Gold and Silver report December 31 , 2013 - Data , news and views touching on the precious metals - Ed Steer's report for December 31 , 2013 , Ann Barnhardt and Gerald Celentes warn on 2014 ! !

A thought for 2014..... From Alasdair Macleod

http://www.goldmoney.com/research/research-archive/precious-metals-in-2014#

Precious Metals in 2014

Posted 31 December 2013

"Now the New Year reviving old desires
The thoughtful Soul to Solitude retires"

Rubaiyat of Omar Khayyam

Yes folks, it's that time of year again; but unlike old Khayyam who reflected bucolically on the continuing availability of wine, we must turn our thoughts to the dangers and opportunities of the coming year. They are considerable and multi-faceted, but instead of being drawn into the futility of making forecasts I will only offer readers the barest of basics and focus on the corruption of currencies. My conclusion is the overwhelming danger is of currency destruction and that gold is central to their downfall.

As we enter 2014 mainstream economists relying on inaccurate statistics, many of which are not even relevant to a true understanding of our economic condition, seem convinced that the crises of recent years are now laid to rest. They swallow the line that unemployment is dropping to six or seven per cent, and that price inflation is subdued; but a deeper examination, unsubtly exposed by the work of John Williams of Shadowstats.com, shows these statistics to be false.

If we objectively assess the state of the labour markets in most welfare-driven economies the truth conforms to a continuing slump; and if we take a realistic view of price increases, including capital assets, price inflation may even be in double figures. The corruption of price inflation statistics in turn makes a mockery of GDP numbers, which realistically adjusted for price inflation are contracting.

This gloomy conclusion should come as no surprise to thoughtful souls in any era. These conditions are the logical outcome of the corruption of currencies. I have no doubt that if in 1920-23 the Weimar Republic used today's statistical methodology government economists would be peddling the same conclusions as those of today. The error is to believe that expansion of money quantities is a cure-all for economic ills, and ignore the fact that it is actually a tax on the vast majority of people reducing both their earnings and savings.

This is the effect of unsound money, and with this in mind I devised a new monetary statistic in 2013 to quantify the drift away from sound money towards an increasing possibility of monetary collapse. The Fiat Money Quantity (FMQ) is constructed by taking account of all the steps by which gold, as proxy for sound money, has been absorbed over the last 170 years from private ownership by commercial banks and then subsequently by central banks, all rights of gold ownership being replaced by currency notes and deposits. The result for the US dollar, which as the world's reserve currency is today's gold's substitute, is shown in Chart 1.

The graphic similarities with expansions of currency quantities in the past that have ultimately resulted in monetary and financial destruction are striking. Since the Lehman crisis the US authorities have embarked on their monetary cure-all to an extraordinary degree. We are being encouraged to think that the Fed saved the world in 2008 by quantitative easing, when the crisis has only been concealed by currency hyper-inflation.

Are we likely to collectively recognise this error and reverse it before it is too late? So long as the primary function of central banks is to preserve the current financial system the answer has to be no. An attempt to reduce the growth rate in the FMQ by minimal tapering has already raised bond market yields considerably, threatening to derail monetary policy objectives. The effect of rising bond yields and term interest rates on the enormous sums of government and private sector debt is bound to increase the risk of bankruptcies at lower rates compared with past credit cycles, starting in the countries where the debt problem is most acute.

With banks naturally reluctant to take on more lending-risk in this environment, rising interest rates and bond yields can be expected to lead to contracting bank credit. Does the Fed stand aside and let nature take its course? Again the answer has to be no. It must accelerate its injections of raw money and grow deposits on its own balance sheet to compensate. The underlying condition that is not generally understood is actually as follows:

The assumption that the Fed is feeding excess money into the economy to stimulate it is incorrect.
Individuals, businesses and banks require increasing quantities of money just to stand still and to avoid a second debt crisis.

I have laid down the theoretical reasons why this is so by showing that welfare-driven economies, fully encumbered by debt, through false employment and price-inflation statistics are concealing a depressive slump. An unbiased and informed analysis of nearly all currency collapses shows that far from being the product of deliberate government policy, they are the result of loss of control over events, or currency inflation beyond their control. I expect this to become more obvious to markets in the coming months.

Gold's important role

Gold has become undervalued relative to fiat currencies such as the US dollar, as shown in the chart below, which rebases gold at 100 adjusted for both the increase in above-ground gold stocks and US dollar FMQ since the month before the Lehman Crisis.

Given the continuation of the statistically-concealed economic slump, plus the increased quantity of dollar-denominated debt, and therefore since the Lehman Crisis a growing probability of a currency collapse, there is a growing case to suggest that gold should be significantly higher in corrected terms today. Instead it stands at a discount of 36%.

