By Stefan Gleason

Imagine a world where every financial move you make gets recorded in databases that are accessible by any number of third parties – from bankers, to government bureaucrats, to data thieves.

It’s the world of the cashless, all-digital economy. And it’s rapidly approaching.

Fortunately, there are some steps you can take to secure your financial privacy – or at least make your wealth less vulnerable to digital prying – before it’s too late.

1. Don’t Trash Your Cash Stash (Yet)

Paper Federal Reserve Notes are a terrible store of value (in fact, they’re guaranteed to lose value over time). Even so, they are still highly useful in everyday commerce.

In some circumstances, it’s just more convenient to use paper money – or you may wish to keep your transactions off the digital grid whenever it’s possible to do so.

In these situations, $20, $50, or $100 bills are superior to checks, credit cards, smartphone payment apps, or even cryptocurrencies.

Contrary to what some Bitcoin enthusiasts believe, blockchain transactions are not “private.” They are recorded on a public ledger and can sometimes be traced back to individual identities.

Obviously, any transactions that get processed through bank or credit card payment systems create digital records that can be exploited. If the financial industry (not to mention the IRS) had its way, all payments would take place in the digital dollar realm.

Anti-money laundering laws already make it legally risky to carry around large amounts of cash – or to deposit or withdraw cash at banks beyond vague “suspicious activity” thresholds. Some politicians are openly calling for $100 and $50 bills to be abolished to further discourage the use of cash for large transactions.

Given the government’s war on cash, it may be more of a privacy risk than advantage to, for example, insist on paying for a new car in physical cash. But for smaller, more routine transactions where paying in cash won’t seem “suspicious” to anyone, you can avoid generating digital records.

As noted above, Federal Reserve Notes are depreciating assets, so you wouldn’t want to keep a large amount of your wealth in them. In the event of a hyperinflationary collapse of the currency, you wouldn’t want to be stuck holding paper cash for any length of time. It could lose half its value literally overnight.

For superior wealth preservation over time, hoard hard money – gold and silver.

2. Invest in Non-Traceable Tangibles

The United States dollar may not necessarily be on the cusp of a Weimer Germany or Zimbabwe-style collapse. But even slow and steady depreciation at the Federal Reserve’s inflation target of 2% can have devastating consequences when compounded over the years.

That’s why it’s essential to park wealth in contra-dollar assets including precious metals.

Sure, you can potentially stay ahead of inflation during good times by owning assets such as rental properties and dividend stocks. But it’s nearly impossible to do so privately.

People who take extraordinary steps to try to hide their financials assets through trusts, corporations, offshore entities, or supposedly anonymous “numbered accounts” risk causing themselves even more trouble by running afoul of laws.

In recent years, most all loopholes for attaining financial privacy legally have been closed.

However, it is still legal to hold high-value tangible assets including memorabilia, diamonds, and gold and silver coins, bars, and rounds without having to set up an account for them, register them with the government, or pay any federal taxes on them unless and until you decide to sell and have capital gains to report.

Obviously, to keep your tangible wealth private, you’ll need to keep quiet about it. Tempting though it may be to show off your latest bullion purchase on Instagram or Twitter, some things are best kept out of the digital public square.

3. Stay Off Social Media

Social media giants and their advertisers are mining our personal data, our time, and our attention spans for billions in profits. We’re only now beginning to fully realize the dangers of social media usage on everything from our mental health and physical safety to our careers and finances.

Over the past year, Facebook, Twitter, and Google have all come out and admitted that they collect more data on us than they previously disclosed – and that they have done a poor job of protecting it from abuse.

It’s not hard to find countless stories of jobs lost and finances wrecked due to simple (and easily avoidable) social media posts. Leftist outrage mobs wage organized and institutionally funded campaigns to expose and punish people for offensive posts.

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A Daily Beast “journalist” credited Facebook staff with helping him pin down the identity of the Trump supporter whose recent viral video made Nancy Pelosi’s speech sound inebriated.

A Jordanian-American female novelist who tweeted about a D.C. Metro worker acting inappropriately was cyber bullied off Twitter and lost a book deal potentially worth millions. Why? Because the rule-breaking worker was a black female whose identity currently occupies a more protected place on the left’s “protected group” hierarchy than a lighter-skinned Arab woman with economic privilege.

Even if you never get political on social media, anything you post with the most innocuous of intentions could be interpreted through a warped political lens by people who have nothing better to do than find offense where none was intended.

Just having your name, face, and/or location displayed on social media can enable scammers, hackers, and artificial intelligence bots to connect more dots about you than you even knew existed online.

Social media usage is akin to a dangerous and highly addictive drug. There are always reasons to post, to check notifications, to connect. The side effects are often various levels of jealousy, guilt, anxiety, and stress.

Social media’s next way to keep us hooked may be through digital currencies. Facebook is expected to soon release its own cryptocurrency, which reportedly will be a “stablecoin” linked to global government-issued fiat currencies.

When Big Tech and Big Government combine forces, you can be sure your privacy gets squeezed.

---

Stefan Gleason is President of Money Metals Exchange, a precious metals dealer recently named “Best in the USA” by an independent global ratings group. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC and in hundreds of publications such as the Wall Street Journal, The Street, and Seeking Alpha.

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Louis James
Casey Research

Economic crises signal that the current system isn’t working as expected and needs improvement. When it comes to monetary systems, questioning their fundamentals can lead to doubts about whether the preferred medium of exchange will continue to be preferred for long. The large-scale whirlwind of economic trouble around the globe has pushed some to rethink the role of gold in the economy – and to actually move toward bringing it back.

A month ago, a rumor that India is going to pay in gold for oil imported from sanction-struck Iran sent shockwaves through the markets. It was no small deal, both in principle and volume: India is one of Iran’s largest oil buyers, responsible for about 22 percent of total exports and worth about US$12 billion per year. China is next with 13 percent, and Japan is third with about ten. All of them are having a hard time dealing with Iranian oil imports, as the country is under sanctions caused by Western fears regarding its nuclear program.

