Gold and Silver Links

OIL. The Black Plague?

2020-04-30T14:34:00.000+12:00

Oil.The Black Plague.

On April 20^th 2020 the price of oil in the futures market went negative $35.00 per barrel. What does this mean for the price of fuel? Nothing!! That’s if you live in New Zealand. Elsewhere around the globe prices have dropped. So why has the price all of a sudden gone negative? It has to do with the storage of oil. Because of the Covid 19 scare there has been a lack of demand for what once was black Gold.

Everyone who consumes oil and it’s by products are safe and sound in their homes with their vehicles left idle. This has flooded the market with an over-supply and has burdened the storage facilities that hold bulk oil whether it’s at the refinery side or the distribution side of the market. I am not an expert on futures markets but I will hopefully give “you” the reader a sound condensed explanation on market theory here.

There is a disconnect between futures prices verses actual commodity spot prices. On one hand The Futures (virtual) price is based on an entity (market trader) taking out a contract at a particular price in the future for a commodity.

In this case when the contract was due for April delivery, unfortunately the buyer/s were unable to take delivery as they may not necessarily be in the oil industry and are without the facilities to store the commodity. They then panic sold off their position to a point where they had to pay another entity to take it off their books to avoid hefty storage charges. There is also a big probability that next month’s due contracts are going to make the futures market in oil even more dire with maybe -$100 price per barrel (PPB).

Normally traders would make a huge profit on their forecasting but in this situation they have got it wrong by a long shot and are now having to pay dearly. There is no doubt, there are some ‘broke’, brokers out there that have up until now, done well in the virtual oil markets by trading this way.

On The other hand the commodity spot price that deals in the physical oil market has also dropped significantly due to the same dilemma to storage. The PPB is under the $20.00 mark which makes it very challenging for those in the oil industry to make a profit. This could well lead to oil companies as well as exploration and refining companies to go into liquidation. This would then have a drastic effect on global economies, especially those reliant on oil, which is 100% of the industrialised world.

Mass unemployment is set to stalk those associated with these industries. Currently the storage units are full of over supplied affordable supply and there are tanker loads anchored in ocean streams all over the world awaiting dis-charge. I fear that as lockdown continues of citizens that the scenario I have just professed will come to fruition.

From there we could see an internationalising of the oil industry where a few at the top may be cornering the market to have total control. This I call global socialism, the same entities bailing out nations with debt through central banks could be sitting back waiting to do the same with oil to create that total global control and manipulate future pricing.

With this scenario in play we may see over supply rapidly turn to high demand as the new oil conglomerate which I will name ‘The Beast’ struggles to maintain the output required as countries try to get back to the ‘old’ normal. ‘The Beasts’ struggle to maintain this imminent situation will be due to liquidated companies within the oil industry including exploration, refining, transportation, storage and fuel outlets hindering production and logistics.

There is also another scenario that may play out here and that’s the possible demise of the US dollar as it was introduced in 1971 as the Petrodollar to replace the then gold backed dollar. This association with oil and the fact that the central bank of central banks, the non-federal, Federal Reserve, which is the lender of last resort and is currently bailing out central banks throughout the world, to supply individuals stimulus money to get them through their government enforced global lockdown due to a pandemic, or what many are calling a plandemic.

With a lack of petrodollars buying oil and unprecedented money supply (debt) to the world, a financial pandemic may well have been unleashed upon us with the symptoms being out of controlled global inflation. The contagion would spread from currency to currency until it roosts where it was manufactured and the USD would plummet into the abyss.

This financial pandemic may prove to be more violent causing more loss and pain than the Convid 19 strain that has had us locked up in our homes indefinitely. What the future brings is uncertainty, we need to brace ourselves for massive financial change, there is no doubt going to be data showing unprecedented unemployment, mortgage stress leading to foreclosures, business failures and liquidations, suicides and stress related illnesses.

With the global shut-down, all this stimulus and also in countries where fuel is heavily taxed there’s another problem evolving and that is, where will the revenue governments are dependent on, come from?