This undervaluation is likely to lead to two important consequences. Firstly, when the tide for gold turns it should do so very strongly, with potentially catastrophic results for uncovered paper markets. The last time this happened to my knowledge was in September 1999, when central banks led by the Bank of England and the Fed rescued the London gold market, presumably by making bullion available to distressed banks. The scale of gold's current undervaluation and the degree to which available monetary gold has been depleted suggests that a similar rescue of the gold market cannot be mounted today.

The second consequence is to my knowledge not yet being considered at all. The speed with which fiat currencies could lose their purchasing power might be considerably more rapid than, say, the collapse of the German mark in 1920-23. The reason this may be so is that once the slide in confidence commences, there is little to slow its pace.

In his treatise "Stabilisation of the Monetary Unit – From the Viewpoint of Monetary Theory" written in January 1923, Ludwig von Mises made clear that "speculators actually provide the strongest support for the position of notes (marks) as money". He argued that considerable quantities of marks were acquired abroad in the post-war years "precisely because a future rally in the mark's exchange rate was expected. If these sums had not been attracted abroad they would have necessarily led to an even steeper rise in prices on the domestic market".

At that time other currencies, particularly the US dollar, were freely exchangeable with gold, so foreign speculators were effectively selling gold to buy marks they believed to be undervalued. Today the situation is radically different, because Western speculators have sold nearly all the gold they own, and if you include the liquidation of gold paper unbacked by physical metal, in a crisis they will be net buyers of gold and sellers of currencies. Therefore it stands to reason that gold is central to a future currency crisis and that when it happens it is likely to be considerably more rapid than the Weimar experience.

I therefore come to two conclusions for 2014: that we are heading towards a second and unexpected financial and currency crisis which can happen at any time, and that the lack of gold ownership in welfare-driven economies is set to accelerate the rate at which a collapse in purchasing power may occur.

http://www.mineweb.com/mineweb/content/en/mineweb-whats-new?oid=222972&sn=Detail

Could there be hidden agenda behind the latest drive by the bullion banks to insist miners hedge some of their output as a prerequisite for the provision of new finance ?

Author: Lawrence Williams
Posted: Tuesday , 31 Dec 2013 

LONDON (MINEWEB) - 

Hedging has come soaring back into the headlines in recent weeks as a result of a number of fairly high profile comments. And, while the global gold hedge book is still massively lower than where it once was, in recent months there has been a growing trend among lenders to ensure that part of the gold output is hedged forward as a prerequisite for raising new finance. 

Before the seemingly ever rising gold price of the first decade of the 21^st Century put hedging out of favour, and the big miners scrambled to dehedge, this was, in fact, pretty normal practice.  Gold mining was looked upon as a particularly risky business after the big collapse down from $800 in 1980 to under $300 over the subsequent 20 years and the banks were thus keen to protect their investment which they could do by an insistence on hedging output at a specific price as an income guarantee.  But now, some are suggesting there is a hidden agenda behind a new insistence on hedging by the bullion banks. 

It certainly won’t have gone without notice that gold bullion is flowing out of U.S. and European vaults to the east – and to China in particular.  Indeed, despite the massive gold liquidations out of the big ETFs – GLD in particular – and more, available metal in COMEX warehouses is at a very low level as most of it is  being swallowed up by Eastern, Middle Eastern and FSU demand. Add into this the certainty that many central banks have been leasing out much of their gold, which has then been sold on by the bullion banks, and there is a huge supply squeeze developing for physical gold in the West. 

The bullion banks will supposedly have to return the gold they have leased, but are unable to do so because the available bullion supplies are just not there and that which comes on the market is being snapped up by the East.  Indeed this desperation to get their hands on physical metal without bankrupting themselves may be at least a partial reason for the gold price being driven downwards with the kind of strange market activity we have seen in the recent past.  Their inability to return leased gold to the central banks is also the most likely reason why Germany is finding it so difficult to repatriate its gold stored in U.S. and U.K. central bank gold vaults.

Thus, the reports suggest, the bullion banks are now exerting pressure on the basic gold suppliers - the miners - to supply gold directly to them  (through hedging) to try and help replenish their holdings so as to be able to return the gold they have leased.  The suggestion is that should a gold miner require say $300 million in finance to build a new mine, or expand an existing one, it is going to be required to hedge a significant portion of its production in order to get the financing.  But the miners are resisting this – at a gold price of around $1200, most would be mining gold at a loss.  The miners’ main hope is for an increase in the gold price in the future as new operations and expansions come on stream, but if they hedge their output forward at $1200 they would be doing so at, or near,  a lossmaking level – not an attractive proposition, and one which could land them in serious financial difficulties should the gold price take off again and, as we have seen in recent years, costs escalate accordingly.

