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The Goldbugg Report - May 05, 2009

May 5, 2009

WORLD FINANCIAL REPORT ON RADIO MAY 1 2009 SHOW

DEFINITIONS-QUOTES-QUICK HITS

-Swine influenza (also swine flu) refers to influenza caused by any strain of the influenza virus endemic in pigs (swine). Strains endemic in swine are called swine influenza virus (SIV). Swine flu is common in swine and rare in humans. People who work with swine, especially people with intense exposures, are at risk of catching swine influenza if the swine carry a strain able to infect humans.

However, these strains rarely are able to pass from human to human. Rarely, SIV mutates into a form able to pass easily from human to human. The strain responsible for the 2009 swine flu outbreak in humans (a strain of influenza A virus subtype H1N1) is believed to have undergone such a mutation. Read more here-

http://en.wikipedia.org/wiki/Swine_influenza

-The 2009 swine flu outbreak is an epidemic that began in April 2009 with a new strain of H1N1 swine influenza virus. It is also referred to as Mexican flu, swine-origin influenza, or 2009 H1N1 flu. The outbreak is believed to have started in March 2009 and was classified as meeting the criteria for the World Health Organization pandemic Phase 5 status on 29 April.

Local outbreaks of an influenza-like illness were first detected in three areas of Mexico, but the virus responsible was not clinically identified as a new strain until April 24, 2009. Its presence was soon confirmed in various Mexican states and Mexico City. Within days isolated cases (and suspected cases) began to appear elsewhere in Mexico, the U.S., and several other Northern Hemisphere countries. Read more here-http://en.wikipedia.org/wiki/2009_swine_flu_outbreak

-Centers for Disease Control and Prevention swine flu info website-http://www.cdc.gov/swineflu/

-Public Health Agency of Canada swine flu info website-http://www.phac-aspc.gc.ca/alert-alerte/swine_200904-eng.php

-World Health Organization swine flu info website-http://www.who.int/csr/disease/swineflu/en/index.html

-Swine Flu Case in Spain May Point to Global Pandemic, WHO Says. A swine-flu patient in Spain who hadn’t traveled to Mexico may signal a new front of the outbreak, potentially heralding the first influenza pandemic in 41 years.

The World Health Organization raised its six-tier alert to 5, the second-highest, and said a pandemic declaration may come soon. It urged countries to make final preparations to deal with a virus that may sweep across the globe. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid=aIHcy7rxdvpI&refer=home

-Estimates of economic costs of a flu pandemic. If the outbreak of swine flu in Mexico becomes a pandemic, the economic consequences could be great. The World Bank estimated in 2008 that a flu pandemic could cost $3 trillion (£2 trillion) and result in a nearly 5pc drop in world gross domestic product. The World Bank has estimated that more than 70m people could die worldwide in a severe pandemic. Read more here-http://www.telegraph.co.uk/health/healthnews/5228878/Estimates-of-economic-costs-of-a-flu-pandemic.html

-If you spent $1 million a day since the day Jesus Christ was born, you still wouldn't have spent a trillion dollars. Senator Mitch McConnell

-Most people still do not understand that the current crisis is not about saving capitalism; it’s about saving the welfare state-crony capitalist-fascist political economy in the US that can no longer pay its bills. Bill King-the King Report

-"Make no mistake. We are selling off our future and the future of our children to prevent the bondholders of US financial corporations from taking losses. We are using public funds to protect bondholders of some of the most mismanaged companies in the history of capitalism, instead of allowing them to take losses that should have been their own." John Hussman

-“The value of gold, as the only true ‘hard currency,’ is coming to the fore, as evidenced by the investment choices of some of the world’s most seasoned investors.” AngloGold Ashanti Ltd. chief executive officer Mark Cutifani

-So where to from here for gold and silver? The set-up in silver hasn't been this good since it was priced around $8.70 back in October. Gold is still the question mark. The 200-day moving average was never broken to the down-side since gold got killed on its last attempt to break through, and stay above, the $1,000 mark on February 22nd. True, the 'sell in May and go away' scenario is almost upon us but will it apply this year? Don't know, but I haven't taken my money off the table especially in silver. I've got the time, so I'm just going to wait these bastards out. Ed Steer

-John Reade of UBS in London pointed out that “considering Mexico’s position as the second-largest producer of silver, supplies could be interrupted if the swine virus continues to spread.” Casey Daily Resource

-The official Xinhua News Agency reported that, according to the head of the State Administration of Foreign Exchange, China has increased its gold reserves by 76% over the six-year period, to 1,054 metric tons (nearly 34 million ounces), mainly through domestic buying and scrap refining.

That makes a great deal of sense in light of China’s repeated assertions that it needs to diversify its nearly $2 trillion stockpile of foreign exchange reserves. Bullion buying clearly reflects efforts in that direction.

“This news is highly significant for the gold market,” wrote John Reade, UBS AG’s head metals strategist in London. “It will raise expectations of further Chinese purchases. It may also trigger purchases from other central banks.” Casey Daily Resource

-While none of the precious metals are truly precious (in terms of supply availability), gold is indeed precious in terms of real money. All I heard in 2008 was how poorly it was performing given what was happening worldwide. Yet it was up 4% for the year. How many people wish their investments were up 4% in 2008 versus what they lost? Now in 2009, the peanut gallery and members of the “Don’t Worry, Be Happy” crowd (and a shill or two who work for gold-oriented companies but are really bears on gold) say with the worst behind us, gold should become a relic once again.

I won’t argue it’s not possible to see $700 again but with upside of two to three times versus downside, I’m not going to try and trade any decline knowing in my heart what’s coming down the pike. I also laugh at the seemingly tireless talk of the IMF selling its gold. During the most recent chatter about it, reports circulated that said China and India were urging the IMF to finally pull the trigger.

