GDP: Great Day to Play

Good Day,

Friday’s market sessions in precious metals started off on a tamer note, following the best gains in gold in three weeks. Explanations follow. The recapture of the $1045 area is noteworthy, although analysts we polled during the wee hours overseas are trying to define the move as everything from a ‘one-hit wonder’ to the ‘re-ignition of what we saw during most of October.’

The Bloomberg weekly survey foresees weaker gold prices come next week - not by a large margin (57% bearish)- but still focusing on a potential comeback by the US currency, the early signs of which became visible this past Monday. Demand for the yellow metal once again slipped away in India, following signs of life during the earlier part of the week when values came close to $1025 per ounce. The country recorded its sixth straight month of declining gold imports, despite a decent gain during September – in anticipation of festival-related sales.

New York spot dealings opened with a $2.60 loss in gold bullion, which was quoted at $1043.20 bid, as against a euro-dollar seen at $1.4798 and the USD index steady-to-higher, at 76.05, with little in the way of fresh news thus far this morning. Oil prices gave back about 50 cents of their whopper-sized Thursday gains, slipping to $79.32 per barrel. Risk traders took a latte break this morning, and this gave the dollar a moment to try to re-group.

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Read the rest of Gold, Silver, Metal Prices: Commentary – 10/30/2009 (2,324 words)

Twenty years ago in 1989 the Austrian State Mint passed from the Treasury into the ownership of the central bank. The mint was given the freedom to produce and sell products in accordance with the demands of the modern numismatic and investment markets. One of the very first innovations introduced by the new CEO, Paul Berger, was the production of a gold bullion coin for investment purposes: the Vienna Philharmonic.

On 16th October this year a limited quantity of 6,027 Vienna Philharmonic coins, each weighing 20 ounces of fine gold, will go on sale in Europe, America and Japan.

20 ounces to commemorate 20 years!

Why the odd number? The mint decided to offer 2009 coins (the date of the 20th anniversary) in its three major markets: in Europe, in America and in Japan. Investors still remember the 15 giant coins (each of 1,000 ounces) that celebrated the fifteenth anniversary in 2004, and that entered the Guinness Book of Records as the then largest gold coin in the world. All 15 giant coins were snapped up within days, and the excitement surrounding this special issue of a 20 ounce coin promises a similar market reaction.

The new 20 ounce coin has a diameter of 74 mm and a thickness of 8.3 mm and is housed in a prestigious wooden and red velvet case. Pre-orders for this unique anniversary gold coin have already started pouring into the mint in Vienna. It promises to be a major success as indeed the past 20 years of the Austrian bullion programme have been.

The Vienna Philharmonic Story

The decision in 1989 to issue a gold bullion coin in the two weights of 1 ounce and ¼ ounce was greeted with indulgent smiles. Austria, a small central European country since the destruction of her empire in 1918 and without any gold mining industry to support, was entering the bullion market, long dominated by the Krugerrand and that time divided between the USA, Canada and Western Australia.

Berger and his team decided that music was the ideal theme for their new coin. Austria was internationally renowned for its music, but they decided against the portrayal of one of the many great composers like Mozart, Haydn or Strauss. That would make the coin appear like a commemorative edition for collectors. Instead they chose a living and world-famous musical institution: the Vienna Philharmonic Orchestra. To their delight the members of the orchestra enthusiastically endorse this choice, freely grant the use of their name. The engraver, Thomas Pesendorfer, designed a collection of instruments to represent the orchestra itself and for the other side of the coin he took the great pipe organ of the Golden Hall in Vienna where the orchestra plays at home. It is seen on television around the world every year on 1st January during the New Year’s Day Concert.

The new Austrian coin was launched in Vienna on 10th October and was an immediate success. The demand in the home market was nothing less than ferocious. In two and a half months 419,000 ounces were sold, achieving with one blow an 18% world market share for the entire year 1989! It rapidly established itself as a serious participant in the international gold market. In 1992 and again in 1995, 1996 and 2000 the Vienna Philharmonic was ranked by the World Gold Council as the top selling gold bullion coin worldwide. In 2008 the Vienna Philharmonic continued to rank No. 1 in Europe and in Japan, and with a year’s market share of 25% it came in 3rd worldwide narrowly missing 2nd place. The “indulgent smiles” have long since disappeared.

A 1/10 ounce in 1991 and a ½ ounce coin in 1994 completed the traditional family of four sizes. In 2008 a silver 1 ounce Vienna Philharmonic was added to the investment range with resounding success.

Looking back on 20 years of continual growth and success, the Vienna Philharmonic has established itself firmly as one of the four great gold bullion coins offered on the international market of today. This one-time issue of a limited number of 20 ounce gold coins is but a fitting tribute to a 20 year long success story that shows no signs of letting up in the near future.

Related posts:

1. Last of the Austrian Mint’s “Vienna Jugendstil” Series
2. Austrian Mint Issues 5 Euro Silver Coin Honoring Great Conductor
3. Gold touches 27-year high of $746.30 an ounce; silver surges nearly 3%

Canadian gold-miners Barrick Gold and Kinross Gold have completed a draft feasibility study on their Cerro Casale project, in Chile, but there is still some work to be done to improve the economics of the project, Barrick CEO Aaron Regent said on Thursday.