Watch out and be concerned about negative interest rates, as when the banks go negative they will have a continuous supply of peoples savings that you, the people, have chosen for them to safely store for you in their care, they will charge you weekly for that ‘safe storage’ and no doubt the government will hop on board and take a slice of that for themselves. Watch for death taxes and capital gains taxes to be introduced if your government hasn’t already implemented them and beware of increases if they have. Watch also for increases in GST, VAT etc. if implemented in your country or do not be surprised if your government implements a similar tax.

A great way to help protect yourself from this is to invest in PM’s (precious metals), both silver and gold are safe havens in times of financial crisis and it’s possible that the gold price does the inverse as to what has just happened to the oil market.

The reason I say this is because what has happened in oil throughout this financial crisis (not health crisis), the opposite is happening in the PM’s markets. Where the floor has collapsed on oil the stratosphere could be opening up for the metals to skyrocket.

Currently there’s been a rush on physical metals to the point that demand has outpaced supply and with refineries and mines shut through CV as well as some investors asking for physical metal from their ETF (Exchange Traded Funds) holdings there’s extreme pressures on price.

Like the oil market there’s futures trading in metals and the futures sets the spot price. However the spot price is dislocating from the actual price, whereas the spot to actual would normally produce a minimal margin for the seller, these premiums have increased quite substantially.

So if you are interested in PM’s as an investment then please look at the spot price verses the actual physical price and whether you would rather be in physical or an unbacked gold holding. I would prefer to own physical because it’s nobody else’s liability, therefore if you hold it, you own it!! Possession is nine tenths of the law!!

There are other safe ways to own the metal without the hassle of safe storage etc. and that’s to own mining stocks, these tend to go up along with the market and sometimes depending on the companies’ fundamentals can have a greater return than the metal itself. If you are in America and have an IRA another way is to have it invested is in gold. Please do not regard this as financial advice as I am not a financial planner or expert, please do your own due diligence.

By Chris Collins.

Key to Obama's Woes?

2014-01-06T15:41:00.002+13:00

Why would the US President want to hang out with a colonial from a remote South Pacific archipelago?

In the last few years President Obama and New Zealand Prime Minister, John Key, appear to have developed a bond.

Evidence of this bond included an opportunity In October 2013 when PM Key had the privilege to chair the APEC Summit upon President Obama’s request due to The President’s absence.

In the past week the pair met on par at a military golf course in Hawaii. PM Key and Key Jr. (Max) were invited whilst on vacation at the $5.5m property the Key’s own on the Island of Maui. President Obama was also on vacation in Hawaii and extended the invitation after an agreement made at a previous gathering between the two leaders to get together for a round of golf.

Speculation will always abound, therefore, is this acquaintance based on a personal or political agenda or both?

This could have been purely for friendship, timeout for some recreation with a fellow leader. We all need it.

If there are other means, what does the US gain from such a relationship with little NZ?

NZ Has up until recently had a cool relationship with the US, this is due to NZ’s 1987 anti-nuclear stance bought about by the then PM, the late Honourable David Lange by introducing a nuclear free policy .

Since Key and Obama have taken their office, spring has sprung in the bilateral relations between the two nations and a thawing has taken place.

Lately free trade talks have taken place with the Trans Pacific Partnership (TPP) involving 12 nations including the US and NZ.

NZ’s growth has been ahead of the rest of the world in 2013, according to the National Inflation Association (NIA):

New Zealand's GDP grew by 1.4% in 3Q 2013 vs. 2Q 2013, beating economist expectations of 1.1%, and nearly 5X higherthan quarterly GDP growth in the previous quarter of only 0.3%. This was NZ's highest quarterly GDP growth in 4 years!

On a year-over-year (yoy) basis, NZ's 3Q 2013 GDP was up 3.5%, well surpassing its yoy GDP growth in 2Q 2013 of 2.3%. This was NZ's strongest annual GDP growth in 6 years! NZ's 4Q 2013 yoy GDP growth is now forecast to rise to 3.71% vs. 2% in the U.S., 1.8% in the U.K., 1.6% in Canada, and -0.5% in the Euro Zone.

NZ's 2014 budget deficit is projected to fall to only -1.4% of GDP vs. -5.8% in the U.S., -5.9% in the U.K, -2.2% in Canada, and -2.5% in the Euro Zone. NZ is projected to reach a budget surplus in 2015! The only other major developed economies projected to have a budget surplus in 2015 are Germany and Norway!