Isn’t it interesting that we just learned that China has been purchasing gold consistently yet they want someone to sell it? Why? So they can lose money on their recent purchases? No, because they want to own more and be glad not to have to pay greatly up for it. Please IMF, sell! Before long it will be one less false stick the gold bears can wave at the market. Peter Grandich-Read more here-http://news.goldseek.com/Grandich/1241036623.php

-How anyone can reasonably think the U.S. Dollar can be higher in the coming years is beyond me. U.S debt is out of control and key holders of it will grow more disenchanted with taking on more without a much higher interest rate to make up for a near certain loss on the currency. My favorite currency is the Canadian dollar. Peter Grandich

-Gerald Celente Predicts Economic Armageddon by 2012. Watch more here-http://www.youtube.com/watch?v=Q2qDW34Fr64 and http://geraldcelentechannel.blogspot.com/

-Martin Armstrong says Major Turn at Hand, batten down the hatches. Read more here-http://jsmineset.com/2009/04/27/martin-armstrong-says-major-turn-at-hand-batten-down-the-hatches-or/ or http://www.moneytalks.net/index.php?option=com_content&view=article&id=1204:major-turn-at-hand-will-it-be-batten-down-the-hatches-or

-Ambrose Evans-Pritchard: Capital well is running dry. The world is running out of capital. We cannot take it for granted that the global bond markets will prove deep enough to fund the $6 trillion or so needed for the Obama fiscal package, US-European bank bailouts, and ballooning deficits almost everywhere. Read more here-

http://www.gata.org/node/7387

-Howard Ruff interviews John Williams of Shadow Stats. Williams says we are headed into a hyper-inflationary depression that will become a Great Depression. When hyper inflation hits, it will disrupt the normal flow of commerce and turn it into a Great Depression. Read more here-http://www.321gold.com/editorials/ruff/ruff042709.html

-The U.K.’s recession will last through the end of next year as house prices drop in an economic slump increasingly resembling that of the 1930s, former Treasury adviser Roger Bootle said. Gross domestic product will drop 1 percent in 2010 after shrinking 4 percent this year, Bootle, an economic adviser at Deloitte & Touche LLP, predicted today. U.K. house prices dropped for a 19th month in April, Hometrack Ltd. said in a separate report.

“It’s looking more and more like the 1930s all over again,” Bootle said in an interview on Bloomberg Television. When asked if the U.K. will sink into a depression, he said, “it’s in danger of being that, yes.” Read more here-http://www.bloomberg.com/apps/news?pid=20601068&sid=as70JW7BS51o&refer=home

-Economy in U.S. Shrank at 6.1% Rate in First Quarter. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid=aHyjnZCJkYIU&refer=home or http://www.bloomberg.com/apps/news?pid=20601110&sid=aeLS30YslYd8

-U.S. March Consumer Spending Fell More Than Forecast. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid=a_oglDHVKGyI&refer=home

-U.S. Economy: Confidence Index Rises Most Since 2005. Read more here-http://www.bloomberg.com/apps/news?pid=20601068&sid=a.JioUJOTODc&refer=economy

-Treasury needs record $361B April-June borrowing. The Treasury Department said Monday it will need to borrow $361 billion in the current April-June quarter, a record amount for that period. It's the third straight quarter the government's borrowing needs have set records for those periods.

Treasury also estimated it will need to borrow $515 billion in the July-September quarter, down slightly from the $530 billion borrowed during the year-ago period. The all-time high of $569 billion was set in the October-December period. The huge borrowing needs reflect the soaring costs of the $700 billion financial rescue program and the recession, which is nearing a record as the longest in the post World War II period. Read more here-http://news.yahoo.com/s/ap/20090427/ap_on_bi_go_ec_fi/us_treasury_borrowing

-Where did all the bailout money go? The government has pledged $11.3 trillion for economic rescue and has spent one-quarter of that. On what? Read more here-

http://www.csmonitor.com/2009/0429/p19s01-usgn.html?page=1

-U.K. government support for the banking system has risen to 1.4 trillion pounds ($2 trillion) and may climb higher as the financial crisis spreads to building societies and economists warn lenders may need more aid. Read more here-http://www.bloomberg.com/apps/news?pid=20601109&sid=a0_DlDun684Q&refer=news

-Question about Goldman Sachs role in the stock market. Something smells fishy in the market. And the aroma seems to be coming from Goldman Sachs. As you probably already know, stock prices have been roaring for seven weeks. This has created a historic rally despite the fact that the economy continues to be in serious trouble, banks are still wheezing under the heavy load of bad assets, workers are being laid off each month by the hundreds of thousands and nobody seems to have answers to our problems. Read more here-

http://www.nypost.com/seven/04282009/business/questions_about_goldman_sachs_role_in_ma_166505.htm

-Bill Fleckenstein says thank Uncle Sam for the stock rally. Cranking up the money-printing machines is like pouring gas on a smoldering fire. While the short-term response is predictable, the long-term effect is far from certain. Read more here-http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/thank-uncle-sam-for-the-rally.aspx?page=all

-Car Dealers' Next Headache: Inventory Loans. For Chrysler LLC and General Motors Corp. dealerships, slow sales are just part of their worries. Now they're bracing for possible auto-maker bankruptcy filings that could trigger repayment of their inventory loans.

The two auto makers have about 10,000 dealers in the U.S., with the bulk of them carrying considerable debt, mainly from the money they borrow to buy cars that sit on their lots. If Chrysler or GM were to file for bankruptcy protection, the banks extending that credit could immediately begin calling dealer loans, demanding a good portion of the money back and refusing to extend any more inventory financing.

U.S. taxpayers, meanwhile, could be called to the rescue. At issue are loans for inventory, known as "wholesale" loans or "floorplan" financing, that are primarily given by GMAC LLC and Chrysler Financial to dealers so they can buy vehicles to stock their showrooms. These loans are typically backed by the vehicles that are being financed by the dealer and paid back when the vehicles are sold. Read more here-http://online.wsj.com/article/SB124078863198457471.html#printMode

-Auditors: Nearly 25% of Companies May Not Be Going Concerns. A research firm predicts 3,589 companies will report that their auditors doubt they will continue as going concerns. Read more here-http://www.cfo.com/article.cfm/13525910

-Italy Seizes Millions in Assets From Four Banks. With municipal bond investigations spreading to Europe from the United States, Italian authorities have seized about $300 million in assets of four global banks JPMorgan Chase, Deutsche Bank, UBS and Depfa whose officials have been accused of fraud.