But there is another side to the new mined gold supply situation that could be even more worrying for the bullion banks in terms of reducing new mined gold supply availability in the West.  We hear that gold miners are being approached to sell their output direct to Chinese refiners at a premium – surely an attractive proposition for a struggling gold miner.  The idea of selling output direct to the Chinese is not new.  Coeur’s Kensington gold mine in Alaska currently sells around half of its output of gold concentrates directly to China National Gold Group Corp. under a deal set up about four years ago.  However the recent reported moves by the Chinese to secure gold output from the mines directly would almost certainly be welcomed by today’s struggling gold producers, and would probably offer far better potential returns should the gold price recover than bullion bank imposed hedging.

It does look as if we may be heading for something of a serious squeeze on supplies of gold bullion in the West if the massive Chinese, and other Eastern demand continues at anything near current levels.  A report highlighted yesterday notes that China’s current President, Xi Jinping, has stated that the Chinese dream is the pursuit of gold with the aspiration to seek ‘peaceful development in the world’.  This appears to suggest a desire by the Chinese to work towards some kind of new currency standard within which gold plays a major role and is perhaps behind the huge accumulation of physical gold by the Chinese who see it as key to the future of the global economy and the country’s place in driving it forwards. 

http://goldswitzerland.com/gold-reflects-the-destruction-of-paper-money/

“The Matterhorn Interview – 31 Dec 2013: Egon von Greyerz”

On the final day of the year we are publishing the interview that Lars Schall has just conducted with me in Zurich.

We cover a wide range of important areas which include the coming failure of the gold paper market, the importance of owning physical gold as insurance against a failure of the financial system and to protect against counterparty risk.

The risks are considerably higher now than they were in 2008. The likely consequences will not just be a repeat of that crisis but the end of a major era. So this time, the world cannot print itself out of trouble and instead we are likely to see “The Dark Years are here” an article which I wrote a few years ago and which Lars asks me about.

We also discuss the gold price and if I am worried about the current pressure that gold is under as well as the destruction of the currency system within 5 years from now.

The future for our children and grandchildren is likely to be a lot more difficult than ours. But the world has been through these periods before and survived. So as I say in the interview, people should prepare themselves to the best of their ability and then just continue to enjoy life.

Finally, I wish everyone a healthy 2014 – it will definitively be eventful.

Egon von Greyerz

“Gold reflects the destruction of paper money”

Bloomberg TV lets Rickards explain the gold price/demand incongruity

Submitted by cpowell on Tue, 2013-12-31 20:58. Section: Daily Dispatches

3:56p ET Tuesday, December 31, 2013

Dear Friend of GATA and Gold:

Bloomberg News Television today gave fund manager and geopolitical analyst James G. Rickards four minutes to explain the incongruity between the falling gold price and the extraordinary demand for the metal, which he said probably involves market manipulation. Rickards cited the flow of Western gold to China through Switzerland and added that the decline in gold holdings claimed by the exchange-traded fund GLD is actually bullish for gold because bullion banks have been unable to obtain gold except by liquidating GLD's metal. The paper shorting of gold, Rickards said, is based on a very small amount of metal. "At some point," Rickards said, "you're going to want your gold and there's not going to be any around." The interview can be viewed at the Bloomberg Internet site here:

http://www.bloomberg.com/video/gold-declining-prices-versus-skyrocketing...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

and.....



The two pieces below sum up current state of  gold and silver markets.....

And Now Gold Is Soaring

Submitted by Tyler Durden on 12/31/2013 10:14 -0500

• Futures market
 
• Precious Metals

inShare2

Short-squeeze time? ... and suddenly CNBC goes quiet on the precious metals market movements.

The last 2 months has seen shorts pile back on in the futures market are squeezing in the fall...

We expect the BIS' Mikael Charoze, who is currently "red" after the recent gold slamdown, to promptly return to "green" at which point gold will once again mysteriously crash to its 2013 lows.

Gold And Silver Smashed To 2013 Lows

Submitted by Tyler Durden on 12/31/2013 08:56 -0500

• Precious Metals

inShare

As the US session starts, despite a dearth of news and actvity in other markets, the precious metals complex is being smashed lower (on heavy volume). Gold just hit 2013 lows at $1182 and Silver at $18.837 is near its 2013 lows also.

