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The Goldbugg Report – February 16, 2010

February 16, 2010

We are proud to welcome the World as Vancouver hosts the 2010 Winter Olympics. We wish all our Canadian athletes the best of luck.

February 12, 2010

The Week in Review

Rumors abound that a bailout of Greece from its sovereign debt troubles was in the works by other European Union countries. Such rumors were enough to allay fears and bring risk appetite back, helping to boost the markets. China, however, bucked the trend. A leaked Communist Party directive stated that dollar reserves should be limited to US Treasuries or agency mortgage debt like Freddie Mac that is implicitly backed by Washington. The directive was aimed at the State Administration of Foreign Exchange as well as state controlled commercial banks and could be a sign that the Chinese expect new trouble in battered global markets.

Yet another precious metals ETF was announced this week. This one, if the SEC allows it to launch, is supposed to be backed by a basket of physical gold, silver, platinum and palladium. If the SEC allows the ETF to begin trading, it could help push prices higher across all the metals included in the fund.

Initial claims for unemployment dropped more than expected last week perhaps justifying previous claims that a backlog brought on by the holidays was responsible for the previously larger than expected numbers. Continuing claims for unemployment also fell, but those particular numbers are no longer a reliable gauge since many people have exhausted their benefits and thus are no longer counted in the figure. The US Senate released the bipartisan jobs bill that Obama asked for in his State of the Union, to the tune of $87 billion but the massive snowstorms crippling the northeastern US have delayed any action on it as yet.

China announced last week that it intended to impose sanctions against US companies that are selling arms to Taiwan. Adding fuel to the fire, tensions over the upcoming meeting between US leaders and the Dalai Lama continue to escalate with Zhu Weiqun, the vice minister of the United Front Work Department in China saying that the meeting “would damage trust and cooperation between our two countries, and how would that help the United States surmount the current economic crisis?”

Wednesday Ben Bernanke outlined what the Fed’s exit strategy would be for the economic stimulus measures they put in place during the crisis. An interest rate hike may be in the near future, especially since China, Brazil and Australia have already started raising their rates.

Crude oil continues to be locked into the mid $70 range. Massive snowfalls in the northeastern US and renewed political tensions in Iran and Nigeria may keep prices on the rise.

The US Dollar stalled in its recent rally against the euro on the news that a bailout was being planned for Greece.

In real estate news, the Congressional Oversight Panel for the TARP stated in its February report that about $1.4 trillion in commercial real estate loans will reach the end of their terms. Almost 50 percent of those loans are “underwater” since commercial property prices have plummeted in lockstep with the housing industry. Elizabeth Warren said, in an interview with CNBC Thursday morning: “We’re looking at a situation where about half of all commercial real estate loans are going to be underwater by the end of this year, and that is going to have a direct impact on about 3,000 community banks, or about 40 percent of our entire banking system.”

Friday to Friday Close

Volatility should be expected to continue. US Consumer sentiment slipped backwards this month due to continued high unemployment and a housing industry that just can’t seem to get legs under it and spooked consumers are holding on to their cash, due to fears that their own jobs may be next on the “hit list”. China raised the bank Reserve Requirement ratio for the second time in as many months, sending waves of fear into markets that China would be much more aggressive in pulling back stimulus than previously thought and quite possibly damaging fragile global growth. The sovereign debt situation in the European Union continues unabated, with the situation in Greece even beginning to draw comparisons to the collapse of Lehman Brothers. Governments around the world are in danger of defaulting on their debt. Marc Faber, editor of the Gloom, Boom & Doom report, went so far to say that “In the developed world we have huge debt to GDP, in terms of government debt to GDP and unfunded liabilities that will come due. These unfunded liabilities are so huge that eventually these governments will all have to print money before they default.” Greece alone will need to borrow $73 billion to cover its deficit and refinance debt, with other countries in the EU in similar, or even worse, situations. When the printing presses fire up again and money starts flying out the other end, precious metals prices may skyrocket as investors seek safety. The sheer number of precious metals backed ETFs launching recently shows that interest in owning precious metals as an investment is on the rise and the wise investor, when price dips have presented an opportunity, has been adding physical precious metals to his portfolio. Remember, the key to profitability through the ownership of physical precious metals is to own them and hold them for the long term. Never over-extend your ability to maintain ownership of your product over the long term.

Trading Department – Precious Metals International, Ltd.

This is not a solicitation to purchase or sell.

© 2010, Precious Metals International, Ltd.

GOLD

-10 reasons why gold price will boom. Gold price has been in a volatile condition in the last two months. While some analysts have predicted that gold price is doomed and would plunge to a low of $800 per ounce, others hold faith saying that the yellow metal price will only continue to rise and rise. Following are 10 reasons why gold price will continue to boom.