The Guardia di Finanza in Milan, the financial police of Italy, took over real estate properties, bank accounts and stock holdings on Monday to assure it could collect from the banks if their officials were found guilty and the banks were held responsible. Read more here-http://www.nytimes.com/2009/04/28/business/global/28muni.html

-Italy's Mafia thrives in global financial meltdown. Read more here-http://www.breitbart.com/article.php?id=D97PHLVO0&show_article=1

-How Bernie did it. Madoff is behind bars and isn't talking. But a Fortune investigation uncovers secrets of his massive swindle. Read more here-

http://money.cnn.com/2009/04/24/news/newsmakers/madoff.fortune/index.htm

-Petraeus: Afghanistan could be harder than Iraq. Read more here-http://www.cnn.com/2009/POLITICS/04/24/petraeus/index.html

-NKorea threatens nuclear, missile tests. Read more here-http://www.breitbart.com/article.php?id=D97S4DRG0&show_article=1

-Jordan sees new war if US does not act quickly. Jordan's king urged President Barack Obama Sunday to take a more forceful role in the peace process between Israelis and Palestinians, warning of a new Mideast war if there is no significant progress in the next 18 months.

Speaking to NBC's "Meet the Press," King Abdullah described the Israeli-Palestinian dispute as the core problem of the region and solving it would help the U.S. in dealing with Iran and combating the appeal of radical Islamic groups like Al-Qaida.

"In the next 18 months, if we don't move the process forward, and bring people to the negotiation table, there will be another conflict between Israel and another protagonist," he said in the interview recorded in Washington on Friday. Read more here-http://news.yahoo.com/s/ap/20090426/ap_on_re_mi_ea/ml_jordan_king_1

-Is Iraq sliding back into chaos? Read more here-http://newsvote.bbc.co.uk/mpapps/pagetools/print/news.bbc.co.uk/2/hi/middle_east/8018866.stm?ad=1

-TIME '100 most influential people list. Read more here-http://www.time.com/time/specials/packages/completelist/0,29569,1894410,00.html

WWW.RARECOLOREDDIAMONDS.COM

-The Rare Colored Diamonds Historical Value Tracker system is the perfect tool for investors to view the potential future value of a rare colored diamond based on the current market trend of a particular type of diamond. Track the potential future value of colored diamonds here-http://www.rarecoloreddiamonds.com/HistoricalValueTracker.html

-Watch BTV interview of Harold Seigel on colored diamonds and his website http://www.rarecoloreddiamonds.com/. Watch video here-http://www.youtube.com/watch?v=BWYMJnEz-n4

and http://www.rarecoloreddiamonds.com/articles/index.html

-BTV-Business Television Features Rare Colored Diamonds. Read press release here-http://www.globenewswire.com/newsroom/news.html?d=162753

-"Colored diamonds have held their value and not suffered from the current economical crisis as other traditional assets have." Mahyar Makhzani-Rapaport February 18 2009

-Rare blue diamond goes on display. A rare blue diamond which could set a world record price per carat when it is sold in May has gone on show in London. Smaller than a penny piece, it is worth between $5.8m (£3.9m) and $8.5m (£5.7m) according to estimates by its sellers.

It weighs 7.03 carats and is one of only a handful of blue diamonds in existence in the world. The diamond was found in South Africa last year and is on show at Sotheby's, in Mayfair, until Tuesday. It will be auctioned in Geneva on 12 May. The gem, which was cut from a 26.58 carat rough diamond, was discovered in 2008 at the Cullinan mine. Read and watch more here-

http://news.bbc.co.uk/2/hi/uk_news/8019249.stm or http://files.shareholder.com/downloads/BID/621714246x0x287752/3f6b2a4c-2955-4ad7-8594-b335242168ab/287752.pdf or http://www.bloomberg.com/apps/news?pid=20601088&sid=a4rPTX2.qZo8&refer=muse

-French Blue diamond is explored in Gems & Gemology’s spring issue. For the Spring 2009 issue of its Gems & Gemology publication, the Gemological Institute of America (GIA) has given a concentrated and in-depth editorial on the French Blue diamond, a rare piece which disappeared in 1792 during the French Revolution.

It has long been believed that the 45.5 ct Hope diamond was cut from the 69 ct French Blue. A lead cast of the fabled French Blue recently discovered at the Muséum National d’Histoire Naturelle (MNHN) in Paris appears to validate this theory. In “The French Blue and the Hope,” Dr. François Farges of MNHN and coauthors used the cast to create a computer model that sheds new light on the Hope-French Blue connection.

“This article reconstructs the history of the French Blue and offers implications for its fate,” says G&G Editor-in-Chief Alice Keller. “It's a significant breakthrough in our understanding of this mythic diamond and the famous stone cut from it,” she added. Read more here-http://diamondworld.net/contentview.aspx?item=3749

-Rio Tinto’s Blue Diamond Tender Ends, "Exceeds Expectations." Rio Tinto’s tender of rare blue and violet diamonds ended recently, realizing record prices according to the company, which did not disclose any specific figures. The diamonds, dubbed the ‘Once in a Blue Moon “collection, included a range of diamonds, divided into16 lots weighing 287 carats in total. Sourced from several years of production at the Argyle diamond mine in Western Australia, the company said the tender prices "far exceeded the company’s expectations."

But while the company is sheepish on the sale prices, not disclosing the total prices or even if all the diamonds were sold, according to Jean-Marc Lieberherr, Rio Tinto’s general manager of diamond sales and marketing, “it was a bold move, with numerous lots selling in excess of the reserve prices, which is a great sign in the lead up to our annual pink diamond tender.” A request for more details about the tender was not answered at publication time.

"We have been overwhelmed by the enthusiasm from new and existing colored diamond collectors around the globe," said Josephine Archer, sales and marketing manager for Argyle Pink Diamonds. The collection was showcased in Tokyo, Hong King and Perth with bids closing on April 8. It included single cuts, a number of matching pairs and a selection of smaller diamonds. In terms of quality, Rio Tinto defined the diamonds as “premium” and commercial diamonds.