It seems someone wants the status-quo-defying precious metals going out at their lows as central-planning-supporting stocks go out at their highs...

on heavy volume...

In other news , Iran sanction relief seems to be on track.....

Iranian Billionaire Promoting "PetroGold" With Turkey Arrested

Submitted by Tyler Durden on 12/31/2013 09:33 -0500

• Corruption
 
• Iran
 
• Mohammad
 
• Newspaper
 
• Reality
• Turkey

inShare1

Earlier this week, in "Why The Turkish Government May Be The Casualty Of A $119 Billion PetroDollar Loophole" we said "dare to mess with the Petrodollar and the wrath of the US government will hunt you down... sooner or later." Sure enough, after resulting in a Turkish government scandal, punishing its stock market and sending the Lira reeling, the blowback has reached Iran where billionaire Babak Zanjani was arrested yesterday on corruption charges, although in reality his chief transgression was allowing the Petrogold system to show that the Petrodollar is no longer irreplaceable.

Iran's PressTV reported that the Monday arrest comes after 12 Iranian lawmakers accused Babak Zanjani of corruption, calling for an inquiry into his financial activities in a letter to the heads of the three branches of the Iranian government. "Experts say Babak Zanjani’s estimated net worth is around USD 13.8 billion. The corporate mogul, aged nearly 40, owns and operates many holdings and companies, including the UAE-based Sorinet group, Qeshm Airlines and Rah Ahan Football Club in Iran."According to Head of Iran’s Supreme Audit Court Amin-Hossein Rahimi, Zanjani’s role in the course of transferring the country’s oil revenues involved breach of law.

"After sanctions were imposed against the National Iranian Oil Company, Iran had to export oil and they gave Babak Zanjani the task of exporting some of this oil worth around USD 3.0003 billion. The problem is that they were supposed to get collateral from him by law and this was not done. This is a violation," Rahimi said in a press conference.  Some other lawmakers believe Zanjani is part of a mafia that makes financial benefits out of the sanctions imposed against Iran. “Zanjani is not alone. There is a network of individuals. They are getting rich out of people’s misery caused by sanctions. There is corruption here,” said Iranian legislator Mohammad Reza Tabesh.

So, Zanjani was tasked to circumvent oil sanctions which he did for over a year, but now, for some inexplicable reason, he is arrested for not "getting collateral"?

Of course, that, however, is only half the story. For the full version we go to Turkey's Cumhuriyet newspaper which last week explained the full extent of Zanjani's "transgressions", the bulk of which involved allowing Iran to avoid the Petrodollar and promoting Petrogold.

This is how the real story goes as explained by Bloomberg:

• Babak Zanjani, an Iranian blacklisted by the U.S. Treasury for evading Iran sanctions, denies Turkish media reports saying he was involved in illegal trade with people implicated in the country’s corruption probe, Turkey’s Cumhuriyet newspaper reports citing a letter from Zanjani.
• Zanjani, who was used by Iranian govt to finance sales of Iranian oil, according to the U.S. Treasury, says he was involved in gold trade with Turkey
• Zanjani says has a minor business relationship with Riza Sarraf, formerly Reza Zarrab, an Iranian-Azeri businessman who was arrested in the corruption probe. As a reminder, Sarraf was arrested two weeks ago along with children of two Turkish cabinet ministers, other senior bureucrats as part of a probe into accusations of graft, money laundering.
• Zanjani says annual trade volume of his group of companies is around 7 billion euros; trade with Sarraf makes up a fraction of it
• Zanjani says he made investments in Turkey due to “his confidence in Prime Minister Recep Tayyip Erdogan’s leadership”

And seeing how Erdogan's government is on the edge, and may fall any minute, that confidence appears misplaced, with the result being Zanjani's arrest. What is unknown is whether his detention was merely Iran no longer needing his assistance to promote the usage of petrogold as a bypass of the petrodollar system now that the Iranian sanctions have been lifted. The only question we have is how much of Zanjani's arrest was due to behind the scenes US influence making it clear that the Iranian detente will only take place - nuclear enrichment strawman forgotten - only if all those who made Petrogold possible are quitely put behind bars...

Charts......

24 HOUR GOLD

24 HOUR SILVER

http://www.caseyresearch.com/gsd/edition/china-said-to-regard-gold-as-the-center-of-a-new-and-fair-monetary-system

¤ YESTERDAY IN GOLD & SILVER

It was another Sunday night where gold ticked up at the open in New York, but ran into a willing seller immediately---and by the London a.m. gold fix, the price was down over ten bucks.  There was a tiny rally that began at 1 p.m. GMT in London, 20 minutes before the Comex open, but that ran into the usual seller of last resort at 9 a.m. EST---just like it did on Thursday and Friday of last week.

