Feb. 9 (Bloomberg) — Mongolia, the Asian nation with some of the world’s largest untapped mineral resources, is considering setting up separate companies owning the country’s gold, copper and coal reserves and using investment banks to sell shares to global investors, the prime minister said.
Source:Mongolia Considers Selling Stakes of Copper, Coal, Gold Assets (Bloomberg)
Self-declared "smartest" investors say the Gold Price can’t rise from here…
HEATED ARGUMENTS continue between eminent global investors, economists and analysts on the skyrocketing price of the hottest commodity in the world – Gold Bullion, writes David Lew for Commodity Online.
The big rise in Gold Prices from $800 an ounce in Jan. 2009 to $1227 an ounce in early Dec. has made gold the centre of debate. Gold bugs have been hailing the whopping Gold Price boom, saying that the precious yellow metal is set to break further records by hitting $2000, $3000 and even $5000 in the coming years.
Amidst this Gold Price rise frenzy, central banks across the world have also been trying to amass gold reserves to replace their US bonds and Dollar holdings. India’s central bank – the Reserve Bank of India (RBI) – bought 200 tonnes of gold from the International Monetary Fund (IMF) in November, adding to the frenzy in Gold Bullion markets.
This unprecedented Gold Price boom has led to a heated exchange of words between the proponents and opponents of gold. They beg to differ on the yellow metal as money, currency and an investment asset. Those who continue to support the boom in Gold Prices include leading global commodities investors like Jim Rogers and Jim Sinclair. They say the Gold Price is zooming thanks to solid fundamentals in the commodities and stock market, and the yellow metal will hit $2000 per ounce.
The main opponent to the Gold Price boom has been global economist Nouriel Roubini, who has been arguing that gold is sitting on a bubble. Its fundamentals do not support gold going above $1000 per ounce, he says, and Roubini ridiculed Jim Rogers’ prediction that Gold Price will boom to $2000 per ounce saying Rogers has frightened the bullion market with "utter nonsense."
Jim Rogers retaliated by slamming Roubini, saying that the latter does not know the basic fundamentals of the gold and commodities market.
As these arguments and counter-arguments continue, I happened to read an interesting article on gold by an eminent fund advisor and investor. Daniel Solin. Solin is a senior vice-president of Index Funds Advisors and the author of books like The Smartest Investment Book You’ll Ever Read, The Smartest 401(k) Book You’ll Ever Read, and The Smartest Retirement Book You’ll Ever Read.
Solin says he is gripped by the big rise in Gold Price, but agrees with Roubini, not with Jim Rogers in the Gold Price forecast game…
"Is this the right time to buy? Before you jump on the gold bandwagon, consider these facts.
"Investors tend to buy and sell at the wrong times, driven by emotion and incompetent advice from their ‘financial professionals’. Burton Malkiel, the author of A Random Walk Down Wall Street, recently noted in an article in the Journal of Indexes that more money entered the market at the height of the internet bubble in late 1999 and early 2000 than had even done so ever before. More money left the market before the recovery in 2002. This pattern repeated itself in 2008 and 2009.
"Malkiel also made the surprising observation that institutional investors fall into the same pattern. Their market timing skills are no better than those of amateur investors.
"This information should give you pause about timing your entry into the gold sweepstakes. And there are other reasons to be cautious.
"The big selling points for gold and other commodities is that they offer excess returns, increase diversification and are a great hedge against inflation. Sounds good. Unfortunately, the reality contradicts the hype. A comprehensive study (still behind a subscriber wall) published in 2004 titled Commodity Futures in Portfolios by Truman A. Clark, former professor of finance at the University of Southern California, concluded:
- The addition of commodities to a portfolio did not provide returns in excess of the Treasury bill return;
- The addition of commodities to a portfolio did not improve diversification for stock and bond portfolios; and
- Commodity futures do not appear to be effective inflation hedges for stock and bond portfolios.
Clark concluded: "The evidence indicates that the purported benefits of commodity futures are exaggerated’…" while at a recent conference, John Bogle – founder of the Vanguard Group of mutual funds – set forth his views on this subject with typical candor: "I for one, have no conviction that commodities belong in anybody’s portfolio, at any time, under any circumstances. Did I make that clear?"
"I am not suggesting that you can’t make money speculating in gold or other commodities," says Solin. "You can do so by buying low and selling high. If that’s your plan, remember there’s no evidence that anyone has market-timing skill (Glenn Beck included).
"If you want to gamble in commodities, and understand the risks, go ahead. However, if you decide to do so, remember that ‘fool’s gold’ can refer to the speculator as well as the commodity."