Then an Israeli news site claimed exclusive knowledge of a possible workaround between India and Iran: settling the purchases in gold. Indian government officials refused to comment, which added to the speculation.

On the surface, the arrangement looked like a great way to settle the purchases via a stable medium: Iranian currency, the rial, is not widely used outside its border, and gold’s inherent anonymity would have provided a perfect way to avoid unnecessary attention from the global community. Ironically, it was precisely the fact that the settlement was planned in gold that attracted so much attention.

It proved to be nothing but a rumor, however: the sides decided to arrange the deal in a more tactical manner. India will partly cover the purchases with its own currency, and Iran will later use those funds to acquire imports.

But gold is not out of the equation yet. The US-initiated sanctions were effective, at least in the sense of making international institutions avoid the pariah nation. Reuters reported that Iran has failed to organize imports of even basic food staples for its population of 74 million. Prices on local markets rose sharply; and as the country neared parliamentary elections on March 2, the government was taking radical steps to provide citizens with basic necessities. One of those unconventional solutions was offering gold as barter for food.

‘Grain deals are being paid for in gold bullion and barter deals are being offered,’ one European grains trader said, speaking on condition of anonymity while discussing commercial deals. ‘Some of the major trading houses are involved.’

Another trader said: ‘As the shipments of grain are so large, barter or gold payments are the quickest option.’

Trading in gold rather than a fiat currency is “cashless.” That may sound as if there’s no medium of exchange, but that is of course a misconception: gold is history’s longest-standing medium of exchange.

As long as the sanctions remain in force and the Iranian government has limited access to international currency markets, gold will remain an obvious way to settle transactions. Decreasing oil imports to Japan, the world’s third-largest importer, will impact the Iranian economy further, draining foreign currency inflows. Lacking foreign currency may push the country to continue using its foreign exchange reserves, or gold, to cover its international liabilities. Oil looks like a viable, though less convenient, alternative as well.

The Iranian economy is in a state of crisis, and due to the lack of trust in its currency, leaders are increasingly resorting to extraordinary offers to trading partners. The situation would clearly worsen if the country enters a state of war. While that’s still speculation, imagine what would happen to the price of gold if a part of Iran’s 29-million-ounce gold reserve becomes a medium – not an object – of exchange in international trade.

That reduction in potential supply could be a game-changer, not only because of crisis-struck Iran, but because it could open the door for other countries to follow suit. The price of gold would likely respond very positively.

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This scenario, while possible, may not happen very soon: large-scale trading in gold has occurred only rarely in recent years. Traces of deals are difficult to track down due to the anonymity of the yellow metal. This re-emphasizes our point regarding gold as money in extremis: when economic push comes to shove, gold will outlast any other medium of exchange in existence. As the evidence from Iran shows, even governments – the masters of the central banks – will resort to mankind’s oldest form of money when pressed.

Which brings us to this evergreen conclusion: Gold is one of the best assets to own in both good times and bad. It can rise with inflation in a surging economy, and it can be practical for exchange when times are bad.

Gold isn’t just a hedge; it’s money.

[There are many ways to take advantage of shifting attitudes toward gold… including buying in at deeply discounted rates. Get started today.]

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Jeff Clark
Casey Research

Mayan prophecies aside, many of the senior Casey Research staff believe that economic, monetary, and fiscal pressures could come to a head this year. The massive buildup of global debt, continued reckless deficit spending, and the lack of sound political leadership to reverse either trend point to a potentially ugly tipping point. What happens to our investments if we enter another recession or – gulp – a depression?

Here’s an updated snapshot of the gold price during each recession since 1955.

Clearly, one should not assume that gold will perform poorly during a recession.

Even in the crash of 2008, gold still ended the year with a 5% gain. And with the amount of currency dilution we’ve undergone since that time, it seems more likely gold will rise in any economic contraction than fall. Indeed, if the response of government to a recession is more money printing, precious metals will be a critical asset to have in your possession.

Even if the gold price ends up flat or down this year, the CPI won’t. Gold’s enduring purchasing power is why we hold the metal.

How about gold stocks?

In spite of the debilitating 1970s that suffered from stagflation, price controls, three recessions, and the Vietnam war, gold producers rose over 600% while the S&P was basically flat. And that includes a roughly 65% fire-sale correction, much like we saw in 2008. To be clear, gold and silver stocks won’t be immune to selloffs if a recession or worse temporarily clobbers our industry. But in the end, we’re convinced they will prevail.

Don’t lose patience with, or confidence in, your gold holdings. What happens to the price over any short period of time is only one chapter in the book of this bull market, and we think you’ll be happy by the time that last chapter is written.

[If you have questions on how to invest in gold in the current market conditions you aren’t alone. If you act fast, you can be among those who get to hear Jeff Clark discuss his thoughts and answer selected audience questions. The Gold Investing in 2012 and Beyond: Your Questions Answered! call is absolutely free – but you must sign up by midnight EDT on April 6.]

Susanne Posel, Contributor
Activist Post

As America slips into monetary oblivion, some states are turning to the US Constitutional right and desiring to use alternative currencies – preparing for the hyper-inflation that Bernanke is currently creating.

Minnesota, Tennessee, Iowa, South Carolina and Georgia are awaiting approval from their respective governments to create a separate currency. This number is up from 2011, when just 3 states were brave enough to attempt this constitutional right.

“In the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System … the State’s governmental finances and private economy will be thrown into chaos,” said North Carolina Republican Representative Glen Bradley. He introduced a new currency bill in 2011.

These states are planning on issuing gold or silver coins as tender “in payments of debts” as allotted them in the US Constitution. Law makers are becoming at ease with this proposal as the worth of the US dollar is further lessened by the actions of the Federal Reserve, and the prices of precious metals like gold and silver soar higher.