From that New York high, gold got sold down lower and lower until the HFT-types pulled the plug at 3 p.m. in the thinly-traded New York Access Market.  Up until that point, the gold price had managed to hang onto the $1,200 spot price mark, but by 3:30 p.m. it was down to $1,196 spot---and traded sideways from there into the 5:15 p.m. EST close of electronic trading.

The CME recorded the high and low ticks as $1,215.80 and $1,193.30 in the February contract.

Gold finished the Monday session in New York at $1,196.70 spot, down $17.10 from Friday's close.  Net volume was only 84,000 contracts---4,000 contracts less than Friday's volume.

And as obvious as the sell-off was in gold before the London open yesterday, JPMorgan et al really did a number on silver after its rally attempt at the New York open on Sunday night---resulting in a chart pattern that you've seen many times in the past, dear reader, as the HFT guys engineer prices lower in the most thinly-traded of all markets.

Silver's rally attempt off it's pre-London low got sold down starting around 11:30 a.m. GMT---and from there it got sold down for most of the rest of the day, culminating in the spike down just before 4 p.m. EST close in New York.  The price recovered a bit from them, but only just.

The high and low for silver were reported as $20.18 and $19.46 in the March contract.

Silver closed in New York yesterday at $19.565 spot, down 51 cents from Friday's close---and safely back under the $20 spot price once again.  Net volume was pretty impressive at 32,000 contracts---8,000 contracts more than on Friday.

Platinum's rally attempt on Sunday evening in New York fared no better than the similar rally attempts in gold and silver.  Platinum also had it's low at the same time as gold and silver---in the thinly traded New York Access Market around 4 p.m. EST.  Palladium's decent rally attempt in New York got squashed as well---and it, too, got sold down for a loss.  "Da Boyz" took no prisoners yesterday, despite the fact that the dollar index was in the toilet throughout most of the trading day on Monday.  Here are the charts.

The dollar index closed late on Friday afternoon in New York at 80.33.  From there it rallied to its "high" of 80.42 shortly after 1 p.m. Hong Kong time on their Monday.  From there it was all down hill into the 79.95 low at exactly 11 a.m. EST, as someone was waiting to catch that proverbial falling knife once again, as the index broke decisively  below the 80.00 mark for the second business day in a row.  From that low, the index recovered a bit, closing at 80.01---which was down 32 basis points from its close on Friday.  Here's the 3-day chart.

***

There were no last minute December deliveries in either gold or silver for later today, so the deliveries I spoke of in Saturday's column were it for the month.  First Day Notice for the month of January showed that 3 gold and an absolutely stunning 1,030 silver contracts were posted for delivery on Thursday within the Comex-approved depositories.

The short/issuers of note were Canada's Bank of Nova Scotia with 368 contracts---but the big kahuna was JPMorgan, with 651 contracts out of its client account!  There's no prize for guessing the biggest long/stopper, as it was JPMorgan Chase once again with 988 contracts in its in-house [proprietary] trading account.  The link to yesterday's Issuers and Stoppers Report is here, and it's worth a look.

This is really a big deal, as January is not a regular delivery month in silver---and the fact the JPMorgan took delivery of five million ounces on the very first day, should make everyone stand up and take notice.  As Ted Butler has pointed out on many occasions---JPMorgan is mega-short the Comex paper market, but taking physical delivery of every ounce they can lay their hands on.

Not surprisingly, there was another withdrawal from GLD yesterday.  This time it was 96,451 troy ounces.  And as of 6:54 p.m. EST yesterday evening, there were no reported changes in SLV.

There was no report from the U.S. Mint yesterday---and I'll be very surprised if there's one today, either.

There was virtually no in/out activity in gold at the Comex-approved depository on Friday.  Nothing was reported received---and only 95 troy ounces were shipped out.

But it was an entirely different kettle of fish in silver, as 1,643,911 troy ounces were shipped in---and 1,526,663 troy ounces were reported shipped out.  Of the amount shipped in, 1.05 million troy ounces disappeared in the JPMorgan depository.  The link to all that activity is here.

The Commitment of Traders Report that came out yesterday afternoon was certainly a disappointment.  Both Ted and I were expecting some fairly substantial improvements in the Commercial net short positions in both silver and gold for the reporting week ending on Tuesday, December 24.  That expectation was on the back of the engineered price declines in both metals on Wednesday and Thursday of the prior week.  The price declines didn't translate into anything close to what we were expecting.  Here's what the COT Report showed.