“We intend to spend the next few months reviewing various options to further optimise the project,” Regent said on a conference call.

Read more….

Vancouver-based Teck Cominco may find itself sitting a lot more comfortably than was the case six months or so, but CEO Don Lindsay made it clear on Thursday that he won’t be happy until the company’s term loan is paid down and it once again merits investment-grade ratings.

One year ago, Teck borrowed $9,8-billion to buy Fording Canadian Coal Trust, and spent the next 12 months scrambling to free up cash after debt markets turned sour late in 2008.

Read more….

The Duluth complex in Minnesota, U.S. hosts one of the world’s great polymetallic metals deposits and one of the key players is Canadian junior, Duluth Metals, which has just announced updated precious metals resource figures.

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Chris Vermeulen submits:

Commodities and stocks almost look ready for a rally or at least a relief bounce. The market is down over 5% and the normal pullback this year has been 4%. Using technical analysis and inter-market analysis, we can see that the market is reaching extreme lows and this usually means we are only a couple days away from a rally.

I work with several market technicians as we all analyze the market a different way and share our work with each other to gain maximum insight on the broad market moves. We analyze momentum cycles, magnetic cycles, volatility levels, support & resistance levels, volume analysis and inter-market analysis.

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By Kim Kyoungwha

Oct. 28 (Bloomberg) — Gold may rise to a record $2,000 an
ounce in the next three years as investors hedge against
“massive” inflation sparked by governments printing money,
according to Superfund Financial Singapore Pte’s Aaron Smith.

“In the next few years, after the deflation cycle, we’ll
see massive inflation,” Managing Director Smith, 30, said in an
interview. “Soon, when you go to buy a cup of coffee, you’ll
pay $20 or $30 because the dollar won’t be worth anything.”

The company’s Superfund Green Gold A Fund, which has more
than doubled since its inception in 2005, has lost 15.6 percent
this year because of higher volatility, said Smith, who joined
in 2002. Gold rose to an all-time high this month as governments
including the U.S. boosted debt to combat the global recession.

“When the U.S. dollar crashes, all the paper currencies
have to crash, otherwise if their currencies are too strong,
their economies will be weak,” said Smith, who issued similar
gold forecasts in May and earlier this month. “Another
excellent buying opportunity for investors is silver.”

Gold for immediate delivery, which touched a high of
$1,070.80 an ounce on Oct. 14, traded at $1,039.32 at midday in
Singapore. The metal has strengthened 18 percent this year,
while the Dollar Index, a six-currency gauge of the dollar’s
strength, fell 6.4 percent.

Gold Forecasts

Smith joins investors including Shayne McGuire, director of
global research at the Teacher Retirement System of Texas, and
Jim Rogers in forecasting higher gold prices. Pension funds will
increase gold holdings as currencies decline, McGuire said on
Oct. 22. Gold will probably top $2,000 in the next decade as the
dollar weakens, Rogers said Oct. 7.

Superfund, founded in 1995 and backed by $1.6 billion in
assets, specializes in so-called managed futures, using its own
trading system to generate buy and sell calls on stock, bond,
currency and commodity futures. Still, the company’s flagship Superfund A, which gained 35.4 percent last year, has lost 24
percent this year, Smith said.

The ratio of silver to gold, currently at 62.35, will be
“cut in half” in the next three to five years as millions of
people in South Asia and China buy the metal as an alternative
because they can no longer afford gold, Smith said. Silver has
soared 46 percent this year to $16.65 an ounce.

Read more….

A "very significant" rerating opportunity existed for South African gold producers, Gold Fields CEO Nick Holland said on Thursday.

Holland said that the large gap that had existed between the market capitalisations of South African gold-mining stocks and those of far smaller international gold-mining companies had been closed in the past and, with proper management, could be closed again in the future.

Holland said that comparative studies had shown that companies with a fraction of the production and the reserves had equal market capitalisations.

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The world’s biggest gold miner, Canadian Barrick Gold, on Thursday reported a big net loss for the third quarter, essentially because of a $5,7-billion accounting charge related to the company’s announcement that it will eliminate its gold hedges.

The firm lost $5,4-billion, compared with a $254-million profit a year earlier.

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(Santa Ana, California) – Information provided to Northern California law enforcement authorities by Professional Coin Grading Service led to the arrest of a suspect who is now under investigation in connection with the sales of fraudulently altered Morgan dollars in tampered PCGS holders for nearly $300,000.

“Genuine, common date Morgan dollars were split into two pieces (front and back along the rim), then adhered to each other in combinations to create the illusion of rare date and mintmarks.  The coins then were placed in tampered PCGS holders to give the coin credibility in the marketplace and to hide the alterations,” said Stephen Mayer, Chief Operating Officer of Collectors Universe, Inc. (NASDAQ: CLCT), parent company of Professional Coin Grading Service.

Among the fraudulent alterations were “1883-S,” “1884-S” and “1903-S” that were deceitfully labeled as PCGS MS65, MS63 and MS64, respectively.

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Read the rest of PCGS Helps Police Nab Counterfeits Suspect (335 words)