1) The Stimulus Effect: Including $1 trillion in cash infusions, the stimulus plan will pump $9.7 trillion into the economy, according to Bloomberg. As the Globe & Mail reports flatly, “Many believe that the monetary stimulus efforts will cause a spike in inflation,” driving gold higher.

2) COMEX Traders Predict $1,600 Gold by December: If gold trades at or above $1,600 by December, some 100,000 call option contracts will be “in the money.” Big-money players Goldman Sachs and JPMorgan are reportedly helping to drive the action, ahead of a huge purchase of gold futures contracts.

3) “Big Money” Inflows: In 2008, NYC-based hedge fund Paulson & Co’s flagship fund returned 37%, as the world markets burned. Paulson’s bullish on gold, big time, including the Mar. 17 purchase of 39.9 million shares of AngloGold, worth $1.28 billion. Other major hedge funds are piling into gold, too, including Eton Park Capital, Greenlight Capital and Hayman Advisors.

4) China’s Doubling Down: China just revealed that it has doubled its gold holdings to 1,054 tons. Yet that still only equals 1.6% of its overall reserves. As China moves out of U.S. Treasuries and into gold, this will help fuel the next leg of the run-up.

5) Demand Building across the Board: Worldwide demand for gold jumped by $29.7 billion in the first quarter, a 36% bolt, according to the World Gold Council. Demand for gold ETFs (Exchange Traded Funds) rocketed 540% another trigger for the coming gold boom.

6) The Paper Dollar’s 30% Drop: Since 2001, the U.S. Dollar Index has tanked 30% while gold has risen 300%. With all the downward pressure on the dollar, and inflation on the way, this trend is about to pick up steam.

7) Gold/Dow Ratio Signals $8,000 Gold: During major gold bull markets (and corresponding equity bears), gold and the Dow converge at a 1-to-1 ratio. During the last gold bull, the Dow sank to 850 and gold rose to $850. The Dow is now over 10,000 But even if it fell to 4,000, we could see $4,000 gold before this bull run is over!

U.S. Treasury Dept. Signals $5,468 Gold: Currently, the U.S. government holds about 286.9 million ounces of gold. It has printed about $1.569 trillion worth of paper dollars. If each dollar were backed by gold, that would put the price at $5,468.80 an ounce.

9) Riding the “Commodity Super Cycle”: Jim Rogers expects the Commodity Super Cycle to drive commodity prices higher for another eight years including gold. And he’s stockpiling the yellow metal by the day. Every pullback, says Rogers, is another buying opportunity. Considering he’s been dead right on every major trend of the past 40 years, we wouldn’t bet against him.

10) Historic Model Predicts $6,214 Gold: During the last gold bull, the yellow metal ran from $35 an ounce to $850, a 24-fold increase. This bull started with gold at $255.95, meaning that if historic trends hold, the price target would be $6,214 an ounce. Read more here-http://www.commodityonline.com/futures-trading/technical/10-reasons-why-gold-price-will-boom-14406.html

-14.3 trillion reasons and counting to own gold. Read more here-http://www.gold-eagle.com/editorials_08/souleles020610.html

-Gold prices may cross $1,500 mark by end-2011. Gold, which has a strong correlation with the greenback and crude, will need the support of oil prices at $ 100 a barrel to attain and cross the $ 1500 an ounce level, Francisco Blanch, Head of Global Commodity Research with Bank of America Merrill Lynch told Emirates Business. Read more here-http://www.business24-7.ae/Articles/2010/2/Pages/08022010/02082010_421672853f7a42309c285a57b69d9cf7.aspx

-Despite recent setback gold fundamentals suggests $1,500 price this year. Specialist precious metals analyst, Jeff Nichols, reckons that gold’s fundamentals remain very strong and although there may be further short term falls in price, we can expect $1,500 gold or more before the end of the current year. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=97794&sn;=Detail&pid;=1

-Hedge Fund Manager Sprott Sees Gold at $1,500 in 2010. Eric Sprott, whose Sprott Hedge Fund increased more than fivefold in nine years, said gold may rise to $1,500 an ounce this year and $2,000 within two years as the U.S. government takes measures to counter the credit crunch.

“With quantitative easing and the financial problems we have, I suspect that the gold price goes up from here,” Sprott said today in an interview in Toronto, where he announced financial support for Canadian athletes.