The Argyle diamond mine is known for its colored diamonds. While most are brownish in color, the mine also produces rare pink, red, violet and gray stones. Rio Tinto usually polishes these diamonds in-house and tenders them to traders and collectors. Story here-http://www.idexonline.com/portal_FullNews.asp?id=32274\

-Christie's Dubai Jewels Sale Tops $4M, Sees Dubai Wealthy Shrug off Econ Woe. Read more here-http://online.wsj.com/article/BT-CO-20090429-702639.html or http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26155

-Christie's Dubai Jewels auction results here-

http://www.christies.com/LotFinder/searchresults.aspx?intSaleID=22320#&intSaleID=22320&sid=3c9f4168-2941-478e-ad4c-7d1f934a1bf3&selectedids=2241&pg=2 and http://www.christies.com/LotFinder/searchresults.aspx?intSaleID=22320#action=refine&intSaleID=22320&sid=3c9f4168-2941-478e-ad4c-7d1f934a1bf3&selectedids=2241

A COLOURED DIAMOND RING, BY CALLEIJA-The pear-shaped Fancy Light Purplish Pink diamond weighing 1.52 carats to the oval-shaped pink diamond shoulders, ring size 7, in Callleija dark blue case Signed Calleija and with maker's mark for John Calleija. Price Realized $30,000-More here-http://www.christies.com/LotFinder/lot_details.aspx?from=salesummary&intObjectID=5192627&sid=76d98328-b1e7-43f9-85dd-0b6ac2ed6c98

A COLOURED DIAMOND AND DIAMOND RING-The oval-shaped Fancy Vivid Purplish Pink diamond weighing 1.53 carats to the marquise-cut diamond double tiered surround and plain hoop, ring size 6½. Price Realized $182,500-More here-

http://www.christies.com/LotFinder/lot_details.aspx?from=salesummary&intObjectID=5192628&sid=76d98328-b1e7-43f9-85dd-0b6ac2ed6c98

A DIAMOND AND COLOURED DIAMOND PENDANT-The modified kite-shaped diamond weighing 5.01 carats suspended from a brilliant-cut diamond spacer to the brilliant-cut Fancy Light Bluish Green diamond within a pavé-set diamond halo with spectacle-set diamond chain, 48.0 cm long, may also be fastened at 43.0 cm.  Price Realized $194,500-More here-

http://www.christies.com/LotFinder/lot_details.aspx?from=salesummary&intObjectID=5192624&sid=3c9f4168-2941-478e-ad4c-7d1f934a1bf3

-Diamonds Hold Steady at Sotheby’s New York Auction. Read more here-http://www.diamonds.net/news/NewsItem.aspx?ArticleID=26095

-Sothebys Magnificent Jewels auction results here-http://www.sothebys.com/app/live/lot/LotResultsDetailList.jsp?event_id=29345&sale_number=N08540

LOT 96-FANCY INTENSE YELLOW DIAMOND RING, CARTIER-The oval modified brilliant-cut diamond of fancy intense yellow color weighing 3.08 carats, flanked by 2 half-moon-shaped diamonds, mounted in platinum and 18 karat gold, size 5¾, signed Cartier. 45,000-55,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  56,250 US-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=96

LOT 124-PAIR OF YELLOW DIAMOND PENDANT-EARRINGS-Composed of 2 pear-shaped diamonds of fancy intense yellow color weighing 3.83 and 3.11 carats, 2 marquise-shaped diamonds of yellow hue together weighing 1.32 carats, and 2 pear-shaped diamonds of fancy intense yellow color weighing 1.40 and 1.11 carats, framed by small round diamonds, mounted in platinum and 18 karat gold. 125,000-75,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  134,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=124

LOT 126-FANCY INTENSE YELLOW DIAMOND RING-The oval diamond of fancy intense yellow color weighing 4.00 carats, flanked by 2 oval diamonds weighing 1.91 carats, mounted in platinum and 18 karat gold, size 7½, numbered 33952. 50,000-60,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  62,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=126

LOT 138-PAIR OF YELLOW DIAMOND EARRINGS-Set with 2 cushion-shaped diamonds of yellow color weighing 3.29 and 2.97 carats, framed by numerous round diamonds, mounted in platinum and 18 karat gold. 20,000-30,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  23,750 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=138

LOT 139-YELLOW AND WHITE DIAMOND NECKLACE-Designed as a flexible stylized graduated fringe set with numerous fancy-shaped diamonds of yellow color weighing approximately 17.60 carats, accented by numerous round diamonds weighing approximately 5.25 carats, mounted in 18 karat white gold, length 16 inches. 10,000-15,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  15,000 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=139

LOT 141-FANCY INTENSE YELLOW DIAMOND RING-The cushion modified brilliant-cut diamond of fancy intense yellow color weighing 3.07 carats, framed by numerous small round diamonds weighing approximately .55 carat, mounted in 18 karat white gold, size 6½. 40,000-50,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  41,250 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=141

LOT 270-DIAMOND RING-The oval diamond weighing 3.00 carats, framed by numerous round pink diamonds weighing approximately 1.30 carats, mounted in 18 karat rose gold, size 6¾. 50,000-60,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  68,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=270

LOT 273-FANCY INTENSE PINK DIAMOND RING-The pear-shaped diamond of fancy intense pink color weighing 1.52 carats, flanked by 8 round diamonds, mounted in platinum, size 6. 50,000-70,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  71,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=273

LOT 300-FANCY ORANGE-BROWN DIAMOND RING-The emerald-cut diamond of fancy orange-brown color weighing 8.69 carats, flanked by 2 baguette and 2 triangular-shaped diamonds weighing approximately 1.60 carats, mounted in platinum, size 7¼. 80,000-100,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  86,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=300

LOT 359-FANCY DEEP BROWNISH ORANGY YELLOW DIAMOND RING-The pear-shaped diamond of fancy deep brownish orangy yellow color weighing 17.33 carats, mounted in 18 karat gold, size 6¾. 90,000-120,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  170,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=359

LOT 361-FANCY INTENSE YELLOW DIAMOND RING-The cut-cornered rectangular modified brilliant-cut diamond of fancy intense yellow color weighing 12.17 carats, flanked by 2 triangular-shaped diamonds weighing approximately 1.55 carats, mounted in 18 karat gold and platinum, size 6½. 120,000-160,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  158,500 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=361

LOT 362-FANCY DEEP BROWNISH YELLOWISH ORANGE DIAMOND RING-The pear-shaped diamond of fancy deep brownish yellowish orange color weighing 6.41 carats, flanked by 2 tapered baguette diamonds, mounted in platinum and gold, size 6¼. 30,000-40,000 USD-Lot Sold.  Hammer Price with Buyer's Premium:  46,875 USD-More here-http://www.sothebys.com/app/live/lot/LotDetail.jsp?sale_number=N08540&live_lot_id=362

GOLD

-China Increases Gold Reserves 76% to Fifth-Largest. China boosted its gold reserves by 76 percent since 2003 and has the world’s fifth-biggest holding by country, said Hu Xiaolian, head of the State Administration of Foreign Exchange.