NZ has very low debt levels compared to other major developed economies. NZ is projected to end calendar year 2013 with a debt/GDP ratio of only 33.89% vs. 103.75% in the U.S., 94.3% in the U.K., 84.57% in Canada, and 95.13% in the Euro Zone. NZ's unemployment rate just fell to 6.2% vs. 7% in the U.S., 7.4% in the U.K., 6.9% in Canada, and 12.1% in the Euro Zone.

NZ will be the BIGGEST BOOM economy of 2014, especially since it has been invited to participate in next year's G20 meetingsfor the first time ever. NZ in 2014 will become widely recognized as the world's leading agricultural economy.

With such growth, the US may envy and may need some guidance for their economy. Yeah Right!!!

There is perhaps another aspect to this growing relationship between these two individuals.

The US is in crisis, their dollar is plummeting, unemployment is rife, the debt of the US is out of control and another debt ceiling limit looms in this coming February/March.

Perhaps both on a personal and political level John Key may be the key that Obama is looking for to unlock a way out of America’s woes!!

This is where PM John Key may be able to offer President Obama some advice. You see!! PM John Key is only the PM because of a childhood dream. As a parliamentarian in NZ one could ill afford such luxuries as a $5.5m vacation home in Hawaii. Here’s a bit of background that was his life before that of a Prime Minister according to Wikipedia.

Key's first job was in 1982, as an auditor at McCulloch Menzies, and he then moved to be a project manager at Christchurch-based clothing manufacturer Lane Walker Rudkin for two years. Key began working as a foreign exchange dealer at Elders Finance in Wellington, and rose to the position of head foreign exchange trader two years later,then moved to Auckland-based Bankers Trust in 1988

In 1995, he joined Merrill Lynch as head of Asian foreign exchange in Singapore. That same year he was promoted to Merrill's global head of foreign exchange, based in London, where he may have earned around US$2.25 million a year including bonuses, which is about NZ$5 million at 2001 exchange rates. Some co-workers called him "the smiling assassin" for maintaining his usual cheerfulness while sacking dozens (some say hundreds) of staff after heavy losses from the 1998. Russian Financial Crisis. He was a member of the Foreign Exchange Committee of the New York Federal Reserve Bank from 1999 to 2001.

John Key’s wealth is estimated to be $50m.

PM Key may well be advising President Obama on an imminent global currency reset which has been forecast to take place. Currency Wars author James Rickards is one whom has made such a forecast back in July 2013 he stated:

‘Now we are all at sea. Nobody knows which currency to follow,’ he said. ‘Some economists argue that we should have multiple reserve currencies but that is just too unstable’.

His forecast is that the IMF will issue a new reserve currency know as a Special Depository Receipt which it has actually previously done in crisis situations in 1972, 1983 and 2009.

‘The US dollar could collapse much faster than you might think. A complete collapse of confidence in the dollar is much closer than ever. But nobody knows exactly what the crucial threshold will be.’

So there you have it!! Perhaps a game of golf is a smoke screen to an alliance in strategizing for what may be upon us. So how does one prepare for a reset? Here’s Jim Rickards again with a clue:

In order to reset the monetary system this time Mr. Rickards argues that the gold reserves of the global central banks will be absolutely essential with 20-40 per cent gold backing sufficient.

Gold has had a beating throughout 2013, a slight reprieve from its’ bull-run from 2003 up to Sept 2011. This run may well continue at an even greater rate of knots.

If you haven't done so already, purchase some precious metals NOW!!!

Disclosure of Material Connection: Some of the links in the post above are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising. ”GFFNVCCF131138661

A Game of Two Halves

2012-08-16T00:44:00.002+12:00

GOLD RISING?

Gold is on the rise!! or is it? Those ignorant of the market conclude that gold is too expensive which keeps them out of the game. There's speculation that because of the recent volatility that Gold has peaked and heading down, therefore would-be investors stay on the side-lines. It is however bullish, the proof is historical, have a look at this chart. the rule of thumb is, as the dollar declines the gold price rises and as the dollar rises the gold price declines, the market is not unlike two sports teams battling it out.

