Saturday, March 28, 2009

Gold, other commodities retreat as dollar advances

Gold prices retreated Friday, as a stronger dollar sapped demand for commodities.

Energy and agriculture futures also fell.

A resurgence of the dollar, which gained against the euro, the British pound and the Japanese yen, put pressure on commodities Friday. A weak dollar makes commodities cheaper in other countries, which can potentially boost demand. At the same time, demand for gold often increases when the dollar is weak since investors tend to use the yellow metal as a hedge against inflation.

James Steel, an analyst with HSBC in New York, said the dollar's advance against the euro was sparked by comments from the German finance minister that the 16-nation currency could be threatened if euro zone countries take on too much debt.

Gold prices have oscillated in recent days as investors weigh concerns about the long-term potential for inflation — which is a boon for gold — against economic data indicating that demand for goods of all kinds remains weak.

In Britain, economic output contracted 1.6 percent in the fourth quarter, more than expected, according to statistics released Friday. Meanwhile, in the U.S., the Commerce Department said consumer spending edged up a modest 0.2 percent in February, as expected. Personal incomes fell, however.

"The growth in prices is low, that's for sure," said Steel. "The deflationary pressures are likely to keep precious metals down."

Last week, gold surged after the Federal Reserve said it would buy up to $300 billion worth of long-term Treasurys and $1.25 trillion in mortgage-backed securities. That sent the dollar tumbling and rekindled fears about inflation.

Gold for June delivery dropped $16.90 to settle at $925.30 an ounce on the New York Mercantile Exchange. Prices finished the weak down 3.2 percent.

Other metals prices also fell. May silver fell 35.7 cents to $13.2630 an ounce, while May copper futures slipped 1.9 cents to $1.8360 a pound.

On Wall Street, stocks finished lower, but managed their first three-week advance of 2009. Analysts said the day's pullback was expected after the market's big climb this month. The Dow Jones industrial average fell 148 points to finish at 7,775 and the Standard & Poor's 500 index shed 16 points to 815.

Energy prices tumbled on the Nymex, as investors worried that oil's recent gains aren't sustainable amid lingering doubts about the economy.

http://www.iht.com/articles/ap/2009/03/27/business/NA-US-Commodities-Review.php

Tuesday, March 24, 2009

Investor Demand Could Push Gold To Record In 2009

The rising economic uncertainties related to recessionary conditions and increasing joblessness, ever more volatile and vulnerable financial markets and weakening economic conditions that helped spur strong investment demand for gold in 2008 could send gold to record highs above $1,000 this year, CPM Group said Tuesday.

"Investors are concerned about the preservation of the value of their assets amid the massive destruction of wealth over the past year," the commodities research and consulting firm said in this year's closely followed CPM Gold Yearbook.

http://online.wsj.com/article/BT-CO-20090324-715826.html

Sunday, March 22, 2009

Gold: Financial Q&A: Some price advice for investors about to join the gold rush

Q: What is the best way to purchase 100 percent gold coins, what kind are best, and from whom should one buy?

A: Gold-coin and gold-bullion dealers can be found in nearly every major city as well as on the Internet. All are happy to sell you gold, as will the US Mint (usmint.gov).

Because gold is soft and can get damaged in handling, the closest you'll actually come to 24-karat pure gold is 99.99 percent pure. In this arena, the most popular choices are Canadian Maple Leafs and US Buffalos, says David McCarthy, senior numismatist at Kagin's, a coin-and-gold dealership in Tiburon, Calif. Each coin is minted by their respective governments.

The biggest selling coin, however, is the 22-karat American Eagle. Because it is less pure, it weighs slightly more than one ounce. But it still contains precisely one ounce of this increasingly popular metal.

Because all of these coins, as well as the South African Krugerrand, contain one ounce of gold, their price calculations are fairly easy. Other coins may have a lesser content or a lower karat weight, so you'll need a calculator whenever you try to peg it to the commonly traded price of one troy ounce.

After you find a seller, determine which coins you want and the price. This is a very volatile market, and Mr. McCarthy says that a quoted price is basically good for as long as you hold the coin in your hand. If you see a price you like, be prepared to act.

But more important, ask the dealer how much of a premium he'll assess. McCarthy says he typically charges a 2-to-3 percent markup over his cost of a coin. He's seen it 10 percent or more elsewhere. One ad, for example, listed a Gold Eagle at $1,025, or 11.8 percent more than the going rate of $916 per ounce as of March 7.