“If you tell me how much quantitative easing there is, I’ll tell you where the gold price will go, but I have no trouble imagining we get to $1,500 this year and to $2,000 in two years.” Read more here-http://www.businessweek.com/news/2010-02-04/sprott-sees-gold-at-1-500-an-ounce-this-yr-2-000-within-2-yrs.html

-John Embry is interviewed by King World News. Listen here-http://www.gata.org/node/8304

-Fear, Gold and the Dollar. Our gold-dollar oscillator (below) shows that the dollar is approaching being overbought over the past 60 trading days, while the gold is showing signs of being oversold.

The magnitude of the current spread between gold and the dollar typically means that both could be close to a price reversal dollar heading back and gold back up toward the mean. Frank Holmes-Read more here-http://news.goldseek.com/GoldSeek/1265653700.php

-China and U.S. heading for a cold war? What impact on gold? Some observers feel that China may be looking to retaliate over recent U.S. political statements and moves and a recent Chinese poll suggests it and the U.S. may be moving towards a ‘cold war’. Such political uncertainties could have a positive impact on the gold price. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page72068?oid=97505&sn;=Detail&pid;=1

-China Becomes Oil ETF’s No. 4 Holder, Buys SPDR Gold. CIC’s investments through the SPDR Gold Trust are equivalent to 145,000 ounces of bullion, or about 0.4 percent of the 33.9 million ounces China’s government maintains, based on data from the International Monetary Fund. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=aZtsKyX2S6Ls or

http://commoditytradealert.com/blog/?p=5289

-Converting paper to gold a change in market perception. Not only does Chris Potter stand by his claim that India’s big gold buy late last year was a game-changer, it’s a 21st century take on the classic alchemist’s quest of old-transforming lead into gold or in this case paper into gold. Interview with The Gold Report. Read more here-http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=97686&sn;=Detail&pid;=1

-Clive Maund gold market update. Read more here-http://www.kitco.com/ind/maund/feb082010.html

-Ned Schmidt’s Gold Thoughts. When the U.S. money supply again begins to grow rapidly, $Gold will advance. In the mean time, when selling pressure on $Gold becomes intense, investors should add to their positions. Investors living in currencies other than U.S. dollars should be adding to Gold positions during this period of currency turmoil.

The EU is not going to dissolve, but using Gold to safeguard wealth from currency turmoil and tax collectors gone berserk seems like a good idea. Read more here-http://www.kitco.com/ind/Schmidt/feb092010.html

-Gold is Testing “Floor” Theory. There is a popular point of view that the Reserve Bank of India put a ‘floor’ under the gold market around $1050, which approximates the price at which it bought 200 tonnes of gold from the IMF.

The thinking is that other central banks, and perhaps the Reserve Bank of India itself, will purchase gold at that price. This theory that $1,050 represents a ‘floor’ is now being put to the test.

Regardless whether this theory proves accurate or not, it is clear from the following chart that gold remains firmly within a major uptrend. Gold also remains above its all-important 200-day moving average. James Turk-Read more here-http://www.fgmr.com/gold-is-testing-floor-theory.html

-Why southern Europe’s debt crisis is a buying opportunity for gold lovers. Read more here-http://blogs.telegraph.co.uk/finance/garrywhite/100003494/why-southern-europes-debt-crisis-is-a-buying-opportunity-for-gold-lovers/

-Midas Fund’s Winmill Turns Gold Rise Into 83% Return on Miners. In January, Winmill predicted gold prices will average $1,200 an ounce (31 grams) during the first quarter and increase to $1,500 by the end of the year. Gold rose 24 percent last year.

Growing U.S. budget deficits will reduce the dollar’s purchasing power, he says. From 2001 through 2009, U.S. money supply almost doubled to $8.5 trillion. During the next decade, U.S. gross domestic product of about $14 trillion is likely to grow an average of only 1 to 2 percent a year, Winmill says.

“We’ll double the supply of dollars and have about the same amount of wealth, so the dollar will have about half the purchasing power that it has today,” he says. Given that assumption, gold will be a way to preserve value, he says.

As the deficit expands, the U.S. Federal Reserve will have less ability to control inflation, Winmill says. He forecasts a 3 percent inflation rate by the end of this year and as much as 5 percent in 2012. The U.S. consumer price index rose 2.7 percent in December from a year earlier.