In Utah, Governor Gary Herbert signed a bill introducing an alternative currency in March of 2011. This bill recognized gold and silver coins issued by the US Mint as legal tender.

“A Utah citizen, for example, could contract with another to sell his car for 10 one-ounce gold coins (approximately $17,000), or an independent contractor could arrange to be compensated in gold coins,” said Rich Danker, a project director at the American Principles Project, a conservative public policy group in Washington, D.C.

Mike Pitts, Republican for South Carolina introduced a currency proposal of which any gold or silver coin could be used as payment for debts based on its weight and size. Pitts and 12 other so-sponsors believe that this move will protect their state from “an economic crisis of severe magnitude.”

Washington State, Iowa, Minnesota, Georgia and Idaho have followed suit and are basing their legal tender values on metal standards as reflected on the market.

In many cases, residents of these states will be able to trade their fiat Federal Reserve Note for gold or silver coin. They could then purchase goods and services with their currency.

There is the notion of creating an electronic depository to alleviate the actual weight of the gold and silver coin carried around.

In Utah, the Utah Gold and Silver Depository is conceiving of a debit card system that will be linked to their precious metals holdings.

Transfers would be made by the market value of the metals.

A return to the gold standard is supported throughout the country. Most Americans are beginning to understand that the fiat money printed by the Federal Reserve is not worth what the privately owned bank would have us believe.

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While some states are moving toward this alternative currency, it opens the door for more states to become brave and put into place these legislative protections.

This move could simply and swiftly eliminate the Federal Reserve’s hold on America’s economic future.

Once their power is gone, it is only a matter of time before they literally disappear from the American landscape; liberating US citizens from their debt slavery.

Susanne Posel is the Chief Editor of Occupy Corporatism. Our alternative news site is dedicated to reporting the news as it actually happens; not as it is spun by the corporately funded mainstream media. You can find us on our Facebook page.

RELATED ACTIVIST POST ARTICLE:
How to Abolish the Fed and Convert to Gold as Money

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Michael Snyder, Contributor
Activist Post

Do you want to know what QE3 is going to do to the price of gold and the price of silver? Well, you can read what the financial experts are saying below, but it doesn’t take a genius to figure out what is likely to happen. During QE3, the Federal Reserve will be introducing 40 billion new dollars that have been created out of nothing into the financial system each month.

So there will be more dollars chasing roughly the same number of goods and services, and that means that more inflation is on the way. In an inflationary environment, investors tend to flock to hard assets such as gold and silver. And it is important to remember that a lot of the money from QE1 and QE2 ended up pumping up the prices of various financial assets. This included commodities such as gold and silver.

The same thing is likely to happen again with QE3. In addition, investors now have an expectation that the Fed will continue printing money for the foreseeable future and that the U.S. dollar is going to steadily decline, and that expectation will also likely give further momentum to the upward movement of gold and silver. Of course when it comes to investing, there is never a “sure thing” and as the global financial system falls apart in the coming years we are likely to see wild swings in the financial markets. So there is definitely an opportunity when it comes to gold and silver, but anyone that wants to invest in gold and silver needs to be ready for a wild ride.

In a previous article, I compiled 10 quotes from experts about what QE3 is going to do to the U.S. economy. In this article, I have compiled 10 quotes from financial experts about the effect that QE3 will have on gold and silver. Hopefully you will find some nuggets of wisdom that you can use in these quotes from some top financial veterans….

#1 Citi analyst Tom Fitzpatrick
“When gold breaks above $1,790, many people will feel they have missed the boat, and they will go to silver instead. So silver should outperform gold. People have to remember that we are only at the midpoint of the gold/silver ratio of the last 45 years. So it is not inconceivable that we could still go lower in terms of that ratio.

If we see gold move to the $3,400 level, it is not inconceivable that we may see silver closer to $100. Investors have to remember that at the end of the 70s the gold price doubled in a mere five or six weeks. If 3 to 5 years down the line we see that the base policy of the developed world is to continue printing money, then the gloves are off in terms of what levels gold and silver could actually go to.”

#2 GATA’s Bill Murphy
“All I know is: the physical market, if you want to buy silver in size, is the most difficult in history. These are from my best sources.”

#3 Francisco Blanch, a global investment strategist with Bank of America Merrill Lynch, regarding his belief that gold is heading to $2400 an ounce….
“Given the new open-ended nature of QE3, the upward pressure on gold prices should continue until employment is strong enough to require a change in policy”

#4 Morgan Stanley Commodities Analyst Hussein Allidina
“We remain convinced that the interest rate outlook, the likelihood of continuing risk aversion because of the Eurozone debt crisis, and strong physical market fundamentals justify exposure to gold”

#5 Peter Schiff, CEO Of Euro Pacific Capital
“The dollar is vulnerable to a massive collapse . . . buy gold and silver.”

#6 Jim Rogers
“But I’m not selling any gold. If it goes down I hope I’m smart enough to buy more. If it goes down a lot I hope I’m smart enough to buy a lot”

#7 Deutsche Bank Analysts Daniel Brebner and Xiao Fu
“We would go further however, and argue that gold could be characterised as ‘good’ money as opposed to ‘bad’ money which would be represented by many of today’s fiat currencies. In describing gold as such we refer to Gresham’s Law – when a government overvalues one type of money and undervalues another, the undervalued money (good) will leave the country or disappear from circulation into hoards, while the overvalued money (bad) will flood into circulation.”

#8 Nick Barisheff, the CEO of Bullion Management Group Inc
“The message is that the era of high returns financial assets for both stocks and bonds, as Pimco’s Bill Gross has stated, is over, and gold is the primary go-to asset for wealth preservation. QE3 will only serve to accelerate this trend.”