Looking to Buy Gold today? Make it simple, secure and cost-effective at BullionVault…
Source:Gold Price Frenzy
China is hot. Investors like hot. Gold is hot in China…
WHICH COUNTRY holds the maximum number of investment seminars and summits focused on Gold and precious metals? asks David Lew for Commodity Online in Mumbai, India.
You may have guessed it right. It’s China.
Beijing, Shanghai and other big Chinese cities now play host to more Bullion and precious metals investors and analysts these days than any where else, all focused on the big potential that China has for the global metals market.
Such meetings in China also take a regular look at other commodities as well – whether it is rubber, wheat, rice, plastics, energy, petrochemicals. But everyone wants to talk about the huge investment potential that the Chinese commodities industry has for the world.
Chinese officials and industrialists recently listed a number of global investors who are lining up to invest in the booming Chinese market. They included global investing veterans like George Soros and Jim Rogers. Indeed, the charm for investing in precious metals and other commodities seems to be weak in comparison in other countries like the United States. Every major investor worth the name is banking on the boom in gold, silver, platinum, palladium and other commodities in China.
Why? China’s commodity industry is the largest investment sector in the booming dragon land these days. Investors love commodities in China. Even garlic is now one of the hottest agricultural commodities in China to invest in, with prices shooting up by more than 50% in the last few months, causing an acute supply vs. demand crisis.
Investing in garlic is going so crazy in China that analysts are comparing the spicy stuff to gold these days. But it is in precious metals that most investors are piling money in China.
Investments in precious metals such as gold, silver, platinum and palladium are in feverish pitch across China. No wonder, then, that the Chinese consumption of precious metals is dramatically going up, and up. China consumed 395.6 tonnes of gold in 2008 for jewelry and investment, reports the World Gold Council, or around 14% of global demand, up from 327.8 tonnes in 2007. In 2009, gold jewelry and investment demand in China is expected to reach 432 tonnes, compared with 422 tonnes from India. Thus, this year, China will effectively overthrow India as the No.1 gold consumer in the world.
On the derivative exchanges, China’s Gold Futures trading volume hit 1.49 trillion Yuan in 2008. This is likely to double in 2009. Ditto platinum and palladium. Physical Chinese demand for platinum jewelry was at around 0.76 million ounces last year, accounting for 68% of the global total of 1.12 million ounces. The latest forecast sees that hitting 1.5 million oz in 2009, which even if it is a gross rather than net (of recycling) remains impressive. The Chinese jewelry demand for palladium increased from 15.5 tonnes to 20.2 tonnes, making palladium another hot commodity in China.
Turnover on the Shanghai Gold Exchange (SGE) on a rolling 12-month basis is the highest it has been, at just under 900,000 oz. The People’s Bank of China has also been going all out to mop up gold reserves. In April, China announced that the country had increased its gold reserves by 454 tonnes to 1,054 tonnes over the previous six years. The news has been prompting bullion analysts to predict that China wants to become a super power not jut politically alone, but in gold reserves, mining and sales.
Gold’s traditional role as a safe haven asset in times of economic instability has been considerably enforced during the financial turbulence, and the ongoing economic uncertainty becomes the most effective motive for the rise of Gold Prices.
As for China, thanks to encouraging policies established for the Gold Mining industry, the gold production in China has enjoyed continuous growth in recent years. By utilizing the capital market, Chinese mining companies have accelerated the pace of resource acquisition and integration, so as to promote the competitiveness in the international market. What’s more, the newly-listed Gold Futures on the Shanghai Futures Exchange (SHFE) mark the start of gold forwards contracts, a key tool for mining firms to raise capital from future production, as well as the reform of Gold Investment in China.
How can China cope with the problems and difficulties of financing mergers and acquisitions, and how to develop a mature Gold Investment market? Together they constitute great challenges to the sustainable development of China’s gold industry. For now, China shows an unending appetite for the yellow metal and its production is set to record a new high this year.
For many decades, South Africa used to be the world’s number one Gold Mining country. But these days, China is emerging as the top gold miner and producer, as well as its leading consumer. So while South African gold production has steadily declined since 1998 (and Australia’s since 2005), China’s gold production continues to grow.
China is hot. Investors are hot on China. Commodities are hot in China, and nothing is hotter than gold.
Looking to Buy Gold today? Cut out the middle-man, cut your costs, and get into the wholesale, professional market at BullionVault…
Source:China's Gold Boom
China is hot. Investors like hot. Gold is hot in China…
WHICH COUNTRY holds the maximum number of investment seminars and summits focused on Gold and precious metals? asks David Lew for Commodity Online in Mumbai, India.