RUGBY: THE GAME

Here in New Zealand, rugby is the sport of the nation, each winter the hearts of most New Zealanders are warmed up by a clash between the NZ All Blacks and the Australian Wallabies. The All Blacks, whose uniform is 'All Black' which incorporates the New Zealand silver fern insignia over the hearts of the players, could well be represented as the dream economy, as every nation would love to forever be in the black with their currency backed by true wealth. Silver.
The Wallabies in their green and predominantly gold livery are representative of the gold currency, maybe it's no co-incidence the "Lucky Country's" first two letters are the symbol for gold, as it producers 10% of the worlds annual gold supply.
Although the precious metals price looks good over the long term, the volatility over the short term mirrors the competitive nature of when these two giants in rugby meet.

THE BATTLE

In the game there's two 40 minute halves and the battle is for possession and territory upon the 100m long playing field. The referee and his side-line cronies (touch judges) can easily control the game, not unlike the (presumed) manipulators in the precious metals market. The teams can battle backwards and forwards but the referee can often make a wrong call and give either team an advantage at the disgust of opposition supporters. The supporters of the game are likened to investors who are either long or short of the market but depending on the mood and timing of the manipulators, things can fall apart for the investors very quickly. During the game there are infringements which can turn the game into either teams favour. Similarly, in the market certain events can add support or bring resistance before determining an outcome.

MANIPULATION

The game I have outlined here to mirror a clash of two of the worlds greatest rugby teams is the battle between two precious metals, however in the real market silver and gold (real money) work in unison and together they battle failing currencies and suspected manipulators. The battle against currencies is a foregone conclusion, the proof of gold winning over paper is its significant rise over the past 10 years . When we hear the experts tell us the dollar is strong, it's all froth and bubble, no currency has strength, one is weaker than the other. That's why prices rise, rising prices are the biggest indicator of dollar weakness (inflation). The real battle is with the suspected manipulators, a cartel of speculators that have an abundance of fiat currency to purchase precious metals via paper promises, one day soon the suspects will find that their precious metals purchases are only worth the paper they're written on. These paper promises do not have the backing of the gold and/or silver they represent, the amount of paper promises far out weigh the tangible mined ounces in existence. The more these suspects manipulate, the more suppressed the market becomes.

THE END IS NIGH

The de-valuation of the dollar is occurring now. The Fed is desperately printing currency which is creating inflation, this is a global event, you need to protect yourself from moth and rust destroying your savings. Don't sit on the side-lines, get in the game, buy physical Gold and Silver NOW!!!!!! while it's still cheap, in the end whoever holds the gold holds the power.

A game of two halves.

2010-10-24T02:21:00.002+13:00

GOLD RISING?

Gold is on the rise, or is it? Those unfamiliar with the market automatically think that it's too expensive and stay out of the game. There's a current misconception that because of the current price, Gold's at its peak, therefore, would-be investors stay on the sidelines. It is however, on a bull run, the proof is historical, have a look at this chart, the rule of thumb is, as the dollar declines the gold price rises and as the dollar rises the gold price declines, the market is not unlike two sports teams battling it out.

RUGBY: THE GAME

THE BATTLE

In the game there's two 40 minute halves and the battle is for possession and territory upon the 100m long playing field. The referee and his sideline cronies (touch judges) can easily control the game, not unlike the manipulators in the precious metals market. The teams can battle backwards and forwards but the referee can often make a wrong call and give either team an advantage at the disgust of opposition supporters.The supporters of the game are likened to investors who are either long or short of the market but depending on the mood and timing of the manipulators, things can fall apart for the investors very quickly. During the game there are infringements, these can turn the game to the oppositions favour. Similarly, in the market certain events can either support or resist the way it is headed.

