Chart courtesy of Kitco.com

As expected the Chairman of the Federal Reserve Board, Ben Bernanke mentioned that word ’tapering’ in reference to the bond buying programme towards the end of this year, given that certain economic conditions are met.

The result was that gold

A dearth of junior financing has painful implications for the most important junior asset: brains.

Author: Kip Keen
Posted: Tuesday , 18 Jun 2013 

HALIFAX, NS (MINEWEB) - 

It was fitting I caught John Kaiser a few hours before he was on his way to attend a meeting in Vancouver about the dire state of the junior market. I had called Kaiser, the California-based owner of Kaiser Research, to get the latest on junior finances. He gave me that. It's not good.

751 out of 1,789 companies on the TSX Venture that Kaiser compiles data on (near all) have less than C$200,000 in the bank.

By Hard Assets Alliance Team

By Ed D'Agostino, General Manager, Hard Assets Alliance

I recently attended John Mauldin's Strategic Investor Conference, where I heard some of the world's brightest minds in finance and economics. From Paul McCully to Mohamed El-Erian, David Rosenberg to Noriel Roubini, the best of the best were on stage pontificating on the future.

And now I know exactly what the next five years will bring. Without a doubt, the next five years are sure to bring inflation. Perhaps double-digit inflation.

Unless, of course, we have a sustained period of deflation

Hathaway:  “Right now I am focused on some very key markets.  Japan obviously is making the headlines, but

Eric Sprott and David Franklin

This past March, Jeroen Dijsselbloem, the head of the finance ministers of the eurozone, shocked the markets with seemingly off-the-cuff comments suggesting that the Cyprus banking solution will, "serve as a model for dealing with future banking crises."1 Depositors across Europe took a collective gasp of horror – could banks possibly confiscate depositors’ funds in a form of daylight robbery? Indeed they could, and last week the Bank for International Settlements (“BIS”), the Central Bank's Central Bank, published what we have referred to as 'the template';

SK Options Trading

With US Non-Farm Payrolls coming in at a solid +175k, gold and silver prices are set to take another leg lower as a complete absence of additional quantitative easing removes the need to buy gold as a hedge against further easing of US monetary policy. We therefore see both gold and silver prices taking another large leg lower in coming months, with both precious metals hitting new multi-year lows before too long.

Fundamental Drivers

The mechanics at play here are not overly complex, with employment data being the most significant driver of gold prices in recent years due to Fed’s focus on battling the high employment rate with aggressive easing of monetary policy and additional quantitative easing. The Fed is mostly focused on the three month average gain for payrolls, and so long as this number is above 150k, there is no chance of additional quantitative easing.

The pain is not likely to be over for investors in mining shares after the steepest drop in gold prices in a generation led to a $6-billion asset writedown at Australia’s Newcrest Mining Ltd., fuelling speculation of more to come.

A $200 plunge in prices in two days in April heightened fears that gold’s 12-year rally may have topped out.

For nearly a month the price has languished around $1,400 an ounce

As the European Union struggles with rising unemployment they now have to face a future of increased competition from the Japanese as they actively devalue the Yen. The new government in Japan, under the Premiership of Shinzo Abe, has managed to devalue the Yen by round 20% so far. In the short term this devaluation should boost Japanese exports as their goods are available at a substantial discount. This action mirrors that of the United States as they continue with their programme of Quantitative Easing. The United Kingdom has also joined in this ‘race to the bottom’ and has managed to reduce the value the British Pound.

The European Central Bank (ECB), under the guidance of Mario Draghi, cut interest rates to a new record low in May and said it would act again if necessary. However, in this tit for tat, cut for cut environment,

SK Options Trading

www.skoptionstrading.com

One can make numerous arguments for the future direction of gold prices, citing a myriad of facts and statistics to justify one’s position, but the reality is there is only one factor that matters right now; the Fed is not delivering any more QE. This means gold prices will continue to head lower, a view we have held since the start of this year.

All other arguments are overridden by the simple reality that Bernanke is currently in discussion as to a potential “tapering” of QE, so additional easing is not even close to being on the table. The reasoning behind this is also simple; employment in the US is getting better, and has been for some time, therefore there is no need for further easing.