Renungan untuk sesi pertama 3 September 2010
1. Harga telah naik dari RM2864 kepada RM2868.
2. Kebanyakan harga masih bertahan antara Rm2867 dan RM2868 ini bermakna harga ini akan menjadi tapak loncatan harga emas pada hari ini.
Kesimpulannya.
Pada hari ini akan berlaku lonjakan harga secara besar-besar kerana adanya berita-berita sensasi tentang emas telah diwar-warkan dalam media. Perak juga telah melepasi jangkauan USD19.50 yang disasarkan pada minggu ini turut merasai tempias dan kini akan cuba mencapai ke paras USD20.50.
Gold price to double in five years - Frank Holmes
With the start of the festive season, September is likely to be a good time for gold and things should continue to do well into 2011
Author: Geoff Candy
Posted: Wednesday , 01 Sep 2010
GRONINGEN -
Historically, September is a very good month for gold. On average, the price of the yellow metal rises around 2.5% from its August price.
But, according to Frank Holmes, it is not just during September that gold will do well, he is expecting the yellow metal to double in the next five years.
Speaking on the Mineweb.com Gold Weekly podcast, Holmes, said, that is more than a "15% compound rate of return and that's far better than what you're going to expect from the stock market as a whole. The same thing is much higher than what you're going to get in a five year bond - a five year bond is paying you less than 2% - so the net in that one is that gold is becoming more attractive as a diversifier."
It is not, however, just its role as a diversifier, where gold is being supported according to Holmes.
He believes that there are two types of buyers of gold: one, he terms the price takers, who are "basically a buyer of gold for jewellery," which he says is an emotional reason to buy gold.
The second group, he calls the price makers. These are people who are buying gold as an investment and are, he adds, growing rapidly.
"This is predominantly because gold is basically looked and perceived more and more as a safe haven investment. The US, Western Europe and Japan are close to buckling under the weight of their own sovereign debt issues and government budget deficits remain large and persistent and, as a result, the major paper currencies is low."
He adds, it is in the seven most populous countries in the world where you find the strongest emotional attachment to the metal, while it is in the G7 countries where you find much of the investment buying.
As we head into September, it is the emotional buyer that has traditionally come to the fore as Ramadan, Diwali, Christmas and then Chinese New Year all follow on from each other. But, in the second quarter it was the investment segment that pushed the price up and there have been some comments about a decline in jewellery buying this year as a result of the higher prices - see story: India's love affair with faux gold..
Holmes admits that the higher prices do play a role but says it is more important to look at the volatility of prices. And, Holmes believes that this year, that same demand trend will continue, adding, that while a spike in gold will slow buying, just as quickly, a significant correction in prices results in a strong uptick.
"This demand from emerging countries if it's a really stop and fall off a cliff it's going to be because of economic developments," he says, rather than because of the price on offer.
But, while, such economic factors are possible, Holmes believes that the current lay of the land points to a bettering of the price of gold going forward.
Firstly, he says, on the investment front, more and more investors (including the likes of pension funds) are becoming interested in gold as an asset class because of the massive debt levels reported by governments around the world and, more importantly, negative real interest rates.
"Whenever you have negative real interest rates... you're fighting deflation and gold has always been a wonderful asset class when either you get big deflation or big inflation," he says.
But he cautions, " don't buy gold to get rich overnight, it's a great diversifier in a well balanced portfolio and the magic is to rebalance every year, to maintain that weighting which you feel comfortable - some are 25% - we've always advocated you should have a minimum of 10%."
Source: http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=110586&sn=Detail&pid=102055
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Japan goes for gold
Published on: September 01, 2010 at 15:30
THE BIG ISSUE in global markets is the meeting of the Bank of Japan, writes Julian Phillips of the Gold Forecaster, where they debated what to do about a Yen strong enough to damage Japanese exports, the mainstay of the Japanese economy.
It was agreed that Japan will spend ¥920 billion ($10.8bn) on economic stimulus and compile an extra budget if needed. The central bank expanded a loan program by ¥10 trillion ($116bn). This left the market underwhelmed and the Yen went stronger still. This was a red rag to a bull as it invited speculators to push the Yen even higher. They will keep pushing it up until the Bank of Japan takes sufficient action to prevent its rise.
The talk is now that it will rise to around ¥78 against the US Dollar, which will force crisis action on the government. But far more than meets the eye lies in this action and potential action.
It attacks the reasoning behind Exchange Rates;
It encourages speculation both on the Yen; and
Unlike the US action, this does not fill the holes caused by deflation but devalues the buying power of the Yen with an inflationary stimulus.
