Gold Catalyst - John Williams: Very Serious Trouble in this Next Year - Weaker Dollar and Hyperinflation GLD, MUX, TNR.v, GDX

"John Williams of Shadowstats.com predicts, "You're going to have a dollar panic, but I can't give you the exact timing on that." Another potential problem is a credit downgrade of U.S. debt. Williams says, "If we get a downgrade here, that would accelerate the process of the dollar selling and moving us again into the early stages of hyperinflation." Williams says you can protect your wealth by holding hard assets. Williams goes on to say, "If your assets are denominated in dollars and Treasury bonds, those will become worthless in hyperinflation." Join Greg Hunter as he goes One-on-One with economist John Williams."

  John Williams is very respected economist who is providing  the real economic data, which is not massaged by the government desires and wishful thinking. His view at the crucial juncture for US Economy and Health of US dollar us very important to share now.

  Gold celebrates today "The Deal" and it looks like that Debt Ceiling Raise Does Mean Increase in the Amount of debt after all.

Jim Rickards – Why China is Buying Gold & Calling for a De-Amercanized World GLD, MUX, TNR.v, GDX

"Jim Rickards steps in with his analysis of the recent China Call to De-Americanized World and its implications for the Gold market. China buys Gold by tons now on the dips and taking the physical delivery."

ZeroHedge: China's Official Press Agency Calls For New Reserve Currency, And New World Order GLD, MUX, TNR.v, GDX

 "All the pieces from this Puzzle are getting into place now. China is happy to accumulate Gold at the artificially depressed levels and ZeroHedge reports about the next step in its state-level planned asymmetrical warfare against the mess called the U.S. Now the recently announced euro swap transaction with ECB is getting the new meaning and the discussion about the factors behind the ongoing Gold smashdown and its manipulation take the new geopolitical importance. We are talking here about the End of Empire and the end of US Dollar as The Reserve Currency of Choice with the very broad economical implications."

Andrew Maguire: Gold Smashdown, FED Defends The Dollar And How Goldman Sachs Operates. GLD, MUX, TNR.v, GDX

"Andrew Maguire presents to us the chronicles of ongoing war behind the curtain with FED defending the US Dollar at the crucial level 80.00 and how the FED's #1 Gold Prime Dealer Goldman Sachs operates in the Gold market. Now we have more information on why Goldman Sachs has issued the Sell Call on Gold last Wednesday. 

   All these revelations will never lead to the higher Gold prices without Buyers and one can argue that this manipulation can go forever. According to the Andrew Maguire the key crucial difference now is that Central Banks are buying and, particularly, China is taking all available Gold for physical delivery now."

Catalyst: Uncovering China’s Rush for Gold GLD, GDX, MUX, TNR.v

"While a lot of people are still wondering why the Gold is beaten down again, it is important to keep the big picture in front of you. As it is happening with Copper now the main player in this market is the same - China is on track to implement state level plan to diversify US Dollar based assets.

  We would like to share with you brilliant report conducted by Jan Skoyles on this subject."

Barron's investment roundtable on Gold. GDL, GDX, AEM, ABX, AUY, SLW, SST.v, TNR.v

Interesting to see Gold as one of the major investment theme from Barron's.

"...Faber: The U.S. economy fell off a cliff between October and December, and will stabilize at a lower level of activity. Some indicators may look better than expected, which will justify the present rally. Stocks already are up 25%. If they go up 50% from the Nov. 21 low of 741 on the S&P, you'll have the S&P at around 1,100. Afterward, reality will set in and in real terms the market will go much lower for much longer.