MANIPULATION

The game I have outlined here to mirror a clash of two of the worlds greatest rugby teams is the battle between two precious metals, however in the real market silver and gold (real money) work in unison and together they battle failing currencies and manipulators. The battle against currencies is a foregone conclusion, the proof of gold winning over paper is its significant rise over the past 10 years . When we hear the experts tell us the dollar is strong, it's all froth and bubble, no currency has strength, one is weaker than the other. That's why prices rise, rising prices are the biggest indicator of dollar weakness (inflation). The real battle is with the manipulators, a cartel of speculators that have plenty of paper currency to purchase precious metals via paper promises, one day soon the cartel will find that their precious metals purchases are only worth the paper they're written on. These paper promises do not have the backing of the gold and more significantly, silver they represent, the amount of paper promises far out weigh the tangible mined ounces in existence. The more these speculators manipulate, the more suppressed the market becomes.

THE END IS NIGH

The de-valuation of the dollar is occurring now. The Fed is desperately printing currency which is creating inflation, this is a global event, you need to protect yourself from moth and rust destroying your savings. Don't sit on the sidelines, get in the game, buy physical Gold and Silver NOW!!!!!! while it's still cheap, in the end whoever holds the gold holds the power.

PRESERVE YOUR WEALTH TODAY!!!

2010-06-21T22:43:00.000+12:00

Preservatives

This blog is a warning to all investors, in the current financial crisis, wealth preservation is key to financial survival, there's an enemy that's about to sap all the goodness out of your savings.

Preservatives are ingredients that prevent deterioration, there are two types of preservatives, natural and scientific. An example of a natural preserved substance is jam. In my childhood, my mum used to make jam, she'd label the jam jars as preserve, she'd have raspberry preserve, strawberry preserve, apricot preserve, etc. The sugar in her recipes were what preserved the fruit and gave it consistency and that sweet flavour which enticed the taste buds to go back for more.

Another example of a natural preservative is salt. When I was in my adolescence I would often go opossum hunting and would skin the bounty for profit. When preparing the pelts I would stretch them out on pre-nailed template's which I had made, I would then apply salt to help in the curing process. The salt's abrasive attributes would dry the pelts and once cured, would leave them pliable enough to be then made into rugs or blankets. Modern foods are saturated in preservatives, at least when my mum made jam, she had control of what ingredients to use. If you take a look at the labels bought from the food store you'll find all different types of additives and preservatives (most not healthy).

Takeaway foods are made up of preservatives. There's a particularly popular restaurant of Scottish descent, whose menu is made up of ingredients enriched with preservative. There's even rumour about how the food from there, can be eaten month's later without refrigeration, because of the amount of preservative. One of my friends frequents this establishment, often I quip him on his good looks and youthfulness and tell him "it's the preservatives in the food just doing their job, the more you eat the better you'll look". The downside to preservatives though is indulgence, and too much is bad for you.

Wealth Preservation

In the same way as food needs preservation so too do your savings. In a savings account your savings earn interest, interest not only preserves your wealth, but adds to your wealth. This is great, until you add into your savings an enemy called inflation. If inflation is running at a level higher than your interest rate, then the interest earned may well be worthless and your bank charges will add to the rot setting in on your savings. Savings accounts are good when things are going great in the economy and interest rates are set above the inflation rate. However, in a time as we live in now, with low-interest rates on savings and inflation increasing, then your wealth creating plan may well be in wealth destruction mode. Inflation is set to increase, the wealthiest? nation on earth is currently printing money uncontrollably to overcome its' deficits, the US is racking up debt at an alarming rate, this is going to translate into an inflationary, or most probably, hyper inflationary environment. Inflation is caused by money creation, the more produced the greater the inflation, on one hand prices increase on the other hand the dollar devalues, eventually the currency dies. There are deflationists out there in our scary world, these are people who would tell you the opposite is true, that prices are falling, don't listen to them they are anti wealth preservationists, they are a bit like extremists and socialists of this world. They will tell you things that are not necessarily true and cause all like sheep to go astray and get on board with the lie. If you are an advocate of deflation, then why are our loan payments rising? food costs rising? insurance premiums rising? utilities rising? and our wages stagnating?

New Zealand Economy

Here in New Zealand, the Government issued their budget in May 2010, introducing some positive steps to help the average household, within weeks however the Reserve Bank issued a raise in interest rates which erodes all those positive steps, which will increase inflation. This news came because we are supposedly coming out of recession, while the government borrows $250m per week to offset its deficit. Well the Reserve Bank from my viewpoint is correct and would have all the sheeple think likewise, but my viewpoint is that perhaps we are coming out of a recession but not to the fiscal stimulant side but to the negative 'D' word side, therefore are we coming out of a recession and into a depression? NZ, like the US is borrowing its way out of debt, which will eventually lead to inflation. If your savings are in paper (fiat) currency, then they are at extreme risk of destruction.