The Fed is holding its target for the federal funds rate at zero to 0.25 percent to stimulate manufacturing and exports, and that’s driving the dollar down, Winmill says. “It’s great for the price of gold,” he says. “As the dollar goes down, it’s going to take more dollars to buy the same ounce of gold.” Read more here-http://www.bloomberg.com/apps/news?pid=20601109&sid;=abSHodgpVd9I&pos;=10

-John Paulson Gold Fund Said to Tumble 14% in Its First Month. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=aPMbZAOfYDcQ&pos;=4 or http://www.gata.org/node/8316

-German Company Will Make Biggest Gold Coin Ever, Weighing 3,333 Ounces. Read more here-http://www.benzinga.com/118117/german-company-will-make-biggest-gold-coin-ever-weighing-3-333-ounces

-GATA Chairman Murphy interviewed on ‘Wall Street Shuffle’. Read more here-http://www.gata.org/node/8321

-GATA Washington conference presentation videos posted. Read more here-http://www.gata.org/node/8309

SILVER

-A Silver Shortage? Money manager Stephen Leeb predicts the price of silver to skyrocket on industrial growth in an interview on the Forbes Video Network. Watch video here-

http://news.silverseek.com/SilverSeek/1265745976.php

Gold to silver ratio at 80 to 1 with gold at $1,300 the silver price would be $16.25

Gold to silver ratio at 70 to 1 with gold at $1,300 the silver price would be $18.57

Gold to silver ratio at 60 to 1 with gold at $1,300 the silver price would be $21.67

Gold to silver ratio at 50 to 1 with gold at $1,300 the silver price would be $26.00

Gold to silver ratio at 40 to 1 with gold at $1,300 the silver price would be $32.50

Gold to silver ratio at 30 to 1 with gold at $1,300 the silver price would be $43.33

Gold to silver ratio at 20 to 1 with gold at $1,300 the silver price would be $65.00

Gold to silver ratio at 15 to 1 with gold at $1,300 the silver price would be $86.67

-Why silver price will boom to $50/oz. Read more here-http://www.commodityonline.com/news/Why-silver-price-will-boom-to-$50oz-25602-3-1.html

-Ted Butler: Last gasp for the big commercial shorts in gold and silver? Read more here-http://www.gata.org/node/8302

-Rob Kirby: A sterling account of silver’s ‘dismal’ performance in January. Read more here-http://www.gata.org/node/8308

CHARTS OF THE WEEK-QUOTES-QUICK HITS

-Chart of the week: Is Austria The Next Euro Nation To Get Vaporized? Right now everyone is focusing on the PIIGS, with special emphasis on the “G” Greece. If the ECB handles the situation right, then hopefully this goes nowhere. But if it goes bad, then we’re talking about contagion.

So who might fall if periphery Europe goes down? Check out Austria. As you can see, its CDS spread is just starting to turn higher, and it’s well known that the country has major banks with dicey Eastern Europe exposure.

But for now, let’s hope the PIIGS firewall remains in place. Read more here-http://www.businessinsider.com/chart-of-the-day-cds-evolution-for-some-emu-countries-2010-2

Source: chartoftheday.com

-Chart of the week: All It Took Was a Few Bad Trading Days To Get Investors Terrified Of Stocks Again. In January, U.S. stocks began to see their first major mutual fund in-flows since July of last year. It took many months, but after a strong 2009 equity rally, investors began to rediscover faith in U.S. stocks.

Well, there goes that trend. All it took was a few bad trading days for the stock market to crush this tiny bud of renewed investor optimism. Based on fund flow data released today by the Investment Company Institute, over $2.2 billion fled U.S. domestic equity mutual funds during the seven-day period ending February 3rd.

The average investor’s confidence in stock markets remains paper thin. Read more here-http://www.businessinsider.com/chart-of-the-day-us-domestic-equity-long-term-mutual-fund-flows-2010-2

Source: chartoftheday.com

-U.S. unemployment video chart updated to Feb 5 2010. Watch here-http://cohort11.americanobserver.net/latoyaegwuekwe/multimediafinal.html

-Chart of the week: Remember When Men Used To Have Jobs? Men between the ages of 25-54 are frequently described as being “working-age,” because, well, they’re expected to be working.

But as this chart, via Brad Delong, shows, that’s happening less and less. Nearly 20% of men in this age group are out of the workforce, and none of the overall second-derivative labor market improvements seem to be helping much.

How this trend impacts society more broadly should be interesting, to say the least. Read more here-http://www.businessinsider.com/chart-of-the-day-employment-to-population-ratio-male-25-54-years-old-2010-2

Source: chartoftheday.com

-Chart of the week: It’s Official: Obama Is Creaming Bush When It Comes To Jobs. Numbers don’t lie, do they? In the last year of the Bush administration, the monthly job loss numbers built steadily to a peak which then began to reverse itself during Obama’s first year.

It’s a perfect mirror image, as this chart from Nancy Pelosi’s office demonstrates. Now, whether this was the result of Obama’s and Bush’s policies or whether it’s just a matter of timing, is obviously open for debate.