Both these new actions thus undermine Japanese money internally and externally. If no one objects to this, then a tacit approval of this policy is being given. If this is the case, then you can be sure that other major nations will follow suit. What of price stability and exchange rates that accurately reflect the Balance of Payments of a nation.
To understand the importance of these issues we take you back to the last time you heard the US complain about the undervaluation of the Chinese Yuan. It is perceived by many in government and in both parties that the Chinese are manipulating their currency to gain advantage in international trade and this is making many people angry.
The Japanese are about to attempt the same. While the principles of a currency's exchange rate dictates that it should reflect the underlying Balance of Payments, such moves clearly go against this. Perhaps we should question whether the Balance of Payments should dictate an exchange rate? Or should it be as in Asia, do what you can to support your exports? If it is the former then the system of exchange rates as we have relied on is giving way to expediency, a road with no principles. In short, if expediency is the way forward then the global system of exchange rates is under threat.
It is not simply a case of manipulating ones economy to engineer a weakening of one's currency if you need to stimulate your own economy. Surely, this also applies if you already have a strong economy.
In the case of the US the policy of benign neglect has led the US into a situation that will lead to a falling Dollar as it has a structural Trade deficit and has watched its manufacturing slip away to China over the years. The reality of this is now China can exert a huge influence over US monetary policy due to the huge investment it has in US Treasuries. And right now they are making moves to reduce this investment to the detriment of the US
The reality is there is no set of rules that determine exchange rates in the world economy. But you will find those who end up at a disadvantage howling 'foul'.
When the 'credit crunch' struck, money literally disappeared of the balance sheets of banks and off those of individual investors. Governments stepped in, in Europe and the US and pumped in new money in an attempt to fill those holes to keep the system going. Despite this the credit crunch persists. Yes, the banks did fill these holes and have made good profits through their trading activities, but the impact on the broad economy is that bank lending was not resuscitated. The state of the consumer and the broad economy in the developed world tells us this.
What's more, the banks have been pumping that money into Treasuries and making money there. So the purpose of the QE is actually being defeated in the States particularly. Certainly, no inflation is being seen in the US economy as a result of the QE. At least not yet! What should happen is that the money supply should be expanded in conjunction with job stimulation.
We take you back to the Depression and the vast money expansion which President Roosevelt authorized through the revaluation and purchase of Gold Bullion thereafter. One of the ways he pulled the US out of the Depression was to employ the unemployed to dig holes and fill them in again. Many thought this ridiculous, but what did it do? It introduced that new money into the economy by expanding the numbers of employed but most important of all it got the consumer spending as the money supply expanded. The money did not go in at the top but went in at the bottom to then filter up into the entire economy. This got the entire economy going, not just the banks. It wasn't inflationary because it did not simply add money to the system, it added spending consumers too. It matched the expansion of the economy to the expansion of the money supply.
Japan is a different kettle of fish. It has suffered deflation for a decade now. Its deflation has been absorbed by the economy and no 'holes' are there needing filling. New money in their system, we believe, will lie on the surface of the economy (as they want it to). It will precipitate inflation. Once this happens, savers will see little gain in holding depreciating cash and turn to invest in assets, so as to protect the value of their savings. They are not spending, but continue to save. By doing that the flow of money in the economy is too slow.
We believe that Japan is now about to walk that inflationary road to get the consumer spending through lowering the value of his savings. The only difficulty is that they have not done enough in this latest package to achieve that, so expect more and soon, as the Yen continues to rise. If they have success, you can be sure the US will do the same.
How can this be good for Gold Investment? Put yourself into the shoes of the Japanese investor. He has suffered deflation for so long he regularly invests in other currencies to gain the interest rate differential as well as the gain in foreign currencies over the Yen when it falls. With the Bank of Japan telling these investors they want to lower the Yen, these investors, when convinced this is about to happen, will follow this route more enthusiastically.
If he believes inflation is about to take off, he knows that in the present global environment the Bank of Japan cannot afford to let interest rates rise (and take the Yen with them). He then realizes that the buying power of the Yen is being reduced by such stimuli. Inevitably, once the Yen has been undermined by QE, interest rates will eventually have to rise, to counter excessive inflation. With this in mind both cash and fixed income securities lose their attraction. A hard asset that cannot be debauched is preferable. Locally this can be anything from property to gold. The advantage of gold is that it is well known to the Japanese and it travels all over the world. History also shows that gold has proved itself the certain retainer of value in all extreme times including both deflation and inflation.