The Only True Currency

The true wealth preservative are the only form's of currency that cannot be eaten by moth or destroyed by rust, these currencies are, GOLD and SILVER. Look how Gold has performed against the US dollar on Youtube here. Gold is once again going to be the king of currencies and so it should because gold is a finite commodity of value and is honest currency. An honest currency is one that is of value as gold is and equally backed by the physical asset, giving it accountability. The wealthiest nations in the world have a certain amount of gold in their asset base. The US has the most, some 4000 Tonnes in Fort Knox? This is their insurance for the inevitable collapse. New Zealand has none, the NZ Government however, recently announced it wants to mine conservation land for minerals, in particular gold and silver, does the NZ Government know something?

Invest NOW into Precious Metals

As sovereign currencies collapse, countries will turn to gold and silver as terms of trade and investors will pour in, this will cause the price of gold and silver to rise exponentially. When the US dollar fails, USA's debt will most likely be divided by gold ounces in Fort Knox and probably have some estimated forward years of debt added to its value in order to give a surplus. This will propel the value of gold into the stratosphere and re-introduce a gold backed currency. It's time to invest wisely, get into the market now as a safe haven for the current crisis and immenent global financial turmoil. If you have any questions or would like to comment on my blog, please use the comments box below. Happy preserving.

The contents of this blog are for general information and illustrative purposes only and are not intended to serve as financial, investment or any other type of advice. Any reliance on any information on this blog shall be at the user's own risk. The Blog writer shall not be responsible for any loss or damage of whatsoever nature (including consequential loss or damage) suffered or incurred, directly or indirectly, by the user or any other person as a result of relying on, or incidental to, or the use of, or any matter relating to, the information contained on this blog.

Welcome

2010-06-14T21:19:00.000+12:00

Welcome to my very first blog and posting, I have built this blog out of an urgency for what the world is going through. If you haven't noticed we are living in a recession, unemployment is growing, companies are failing, sovereign debt crisis' are everywhere. There's a reason behind all of this and that's a lack of accountability. When there's a lack of accountability there's exposure somewhere ahead, we've seen it in various industries with the demise of corporations and we are seeing it with the monetary system. Since the Gold Standard was taken away from the monetary system, the only thing backing it is the paper it's written on. The currency has gone from a finite backed hard asset to an infinite backed commodity, so long as there are tree's then there will be money for this system. The Gold Standards' demise occurred in 1971 under President Nixon, when at the time the US incurred out of control debts including those associated with the Vietnam war. The only way to pay their debts to the Foreign lenders was with gold reserves, for the preservation of these reserves the new standard was introduced without the consultation of the members of the international monetary system. This lack of accountability went down in history and was recorded as 'The Nixon Shock' where after the lenders received some payment in gold but mostly in the new (fiat) Greenback. The Greenback has since suffered inflation and deflation but has yet to experience hyper inflation. Hyper inflation is the death rattle of any currency, when it happens, you'd better hope your debt's are paid and you have insurance. Hyper inflation is caused from a supply of money to pay for indebtedness of nations, a modern and recently used terminology to disguise paying of debt is quantitative easing (QE). In essence to explain it simply, the value of currency is no different to the value of anything, the more you produce, the less it's worth. The Federal Reserve is in overdrive printing money to take care of USA's out of control deficit, this in turn is likely to produce an inflation ridden environment and probable currency failure. To protect yourself against any currency crisis, you need to get out of debt and as insurance you need gold or silver. There are various ways to invest, however the best way is to purchase physical metal, tell no-one and store it yourself. Another way is to buy into gold and silver stock indices, these are shares that are made up of shares in the top gold and silver mining companies, this way any due diligence is done for you and you reap the price increases as gold soars and any dividends. Other ways are shares in individual gold and silver mining companies (be careful, do your due diligence) ETF's (use only gold or silver backed funds) and numismatic coins.