Do as he does, not as he says.

"Gold is rallying — but is it all because of one man’s lack of faith in the euro?

As Bloomberg reported on Monday:

George Soros is helping drive up gold prices by doubling his bet in a market even he considers a “bubble” as Goldman Sachs Group Inc., Barclays Capital and HSBC Holdings Plc predict more gains before it bursts..."

Read more:

http://ftalphaville.ft.c...and-the-bullion-bubble/


Cast your eyes to the gold charts in Euro and Pound, both at historic highs as investors seek a port of safety:

http://jsmineset.com/wp-...uropean-Gold-2-2010.pdf

Were I the Tanzanian central bank, I would convert 30% of the $3.55 billion in forex reserves into gold. I would buy during the seasonally weak periods that gold experiences price dips. I would only sell into strength at the peak in 2015.

Were I an aggressive Tanzanian central bank, I would convert 60% of the $3.55 billion into gold.

"Tanzania’s earnings from gold exports rose by 15.4 percent in 2009 on the back of higher world prices and increase in output, the east African country’s central bank said in a report on Monday.

In a monthly report, central Bank of Tanzania (BoT) also said tourism earnings, the country’s biggest foreign exchange earner, dropped to $1.26 billion in 2009 from $1.28 billion in the previous year, partly due to the global crisis.

Gold exports earned Tanzania $1.076 billion in 2009, up from $932.4 million the previous year....."

Read more:

http://www.businessdaily...2/-/6cfoju/-/index.html

useful!..... whats stocks would you clasify as defensive at NSE/

An Easily Understandable Explanation of the OTC Derivatives Markets

Heidi is the proprietor of a bar in Detroit. She realizes that virtually all of her customers are unemployed alcoholics and, as such, can no longer afford to patronize her bar. To solve this problem, she comes up with new marketing plan that allows her customers to drink now, but pay later.

She keeps track of the drinks consumed on a ledger (thereby granting the customers loans).

Word gets around about Heidi’s "drink now, pay later" marketing strategy and, as a result, increasing numbers of customers flood into Heidi’s bar. Soon she has the largest sales volume for any bar in Detroit.

By providing her customers’ freedom from immediate payment demands, Heidi gets no resistance when, at regular intervals, she substantially increases her prices for wine and beer, the most consumed beverages. Consequently, Heidi’s gross sales volume increases massively.

A young and dynamic vice-president at the local bank recognizes that these customer debts constitute valuable future assets and increases Heidi’s borrowing limit. He sees no reason for any undue concern, since he has the debts of the unemployed alcoholics as collateral.

At the bank’s corporate headquarters, expert traders transform these customer loans into DRINKBONDS, ALKIBONDS and PUKEBONDS. These securities are then bundled and traded on international security markets. Naive investors don’t really understand that the securities being sold to them as AAA secured bonds are really the debts of unemployed alcoholics.

Nevertheless, the bond prices continuously climb, and the securities soon become the hottest-selling items for some of the nation’s leading brokerage houses.

One day, even though the bond prices are still climbing, a risk manager at the original local bank decides that the time has come to demand payment on the debts incurred by the drinkers at Heidi’s bar. He so informs Heidi.

Heidi then demands payment from her alcoholic patrons, but being unemployed alcoholics they cannot pay back their drinking debts. Since, Heidi cannot fulfill her loan obligations she is forced into bankruptcy. The bar closes and the eleven employees lose their jobs.

Overnight, DRINKBONDS, ALKIBONDS and PUKEBONDS drop in price by 90%. The collapsed bond asset value destroys the banks liquidity and prevents it from issuing new loans, thus freezing credit and economic activity in the community.

The suppliers of Heidi’s bar had granted her generous payment extensions and had invested their firms’ pension funds in the various BOND securities. They find they are now faced with having to write off her bad debt and with losing over 90% of the presumed value of the bonds. Her wine supplier also claims bankruptcy, closing the doors on a family business that had endured for three generations, her beer supplier is taken over by a competitor, who immediately closes the local plant and lays off 150 workers.

Fortunately though, the bank, the brokerage houses and their respective executives are saved and bailed out by a multi-billion dollar no-strings attached cash infusion from the Government. The funds required for this bailout are obtained by new taxes levied on employed, middle-class, non-drinkers.

Now, do you understand?

The free market can scuttle the best laid plans of man and his government. The world is in the midst of a global commodity bull market which will entice politicians to step in and seek to control prices. Such attempts, without knowledge of the underlying fundamentals, only serves to distort markets and spawn black markets.

Quotas are useless in a deficit situation that seeks to fill in the gap with a commodity whose price is surging. Open the floodgates and stockpile while prices are low.

"Local millers will be banking on a sustained global sugar deficit to cushion them from a fresh onslaught of competition after the country ushers in a new window of larger duty-free imports from the Common Market for Eastern and Southern Africa (Comesa).