#9 Pimco’s Bill Gross
“Gold can’t be reproduced. It could certainly be taken out of the ground in an increasing rate but there’s a limiting amount of gold.

And there has been an unlimited amount of paper money over the past 20 to 30 years and now – in this period of central bank expansion where it’s QE1 or QE2, or whether it’s the LTROs of the ECB or this potential new program … then central banks are at their leisure to basically print money.

Gold is a fixed commodity that has a considerable store of value that paper money has not….

When a central bank starts writing checks and printing money in the trillions of dollars, it’s best to have something tangible that can’t be reproduced, such as gold.”

#10 Marc Faber
“I think that the trend for gold prices will be steady, but the trend for the dollar and other currencies will be down. In other words, in dollar terms the price of gold will trend higher. How high it will go, you have to call Mr. Bernanke and at the Fed, there are other people actually that make Mr. Bernanke look like a hawk. So they are going to print money.”

Over the past several weeks (both before and after QE3 was announced) we have seen a significant rise in the price of gold and in the price of silver.

A lot of very wealthy people around the globe greatly benefited from this move.

In a previous article, I quoted an article from the Telegraph that discussed the enormous amounts of money that billionaires George Soros and John Paulson had been investing in gold earlier this year….

There was also news last week in an SEC filing that both George Soros and John Paulson had increased their investment in SPDR Gold Trust, the world’s largest publicly traded physical gold exchange traded fund (ETF). 

Mr Soros upped his stake in the ETF to 884,400 shares from 319,550 and Mr Paulson bought 4.53m shares, bringing his stake to 21.3m. 

At the current price of about $156 a share, these are new investments of about $88m of Mr Soros’ cash and more than $700m from Mr Paulson’s funds. These are significant positions.

And central banks all over the planet have also been hoarding gold.

According to the World Gold Council, global central banks added 157.5 metric tons of gold last quarter. That was the most gold that global central banks have ever added to their stockpiles during a single quarter.

Could it be possible that some folks knew ahead of time that QE3 was coming?

That is a very interesting question.

In any event, there is certainly a lot of hoarding of precious metals going on around the world, and without a doubt a lot of financial insiders are very bullish on gold and silver right now.

But in the financial world there is never a guarantee that something will happen.

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For example, if there is a stock market crash in the coming months the price of gold and the price of silver are likely to fall dramatically.

Just take a look at this 5-year chart for silver. During the last financial crisis the price of silver dropped like a rock. In fact, it fell by more than 50 percent between late 2008 and early 2009.

So when the next stock market crash comes (and it is coming at some point) be prepared for gold and silver to take a tumble.

But how will the financial authorities respond to such a crash?

They will print even larger amounts of money of course.

And that will once again be very good for gold and silver.

So don’t let the ups and downs scare you too much.

Gold and silver are definitely in for a wild ride, but in the long-term I am extremely bullish on gold and silver. I believe that both are eventually headed into the stratosphere.

So what do you think is going to happen to gold and silver? Please feel free to post a comment with your thoughts below….

This article first appeared here at the American Dream.  Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.

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Jeff Clark
Casey Research

While many of us at Casey Research don’t like making price predictions, and certainly ones accompanied by a specific date, it’s hard to ignore the correlation between the US monetary base and the gold price.

That correlation says we’ll see $2,300 gold by January 2014.

There are plenty of long-term charts that show a connection between gold and various other forms of money (and credit). Most show that one outperforms until the other catches up. But let’s zero in on our current circumstances, namely the expansion of the US monetary base since the financial crisis hit in 2008.

Here’s the performance of the gold price compared to the expansion of the monetary base since January 2008.

You can see the trends are very similar. In fact, the correlation coefficient is an incredible +0.94.

Since the Fed has declared “QEternity,” it’s logical to conclude that this expansion of the monetary base will continue. If it grows at the same pace through January 2014, there is a high likelihood the gold price will reach $2,300 at that point. That’s roughly a 30% rise within 15 months.

And by year-end 2014, gold could easily be averaging $2,500 an ounce. That’s 41% above current prices.

Some may argue that there’s no law saying this correlation must continue. That’s true. And maybe the Fed doesn’t print till 2014. That’s possible.

But it’s not just the US central bank that’s printing money…

• European Central Bank (ECB) President Mario Draghi has declared that it will buy unlimited quantities of European sovereign debt.


• Japan’s central bank is expanding its current purchase program by around 10 trillion yen ($126 billion) to 80 trillion yen.


• The Chinese, British, and Swiss are all adding to their balance sheets.

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The largest economies of the world are all grossly devaluing their currencies. This will not be consequence-free. Gold and silver will be direct beneficiaries –along with mining companies– starting with rising prices.

There are other consequences, both good and bad, of gold hitting $2,000 and not stopping there. We think investors should be prepared for the following:

• 
  Tight supply. As the price climbs and attracts more investors, getting your hands on bullion may become increasingly difficult. Delivery delays may become commonplace. Those who haven’t purchased a sufficient amount will have to wait in line, either figuratively or literally.

• 
  Rising premiums. A natural consequence of tight supply is higher commissions. They won’t stay at current levels indefinitely. Premiums doubled and more in early 2009, and mark-ups for silver Eagles and Maple Leafs neared a whopping 100%.

• 
  Swelling profits for the producers. If margins on gold production average $1,000 per ounce now, what will earnings be like when they average $1,500? At $2,000? Gold can rise much faster than operating costs, so this could happen. Imagine what this could do to dividend payouts, especially those tied to the gold price and/or earnings.

• 
  Tipping point for a mania. There will be an inflection point where the masses enter this market. The average investor won’t want to be left behind. Will that happen when gold hits $2,000? $2,500?

The message from these likely outcomes is to continue accumulating gold – or to start without delay. Waiting will have consequences of its own.

People say that there’s nothing certain in life except death and taxes. In my view, $2,300 gold is a close second.