In gold, the total commercial net short position declined by a scant 600 contracts to 26,500 contracts. There have been very few weeks where the total commercial net short position has been lower and as such the market structure is still extremely bullish. With such a small total net change, the individual commercial category change couldn’t, by definition, be dramatic. For the record, the big 8 shorts added almost 1,800 new shorts and the raptors added 2,400 new longs.

The technical funds (in the managed money category of the disaggregated COT report) did add over 3,100 contracts of gross new shorts to come close to their previous high-water mark, but I had expected more.

In silver, the total commercial net short position actually increased by 500 contracts to 19,700 contracts. Like in gold, this is still a very low number on any historical basis and must be considered strongly bullish. The changes by commercial category were all in the low hundreds of contracts and not worth detailing. The technical funds did add a few hundred new short contracts, but I was hoping for more there as well. As a result of the minor changes, JPMorgan looks to still be short 13,000 contracts [65 million troy ounces of silver].

I stole the above comments from silver analyst Ted Butler's short essay to his paying subscribers yesterday.  And since I was born in Missouri in another life, the thought also crossed my mind that these COT numbers from the CFTC yesterday were not reported correctly, or some data was withheld because of the holiday.  We'll find out next Monday.

Ted figures that JPMorgan Chase's long-side corner in the Comex futures market in gold is in the order of 67,000 contracts, or 6.7 million ounces.

***

Selected news and views.....

Nine King World News Blogs/Audio Interviews

1. Art Cashin: "Cashin Warns About West's Disappearing Gold Hoard".  2. John Embry: "2014 is Going to Be a Year of Utter Turmoil and Chaos".  3. James Turk: "Terrifying Tsunami to Rip Through Global Markets in 2014".  4. William Kaye: "Absolutely Shocking Developments in the War on Gold".  5. Robert Fitzwilson: "Expect Historic Changes and Fortunes to Be Made In 2014".  6. Bill Haynes: "The Big Picture as We Head Into 2014".  7. Michael Pento: "2014...and the Contrarian Trade of the Decade".  8. The first audio interview is with Egon von Greyerz...and the second audio interview is with Art Cashin.

'Shadow warehouses' are hoarding the world's metal

The world's metal is slipping into the shadows.

Banks, hedge funds, commodity merchants and others are stashing tens of millions of tons of aluminum, copper, nickel and zinc in a hidden system of warehouses that span the globe.

These facilities are known to some in the industry as "shadow warehouses" because they are unregulated and don't disclose their holdings.

They operate outside the London Metal Exchange system of warehouses, the traditional home for these metals...and as of October, a record 7 million to 10 million tons of aluminum were being housed in these facilities, in countries as far apart as Malaysia and the Netherlands, according to estimates from several analysts.

This interesting article originally showed up on The Wall Street Journal...and is reprinted here on the money.msn.comInternet site last Friday afternoon EST.

Gold price collapse is the worst for 30 years

Gold will finish the year as one of the worst-performing asset classes, bringing to an end a decade-long rally in the precious metal.

Gold has suffered its sharpest fall in 30 years, down almost 28pc over the past 12 months to close 2013 at about $1,200 (£725) an ounce.

That compares badly against other assets, with the S&P 500 up 28pc, the FTSE 100 gaining around 13pc and Brent crude oil futures up about 2.5pc in the same period.

“Equities have won the battle over gold for investors’ money this year,” Ole Hansen, head of commodity strategy at Saxo Bank, said. Last year, Mr Hansen correctly predicted that gold would finish the year at $1,200 and for 2014 he is forecasting that prices may have already bottomed out.

This commentary was posted on The Telegraph's website on Saturday evening GMT...and I thank Roy Stephens for his final contribution to today's column.

Bank of Canada's gold coins to be liquidated to help balance government's budget

Canada's first gold coins had barely been minted before Ottawa yanked them out of circulation a hundred years ago in an effort to stop gold from leaving the country during the First World War.

After a century of sitting in cloth bags inside the Bank of Canada vault, they are among a wide range of assets the Conservative government is liquidating -- in this case literally -- to save taxpayers a few dollars and help balance the books. The plan is to melt down more than 200,000 gold coins from the years 1912 to 1914, when Ottawa suspended the gold standard.

The coins have been the subject of whispers among collectors curious what happened to the $5 and $10 gold coins that Ottawa had pulled out of circulation. The mystery was lifted late last year when the Bank of Canada announced it would be offering 30,000 of the bank's 246,000 coins for sale to collectors.

This story, filed from Ottawa, was posted on theglobeandmail.comwebsite late yesterday evening EST...and I found embedded in a GATA release.  And on a personal note, I'm sure not happy about seeing these coins get melted.