We know what Speaker Pelosi would have you believe. Read more here-http://www.businessinsider.com/chart-of-the-day-jobs-lost-in-the-bush-and-obama-administration-2010-2

Source: chartoftheday.com

-”Formal education will make you a living; self-education will make you a fortune.” Jim Rohn

-”The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.” William Arthur Ward

-US government debt is a safe haven the way Pearl Harbor was a safe haven in 1941. Niall Ferguson

-Starting a journey into the future with dollars is no better than setting off into the desert with a camel that has no hump. Not owning gold or silver in the current environment is like being lost in the desert having neither water nor compass. Peter Souleles

-Technicals run the short term, Fundamentals run the long term, Insurance is not a day to day item. Jim Sinclair

-“You can’t get much lower than zero percent.” “The Fed won’t be able to raise rates, given the employment situation and current fiscal burden. Conditions are in place for higher gold prices.”

Tom Winmill, a New-York based portfolio manager of the Midas Fund. In December, he predicted gold may average $1,500 in the fourth quarter of 2010.

-Reasons to Own Gold Unchanged as Banks Become Buyers. It is gold that dominates our list of “Current Positions.” Despite hitting yet new highs near the end of the year, there is much further to go for gold and gold stocks. Gold itself saw its ninth annual advance, to new highs before a 10% correction at the end of the year.

Gold certainly was helped by the weak dollar and the year-end sell-off was provoked by a dollar recovery but it’s much more than an anti-dollar play. Gold is up in terms of all currencies, boosted by concern about inflation and extraordinarily low interest rates.

Mostly, it’s a vote of no confidence in the world’s paper monies, and scepticism of central bankers’ abilities to effect stable money, and specifically to exit stimulus programs in an orderly manner. Nothing has changed, and gold is becoming a new de-facto alternate currency. There is a lot further to go. Most significant perhaps, central banks have switched from being net sellers to buyers.

As we have discussed before, banks that built up their reserves in the last couple of decades tend to have the highest levels of reserves but the lowest proportion of gold (India, China, Korea etc.). The overall level of gold in central bank reserves has dropped from over 30% a decade ago to just over 10%, the lowest level ever.

The ease with which India (and Mauritius) scooped up half the IMF’s gold for sale shows clearly that demand overhang is not a problem. Central banks are likely to be net buyers for years to come.

Adrian Day, President of Adrian Day Asset Management-Read more here-http://www.kitco.com/ind/GoldReport/feb092010.html

-The inflationary depression still dominates and probably will continue to do so. In time the stimulus will fail to work and the world will slip into total insolvency and deflationary depression. The old M3 is about 3%, but we still have $23.7 trillion floating around. Not only is the US bankrupt, but also so is the rest of the world.

It is now only a question of when the dominos will fall. It looks like the first wave in the collapse of the bear market rally is underway. Bonds will follow with higher interest rates and eventually commodities will be hit. Only gold and silver will survive, as the bankers and Wall Street complete their destruction of the world economy. Bob Chapman-Read more here-http://news.goldseek.com/InternationalForecaster/1265815105.php

-As we have been forecasting for the last two years, the second wave of mortgage defaults and foreclosures will hit the economy this year. Not only will we have failure in prime loans and option-arm loans, but we are faced with a new crop of subprime and ALT-A loans put into motion by Fannie Mae, Freddie Mac, Ginnie Mae and FHA.

In addition, we find it of great interest that the FHA is changing the rules to purchase homes. That, of course, means less homes will be purchased. Bob Chapman-Read more here-http://news.goldseek.com/InternationalForecaster/1265565600.php

-2010 bank failure tally now 16. Regulators shuttered a Minnesota bank on Friday night, for the 16th failure of 2010. The bank, 1st American State Bank of Minnesota, in Hancock, was closed by the state’s Department of Commerce. The department named the Federal Deposit Insurance Corp. the receiver. Read more here-http://money.cnn.com/2010/02/05/news/economy/bank_failures/index.htm

-Niall Ferguson: A Greek crisis is coming to America. Read more here-http://www.gata.org/node/8317

-7 U.S. States That Are Worse Off Than Greece, Portgal, Ireland, and Spain. The seven states to make my list are California, Florida, Illinois, Ohio, Michigan, North Carolina, and New Jersey. Each has a population above 8 million people. Each has had to borrow more than a billion dollars, so far, to pay claims out of their now bankrupt unemployment insurance fund.