Jeff Clark
Casey Research

What’s important about China’s production is that unlike most other countries, it doesn’t reach the world market, since China doesn’t export gold.

Further, while some point to the growth in production since 2008, output is still 12.8% below the year 2000 level. And there are reasons to believe the gap between global mine production vs. mine production excluding China could widen. MarketWatch reports that China’s Ministry of Industry and Information Technology has said that China wants domestic gold production to reach 14.5 million ounces by 2015, an increase of approximately 25% over last year’s levels. Given that what’s produced in the country stays in the country (where there is escalating domestic consumption), a “widening of the fundamental market shortage,” as per the MarketWatch article, seems almost certain.

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Since global production is lower without China’s production included, we decided to examine total supply (mine production plus scrap), backing out Chinese production and adjusting for Chinese gold imports. How much gold is left for the rest of the world after the Chinese take what they want? The contrast surprised even us.

Total gold supply has been growing since 2006, reaching a record of 120 million ounces in 2011. However, as you likely know, China’s consumption is second only to India’s – and could soon reach number one. China’s gold imports from Hong Kong have soared, hitting a record 13.5 million ounces last year, with 16.5 million ounces imported through August of this year. Upon adjusting for China’s imports, gold supply for countries outside China has actually been falling since 2009!
That’s Not All

Another trend to take in to account is China’s growing interest in natural resources – basic materials, energy, and others. What gets underreported, however, is that the Chinese are also purchasing gold mines. Here is a list of Chinese gold-mining acquisitions over the last year:

November 2011: Baiyin Nonferrous Group completes a takeover of Gold One International, a gold operator in South Africa. 

December 2011: China Gold International Resources Corporation buys a gold mine in Central Asia, and is reported to be looking at Canada and Mongolia for its next targets. (It bought Canadian gold miner Jinshan a few years ago.) 

December 2011: The Chinese take control of A1 Minerals, a gold exploration and production company, and rename it Stone Resources Australia. 

December 2011: Shanghai investors buy a controlling stake in the Australian-owned Zara gold project in Eritrea. 

April 2012: Sovereign Gold partners, along with Jiangsu Geology & Engineering, pay $4 million for a 30% interest in two gold tenements (an area of land in Australia where the holder may conduct exploration or mining activities). In November 2012 the firm increased its funding to fast-track exploration and development of the projects. 

August 2012: A subsidiary of Zijin Mining Group (China’s top gold producer by output) buys more than 50% of Norton Gold Fields, acquiring a large, operating gold miner. 

August 2012: China National Gold Corporation announces a $3.9 billion bid to acquire African Barrick Gold, Tanzania’s largest gold miner. If the deal is approved, China National Gold’s production capacity will double. 

September-December 2012: China’s Shandong Gold Group announces its intention to purchase 51% of Australian gold miner Focus Minerals, which has four active mines in Western Australia. The deal is expected to be completed early this month. 

November 2012: China-based Western Mining Group, through its subsidiary, buys all the outstanding shares of Inter-Citic Minerals, a Canadian-based gold exploration and development company..

The facts can’t be denied: China is on the hunt for gold deposits and mines. These gold-focused deals will add more ounces to the country’s pool of gold assets. Just the three most recent acquisitions (Focus Minerals, Norton Gold Fields, and Inter-Citic Minerals) contain 12.5 million ounces of gold resources.

As the Chinese have publicly stated before, acquiring large amounts of gold on the open market would almost certainly drive prices higher, as well as trigger greater volatility. One way to get around that is to purchase deposits that either are or will be producing the precious metal, allowing them to accumulate the gold before it hits the international market – and at cheaper prices than spot. In spite of the gargantuan quantity flowing through Hong Kong, it’s entirely possible that we are underestimating China’s demand.

In light of all this, it seems clear that concerns about future supply are real.

Dees Illustration

Jeff Clark
Casey Research

While the price of gold has languished in a trading range much of the year, leaving some investors scratching their heads, many have been buying – and in some cases, really loading up.

It’s a tad puzzling that gold hasn’t broken into new highs, despite enough catalysts to move a herd of stubborn mules. But that’s the hand we’re dealt right now. We can’t get up from the table until the game reaches its conclusion. Besides, I think the stall in prices is giving us one last window to buy before prices break permanently into higher levels for this cycle.

At least that’s how a number of prominent investors and institutions are viewing the price action right now. Here’s a sampling of this year’s “gold bugs” and what they’ve been doing about precious metals recently.

Jim Rogers, billionaire and cofounder of the Soros Quantum Fund, publicly stated last month that he plans to “sell federal debt and purchase more gold and silver.”

George Soros increased his investment in GLD by a whopping 49% last quarter, to 1.32 million shares. His stake is now worth over $221 million. Many investors don’t realize that he also placed call options on GDX worth $9 million. The most logical explanation is that he thinks gold equities are undervalued and that there’s big money to be made in them within a year.

Marc Faber mocks those claiming gold is in a bubble. “It’s nowhere close to that stage,” he says. And even though he’s already sitting on a huge gain, he won’t take any profits. Why? “I keep a picture of Mr. Bernanke in my toilet, and every time I think about selling my gold, I look at it and I know better!”

Brent Johnson, a San Francisco hedge-fund manager, believed in gold so much that he started his own gold fund, Santiago Capital, earlier this year. His latest video points out that there have been “278 global easing moves in the last 14 months.” How does someone not own gold in that kind of environment?

Don Coxe, a highly respected global commodities strategist, stated at the Denver Gold Forum that “now is the best climate I have ever seen for an increase in gold prices.” He told fund managers, mining analysts, and mining executives to prepare for significantly higher gold prices and thus higher gold-mining-stock valuations. “The opportunities ahead are the best I’ve seen.” He thinks a new gold rush is ahead for gold stocks, and that a “lustrous” rally will occur within a year.