Lawrence Williams: Whither Gold in 2014?

As we draw to the close of another very disappointing year for the gold investor, one might ask how much further the yellow metal has to fall before making something of a sustained recovery.  And while our track record on gold price prediction may have been pretty good prior to 2012, since the start of that year it has been decidedly out of sync with reality.  Perhaps one can do better in the current year?

On a basic reading of the current situation vis-à-vis gold, one might suggest that, in 2014, gold will end the year at a higher price level than it will likely begin it, but that does not necessarily mean there won’t be a few difficult months ahead before things start to get better.

Although, as the gold price falls, the potential for further downside risk diminishes.  Politicians have been adept, for the most part, in talking up the global economy and thereby building confidence among the general populace, however misleading the quoted, massaged statistics may be in reality.  Increased confidence means a return to the spending economy and this has transferred to the stock markets with nearly all major western stock indices rising, and, so far, continuing to do so.

This commentary by Lawrie was posted on the mineweb.comInternet site yesterday...and I thank Ulrike Marx for bringing it to our attention.

J.P. Morgan Sees Golden Opportunities for Huge Gains in 2014 With Gold and Silver

With serious inflation still only a gleam in the eyes of the ardent gold bugs, 2014 looks like a tough year for gold miners. The metals analysts at J.P. Morgan think it is easy to look at the cost of new mines and conclude that current prices are unsustainable. But new mine projects may not be needed for several years if more of investors’ above-ground gold horde is unwound. Here is where the story gets more interesting.

For many on Wall Street the question of future inflation is a when, and not if, proposition. Central backs around the world are printing money at a furious pace, debasing the value of their local currency. So whether it is a question of gold and silver as a hedge, an industrial commodity or simply a straight contrarian stock trade, the J.P. Morgan team thinks now is the time to look hard at the top names. They also think the downturn in prices has created a golden opportunity.

This commentary from a week ago yesterday quotes a note from JPMorgan Chase, but there was no link or direct quote in this article...and therefore I would treat this story as hearsay until such time as a hard copy of the "note" appears.  I thank Casey Research's own Jeff Clark for sending this our way.

India gold tax hits bridal budgets and smuggling is up

With India's wedding season in full swing, the glass sales counters in Mumbai's famed Zhaveri gold bazaars are crowded with customers eyeing elaborate headpieces, nose rings, and necklaces. No one does jewelry quite like an Indian bride, who by tradition wears all the gold she can stand up in and her family can afford.

These days, though, even the most ambitious bridal budgets don't bring the bling like they used to, thanks to hikes in import duties and a rise in local gold prices that have shoppers like Rajanikant Mehta grumbling.

Mehta, who owns a factory outside the capital, had planned to spend about $1,800 on a necklace for the woman marrying his son late this month, but he's unhappy about what he's getting for his money. Gold prices in India, which imports nearly all its gold, have risen 50 percent over the past three years to about $1,400 an ounce.

This AP story, filed from Mumbai, showed up on The Seattle Times website last Friday...and I have a feeling that I've read this before, so it may be a repeat.  I went back a full week in my previous columns, but couldn't find it, so I could be wrong.  I found this article in a GATA release on Saturday, so maybe that's where I read it!

China's gold imports drop 42 percent in November

The mainland's net gold imports from Hong Kong fell 42 per cent to below 100 tonnes last month, reflecting a drop in demand from jewellers and retail investors after strong purchases in recent months.

Net flows into the mainland, excluding imports by Hong Kong from the mainland, slipped to 76.39 tonnes from 131.19 tonnes in October, data from Hong Kong's Census and Statistics Department showed.

The People's Bank of China plans to increase the number of firms allowed to import and export gold and ease restrictions on individual buyers of the precious metal, according to a draft policy document issued in September.

This Reuters story, filed from Singapore, was picked up by theSouth China Morning Post in the wee hours of this morning local time over there...and my thanks go out to Ulrike Marx for her final offering in today's column.

China said to regard gold as the center of a new and fair monetary system

China sees gold as the basis of a new world monetary system that is fair to all nations and not favoring any nation issuing a dominant currency, according to a speech given [earlier] this year by Zu He Liang, director of the Chinese Gold Market Research Center...and reported yesterday by gold researcher and GATA consultant Koos Jansen at his Internet site,ingoldwetrust.com.

This is another item I found over at the gata.org Internet site yesterday...and I consider it a must read.

¤ THE WRAP

The commercials may not know in advance precisely how many technical fund shorts they can lure into the market. The commercials keep rigging prices lower until the tech funds can’t short anymore. At that point, the bottom in price is established. It seems to me we are close to that point---and that may be why there was not more technical fund selling in the current COT report.

