Editor’s note: Mark Leibovit is one of the investment world’s top-rated gold timers, and helps investors anticipate and benefit from both the ups and the downs of the precious metals markets with his Leibovit VR Gold Letter (available to WND readers at a huge discount).
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From the Wall Street Journal:
‘Buy gold’ and short Federal Reserve, says Marc Faber
[jwplayer cbwOeTuL]
Celebrated Swiss investor Marc Faber warns that 2015 may be the year investors will lose confidence in central banks and will “suddenly realize what a scam that central banking is.”
He is long gold and recently bought more, advising that investors should buy gold and short sectors such as biotech and social media.
In an interview with Jack Otter, editor of Barrons.com, Faber reiterated his desire to short central banks. While that is technically impossible, the editor of the “Gloom, Boom and Doom Report” indicated it can be done by proxy, through the buying of gold and gold stocks.
In the Barron’s video, Faber said: “I think that my bet is that if I could short central banks, I would … in 2015 because I think that investors will suddenly realize what a scam central banking is and then they will lose confidence. And there is only one way to short central banks and that is to buy gold.”
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From GoldMoney.com:
Sovereign bonds won’t stay up forever
By Alasdair Macleod, member London Stock exchange
Today’s obvious mispricing of sovereign bonds is a bonanza for spending politicians and allows over-leveraged banks to build up their capital. This mispricing has gone so far that negative interest rates have become common: In Denmark, where the central bank persists in holding the krona peg to a weakening euro, it is reported that even some mortgage rates have gone negative, and high quality corporate bonds such as a recent Nestle euro bond issue are also flirting with negative yields. …
Macroeconomists will probably claim that so long as central banks can continue to manage the quantity of money sloshing about in financial markets, they can keep bond prices up. But this is valid only so long as markets believe this to be true. Put another way, central banks have to continue fooling all of the people all of the time, which as we all know is impossible.
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From the Financial Times:
Another central bank pledges ‘whatever it takes’
Denmark’s central bank governor pledged to face down speculators testing its currency peg to the euro, saying he would do “whatever it takes” to defend it.
Lars Rohde told the Financial Times that Nationalbank could “go on forever” defending the peg, after lowering interest rates four times in three weeks to a global record low of minus 0.75 percent. It has also swelled its balance sheet to a record size by printing krone in an attempt to weaken the Danish currency.
“The main message is that we are ready to do whatever it takes to defend the peg. We have unlimited access to Danish krone and we have no restrictions on our balance sheet,” he said, in his first public comments since the recent quadruple rate cuts. …
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From the New York Sun:
The Fed’s right mind?
It looks like the Federal Reserve is starting to worry about Sen. Rand Paul’s plan to audit the central bank. The way the Hill newspaper, which covers Congress, puts it this week is that the Fed is “lashing out” at Mr. Paul’s plan, which, it said, could gain traction now that the Republicans are in control of the Senate as well as the House. It quotes the president of the Dallas Fed, Richard Fisher, as demanding, in an interview, “Who in their right mind would ask the Congress of the United States – who can’t cobble together a fiscal policy – to assume control of monetary policy?”
Who in their right mind? How about George Washington, James Madison, Alexander Hamilton, and the rest of the rest of the authors of the Constitution. …
If the Congress is so inept at budgeting, why has the Federal Reserve been buying up the paper it’s kiting? The Fed has taken onto its books more than $2 trillion in federal debt. …
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From BloombergView.com:
Is China preparing for currency war?
By William Pesek
China has entered the global monetary-easing fray, along with more than a dozen other economies, after its central bank surprised investors by cutting reserve requirements 50 basis points to spur lending and combat deflation. But Beijing may be raring for an even bigger and more perilous fight – in the currency markets.
Reducing the amount of cash that banks are required to set aside (to 19.5 percent), as China has just done, is largely symbolic – a don’t-panic-we’re-on-top-of-things reassurance to international markets and local property developers. Still, the move is also an inflection point. China is in all likelihood about to loosen monetary policy considerably to support economic growth. If global conditions worsen, China’s one-year lending rate, now at 5.6 percent, could head toward zero.
At the same time, something else is afoot in Beijing could have even greater global impact. The central bank is cooking up measures to widen the band in which its currency trades. People’s Bank of China officials say it’s about limiting volatility as capital zooms in and out of the economy. Let’s call it what it really is: the first step toward yuan depreciation and currency war. …
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From Bloomberg.com:
Where is Germany’s gold?
Bloomberg News published a long profile about the heroic work of the leader of Germany’s gold repatriation campaign, Peter Boehringer of the German Precious Metals Society. As the profile raises the campaign’s powerful questions about the disposition of the gold reserves of the German Bundesbank and other central banks, it touches ever so briefly on the previously prohibited subject of gold market manipulation.
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From Reuters:
Bank of Montreal gold product takes aim at big ETF market, new investors
Bank of Montreal has launched a new way for investors to buy physical gold, offering greater security than private storage while going head to head with the $60 billion exchange-traded fund industry.
The launch comes at a critical time for bullion, with investors in recent weeks making a tentative return to the market after a prolonged exodus as the oil rout and euro-zone instability reignite gold’s appeal as a safe-haven investment.
The first of its kind in the United States, the Canadian bank’s new gold deposit receipt program (GOLDR) allows investors to buy and sell shares that are backed by physical bullion stored in Canada and that track the price of spot gold. …
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From GoldBroker.com:
5 reasons to buy gold and silver in 2015
After evaluating four different possible scenarios for gold’s future performance, investment analyst Dan Popescu offers five reasons to buy the monetary metals this year, with the best ones perhaps being that central banks are increasingly at odds with each other and that the developed world’s debt has reached unsustainable levels that can only be repudiated directly or inflated away.
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