, with the same discriminating approach the BMG uses for all its investment offerings – no 'paper assets'. Here is an excerpt from the announcement: "Bullion Management Group Inc. (BMG) has expanded its line of precious metals bullion funds with the launch of BMG Gold BullionFund. The new fund invests exclusively in uncompromised physical gold bullion and is designed for investors seeking a core holding that offers long-term security and potential capital growth. BMG Gold BullionFund is an open-end mutual fund trust that can be purchased and redeemed daily at Net Asset Value. As a result, it has the same liquidity as bullion itself. All bullion meets London Good Delivery Standards." Read more here: BMG BullionFund
BullionBuzz Newsletter
The latest BullionBuzz Newsletter is available now. Articles include Why Soros is Probably Buying Gold Now,Gold Stocks Versus Gold Bullion, and Secret Banking Cabal Emerges From AIG Shadows. Read the Buzz here: BullionBuzz
Gold Bullion Hard to Get Hold Of
Yet another report declaring that gold bullion is in short supply. Many 'paper gold' ETF's are fooling people into believing that they hold real bullion safely. Boy, are they going to be surprised if/when we get to the kind of crunch that sees real bullion in severe demand. As author Patrick Heller points out in the article below, Credit Suisse is defending two law suits now over the issue of the bank selling depositors gold.Dont' get caught in a similar situation. Contact me for real bullion, safely stored in Canada now.
In the meantime, here is an excerpt from the article: "In the London Bullion Market there were even more reports that it is becoming almost impossible to obtain delivery of physical gold. In theory, the London market contracts are to be settled by delivery of physical gold, but many would-be buyers who ask to buy a contract to take delivery are having their bids rejected. Others who have purchased contracts are having to hire attorneys to force the sellers to comply with the terms of the contract. The stories continue to mount about buyers being offered substantial bonuses in return for not taking delivery on these contracts.
Credit Suisse, the huge Swiss bank, is defending against two new suits. They involve the bank’s customers who were paying the bank to hold gold for them, that were told the gold was supposedly “not there” when the owners asked to retake physical possession.
As the number of stories grows about non-existent physical gold theoretically being held to cover shares of exchange traded funds, certificate programs, commodity contracts, and non-allocated storage accounts, I think it is long past time to get out of such forms of “paper gold.” In the past six months, a significant number of owners of such assets have liquidated them to replace them with physical gold in their immediate custody or allocated storage. I expect huge shortages of physical gold to develop in the next one to two years, with the result that many owners of “paper gold” will learn to their dismay that they don’t really own gold. Any reader who owns gold in paper form may soon find themselves in much better financial circumstances by promptly turning that asset into the real thing under their own control." Read more here: Numismaster.com
Buy Gold, Silver & Platinum Bullion Safely
Are you interested in holding precious metals? Perhaps you already hold some. I believe you are smart to do so. There are good reasons – portfolio diversification, a hedge against currency risk, a hedge against crisis are just a few. And you can hold them via stocks, coins, ETF's or in bullion form, allocated directly to yourself.
Each of the above options have their risks and rewards. However, a lot of people who purchase ETF's don't realize how much risk they take on. Many precious metals ETF's do not guarantee their holdings. Do you hold a precious metal ETF? If so, I highly recommend you read your prospectus. Once you have done so, you may want to check out the bullion option available through my dealership. Through BMG BullionBars you have access to gold, silver and platinum bullion. We deal in London Good Delivery Bars only and you can store them safely if you wish. All bars are allocated to you and you alone.
Visit my main site bullionhold now for more information on purchasing gold, silver and platinum bullion safely.
Why HSBC Asked Deporitors to Remove Their Gold
An interesting article by Doug Hornig in Gold Seek on the reasons why HSBC may have given notice for holders of gold to remove it from their NY vault. HSBC gave the directive in November and have given clients till July orf 2010 to remove their gold according to Hornig. Why? Well Hornig lists a number of theories and gives us his best guess. Read more here: Get Your Gold the Hell Outta Here!
 |  |