You may have guessed it right. It’s China.
Beijing, Shanghai and other big Chinese cities now play host to more Bullion and precious metals investors and analysts these days than any where else, all focused on the big potential that China has for the global metals market.
Such meetings in China also take a regular look at other commodities as well – whether it is rubber, wheat, rice, plastics, energy, petrochemicals. But everyone wants to talk about the huge investment potential that the Chinese commodities industry has for the world.
Chinese officials and industrialists recently listed a number of global investors who are lining up to invest in the booming Chinese market. They included global investing veterans like George Soros and Jim Rogers. Indeed, the charm for investing in precious metals and other commodities seems to be weak in comparison in other countries like the United States. Every major investor worth the name is banking on the boom in gold, silver, platinum, palladium and other commodities in China.
Why? China’s commodity industry is the largest investment sector in the booming dragon land these days. Investors love commodities in China. Even garlic is now one of the hottest agricultural commodities in China to invest in, with prices shooting up by more than 50% in the last few months, causing an acute supply vs. demand crisis.
Investing in garlic is going so crazy in China that analysts are comparing the spicy stuff to gold these days. But it is in precious metals that most investors are piling money in China.
Investments in precious metals such as gold, silver, platinum and palladium are in feverish pitch across China. No wonder, then, that the Chinese consumption of precious metals is dramatically going up, and up. China consumed 395.6 tonnes of gold in 2008 for jewelry and investment, reports the World Gold Council, or around 14% of global demand, up from 327.8 tonnes in 2007. In 2009, gold jewelry and investment demand in China is expected to reach 432 tonnes, compared with 422 tonnes from India. Thus, this year, China will effectively overthrow India as the No.1 gold consumer in the world.
On the derivative exchanges, China’s Gold Futures trading volume hit 1.49 trillion Yuan in 2008. This is likely to double in 2009. Ditto platinum and palladium. Physical Chinese demand for platinum jewelry was at around 0.76 million ounces last year, accounting for 68% of the global total of 1.12 million ounces. The latest forecast sees that hitting 1.5 million oz in 2009, which even if it is a gross rather than net (of recycling) remains impressive. The Chinese jewelry demand for palladium increased from 15.5 tonnes to 20.2 tonnes, making palladium another hot commodity in China.
Turnover on the Shanghai Gold Exchange (SGE) on a rolling 12-month basis is the highest it has been, at just under 900,000 oz. The People’s Bank of China has also been going all out to mop up gold reserves. In April, China announced that the country had increased its gold reserves by 454 tonnes to 1,054 tonnes over the previous six years. The news has been prompting bullion analysts to predict that China wants to become a super power not jut politically alone, but in gold reserves, mining and sales.
Gold’s traditional role as a safe haven asset in times of economic instability has been considerably enforced during the financial turbulence, and the ongoing economic uncertainty becomes the most effective motive for the rise of Gold Prices.
As for China, thanks to encouraging policies established for the Gold Mining industry, the gold production in China has enjoyed continuous growth in recent years. By utilizing the capital market, Chinese mining companies have accelerated the pace of resource acquisition and integration, so as to promote the competitiveness in the international market. What’s more, the newly-listed Gold Futures on the Shanghai Futures Exchange (SHFE) mark the start of gold forwards contracts, a key tool for mining firms to raise capital from future production, as well as the reform of Gold Investment in China.
How can China cope with the problems and difficulties of financing mergers and acquisitions, and how to develop a mature Gold Investment market? Together they constitute great challenges to the sustainable development of China’s gold industry. For now, China shows an unending appetite for the yellow metal and its production is set to record a new high this year.
For many decades, South Africa used to be the world’s number one Gold Mining country. But these days, China is emerging as the top gold miner and producer, as well as its leading consumer. So while South African gold production has steadily declined since 1998 (and Australia’s since 2005), China’s gold production continues to grow.
China is hot. Investors are hot on China. Commodities are hot in China, and nothing is hotter than gold.
Looking to Buy Gold today? Cut out the middle-man, cut your costs, and get into the wholesale, professional market at BullionVault…
Source:China's Gold Boom
 LIVENEWS.com.au |
Global investors continue to bet big on gold
Hindu Business Line, India Demand for gold coins and bars including that of ETFs jumped 248 per cent to 596 tonnes. Investment into ETFs alone soared 540 per cent to 465 tonnes, valued at $13.6 billion, according to the data compiled independently for WGC by GFMS Ltd. Net retail … Gold demand is buoyant Mining MX Global banks eye gold trading in India Commodity Online all 144 news articles |
Source:Global investors continue to bet big on gold – Hindu Business Line