Based on a deal between Kenya and the Comesa secretariat in December 2007, Kenya is scheduled to allow some 300,000tonnes of duty-free sugar into the domestic market between now and March 1, 2011 with any consignments outside the quota attracting a 40 per cent duty charge.

This marks a significant shift from last year when the country was scheduled to allow into her market some 260,000 tonnes with any shipments outside the ceiling being slapped with a 70 per cent charge.

Luckily for local companies, importers licensed to bring in the commodity last year only managed to secure supplies estimated at just 25 per cent of the targeted volume as producers diverted consignments to the better paying global markets...."

Read more:

http://www.businessdaily.../-/t2sc3ez/-/index.html

Two of the only nations not to have defaulted on their sovereign debt in the 1931 Currency Crisis were Switzerland and Britain. Fast forward to present day, the prosperity tide has gone and we can see that Britons have been swimming naked.

Bond vigilantes and currency sharks, having rung the register with the debacle in Greece are scouting for another sovereign to maul. Jim Sinclair (www.jsmineset.com) is of the opinion that a profit of $9.9 billion was made in shorting Greek bonds via OTC derivatives.

"First the euro, now the pound. Britain's currency is coming under massive pressure as speculators bet that the UK's national debt will soon get out of hand. Like Athens, London has its share of problems -- and the Brits don't have any euro zone partners to back them up.

Schadenfreude may be a German word, but it has never been a foreign concept in Great Britain -- particularly in recent months as the British watch the trials and tribulations of the European common currency, the euro. The budgetary and debt problems facing Greece, Portugal, Italy, Ireland and Spain have merely reinforced their conviction that staying out of the euro zone was the right decision. Unlike Berlin, London is not under pressure to come to the aid of Athens...."

Read more:

http://www.spiegel.de/in...e/0,1518,681597,00.html

Even the socialists are in agreeement: a little gold goes a long way. Tanzania has a roadmap to follow; Venezuela is stockpiling 50% of local production.

" March 5 (Bloomberg) -- Venezuela’s central bank will boost its gold reserves this year and will buy more than half the estimated 20 metric tons of domestic production, bank director Jose Khan said today at an event in Caracas.

The central bank, which has about $16 billion of its $30.6 billion of reserves in gold, purchased 1.08 tons of gold from domestic mines in the first two months of this year after buying just 2 tons in all of 2009, said Khan, one of five directors at the country’s monetary authority.

“We’re going to increase our gold reserves and buy more local production,” Khan said today. “Our objective is to increase reserves and help develop the local gold industry.”

Read more:

http://www.bloomberg.com...86&sid=awESVDHFnzbQ

all the parameters should be undertaken as above
Behaviour of stock market participants
* Speculation vs. investment
* Fundamental analysis and stock valuation
* Inflation and its effects on asset prices
* The global financial crisis and its effects on you

"You might think that governments have caught on to the Blitzkrieg (CDS OTC derivative) utilized by today’s Financial Reich.

What difference does it make if you bomb Greece to its knees or just break them financially?

With Wall Street in possession of Washington, it will be interesting to see what, if anything, is done a...bout OTC derivatives. Without exception, these are weapons of mass financial destruction.

OTC derivatives are the basis for the present crisis and nothing has been done to curtail them. Therefore, nothing has been done to correct the problem at all.The crisis is not over at all." - Jim Sinclair (www.jsmineset.com)

"WASHINGTON — The Greek prime minister on Monday called on the United States and the European Union to crack down on speculative trading, saying that exotic market bets had driven up Greece’s borrowing costs and threatened its effort to ease its debt crisis.

"We will have a very hard time implementing our reform program if the gains from our austerity measures are simply swallowed up by prohibitive interest rates," the prime minister, George A. Papandreou, said in a speech at the Brookings Institution, at the start of a visit that will include a meeting with President Obama on Tuesday...."

Read more:

http://www.nytimes.com/2...s/global/09drachma.html

For those that seek gold as a triple-A rated personal reserve asset, words of advice from John Embry, Chief Investment Officer, Sprott Asset Management. The Toronto based firm has launched a physical gold Exchange Traded Fund (ETF) that trades on the New York Stock Exchange under the ticker symbol PHYS. Storage of the bullion is in Canada. Each share represents 1/100th of an ounce.

"The Gold Report caught up with John Embry, Chief Investment Strategist, Sprott Asset Management, to get his thoughts on gold and some mining stocks he favors. Embry, an industry expert in precious metals, has researched the gold sector for over 30 years. Read about why he thinks gold could gain another 30% this year as a greater proportion of the public realizes the degree of difficulty that sovereign debt is in. He believes as confidence in gold returns people will seek an outlet in gold stocks, especially small-cap gold producers and junior explorers with solid projects.

The Gold Report: John, in Investors Digest of Canada you recently said you're expecting gold to gain another 30% this year....."

Read more:

http://www.theaureport.com/pub/na/5783