The nation increased its reserves by 454 tons to 1,054 tons through domestic purchases and refining scrap metal, Hu said in an interview with the Xinhua News Agency today. The amount is more than Switzerland’s 1,040 tons, World Gold Council data show, and is worth $31 billion at current prices.

China has the world’s largest foreign exchange reserves at $1.95 trillion as of March 31, according to state administration data. The holdings have climbed about sixfold in the past six years as the country had record trade surpluses and inflows of foreign investment. Gold prices have almost tripled to more than $900 an ounce from $337.

“Chinese foreign-exchange reserves have absolutely exploded in the past few years,” said Jan Lambregts, head of Asia research at Rabobank International in Hong Kong. “We shouldn’t be surprised that they’re adding a lot of all asset classes. I don’t think they’re shifting away from U.S. dollars into gold.” Read more here-

http://www.bloomberg.com/apps/news?pid=20601080&sid=aoLApmbjN47k&refer=asia or http://www.gata.org/node/7380

-CPM stresses significance of Chinese gold holding clarification. The recent announcement that China has increased its monetary reserves of gold by 14.6 million ounces (454 tonnes) is perhaps more significant in the process than in the amount reckons CPM. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page34?oid=82492&sn=Detail

-Is it China that's giving gold strength or is it on the way up anyway? While both Chinese gold reserve purchases and swine 'flu are both said to have had an impact on the gold price we would argue that longer term trends are more significant. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=82481&sn=Detail

-Chinese Purchase Could Lead to Structural Shift in Gold Holdings, Says WGC. Read more here-http://finance.yahoo.com/news/Chinese-Purchase-Could-Lead-bw-15027196.html?.v=1

-J.S. Kim: Central banks are full of disinformation on gold. Read more here-http://www.gata.org/node/7392

-Michael Kosares: China turns IMF gold sales into a wet noodle. Read more here-http://www.gata.org/node/7383

-Judy Shelton: The IMF's gold gambit. Read more here-http://www.gata.org/node/7388

-Third gold sales pact to plant flag of support. Read more here-http://uk.news.yahoo.com/22/20090430/tbs-uk-precious-gold-sales-analysis-sb-e5e6c38.html

-I have just completed an analysis of the performance of the spot price of gold vs. Berkshire Hathaway. I think you will find the results are a little surprising. Interestingly, Buffet himself emphasized the non-productive aspects of gold in a speech at Harvard in 1998: “It gets dug out of the ground in Africa or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.” Perhaps its utility is in balancing a portfolio Warren? Gold.ie

-James Turk on Gold's Strong Technical Position. Read more here-http://goldmoney.com/en/commentary/2009-04-26.html

-Precious coin distributor claims record Krugerrand sales. A South African precious coin distributor, the South African Gold Coin Exchange, reported on Friday that sales of Krugerrands were “at an all-time high”. Executive chairperson Alan Demby said that domestic demand appeared to be underpinned by prevailing concern about the safety of banks.

Investors were also resorting to physical-gold purchasing as a way to protect their assets, as well as to stave off the threat of a possible surge in inflationary pressures as trillions of dollars were pumped into the global economy in a bid to deal with a global recession.

A recent World Gold Council report found that retail demand for gold bullion in the fourth quarter of 2008, was almost five times what it was in the same period of 2007. Demby noted that a Krugerrand bought for £200 or so in 2005 was now worth more than £700. Read more here-http://www.miningweekly.com/article/precious-coin-distributor-claims-record-krugerrand-sales-2009-04-24

-Clive Maund gold market update-http://news.goldseek.com/CliveMaund/1240768646.php

-Gold one of best asset plays, but copper due for pullback and don't count on China! Bullish on gold, platinum, palladium and natural gas, but far from bullish on the recovery, which he sees happening later than expected. Interview with John Licata from The Gold Report. Read more here-http://www.mineweb.net/mineweb/view/mineweb/en/page31?oid=82458&sn=Detail

-Gold prices to stay high, but investors to shift to equities, industrial commodities. Scotiabank's Patricia Mohr advises that copper prices have surged to genuinely profitable levels, although zinc and nickel prices still remain below average break-even costs. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page36?oid=82565&sn=Detail

-Worst recession in living memory, but metals already eyeing the sunny uplands. Stay with precious metals, urges RBS, but ensure also that you have industrial metal exposure. April heading to be the best month for prices in 40 years. Zinc is expected to slip into deficit next year and copper in 2011, but aluminum is carrying heavy inventories that may yet increase further. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page36?oid=82561&sn=Detail

-World gold output will continue to fall Barrick CEO. Global gold production from mines will continue to decline, as the gold industry battles maturing mines, a scarcity of new discoveries and longer permitting and construction times for new projects, the CEO of the world's biggest gold miner said on Wednesday.

“The gold industry needs to replace almost 100-million ounces of reserves per year, and clearly this has not been happening,” Barrick Gold chief Aaron Regent said at the company's annual shareholders meeting in Toronto. Gold mine supply has been on a downward trend since 2001, despite a more than tripling of the gold price, and this trend is likely to continue, he said.