Gold prices are set twice daily by the London Bullion Market Association, at lbma.org.uk, or throughout the day by the Comex division of the New York Mercantile Exchange, at nymex.com.

Q: Can one own too many charitable annuities? It seems a wonderful way to donate to worthy causes and help them over the long term, especially since the funds (in my case) are directed to them. For me, the added quarterly or monthly income is welcome. I'm now considering this type of donation to a summer camp program for children. That would make it No. 4. Is that too many?

A: It's perfectly fine to have several gift annuities. In fact, it isn't uncommon for a single donor to have 20 or even 30 gift annuities at a time, says Johni Hays, an attorney with Stelter Co., a Des Moines-based firm that supports the charitable giving industry.

Briefly, a charitable gift annuity involves donating funds to a qualified charity of your choice – a college, hospital, or summer camp, for example. In return, donors will likely be entitled to a tax break for their gifts, and the charity will give them a predetermined amount of money each year. When a donor dies, the nonprofit keeps any of the original gift amount that remains.

Ms. Hays says these annuities have become popular because they provide higher rates of return than a typical stock dividend or savings account. And the repayment amount rises with your age.

The underlying question to ask might be more about how much of your total net worth is comprised of gift annuities. Because you no longer have access to the principal once it's given to a charity in exchange for a charitable gift annuity, Hays says that you'll want to be certain that you still have access to other funds in the event you might need them later on.

http://www.csmonitor.com/2009/0323/p15s02-wmgn.html

Special gold nanoparticles show promise for 'cooking' cancer cells

Researchers are describing a long-awaited advance toward applying the marvels of nanotechnology in the battle against cancer. They have developed the first hollow gold nanospheres — smaller than the finest flecks of dust — that search out and "cook" cancer cells. The cancer-destroying nanospheres show particular promise as a minimally invasive future treatment for malignant melanoma, the most serious form of skin cancer, the researchers say. Melanoma now causes more than 8,000 deaths annually in the United States alone and is on the increase globally.

The topic of a report presented here today at the American Chemical Society's 237th National Meeting, the hollow gold nanospheres are equipped with a special "peptide." That protein fragment draws the nanospheres directly to melanoma cells, while avoiding healthy skin cells. After collecting inside the cancer, the nanospheres heat up when exposed to near-infrared light, which penetrates deeply through the surface of the skin. In recent studies in mice, the hollow gold nanospheres did eight times more damage to skin tumors than the same nanospheres without the targeting peptides, the researchers say.

"This technique is very promising and exciting," explains study co-author Jin Zhang, Ph.D., a professor of chemistry and biochemistry at the University of California in Santa Cruz. "It's basically like putting a cancer cell in hot water and boiling it to death. The more heat the metal nanospheres generate, the better."

This form of cancer therapy is actually a variation of photothermal ablation, also known as photoablation therapy (PAT), a technique in which doctors use light to burn tumors. Since the technique can destroy healthy skin cells, doctors must carefully control the duration and intensity of treatment.

Researchers now know that PATs can be greatly enhanced by applying a light absorbing material, such as metal nanoparticles, to the tumor. Although researchers have developed various types of metal nanoparticles to help improve this technique, many materials show poor penetration into cancer cells and limited heat carrying-capacities. These particles include solid gold nanoparticles and nanorods that lack the desired combination of spherical shape and strong near-infrared light absorption for effective PAT, scientists say.

To develop more effective cancer-burning materials, Zhang and colleagues focused on hollow gold nanospheres — each about 1/50,000th the width of a single human hair. Previous studies by others suggest that gold "nanoshells" have the potential for strong near-infrared light absorption. However, scientists have been largely unable to produce them successfully in the lab, Zhang notes.

After years of research toward this goal, Zhang announced in 2006 that he had finally developed a nanoshell or hollow nanosphere with the "right stuff" for cancer therapy: Gold spheres with an optimal light absorption capacity in the near-infrared region, small size, and spherical shape, perfect for penetrating cancer cells and burning them up.

"Previously developed nanostructures such as nanorods were like chopsticks on the nanoscale," Zhang says. "They can go through the cell membrane, but only at certain angles. Our spheres allow a smoother, more efficient flow through the membranes."

The gold nanoshells, which are nearly perfect spheres, range in size from 30 to 50 nanometers — thousands of times smaller than the width of a human hair. The shells are also much smaller than other nanoparticles previously designed for photoablation therapy, he says. Another advantages is that gold is also safer and has fewer side effects in the body than other metal nanoparticles, Zhang notes.