Also, each state currently registers broad, underemployment above 15% as indicated by the U-6 measure for the States. And finally, each state is a large net importer of either oil, natural gas, electricity, or all three of these energy sources. Read more here-http://finance.yahoo.com/tech-ticker/7-u.s.-states-that-are-worse-off-than-greece-portgal-ireland-and-spain-420138.html

-New Jersey Governor Chris Christie on Thursday declared a “fiscal emergency,” allowing him to reserve or freeze state spending as part of his plan to tackle one of the largest 2011 deficits among U.S. states. Read more here-http://www.reuters.com/article/idUSTRE61A49V20100211

-Secret summit of world’s top bankers in Australia. Read more here-http://www.gata.org/node/8305

-G-7 Risks ‘Muddled Middle’ With Plan to Spend Now, Save Later. Read more here-http://www.bloomberg.com/apps/news?pid=20601068&sid;=ajXjEgtNTtXc

-How Goldman Sachs Helped Greece to Mask its True Debt. Read more here-http://www.spiegel.de/international/europe/0,1518,druck-676634,00.html

-The Dumping Begins: Chinese Reserve Managers Notified That Any Non-USG Guaranteed Securities Must Be Divested. Read more here-http://www.zerohedge.com/print/72753 or

http://www.gata.org/node/8313

-TARP Watchdog: Don’t Be Fooled By The Calm, Banks Will Be Rocked By 2011’s $300 Billion Commercial Real Estate Time Bomb. Read more here-http://www.businessinsider.com/tarp-watchdog-the-300-billioin-commercial-real-estate-bomb-hits-in-2011-2010-2

-The stock market will be “flat,” or almost unchanged, through the end of the year, Nouriel Roubini said after the Standard & Poor’s 500 Index posted its biggest losses since March. Read more here- http://www.bloomberg.com/apps/news?pid=newsarchive&sid;=aTtM3cfIfsnI

-Roubini Sees Dollar Falling Versus Asian Currencies. Read more here-http://www.bloomberg.com/apps/news?pid=newsarchive&sid;=aDV9aUi1.h0Q

-Peter Warburton: The debasement of world currency: It is inflation, but not as we know it. Read more here-http://www.gata.org/node/8303

-Toyota Recall Cost Will Exceed $2 Billion Estimate, Lawyers Say. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=a8IPQpESrNWo

-Swine Acronym Ordered Out of Barclays Capital Reports. Read more here-http://www.bloomberg.com/apps/news?pid=20601109&sid;=a.eowWPTrbNI

-Study shows why it is so scary to lose money. Read more here-http://www.reuters.com/article/idUSN0823962020100208?loomia_ow=t0:s0:a49:g43:r1:c0.392924:b30376896:z0

-US food stamps set ever-higher record-32.8 million. Read more here-http://www.guardian.co.uk/business/feedarticle/8933161

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/HistoricalPriceTrackingsystem.html

 

-Watch BTV interview of Harold Seigel on colored diamonds and his website http://www.rarecoloreddiamonds.com/. Watch video here-http://www.rarecoloreddiamonds.com/watchnow.html

-Graff accused of ‘painting over a Rembrandt’ by gemologists. Laurence Graff, the Mayfair jeweller, has been accused of committing a crime akin to “painting over a Rembrandt” after re-cutting an historic diamond, the Wittelsbach Blue. Read more here-http://www.telegraph.co.uk/news/7103328/Graff-accused-of-painting-over-a-Rembrandt-by-gemologists.html or http://www.thenational.ae/apps/pbcs.dll/article?AID=/20100207/FOREIGN/702069935/1002/foreign

-The Argyle Diamond Mine is a diamond mine located in the East Kimberley region in the remote north of Western Australia. Argyle is the largest diamond producer in the world by volume, although due to the low proportion of gem-quality diamonds, is not the leader by value.

It is the only known significant source of pink diamonds, producing over 90% of the world’s supply. It additionally provides a large proportion of other naturally coloured diamonds, including champagne, cognac and rare blue diamonds. Argyle is currently transitioning from an open pit mine to an underground mine. Read more here-http://en.wikipedia.org/wiki/Argyle_diamond_mine

-An Argyle pink diamond is admired as the most concentrated form of wealth in the world. One and a half billion years ago, forces of nature rewarded the land in Western Australia’s vast Kimberley, with pink diamonds. The exact story behind their formation remains largely a mystery, adding to their allure and intrigue.