New projects can take as long as seven to ten years to bring online, compared with just three to five years in the past, Regent said. Several gold projects around the world have also been put on ice because of ballooning capital costs and difficulties raising finance. Global gold mine production contracted almost 3% last year, to its lowest level in 12 years, according to consultancy GFMS. Read more here-http://www.miningweekly.com/article/world-gold-output-will-continue-to-fall-barricks-regent-2009-04-29

-Gold Scrapping May Have Reached 500 Tons, GFMS Says. Read more here-http://www.bloomberg.com/apps/news?pid=20601012&sid=amSEAIzDso1E&refer=commodities

-Why Didn't Gold Rise by $100? Read more here-http://www.numismaster.com/ta/numis/Article.jsp?ad=article&ArticleId=6632

-Ned Schmidt's Gold Thoughts. Read more here-http://news.goldseek.com/NedSchmidt/1240898640.php

-GATA Chairman Murphy interviewed by TheFinancialTube.com. Watch more here-http://www.thefinancialtube.com/video/3135/042509-Bill-Murphy-of-GATA--LeMetropoleCafe

-Gold vs. Paper. Read more here-http://news.goldseek.com/GoldSeek/1240988400.php

-Gold Bullion vs. Gold Mining Stocks. Which Investment is Best for You? Many investors believe their portfolios have exposure to gold and precious metals because they hold stocks in mining companies. Bullion and mining stocks should be viewed as two different investments. But as a safe haven, no gold or silver or platinum mining stock (or even an ETF) compares with actual physical bullion. Let’s examine why physical bullion is the superior investment to mining stock’s for long-term investors.

Over the long term, bullion reduces risk and improves returns. In order to be fully diversified, investors need to include all the major asset classes in their portfolios: stocks, bonds, cash, real estate, commodities and precious metals. Of these asset classes, precious metals in bullion form are, over the long term, the most negatively correlated to traditional financial assets such as stocks and bonds.

Holding bullion reduces portfolio volatility and improves returns during normal market conditions, and will act as portfolio insurance during periods of economic stress, growing in value and effectively offsetting losses in the other asset classes.

During high inflation periods, bullion tends to outperform all other assets classes. During the 1970s, a memorable period of high inflation, precious metals outperformed all other assets classes for over 11 years. Many economists predict we will soon be heading into a period of inflation and possibly hyperinflation as a result of the ‘easy money’ policies implemented by deflation-phobic central banks.

When bullion prices are rising, mining stocks can form a significant part of the equity component of every portfolio. A study by Ibbotson Associates concluded that: "Investors can potentially improve the reward-to-risk ratio in conservative, moderate, and aggressive asset allocations by including precious metals with allocations of 7.1%, 12.5%, and 15.7%, respectively. These results suggest that including precious metals in an asset allocation may increase expected returns and reduce portfolio risk."

However, in order to fully protect portfolios from real inflation and market declines, a much higher allocation would be appropriate. Bullion provides real wealth preservation. Gold and silver have been used as money for over 3,000 years, and platinum for centuries. Today, the world’s wealthiest families still hold bullion to protect their wealth. Precious metals have proven to be the best protection an investor can have against both inflation and monetary crises. As the financial storm clouds intensify in 2009 and beyond, any portfolio without a sizeable physical bullion component is needlessly at risk. Nick Barisheff-Read more here-http://www.kitco.com/ind/Barisheff/apr282009.html

SILVER

Gold to silver ratio at 80 to 1 with gold at $1,900 the silver price would be $23.75

Gold to silver ratio at 70 to 1 with gold at $1,900 the silver price would be $27.14
Gold to silver ratio at 60 to 1 with gold at $1,900 the silver price would be $31.67

Gold to silver ratio at 50 to 1 with gold at $1,900 the silver price would be $38.00
Gold to silver ratio at 15 to 1 with gold at $1,900 the silver price would be $126.67

-Gene Arensberg: Big players positioning for higher silver. Read more here-http://www.gata.org/node/7391

-David Morgan: A Bull’s Case For Silver. Morgan predicts that continuing financial instability will push silver higher throughout 2009. "I think silver will establish a wide trading range this summer," says Morgan. "But by early fall, we should start to see strength. By late 2009 into first quarter 2010, I'm looking for it to go beyond the $21 level it established in 2008."

The key, says Morgan, is the $25/ounce price point. "Once we get to that level and stay there for at least three or four consecutive trading days, I think you'll start to see a real acceleration in the silver market," he says.

"After that, how high is high? No one knows. There's no upside resistance once we break through that level, because anybody who owns silver is going to say, 'Well, I'm not going to sell now.' And that's when we'll see those markets really start to accelerate." Read more here-http://www.hardassetsinvestor.com/features-and-interviews/1544-david-morga.html

-Adrian Douglas: GFMS publishes a sham against silver. GFMS has issued a 41-page report on the silver market, It is a complete sham misinformation and garbage. Read more here-

http://www.gata.org/node/7379

-CPM forecasts big silver surplus this year. In their latest silver yearbook, precious metals consultants CPM project that investors may be net buyers of 182 million ounces of silver on a bet basis this year. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page32?oid=82562&sn=Detail

-Ted Butler silver commentary. Read more here-http://news.silverseek.com/TedButler/1240851873.php

-Clive Maund silver market update-http://news.silverseek.com/CliveMaund/1240768393.php

OIL

-OPEC wants oil to reach $70 a barrel. OPEC wants to see oil prices rising to more than 70 dollars a barrel, the oil cartel's secretary general Abdalla El-Badri said Sunday. "The price of 50 dollars is not enough to cover investment costs for the future," El-Badri told reporters in Algiers.

"The price which allows reasonable and acceptable revenues is more than 70 dollars a barrel," he added. El-Badri was speaking after talks with Energy Minister Chakib Khelil ahead of the next meeting of the Organization of Petroleum Exporting Countries in Vienna on May 28. Read more here-http://www.breitbart.com/article.php?id=CNG.b84fea41a4937984085503f14c5e8222.b41&show_article=1

-Oil could rally to $60 by year-end: OPEC's al-Badri. Read more here-http://www.reuters.com/article/ousiv/idUSTRE53P1W620090426

-Oil will hit peak after recession, says OPEC. Oil could approach the record prices of last July as the global recession halts investment in exploration and energy projects, the Organization of Petroleum Exporting Countries (Opec) warned last night. Read more here-http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/5226067/Oil-will-hit-peak-after-recession-says-OPEC.html

-Has Oil and Gas Collapse Sealed Fate of Peak Oil? Watch slide show here-http://www.321energy.com/editorials/simmons/simmons042909/simmons042909.html#

FOUR MORE U.S. BANKS ARE SHUT

-Four Banks Are Shut, Costing U.S. Deposit Fund $698 Million. Regulators shut banks in Georgia, Michigan, California and Idaho, costing the deposit insurance fund $698 million the highest so far this year as the tally of U.S. failures rose to 29 and exceeded the 2008 total.