In collaboration with Chun Li, Ph.D., a professor at the University of Texas M.D. Anderson Cancer Center in Houston, Zhang and his associates equipped the nanospheres with a peptide to a protein receptor that is abundant in melanoma cells, giving the nanospheres the ability to target and destroy skin cancer. In tests using mice, the resulting nanospheres were found to be significantly more effective than solid gold nanoparticles due to much stronger near infrared-light absorption of the hollow nanospheres, the researchers say.

The next step is to try the nanospheres in humans, Zhang says. This requires extensive preclinical toxicity studies. The mice study is the first step, and there is a long way to go before it can be put into clinical practice, Li says.

http://www.eurekalert.org/pub_releases/2009-03/acs-sgn030909.php

Gold May Rise on Demand for Dollar Alternative, Survey Says

Gold may rise for a second straight week as the slumping dollar boosts demand for the precious metal as an alternative investment.

Twenty-one of 28 traders, investors and analysts surveyed from Tokyo to Chicago on March 19 and March 20 advised buying gold, which rose 2.8 percent last week to $956.20 an ounce in New York. Five said to sell, and two were neutral.

Last week, the dollar dropped 4.8 percent against the euro, the most since December. Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, has jumped 41 percent this year to a record.

Most traders surveyed on March 12 and March 13 anticipated gold’s gain last week. The survey has forecast prices accurately in 151 of 254 weeks, or 59 percent of the time.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aAEQMMKIFNZ8&refer=home

Wednesday, March 18, 2009

Economy fuels gold rush _ Tupperware party-style

The women gathered in the kitchen, enjoying brie and chocolate tortes as they told stories about their high school rings and pieces of jewelry given to them by ex-husbands and boyfriends. But they weren't just reminiscing for old times' sake.

The guests at Cheryle Podgorski's "gold party" were there to trade in their old jewelry for cash.

Gold parties — the recession answer to Tupperware parties — have become increasingly popular around the country as people cast about for ways to raise money. A professional gold buyer tests and appraises the guests' jewelry and then pays them on the spot.

Guests say getting together with friends in somebody's living room makes it a fun, social occasion, and feels more respectable than hocking their rings, necklaces and brooches at seedy pawn shops or selling them back to jewelry stores.

"It's terrific because it's a little bit intimidating to think about walking into a jewelry store, even though they may be heavily advertising it, and, you know, to someone that you don't know and turning over your valuables to them," said Pat Walsh, a 56-year-old retired store manager from Simsbury, Conn.

Walsh went home with $286 after selling a pinky ring she received as a wedding favor 35 years ago, circle-linked bracelets, broken necklaces and a few large, mismatched or outdated earrings.

Gold prices are close to their highest levels on record, hovering around $900 per ounce, up from $400 five years ago. Analysts say investors looking for a safe haven for their money while the stock market is in a meltdown could keep gold prices high for some time.

That — together with aggressive advertising by online scrap gold buyers, jewelry stores and gold party organizers — has led many people to clean out their jewelry boxes and dresser drawers.

Several companies are mining the phenomenon, which first began to thrive in Michigan a couple of years ago amid the struggles of the auto industry. My Gold Party LLC now has at least 35 representatives running parties in 21 states and is looking for more, said January Thomas, co-owner of the Grosse Pointe Woods, Mich.-based company.

"It's definitely a growing trend. I mean, the economy is not getting any better," Thomas said.

The gold buyer at Podgorski's party, Maggie Percival, said she started organizing parties this year as a representative of My Gold Party to raise money to send her son to college. She soon learned that gold parties can carry an element of risk for organizers.

"I've actually given money to people for stuff that isn't gold because I didn't test it properly. That was when I was a newbie. I've gotten much better at it," Percival said. "I had to pay the price for that one."

In front of the guests, Percival uses a jeweler's magnifying loupe to assess the gold, a digital meter to test whether it is real, and an electronic scale to weigh it.

At Podgorski's party, women laughed as they narrated stories behind their jewelry, which included gifts from ex-husbands and boyfriends who no longer inspired fond memories, 1960s cocktail rings that a man gave to his wife before they divorced, and a souvenir from a high school trip to Russia.

"Somebody at a party last week had a pre-engagement ring from her boyfriend before her husband, and her 14-year-old daughter wanted the ring, and she said, `If your father ever saw you with that ring on you, he'd kill me,' so she sold it," Percival said.