Of course, the collusive commercials, particularly the low lifes at JPMorgan, are likely to press prices until it’s crystal clear to them that the tech funds are sold out to the max. I think that’s the explanation for today’s price action and any further rigged sell-offs. But considering how extreme the price action and resultant market structure has become, it has to be played as a crooked game at the very end of its existence. - Silver analyst Ted Butler: 30 December 2013

It should be obvious to anyone with a couple of synapse to rub together that the HFT boys were out in the thinly-traded Far East market on their Monday.  As Ted Butler said in his short COT commentary yesterday---"there was a clear intent by the commercials to press prices lower to induce more technical fund selling, as there was no legitimate supply/demand justification for the lower prices", and as I scan the Far East price action for today, I see the same intent again, with new low ticks for this move down.

Today is the last trading day of the year---and also the cut-off for next Monday's Commitment of Traders Report, which is delayed one day because of the New Year's Day holiday.  It certainly appears that JPMorgan et al are attempting to send the year out on the most negative tone possible---and nothing will surprise me during the trading action in New York later this morning.

But the real surprise yesterday was the amount of silver that JPMorgan Chase stood for delivery on, on the first day of the January delivery month.  Events like this put "paid" to the Butler quote above that states that it is a "crooked game at the very end of its existence."

With the London open about five minutes away as I type this paragraph, the gold price traded pretty flat throughout the Far East session on their Tuesday, with a spike down around 1:30 p.m. Hong Kong time.  It rallied back over the $1,200 spot price mark, but that got sold down right away.  Silver made a rally attempt in early Far East trading, but that ran into selling pressure at 9 a.m. Hong Kong time---and then spiked to its low at the same moment as silver.  Gold is up three bucks---and silver is down about 15 cents.  Platinum had the same spike low at the same time---and is unchanged in price.  Palladium is up four dollars.  Gold volume is very light, a hair under 14,000 contracts----and silver's volume is under 6,000 contracts.

And as I hit the send button on today's column at 5:15 a.m. EST, there hasn't been much change in any of the four precious metals during the last two hours of trading, although they have all rallied a bit since the London open---and gold is up about seven bucks and silver is back to unchanged on the day.  Volumes in both gold and silver are still very light---and I'm must admit that I'm expecting things to remain that way.  The dollar index is up a handful of basis points.

I await the 8:20 a.m. EST Comex open with a great deal of interest, but I expect the markets will close early.

I may or may not have a column tomorrow---and whether I do or not, obviously depends on what happens as the trading day unfolds in New York.

If there's nothing in your in-box tomorrow, then I'll certainly have something on Thursday morning.

Happy New Year---and all the best in 2014 to you and yours.

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and....

http://www.silverdoctors.com/ann-barnhardt-get-completely-out-of-the-system-total-collapse-is-coming/#more-36703

Ann Barnhardt of the former Barnhardt Capital warns Elijah Johnson toget COMPLETELY out of the system, there is a total collapse coming!
Barnhardt, who backed up her talk by closing her own futures brokerage to protect her clients in the wake of the MFGlobal client bail-in by JPM,  discusses the total lack of rule of law for the political and banking sector in the US, and why Americans must unite to abolish the Federal Reserve system.
Ann Barnhardt at her finest on the urgent need to get (completely) out of the system:

http://www.silverdoctors.com/gerald-celentes-2014-forcast-rising-gold-financial-panic-economic-collapse-war/

Gerald Celente is one of the world’s top trends researchers.  His top trends in 2014 start with the Middle East.  Iran, Syria, Egypt, Israel, Yemen and Turkey are just a few of the countries facing big problems.  Celente exclaims, “You just keep going around the Middle East, it’s total turmoil.”  Will there be war in the Middle East in 2014?  Celente says, “I thought it would have happened last year; but, then again, there are wild cards.”  On the economy, Celente predicts, “Interest rates are going to go up. . . . When interest rates go up, the economy is going down—period.”  Celente goes on to say, “I think they are going to institute more tapering, and it’s going to create a financial crisis worldwide.”  On gold, Celente predicts, “Then they’re going to dump more dough into the system.  When that happens, that’s when you’re going to see the real panic start to happen. . . . You’re going to see a rise in gold prices that’s going to eclipse the last one.”  In Asia, Celente points out, “Things are heating up between China and Japan.  If that thing goes into a war, it’s a whole new game.”  Celente predicts, “Absent the war card, I think we will see a financial crisis before the end of the second quarter of 2014.”