Georgia’s American Southern Bank, Michigan Heritage Bank and First Bank of Beverly Hills were closed yesterday by state agencies. First Bank of Idaho was seized by the Office of Thrift Supervision. The Federal Deposit Insurance Corp. was named receiver of all four, which combined had $2.39 billion in assets and 1.63 billion in deposits.

First Bank of Beverly Hills, with headquarters in Calabasas, California, will cost the insurance fund $394 million. While the three other banks are being taken over by other institutions, the FDIC couldn’t find a buyer for First Bank, forcing the regulator to assume $1.5 billion in assets. “Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship,” the agency said.

The seizures pushed the tally of failed banks past the 25 reached last year. Home foreclosure filings for March totaled 341,180, a record high, according to RealtyTrac, the California- based seller of default data. The economy has lost 5.1 million jobs since December 2007, and unemployment rose to 8.5 percent in March, the highest since 1983.

The toll of failed banks last year was the most since 1993 and drained money from the deposit insurance fund, which tumbled 45 percent in the fourth quarter to $18.9 billion. The agency has estimated future bank failures may cost the deposit insurance fund $65 billion through 2013. Read more here-

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aWAXZGoDhtRM or http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ab5rnngdYegE

-Bad year for banks: Failures surpass '08. Four regional banks fail Friday, setting the FDIC back nearly $700 million and bringing the annual total up to 29. Read more here-

http://money.cnn.com/2009/04/24/news/companies/bank_failure/index.htm

-New Worries for Next Tier of Banks. Absent fresh details on how the nation’s 19 largest banks fared in a new government test of their health, analysts are turning the spotlight on a handful of major regional banks that they reckon may be the next weak links in the financial industry. Read more here-http://www.nytimes.com/2009/04/25/business/economy/25bank.html

CHRYSLER GOES BANKRUPT

-Obama Says Chrysler Getting ‘New Lease on Life’ in Bankruptcy. President Barack Obama said the U.S. and Canada will commit more money to Chrysler LLC as it forms an alliance with Italy’s Fiat SpA that will give the automaker a “strong chance of success.”

As part of the deal to get as much as $3.5 billion in operating loans from the U.S. government, Chrysler will file for bankruptcy in New York, a process that an administration official said should be completed within two months.

“The necessary steps have been taken to give one of America’s storied automakers, Chrysler, a new lease on life,” Obama said in remarks at the White House. “This process will be quick, it will be efficient.”

The president faulted some of Chrysler’s smaller lenders, including hedge funds that he didn’t name “a small group of speculators” who refused to make the concessions agreed to by the company’s major debt holders and workers.

Chrysler will be in bankruptcy for one to two months and GMAC LLC will become its new finance arm with a fresh infusion of capital from the government, according to an administration official who briefed reporters before Obama spoke. The Auburn Hills, Michigan-based automaker will receive $4.5 billion in exit financing, the official said.

Chrysler’s bankruptcy filing will be made imminently and the court process will be used to extinguish some contracts and to thin the company’s dealership body, the official said. Payments to auto-parts makers and other contractors will continue to be made. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid=aEijL5Nqod3k&refer=home and http://www.bloomberg.com/apps/news?pid=20601087&sid=awd3WqBbBqwg&refer=home

GM CANADA TO CUT WORKFORCE IN HALF AND CLOSE 40% OF DEALERSHIPS

-General Motors Canada will slash its workforce by more than half by 2014 and close as many as 310 dealerships by the end of next year as part of a broad restructuring plan announced by the company Monday. The troubled company's Canadian arm will reduce its hourly workforce by 57 per cent, from 10,300 currently to 4,400 over the next five years. The company employed 20,000 Canadians as recently as 2005.

Many of the 5,900 jobs being eliminated under Monday's latest streamlining plans were previously announced and include the closure of a truck plant in Oshawa, Ont., and a transmission plant in Windsor, Ont. GM Canada spokesman Stew Low estimated that Monday's announcement will affect about 1,500 jobs on top of those already announced.

The announcement didn't surprise Canadian Auto Workers president Ken Lewenza. "The reality is there's been significant plant closure announcements in Canada that are going to take place within the next couple years, and we're not totally surprised by the numbers although they're a little bit more than we'd anticipated," he said.

Lewenza said he expects most of the new job cuts will take place through attrition. Meanwhile, a spokesman for the Canadian Automobile Dealers Association estimated that the dealership closures from 705 today to between 395 and 425 by the end of next year could affect as many as 12,000 Canadians. Read more here-

http://www.cbc.ca/cp/business/090427/b0427113A.html

INSIDER STOCK SELLING JUMPS TO HIGHEST LEVEL SINCE 2007

-Executives and insiders at U.S. companies are taking advantage of the steepest stock market gains since 1938 to unload shares at the fastest pace since the start of the bear market.

Gap Inc.’s founding family sold $45 million of shares in the largest U.S. clothing retailer this month, according to Securities and Exchange Commission filings compiled by Bloomberg. Daniel Warmenhoven, the chief executive officer at NetApp Inc., liquidated the most stock of the storage-computer maker in more than six years.

Sales by the co-founders of Bed Bath & Beyond Inc. were the highest since at least 2001. While the Standard & Poor’s 500 Index climbed 26 percent from a 12-year low on March 9, CEOs, directors and senior officers at U.S. companies sold $353 million of equities this month, or 8.3 times more than they bought, data compiled by Washington Service, a Bethesda, Maryland-based research firm, show. That’s a warning sign because insiders usually have more information about their companies’ prospects than anyone else, according to William Stone at PNC Financial Services Group Inc.

“They should know more than outsiders would, so you could take it as a signal that there is something wrong if they’re selling,” said Stone, chief investment strategist at PNC’s wealth management unit, which oversees $110 billion in Philadelphia. “Whether it’s a sustainable rebound is still in question. I’d prefer they were buying.” Read more here-

http://www.bloomberg.com/apps/news?pid=20601213&sid=au8cyqeJFifg&refer=home

UNEMPLOYMENT NUMBERS

-Unemployment in Spain Hits 17.4%. Read more here-http://www.nytimes.com/2009/04/25/business/global/25euecon.html

-U.S. Unemployment: 109 cities at 10% or higher. Government survey shows jobless rate grows in all 372 metro areas, with 15% joblessness in 18 of them. Read more here-

http://money.cnn.com/2009/04/29/news/economy/metropolitan_area_unemployment/index.htm?postversion=2009042914

REAL ESTATE-FORECLOSURES

-Home Prices in 20 U.S. Cities Declined at Slower Pace. The decline in home prices in 20 major U.S. cities slowed in February for the first time since 2007, amplifying signals that the market may be stabilizing. The S&P/Case-Shiller index’s 18.6 percent decrease compares with a record 19 percent decline the month before. The gauge has fallen every month since January 2007, and year-over-year records began in 2001.