Diamonds were first discovered in the region in 1979, when a geologist noticed a diamond embedded in an anthill. A Rio Tinto owned mine was built on the site in 1985, and of the 600 million stones it produces each year, just one tenth of one percent is pink. Argylepinkdiamonds.com.au

DAVID ROSENBERG COMMENTARY

-The next shoe to drop could be bullish for oil and gold. While Greece and the other PIGS have been getting all the press, don’t take your eye off the prospect of a strike against Iran, either by Israel or Obama. Netanhyahu sounded very tough in a speech in Europe on Tuesday (relegated to a page 14 news item). What we are talking about here is what the response is going to be to Iran’s intent to move to 20% enrichment of its uranium from the current 3.5%. David Rosenberg-Gluskin/Sheff

-Yes, we are likely on the verge of seeing a trickle of employment growth in the next few months/quarters, but it will take at least eight years before the U.S.A. gets back to full employment. David Rosenberg-Gluskin/Sheff

-With the revisions, we now know that the total job loss in this recession was 8.4 million. It would take eight years of 200k monthly gains just to recoup this decline, adjusting for the growth rate in the workforce. David Rosenberg-Gluskin/Sheff

-The drop in the unemployment rate to 9.7% is very misleading since the number of discouraged workers rose 137k in January, to 1.1 million. What is key is that the economy still shed 20k payrolls and normally at this stage of the cycle, nearly two-and-a-half years after the first Fed rate cut, the economy is already generating at least 150k net new jobs, month-in, month-out.

Hopefully this puts a minus-20k payroll figure into its proper perspective. As an aside, TrimTabs adjusts the jobs data using income tax receipts and its metric shows that employment contracted by 104k in January. Gluskin/Sheff

-While there will be many economists touting today’s U.S. employment report as some inflection point, the reality is that the level of employment today, at 129.5 million, is the exact same level it was in 1999. David Rosenberg-Gluskin/Sheff

-While the focus has been on Greece, and the PIGS in general, let’s not forget that fiscal strains are evident everywhere from the U.K., to Japan, to the U.S.A. David Rosenberg-Gluskin/Sheff

-The sources of buying power that drove the 2009 rally have all but dried up. Who’s left to pick up the baton? The general investing public, but all the ‘dry powder’ there is being put to work towards the fixed-income market, not equities. David Rosenberg-Gluskin/Sheff

-Since this is a technically-driven equity market, we are bound to get a 50% reversal of the bear market rally, which would take the S&P; 500 to 912 so keep your seatbelts on. David Rosenberg-Gluskin/Sheff

-We are currently seeing a countertrend rally in the U.S. dollar all of a sudden, the USD looks like the one-eyed man in the land of the blind. David Rosenberg-Gluskin/Sheff

-When accurately measured, including the shadow inventory from bank foreclosures, there is still nearly two year’s worth of unsold housing inventory in the United States, and commercial vacancy rates are poised to reach unprecedented highs, and this excess supply is bound to unleash another round of price deflation and debt defaults this year. David Rosenberg-Gluskin/Sheff

-First the governments bail out the banks who were (are) basically insolvent. Then these governments, especially in Europe, see their balance sheets explode and face escalating concerns over sovereign default. The IMF now predicts that the government debt-to-GDP ratio in the G20 nations will explode to 118% by 2014 from pre-crisis levels of around 80%.

Now, the ball is put back onto the banks because many have exposure to the areas of Europe that are facing substantial fiscal problems right now. According to the Wall Street Journal, U.K. banks have $193 billion of exposure to Ireland. German banks have the same amount of exposure and an additional $240 billion to Spain.

Many international bond mutual funds also have sizeable exposure to sovereign debt of Portugal, Ireland, Greece and Spain as well. Contagion risks are back. Stay defensive and expect to see heightened volatility. In a nutshell, toxic assets have basically been swept under the rug in the hopes that we will outgrow the problem.

Leverage ratios across every level of society are still reaching unprecedented levels as the public sector sacrifices the sanctity of its balance sheet in its quest to stabilize the dubious financial position of the household and banking sectors in many parts of the world.

Whatever bad assets have been resolved have almost entirely been placed on the books of governments and central banks, which now have their own particular set of risks, as we have witnessed very recently in places like Dubai, Mexico, and Greece, not to mention at the state and local government level in the United States.

We simply have not seen a reduction in the percentage of properties with mortgages that are “under water”, hence the FDIC has identified 7% of banking sector assets ($850 billion) that are in “trouble”, so how can it possibly be that the financial system is anywhere close to some stable equilibrium? David Rosenberg-Gluskin/Sheff

BRITAIN THE NEXT GREECE?