The gold-buying services typically are not interested in the jewelry itself. Instead, they sell the items to gold refiners to be melted down.

The gold party host and gold buyer generally get a 10 percent cut. Podgorski made $300 at her party, which she said she donated to a charity she runs that provides free prom dresses to high school girls who cannot afford one.

"It's fun, it's something different. It's not a Tupperware party, it's not Pampered Chef," said Jennifer Phillips, a 39-year-old high school suspension supervisor and mother of six, who made $321 on her gold sales.

Alona Bloom, a 34-year-old mother of two and a teacher's assistant in Pittsburgh, recently sold old jewelry at a friend's gold party. Bloom thought she would leave with $100 but walked out with $700.

Now, she is now working to organize her own party to earn the 10 percent commission. She would like at least 10 sellers but has found just eight so far.

"A lot of people have already sold their gold," Bloom said.

http://www.google.com/hostednews/ap/article/ALeqM5jIp0tAwji4FcFpnO1PlqEmq-jJOgD970K8EG0

Tuesday, March 10, 2009

Gold Is Ready To Go Very High Very Fast

It appears that gold is ready to go very high very fast, as measured in all currencies of the world. It seems that gold is in the process of completing the mega cup and handle pattern that started to form in 1980 when gold was at about US $850. The interesting part is the fact that it seems that we are in the final phase which should take us to about US $ 1 300 (about R 14 000) and eventually to about US $ 1 700 (about R 18 760) in a very short time relative to the 29 years since 1980. Do not be surprised to see $50, $100 and more up days, should key levels be broken.

The correction to about US $900 (and so far reversal to US $ 939) was the confirmation that the pattern is still very much on course. It seems that all major corrections, as is the nature of this pattern, are now completed. It now needs to get up to US$ 1000 and just above in a short period (with very brief minor corrections on the way there. For more on this cup and handle formation see the article by Jordan Roy-Byrne/Trendsman.

I have to state that it is not the potential high paper prices that make me bullish about gold, but its fundamental nature, and the current situation the world finds itself in. It is not the paper price, but what you can buy with it that matters.

During the correction, it was an opportune time to remind myself of why I am storing my wealth in gold and silver.

This is some of what I came up with: (please note that I am mostly repeating what I wrote previously, but that is exactly what I was doing - reminding myself)

Gold and silver is money and money is gold and silver, and money (real, not paper) is the safest and most consistent store of wealth over long periods of time and is especially important during times of uncertainty. There is a lot of fear and uncertainty today, therefore I store what little wealth I have in money, I store it in gold and silver.

As time passes, more people are realising the fact that the world's monetary system is fraud and that gold and silver is real money and not the paper money that the world uses today. The traffic is one-way, more, not less people come to the realisation that paper money is fraud and ditch it for gold and silver (the potential is huge). Maybe, right now someone who is reading this is ditching paper money for gold and silver. This fact is what makes me most bullish about silver, since it is the form of money that has the greatest potential due to the fact that it has more room to move from where it is (a demonetized monetary asset) to a fully monetized asset.

The debt levels in the world are enormous, and it is an inescapable fact that debt can only be properly and fully settled with real assets. Some assets are better than others when it comes to discharging debt. Gold and silver are real assets, and due to the fact that they are money, they are the ultimate form of payment and settlement of debt.

Due to these enormous debt levels, assets that are acceptable as proper settlement of debt will be in huge demand if these debts are to be properly settled; and this hold true whether debt levels are extinguished by default as well. Gold and silver is in huge demand, and this will accelerate.

Should the big debtors of the world attempt to "settle" their debt with more debt (inflationary) such as paper promises (like what is currently happening), then paper prices of real assets will explode, with gold and silver leading the way.

Paper money, bonds and other promises to pay are all subject to possible default, and during these times, default is a very common occurrence. Real assets are not subject to default, and gold and silver are real assets that you can hold in your hand, and are financially liquid (liquidity is even more essential during such times).

Paper money, bonds and other promises to pay are certainly at risk of impairment during these deflationary times, due to possible partial default or delays due to lack of debtors' ability to pay on time due to liquidity constraints. Remember an assets' value to you is less if you are not able to use it when required.

During inflationary times you are at risk, because though you might get the promised payment, but by the time you get it, it has lost a lot of its value and basically all of its value during hyperinflation.

This is all I have time for now, however it is enough to help me confirm that gold and silver is the best option when it comes to storing my wealth.

http://www.gold-eagle.com/editorials_08/moolman030909.html