Welcome To The Golden Minerals HUB On AGORACOM
Golden Minerals is a junior silver producer with a strong growth profile, listed on both the NYSE Amex and TSX.
Message: Today's excerpts
These are just a few highlights for today. I don't know about the rest of you, but I am getting just a touch nervous....even if it does mean that gold and silver and all our stocks explode to the upside.
Sprott Sees Financial Turmoil Pushing Gold to $2,000 an OunceBy Stewart Bailey
March 10 (Bloomberg)
EXCERPT:“Turmoil in global credit markets may lead to the collapse of a North American bank, pushing bullion prices up to $2,000 an ounce as investors seek a haven in gold, Eric Sprott said.
This year’s decline in banking and brokerage stocks will worsen, said Sprott, 63, founder and chairman of Sprott Asset Management, which manages about $7 billion. In response, the company is short selling financial stocks and increasing holdings in bullion and mining companies, Sprott said. He declined to name which bank he thought may collapse.
“We’re in a systemic financial meltdown,” Sprott said in a March 6 interview at the company’s Toronto headquarters. “There are probably 10 companies that are broke that are still trading — banks and financial institutions.”” Market WrapUp for Monday, March 10
The World's Worst Kept Secret
by Rob KirbyWhen bond maven Bill Gross openly writes about it – as he did in his January Investment Outlook - it’s perhaps inappropriate to use the word “secret”: Pyramids Crumbling “But today’s banking system as pointed out in recent Investment Outlooks, has morphed into something entirely different and inherently more risky. Our modern shadow banking system craftily dodges the reserve requirements of traditional institutions and promotes a chain letter, pyramid scheme of leverage, based in many cases on no reserve cushion whatsoever. Financial derivatives of all descriptions are involved but credit default swaps (CDS) are perhaps the most egregious offenders.” Rumor has it that the Chicago Board of Trade has increased Silver margin by 50%. Hedge Funds Reel From Margin Calls Even on Treasuries
By Tom Cahill and Katherine Burton
March 10 (Bloomberg) -- The hedge-fund industry is reeling from its worst crisis in a decade as banks are now demanding more money pledged to support outstanding loans even when the investment is backed by the full faith and credit of the United States.
Since Feb. 15, at least six hedge funds, totaling more than $5.4 billion, have been forced to liquidate or sell holdings because their lenders -- staggered by almost $190 billion of asset writedowns and credit losses caused by the collapse of the subprime-mortgage market -- raised borrowing rates by as much as 10-fold with new claims for extra collateral.
While lenders are most unsettled by credit consisting of real estate and consumer debt, bankers are now attempting to raise the rates they charge on Treasuries, considered the world's safest securities, because of the price fluctuations in the bond market.
``If you have leverage, you're stuffed,' said Alex Allen, chief investment officer of London-based Eddington Capital Management Ltd., which has $195 million invested in hedge funds for clients. He likens the crisis to a bank panic turned upside down with bankers, not depositors, concerned they won't get their money back.
The Face-Slap Theory PAUL KRUGMAN
Published: March 10, 2008
Friday’s employment report which was so weak that it had many economists declaring that we’re already in a recession was bad news. But it was actually less disturbing than what’s going on in the financial markets.
Paul Krugman.
The scariest thing I’ve read recently is a speech given last week by Tim Geithner, the president of the Federal Reserve Bank of New York. Mr. Geithner came as close as a Fed official can to saying that we’re in the midst of a financial meltdown.
Jim Sinclair March 10 First I told you “This is it” and clearly this is it.
I have demonstrated to you that there is NO practical solution to this gathering of problems caused by unbridled greed and lack of regulation to facilitate it.
Now I am telling you that we are “Slipping out of control.”
Attempts to use tools that have no practical power to cure the problem is pushing the problem over the hill.
In the Weimar Republic it was agreed that the great plan to depreciate the currency in order to depreciate war reparations written in their currency would “get out of control.” The currency began a march to zero and therefore gold to infinity in terms of that currency.
I do not expect such a situation here percentage-wise. I pray that this situation which is now “Slipping out of control” does not come to such an end; however today’s conditions are a duplicate of the Weimar case study.
All you need to do is take the words “war reparations” out of the Weimar case study and replace them with “over the counter derivative meltdown in credit and default derivatives” and you have a similar situation in economic history to which you can compare today’s.
Gold is going to a minimum of $1650.
Every category of gold shares will participate with many substantially outperforming gold as shorts are forced to cover.
“This is it” and we are “Slipping out of control.”
Eliminate as many intermediaries between you and your assets. Own the Swiss and Cando treasury instruments. Have at least 1/3 of your liquid net assets in gold and precious metal shares. For some it will be a lot more.
Under no circumstances use margin.
Hard assets are about to make their entrance onto the stage of the establishment equity investors.
Before you invest in a Gold ETF read the original prospectus thoroughly.
Do not try and save the world. The world will think you are crazy and get annoyed. You can only protect yourselves. The saddest part is that Joe Six Pack is LOST, sacrificed on the sick altar of Greed.
Regards,
Jim
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