In view of this we believe that the Japanese will turn to gold, once they see the policies intended to lower the Yen, working.
By arrangement with: www.bullionvault.com
Source: http://www.commodityonline.com/news/Japan-goes-for-gold-31389-3-1.html
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Gold Will Shine No Matter What the U.S. Economy Does
August 31, 2010
By Don Miller, Associate Editor, Money Morning
More analysts and investors are increasing their bets on gold with some forecasters saying the rally in the yellow metal will continue no matter what happens with the U.S. economy.
"Either a swift economic recovery or further dismal economic performance should bring new buyers into the market," Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt who expects gold to rise as high as $1,400 next year, told Bloomberg News. "A stronger economy would create more jewelry demand. If the economy stays weak or gets worse, then investors will be looking for a safe haven."
Gold will continue its longest rally in at least nine decades and may rise as high as $1,500 next year, about 21% higher than current levels.
Dan Brebner, an analyst at Deutsche Bank in London who is the most accurate forecaster so far this year, told Bloomberg gold prices might reach $1,550.
Altogether, analysts raised their 2011 forecasts for gold more than any other precious metal, predicting it will post its 10th consecutive annual advance.
Buyers have accumulated a record total of 2,078 tons of gold in 10 exchange-traded funds (ETFs), adding almost 278 tons worth $10.4 billion in 2010 alone, Bloomberg reported. Total holdings are almost twice Switzerland's official reserves of 1,040 tons, figures from the World Gold Council (WGC) show.
Leading the buying binge has been Soros Fund Management LLC, with total assets of about $25 billion. In January, George Soros described gold as "the ultimate asset bubble" at the World Economic Forum's meeting in Davos, Switzerland, and said that buying at the start of a bubble is "rational."
Even after selling 341,250 shares of the SPDR Gold Trust ETF (NYSE: GLD) in the second quarter, Soros' fund still held 5.24 million shares equal to almost 16 tons of the yellow metal.
Soros, who made $1 billion betting against the British pound in 1992, also purchased 11,000 call options that would allow him to buy an extra 1.1 million shares should gold prices move higher, according to the London-based Daily Telegraph.
Gold prices have gained 13% since January, beating the 8.4% return posted by U.S. Treasuries, and a roughly 6% decline in the Standard & Poor's 500 Index.
Investors are concerned about an economic recovery that appears to be weakening. Sales of U.S. homes fell to an all-time low in July, and the economy grew at a 1.6% annual rate in the second quarter, less than previously thought, the Commerce Department said Aug. 27. U.S. growth will slow to 2.8% next year, compared with 3% in 2010, according to forecasts compiled by Bloomberg.
But while the U.S. economy struggles, investors betting on gold may do well if emerging market economies continue to support the global economy with strong growth. The International Monetary Fund (IMF) said on July 7 that global economic growth would be 4.6% this year, the most since 2007.
Under that scenario, purchases of jewelry could increase, reviving demand that fell to a 21-year low in 2009, Jochen Hitzfeld, an analyst at UniCredit SpA in Munich, told Bloomberg.
Investment demand last year exceeded jewelry consumption for the first time in three decades, according to London-based GFMS Ltd. That trend continued in the second quarter, with total demand advancing 36% to 1,050.3 tons, the WGC in London said Aug. 25.
Imports by India, the world's largest bullion buyer, may hit 625 tons this year, compared with an estimated 480 tons to 485 tons last year, according to Anjani Sinha, chief executive officer of National Spot Exchange Ltd., the country's biggest exchange for trading physical gold.
In the long run, the likeliest possible outcome of the planet's economic troubles is inflation, given the recent actions of spendthrift governments like that of the United States. And gold offers investors a tangible asset that has inherent value, compared to a fiat currency that's only as good as the word of the government that issued it.
Even though investors have made the SPDR GLD ETF into the world's largest holder of bullion, Peter Krauth, a well-known commodities expert who is also the editor of the Global Resource Alert thinks there's no substitute for physical gold.
"There's nothing like holding a gold coin or gold bar in your hands. This is the oldest and most direct form of gold ownership," Krauth, recently said in an interview for Money Morning.
And Peter D. Schiff, President and chief global strategist at Euro Pacific Capital Inc., seconds that notion.
"I continue to recommend that investors hold 5% to 10% of their wealth in physical precious metals," he wrote in a recent Money Morning article.
"Aside from the likelihood that gold and silver will rise in price, precious metals offer timeless benefits, such as financial privacy, elimination of counter-party risk (if you store them yourself), as well as protection from government confiscation, onerous securities regulation, and punitive tax rates."
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