Jeffrey Gundlach, cofounder of DoubleLine Capital, predicts that deeply indebted countries and companies will default sometime after 2013. Central banks may forestall these defaults by pumping even more money into the economy – but at the risk of higher inflation in coming years. He recommends buying hard assets including gold, and also “gold-mining firms because we consider them to be bargains.”

Rob McEwen, CEO of McEwen Mining and founder of Goldcorp, is buying precious metals because he believes gold will someday hit $5,000 and silver $200.

Savneet Singh, a former investment analyst at Morgan Stanley, was frustrated with the options available to acquire physical gold in an allocated, whole-bar format outside the banking system. He started Gold Bullion International, the platform service used by the Hard Assets Alliance, a service that virtually does away with the need to buy GLD.

This is only a handful of individual investors who have made recent news with their bullion buying. But institutions, governments, and others are participating, too…

Central Banks

• The South Korean central bank added 14 tonnes (approximately 450,000 troy ounces) of gold in November, and now holds six times more than back in June of 2011. “Gold is a physical, safe asset, and allows us to deal with changes in the international financial environment more effectively,” bank officials said.


• Brazil bought 18.9 tonnes (607,650 ounces) in September and October alone. It will likely buy more, since gold still accounts for only 0.8% of its reserves.


• Paraguay bought 7.5 tonnes (241,130 ounces) in July.


• Turkey imported 4.2 tonnes (135,000 ounces) of gold in November. It has bought 117.2 tonnes (3.7 million ounces) so far this year, almost double last year’s purchases.


• Central banks around the world bought a total of 351.8 tonnes of gold (11.3 million ounces) in the first nine months of 2012, up 2% from a year ago.


• Even Argentina added 7 tonnes last year (225,000 ounces), and Colombia 2.3 tonnes (almost 74,000 ounces).


• And of course there’s China. While nothing official has been announced by its central bank, its imports and buying habits are mind-boggling.

These data suggest in and of themselves that dips in the gold price are likely being bought – and will continue to be bought – by central banks. They’re not exactly short-term traders. Remember, central banks were net sellers as recently as 2009, so this reversal will likely play out for years.

India. I tire of the reports that proclaim something like, “Indian buying dropped this month!” Let’s be clear about India and gold: Imports have more than doubled in three years (through 2011), and investment demand has climbed almost fivefold. And all this occurred while prices were rising and from a nation that already has a strong cultural predisposition towards the metal. Further, silver demand is taking off: sales have jumped 24% this year over last.

There is some government interference, but no slump in demand in India. This trend will continue and may even strengthen when inflation begins making front-page headlines.

Germany. A precious-metals group recently reported that Germans are increasingly buying gold because of fears about economic uncertainty, and that a third of citizens are now considering gold as part of their investments. “There has been a significant increase in demand in recent months because of worry about actions taken by the European Central Bank and US Federal Reserve, as the two central banks seek to counter the euro zone crisis and slow US economic growth.”

Commercial Banks

• Morgan Stanley’s preferred metal exposure for 2013 is gold, though the company expects silver to outperform it. The bank stated that it believes “nothing has changed with gold’s fundamental thesis: QE 3 (and 4…) and similar commitments from the ECB and BoJ; low nominal and negative real interest rates; ongoing geopolitical risk in the Middle East; and mine supply issues.”


• ScotiaMocatta stated that it will “not be surprised to see prices reach $2,200/oz.” Why? “One of the main reasons we are still bullish is because of the mess the Western world is in. Europe has a debt problem that is proving all but impossible to solve, and all efforts to date have revolved around throwing more money at the problem to avoid the monetary system from breaking down… that should be reason enough to be bullish.”


• Deutsche Bank released a new report essentially declaring that gold is money. “We see gold as an officially recognized form of money for one primary reason: it is widely held by most of the world’s larger central banks as a component of reserves. We would go further, however, and argue that gold could be characterized as ‘good’ money, as opposed to ‘bad’ money which would be represented by many of today’s fiat currencies.”


• Bank of America Merrill Lynch says gold will hit at least $2,000 by the end of 2013.


• JP Morgan now accepts physical gold as collateral.


• Another source of demand from banks could be the change in Basel III regulations. If you haven’t read about it, gold could get promoted to Tier 1 status, meaning it would be considered a “zero-percent risk weighted item.”

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Eric Sprott recently wrote:

If the Basel Committee decides to grant gold a favourable liquidity profile under its proposed Basel III framework, it will open the door for gold to compete with cash and government bonds on bank balance sheets – and provide banks with an asset that actually has the chance to appreciate. Given that US Treasury bonds pay little to no yield today, if offered the choice between the ‘liquidity trifecta’ of cash, government bonds or gold to meet Basel III liquidity requirements, why wouldn’t a bank choose gold?

We’ll be watching the news on this topic.

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None of these parties think the gold bull market is over, nor the price too high. They recognize the implications of a world floating on fiat currencies, and that government “solutions” to debt and deficit spending will significantly – perhaps catastrophically – dilute the value of currencies, the fallout of which has yet to materialize. As for me, I think that the longer the malaise continues, the more likely the breakout is to be both sudden and dramatic.

We can all speculate about when the next leg up for gold will kick in, but the point for now is to take advantage of the weakness, like many of these gold bugs. When the price breaks out of its trading range, are you sure you won’t wish you’d bought a little more?

I say give you and your loved ones a lasting Christmas gift and call your favorite bullion dealer.

Now is a great time to give yourself another gift… one that will make next year’s holiday season even brighter. There’s currently an anomaly in the metals market that can bring astute investors life-changing gains. Learn more about it and get started today.

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Susanne Posel, Contributor
Activist Post

In 2011, the technocrats devised a scheme, with the assistance of Hans Hoogervorst, appointed chairman of the International Accounting Standards Board, that Europe would be included in IFRS9, a new rule that eliminates mark-to-market accounting of sovereign debt from the European Central Bank’s balance sheets.