Marc Faber: "With the Fed buying up everything, hyperinflation will be the result."
Around the world, governments are throwing money at the system to revitalize debt growth. When an economy is credit-addicted and debt growth slows, it is a catastrophe. With the Fed buying up everything and boosting the federal deficit, hyperinflation will be the result down the line. I am pleased that Barron's just wrote a cover story about the inflation in Treasury bonds ["Get Out Now!" Jan. 5]. This was the last bubble the Fed was able to inflate, aside from their egos.
[Laughter]
So, Marc, you're not too bullish this year.
Faber: Let's put it this way. A true market low will be lower, but in a hyperinflating economy, you can have nominal price gains while going lower in real, or inflation-adjusted, terms. Between the start of 2008 and November, almost every asset market collapsed, but the dollar was strong. After November the asset markets rebounded but the dollar went down again. There's an inverse correlation. Dollar weakness is a signal that the Fed has succeeded in pushing liquidity into the system. Some say the dollar will collapse this year, but collapse against what? The euro? The Russian ruble? These currencies are even weaker. In the very long run, each citizen must become his own central bank. Every responsible citizen must hold some physical gold, platinum and silver -- physically, not through derivatives..."

"...Hickey: I suspect they were trying to mask revenue deterioration. When things get desperate, companies typically do things like try to buy other companies.
On to gold. You have to protect yourself against potential hyperinflation. All the central banks are printing money now. The bull market in gold was rather orderly for the first eight years. We haven't seen the blow-off phase you get in all bull markets. That's coming. In dollar terms, gold was up 5% or so last year. In Indian rupees it was up nearly 30%. The price of almost all other commodities collapsed. I own bullion, the gold ETF [ SPDR Gold Shares (GLD)], some gold stocks and coins. I couldn't get them as the year progressed because demand was so great. But my first pick today is Market Vectors Gold Miners, an ETF. It sells for 32 and mirrors the NYSE Arca Gold Miners Index, a modified market-capitalization-weighted index of publicly traded gold companies. The top five components are Barrick Gold [ABX], Goldcorp [GG], Newmont Mining [NEM], Kinross Gold [KGC] and Agnico-Eagle Mines [AEM].
How has it performed?
Hickey: The ETF dropped 26% last year, so while gold held up, the stocks didn't do as well. One reason is that oil prices were so high; oil is a key component in production costs. Now crude is falling, which will be a help to gold miners in 2009. The fund has $2 billion in assets. It has been around since 2006, and the expense ratio is 0.55%. It gives you broad exposure to the gold-stock business.
My second gold pick is Agnico-Eagle Mines . It fell about 6% last year, so it did relatively well. It trades for 51. Not every stock fell in the 1930s, either. Homestake Mining went from 65 a share in 1929 to 500 in 1935. It had two things going for it: rising production and an increase in the price of gold, against a devalued dollar.
Barron's Mike Santoli speaks with The High Tech Strategist Editor Fred Hickey, at the Barron's Roundtable, about the reaction to gold in the market and how it can be handled as 2009 progresses.
Zulauf: The U.S. was on the gold standard. It devalued the dollar and revalued gold relative to the dollar, and the price went up to 35 an ounce from 28.
Hickey: Gold could go to $2,000 an ounce this year, or next. The Fed is going to pump all kinds of money into the economy and it won't help. It won't get to corporations or the consumer. But it might get to gold and cause yet another bubble. Gold is one of the few assets that has performed well. And, there is a tremendous shortage of physical gold. In times of turmoil it is a classic hedge against inflation.
Gabelli: People withdraw their cash from banks and buy safes and guns and gold.
Zulauf: You can't get a safe at a Swiss bank anymore because they are all rented out.
MacAllaster: Agnico-Eagle doesn't make much money and pays almost no dividend. It earned more than a dollar a share in 2006 and '07. Earnings were cut in half in 2008 because one mine produces zinc and the price of zinc collapsed. The real kicker is that Agnico will quadruple production, from 300,000 ounces in 2008 to 1.2 million ounces in 2010. Capital expenditures will decline to $146 million by 2010 from $900 million in 2008. They have five new mines, in Canada, Mexico and Finland, countries with low political risk. Production costs are around $300 an ounce.
Zuluaf: The industry's break-even is about $430 an ounce. There is a limited amount of gold in the earth's crust, and most of it is in politically unstable places. It is cheaper to buy mining stocks than build new mines.Hickey: Very few gold miners will grow production or earnings this year and next. Agnico's earnings are going up by orders of magnitude. They'll do 40 or 50 cents this year, and $2 to $5 when the new mines come on. Because there is excitement about this company, they were able to do a stock offering in December. There are still a lot of momentum investors. This stock will have momentum."

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