Declining prices, Federal Reserve efforts to bring mortgage rates down, and government tax credits for first-time buyers may continue to support sales after an almost four-year slide. Still, mounting unemployment means purchases are unlikely to rebound quickly. Read more here-http://www.bloomberg.com/apps/news?pid=20601068&sid=aIGs3yk6Pwmw&refer=home

-Las Vegas Home Prices Fall to Lowest Since 2000 on Foreclosures. Read more here-http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ad1RkuIkvrCY

-UK house price fall dampens recovery hopes. UK house prices continued to slide in April, suggesting that last month’s surprise rise was a blip in a downward trend, according to figures from Nationwide, the British mortgage lender.

Nationwide said that the average cost of a UK home dropped 0.4 per cent between March and April to £151,861, partially unwinding a 0.9 per cent increase during the previous month. The figures also revealed that UK house prices have fallen 15 per cent compared with April 2008. Read more here-http://business.timesonline.co.uk/tol/business/economics/article6196858.ece

or http://news.bbc.co.uk/2/hi/business/8026152.stm

-Home Vacancies Rise in U.S. to Record Amid Recession. A record 19.1 million homes stood unoccupied in the first quarter and the U.S. homeownership rate fell as the recession sapped demand for real estate.

The number of vacant homes, including foreclosures, properties for sale and vacation properties, jumped from 18.6 million a year earlier, the U.S. Census Bureau said in a report today. Households that own their own residence declined for the third straight quarter to 67.3 percent.

The U.S. financial crisis and falling home prices have shattered the confidence of homebuyers. The percentage of people who said they plan to buy a home in the next six months dropped to a 26-year low in March, according to the Conference Board in New York. Job losses will continue to erode real estate demand, according to an April 23 report by Mark Fleming, chief economist for First American CoreLogic Inc. in Santa Ana, California.

“We expect home prices to continue to decline into 2010 as economic conditions and excess housing inventories dampen prices,” Fleming said in the report. “Decreases are now being driven by rising unemployment and a high volume of distressed home sales.”

The percentage of all U.S. homes empty and for sale, known as the vacancy rate, fell to 2.7 percent in the first quarter. It hit an all-time high of 2.9 percent in the first and fourth quarters of 2008, the Census Bureau said. Read more here-http://www.bloomberg.com/apps/news?pid=20601213&sid=am4VMDGoSAPY&refer=home

-Why Housing Is Not Coming Back. Read more here-http://www.businessinsider.com/why-housing-is-not-coming-back-2009-4

-Ranieri Says Housing Is Shouting Distance From Bottom. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid=a1UJ49yccKoY

-Phoenix leads U.S. in home price declines in February. A new report shows home prices across the country continued to drop in February, and Phoenix has the unfortunate designation of loss leader. Phoenix home prices fell 35 percent from February 2008 to February 2009, according to the new S&P/Case-Shiller 20-city home price index.

That’s the largest decline of any of the 20 largest cities in the U.S. In addition, Phoenix home prices are down 51 percent from their peak. The weak housing market continued to plague home sellers in February as home prices extended their losing streak to 31 consecutive months, according to a report issued Tuesday.

The entire 20-city index fell 18.6 percent for February, compared with a 19 percent year-over-year decline in January. The good news is the pace of year-over-year slowing lessened for the first time since October 2007. Read more here-http://www.bizjournals.com/phoenix/stories/2009/04/27/daily16.html?ana=from_rss

-KB Home introduces new home priced at $89,999. With foreclosures driving down home prices, KB Home is facing the competition head-on with a line of new homes it’s calling the Open Series. “We didn’t want to just sit back on our heels and let the market dictate how we were going to perform,” said Mark Rodocker, executive vice president of KB Home’s Arizona division. Read more here-http://www.azbiz.com/articles/2009/04/27/construction_real_estate/doc49e8d8813dab7411430334.txt

-Foreclosure filings in record jump. Hope Now reports a 20% increase in initial foreclosure filings during March. But there was a steep drop in bank repossessions. Read more here-

http://money.cnn.com/2009/04/30/real_estate/March_Hope_Now/index.htm

-No bankruptcy help for homeowners. Measure to modify delinquent loans in bankruptcy court fails in Senate. Obama administration loses big stick to prod loan servicers to aid troubled borrowers. Read more here-http://money.cnn.com/2009/04/30/news/economy/cramdown/index.htm?postversion=2009043017

-A second wave of home foreclosures is ahead, Fed economist says. A second, punishing wave of home foreclosures is poised to strike just as the subprime mortgage mess ebbs, an economist in Kansas City said Thursday. Kelly Edmiston, senior economist for the Federal Reserve Bank of Kansas City, dropped that unwelcome forecast at the Fed’s Money Smart Day program.

“I don’t expect the foreclosure problem to get much better in the next couple of years. In fact, it may well get worse,” Edmiston said. Blame the widening recession, persistent unemployment and exotic mortgages that emerged alongside the boom in subprime lending to less creditworthy homebuyers.

Lenders laid the groundwork for this second foreclosure wave in 2005 and 2006, Edmiston said. Those years saw a surge in mortgages on which borrowers were required to make relatively small monthly payments for the first five years.

It was the height of the housing bubble, and buyers turned to such loans, called interest-only mortgages and payment-option adjustable-rate mortgages, as one way to jump into the runaway market. Those low house payments are poised to reset to much higher levels in 2010 and 2011 and push more owners out of their homes, Edmiston said. Read more here-

http://www.kansascity.com/business/story/1159532.html

© 2009, Worldwide Precious Metals.
www.wwpmc.com

The Goldbugg Report - May 05, 2009
Posted by Worldwide Precious Metals on Tuesday, May 05, 2009

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