When mark-to-market practices were installed in 2009, it led to a short-term market recovery, which presented a false positive as banking institutions no longer had to provide capital to promote long-term financial stability. In the Euro-Zone, banks can now conduct business as sovereign debt becomes the only path that can be taken by countries being affected by the technocratic takeover.

Under the guise of creating jobs, Ben Bernanke, chairman of the Federal Reserve Bank, is buying back mortgage-backed securities. At a steady $85 billion per month, Bernanke is quickly becoming the biggest landowner in the United States. This plot is turning Federal Reserve fiat into hard assets at an alarming rate, as the technocrats implode fiat currencies across the globe.

As the multinational corporations have moved domestic US manufacturing offshore, our nation has been severely deindustrialized. Because of the North American Free Trade Act  combined with QE3, the central bankers can drive up food costs to astronomical levels while acquiring commodities futures on the stock market to profit from this planned implosion.

As the value of the US dollar drops consistently, BRICs nations have begun backing their fiat with precious metals like gold. When China trades with Iran to obtain oil with gold, Organization of the Petroleum Exporting Countries (OPEC) cannot manipulate the system as they have done for decades whereby they took excess US dollars acquired and purchased US Treasury bonds to prop-up the US financial system.

The result of the actions of BRICs nations is the systematic death of the petrodollar, and the US dollar as the global reserve currency. Without money laundered from OPEC to the US Treasury, there is less financial backing for the Zionist funding for war in the Middle East.

To further punish BRICs nations for circumventing the technocrats, the New York Department of Financial Services announced that the Standard Chartered Bank, housed in the UK, would have their operations suspended because of $250 billion that were transacted to Iran, as US regulators use financial terrorism against this Middle Eastern nation.

In October, President Obama signed an executive order that claims governmental authority to steal money out of customer bank accounts of those judged to have assisted Iran with “certain transactions” that would facilitate their ability to economize on their petroleum resources. And this agenda is hidden within the EO that redirects attention to the sanctions imposed by the US and UK.

Obama has empowered himself, Hillary Clinton as Secretary of State, and Timothy Geithner as Secretary of the US Treasury to use authority imbued to them by the President that the US government would impose any amount of sanctions on Iran for the sake of bringing the nation to its economic knees.

This includes prohibition of:

• US banks loaning money to Iran or any person involved in Iranian interests.


• Using credit cards to facilitate interests of Iran or any person involved with Iran.


• Acquisition of property and interests in property by the US government of any person suspected of aiding Iran or their interests.


• Sanctioning individuals against investing or purchasing with intended profit for Iran.


• Prohibition of individuals importing goods, services, or technology for the benefit of Iran.

With the US dollar failing, the only out by the technocrats is to further implode the fiat so that a new global currency can be introduced. The Institute of International Finance (IIF), a group of technocrats that represent 420 banking cartels and financing houses have joined the cry for a one world currency.

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In May, The UN Conference on Trade and Development (UNCTAD) issued a report proposing that the current system of world currencies and capital rules that govern the world’s economy need to be altered in order to stabilize our economic crisis.

UNCTAD wants to see the BRICs countries, known as the non-aligned nations, considered surplus nations, cut their imbalances, thereby taking the financial burden off of the UK and US as upholding the global reserve currency.

A global monetary system that replaces the US dollar as the global reserve currency will accomplish this goal.

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The UN proposes a complete overhaul. In the report “Adapting the International Monetary System to Face 21st Century Challenges”, they call for:

more intense debate on and reforms to the international monetary system imply that the current system is unable to respond appropriately and adequately to challenges that have appeared, or have become more acute, in recent years. This paper focuses on four such challenges: ensuring an orderly exit from global imbalances, facilitating more complementary adjustments between surplus and deficit countries without recessionary impacts, better supporting international trade by reducing currency volatility and better providing development and climate finance. After describing them, it proposes reforms to enable the international monetary system to better respond to these challenges.

They recommend movement toward a global currency that will replace all current currencies. Revaluation will be accessed and the worth of money would redistribute with oversight of the IMF, WTO and ultimately the United Nations.

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Zionist-controlled Goldman Sachs has directed their clients to sell their stocks as the US economy falls over the financial cliff created by the technocrats. David Kostin, chief US equity strategist for Goldman Sachs explained:

Political realities and last year’s precedent suggest the potential that Congress fails to reach agreement in addressing the fiscal cliff is greater than what most investors seem to believe based on our client conversations.

Knowing that there is a big push in the financial world for acquiring hard assets, George Soros has sold his stock in CitiGroup, JPMorgan Chase, and Goldman Sachs and is buying a reported $130 million worth of gold.

According to the World Gold Council, the central bankers are also amassing massive amounts of gold to the tune of 157.5 metric tons in 2012.

Susanne Posel is the Chief Editor of Occupy Corporatism. Our alternative news site is dedicated to reporting the news as it actually happens; not as it is spun by the corporately funded mainstream media. You can find us on our Facebook page.

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Youtube

MUST SEE documentary especially since there are rumors that China is planning to back its Yuan with gold.

VITAL ARTICLE:
Central Banks are the Real Target for West’s Imperial Wars

Dees Illustration

Jeff Clark
Casey Research

Bloomberg reported recently that Russia is now the world’s biggest gold buyer, its central bank having added 570 tonnes (18.3 million troy ounces) over the past decade. At $1,650/ounce, that’s $30.1 billion worth of gold.

Russia isn’t alone, of course. Central banks as a group have been net buyers for at least two years now. But the 2012 data trickling out shows that the amount of tonnage being added is breaking records.

The following table lists the countries that have added to their gold reserves this year, while the second one tallies those that have been selling. You’ll see how recently each country has reported, along with its percentage increase.

Based on current data, the net increase in central bank gold buying for 2012 was 14.8 million troy ounces – and that’s before the final 2012 figures are in for all countries.

This is a dramatic increase, one bigger than most investors probably realize. To put it in perspective, on a net basis, central banks added more to their reserves last year than since 1964. The net increase – so far – is 17% greater than what was added in 2011, which was itself a year of record buying.

Here’s a picture of total central bank reserves since the financial crisis hit.

Whatever gold’s price movements, positive or negative, central bank officials have continued adding a lot of ounces to their reserves.

But this understates the case, because most of the data exclude China, as well as a few other small countries. China last officially reported gold reserves in 2009, so the totals in the chart since then exclude whatever its purchases might have been.

Here’s where it gets interesting: Bloomberg claimed that Russia has been a bigger buyer of gold over the past decade than China – by a full 25%. Based on data about gold imports through Hong Kong and the fact that, for the most part, Chinese production doesn’t leave the country, it seemed to me that this could not be right.

The Chinese central bank holds an official 1,054 tonnes of gold in its reserves. Bloomberg states, based on IMF data, that China has added somewhere around 425 tonnes over the past decade.
I can’t say exactly what the correct number is, but the Bloomberg number almost has to be wrong. Here’s why:

• Gold imports through Hong Kong in December alone hit a record high of 109.8 tonnes.

• Imports for 2012 also hit a record high of 572.5 tonnes.

• If you add 2012 mine production – remember that China is now the world’s largest gold producer – roughly 970 tonnes of gold was delivered to various entities within the country last year.

• Cumulative imports since 2001 have reached 1,352 tonnes.

• Since 2001, imports plus production total a whopping 4,793 tonnes.

So Bloomberg is essentially saying that roughly 10% of the total gold available inside the country during that period was added to China’s reserves. While it’s true that Chinese citizens are buying a lot of gold (though perhaps more silver), it’s highly doubtful that private parties bought 90% of all the gold brought to the Chinese market during this period. I think – but can’t prove – that China’s central bank is buying more gold and at a faster pace than its Russian counterpart.

Jim Rickards, a highly respected author and hedge fund manager, said last month that China has probably already accumulated between 2,000 and 3,000 tonnes of additional gold reserves. If he’s right, that would be roughly double or triple the 1,054 tonnes it reported in 2009 – not the 40% increase Bloomberg‘s numbers suggest.

At the very least, we can say that the Bloomberg report left consideration of China’s imports and production out of its report naming Russia the top gold buyer of 2012. Okay…but so what?

Well, Jim thinks the next big catalyst for gold will be an announcement from China about its reserve position. Here’s what he told me in late December:

The catalyst for a spike into the $2,500 to $3,000 price range for gold will be an announcement by China, probably in late 2013 or 2014, that they have acquired 4,000 tonnes or more in their official reserve position. This will put China on an equal footing with the US in terms of a gold-to-GDP ratio, and validate gold as the real foundation of the international monetary system. Once that position is validated, gold will move to the $7,000 range in 2015 and beyond.

Even if Jim’s estimate is high or China doesn’t make an announcement until later, it’s clear that central banks around the world are buying gold in record quantities.

It almost makes you wonder… do they know something we don’t?

The Russians gave us some hints.

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“The current international currency system is the product of the past,” said Hu Jintao, General Secretary of the Communist Party of China.

Others have provided clues as well.

“We’re in the midst of an international currency war,” said Guido Mantega, finance minister of Brazil.

“Quantitative easing also works through exchange rates… The Fed could engage in much more aggressive quantitative easing, to further lower the dollar,” said Christina Romer, former chair of the Council of Economic Advisors.

Economist Kyle Bass recently spoke to a senior member of the Obama administration about its planned solutions for fixing the US economy and trade deficit. When he asked, “How are we going to grow exports if we won’t allow nominal wage deflation?”, the answer he got was, “We’re just going to kill the dollar.”

Yes, we’re talking about the US dollar. Perhaps some investors have gotten complacent about the risks to the world’s reserve currency – but not central bankers. It’s not hard to see why: whether they admit it or not, central bankers must know what it means to run the printing presses the way the US has since 2008, even if price inflation is not immediately obvious. It’s no surprise they want to hedge their bets, moving more reserves into something with actual value… something that can’t be debased by a few computer keystrokes by an increasingly unfriendly government.

The US dollar has been the world’s reserve currency since WWII. That’s beginning to change, and the movement into gold is just one facet of that change. The buying by central banks is exactly what one would expect to see as we approach the end of the dollar hegemony.

The message from central banks is clear: they expect the dollar to move inexorably lower. It doesn’t matter that it’s been holding up against other currencies or that the economy might be getting better. They’re buying gold in record amounts because they see a significant shift coming with the status of the dollar, and they need to protect themselves against that risk.

This leads to a second message: gold is not overpriced, in spite of the 500%+ increase since 2001. Indeed, with the recent correction, central banks are likely buying more, even as you read this.

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Bloomberg and other mainstream media outlets could be caught off guard when China announces higher gold reserves than expected – perhaps much higher.

Clearly we should take notice. If central banks are preparing for a major change in the value of the dollar, shouldn’t we? The fact remains that the US dollar cannot and will not survive the ongoing abuse heaped upon it by government planners and federal officials. That not only means the gold price will rise, but that many, if not most currencies, will lose a significant amount of purchasing power. This has direct implications for all of us.

Embrace the messages central bankers are telling us – the ones they tell with their actions, not their words. Buy gold. Your financial future may very well depend upon it.

While buying gold will protect your purchasing power, your best bet at growing it substantially is to stake claims in little-known companies that mine precious metals. That’s how Doug Casey, Rick Rule, and other well-known contrarian speculators made their millions. To learn exactly how they did it – and how you can too – sign up for Downturn Millionaires, a free video presentation from Casey Research.

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