-Greece crisis: There but for the grace of God goes Britain. Should markets pass the same verdict on Britain as on Greece, the results would be almost identical and just as disastrous, says Edmund Conway. Read more here-http://www.telegraph.co.uk/finance/comment/edmundconway/7153169/Greece-crisis-There-but-for-the-grace-of-God-goes-Britain.html

-Could Britain follow Greece into deficit tragedy? Read more here-http://money.uk.msn.com/markets/articles.aspx?cp-documentid=152066756

FABER-I WILL NEVER SELL MY GOLD

-Faber: If We Analyzed The U.S. As A Company, It Would Be A Distressed Piece Of Trash. In an interview with Bloomberg’s Margaret Brennan, Marc Faber hints that markets are improperly giving the U.S. government a free ride.

That’s because if investors were to analyze the U.S. government as a company, they’d soon realize it is completely distressed. You might have suspected it as such, but here’s a gloomy reminder from the man who sells the Gloom, Boom, and Doom report:

“If you add all the unfunded liability’s the US has in terms of future liability’s arriving from medicare, medicaid and social security, then obviously if the US was a corporation it wouldn’t be a triple A, but it would have funds that are junks rated. ” Watch video here-http://www.businessinsider.com/if-the-us-was-a-company-we-would-think-it-was-trash-2010-2

-US, Europe Will All Default On Their Debt: Marc Faber. The governments of every developed economy will eventually default on their sovereign debts, including the US, the UK and Western Europe, Marc Faber, editor of the Gloom, Boom & Doom report, told CNBC.

“In the developed world we have huge debt to GDP, in terms of government debt to GDP and unfunded liabilities that will come due,” Faber said in a live interview via telephone. “These unfunded liabilities are so huge that eventually these governments will all have to print money before they default.” Read more here-http://www.cnbc.com//id/35332965

-Marc Faber sees ‘no huge downside risk for gold,’ more sovereign defaults. Read more here-http://www.bi-me.com/main.php?id=44247&t;=1&c;=35&cg;=4&mset;=1011

-Marc Faber on US Bubble, ‘worthless’ dollar & Gold ‘the Savior’. Watch more here-http://www.youtube.com/watch?v=pAJeZaFdbJA

-Marc Faber: US govt will go bankrupt. Watch more here-http://www.youtube.com/watch?v=2qHD7-XVX4I

-CNBC Anchors Freak Out After Marc Faber Says US Will Default. Watch here-http://www.businessinsider.com/cnbc-anchors-freak-out-after-marc-faber-says-us-will-default-2010-2

NASSIM TALEB-THREE FAVORITE TRADES-BUFFETT LUCKY

-Black Swan Taleb: 3 Favorite Trades Now; “You will be Flying in a Private Jet From Now On.” 1) Short the S&P; vs Long Gold, in a 5 to 1 ratio. By gold Taleb means a basket of precious metals including gold. 2) Hyperinflation bet that could very well not work but if it does “you will never fly in a public jet again” He prefers to play this bet with way out of the money call options on both gold and silver.

3) His “no-brainer” trade is short US treasury bonds , Taleb cites current policy and Larry Summers in Davos. Read more here-http://commoditytradealert.com/blog/?p=5234

-’Black Swan’ Author Nassim Taleb: Warren Buffett May Just Be Lucky. Nassim Taleb says there isn’t enough evidence to show that Warren Buffett’s skill, and not his good luck, is responsible for the billionaire’s enormous investing success over the decades. Read more here-http://www.cnbc.com/id/35300031/

U.S. DEBT CRISIS

-Will Baby Boomers Bankrupt Social Security? Read more here-http://www.cnbc.com/id/34941334

-Rash of retirements pushes Social Security to brink. Read more here-http://www.usatoday.com/news/washington/2010-02-07-social-security-red-retirements_N.htm

-$13.5 Trillion of New Debt: The President’s budget proposes to increase the national debt from today’s level of $12.3 trillion to $25.8 trillion in FY 2020 an increase of $13.5 trillion or 109.8%. The amount of new debt proposed by this budget is larger than the total amount of debt accumulated by the federal government from 1789 to today (even including the $3.6 trillion of new debt over the last three years). Olivier Garret-Republican Study Committee

-Interest Payments on the Debt: Increases from $187 billion in FY 2009 to $840 billion in FY 2020 an increase of $653 billion or 349.2%. Olivier Garret-Republican Study Committee

-$2.8 Trillion Tax Increase:The president’s budget submission increases taxes by $2.8 trillion over ten years. This includes allowing many of the 2001 and 2003 tax cuts to expire at the end of this year, such as allowing the top rate (which is often paid by small businesses) to increase from 35% to 39.6%, and allowing the top capital gains tax rate to return to 20%. These tax increases would take effect in an economy that, according to many economists, will still have an unemployment rate around 10%. Garret-Republican Study Committee

-Mandatory Spending: Increases from last year’s level of $2.1 trillion to $3.4 trillion in 2020, an increase of $1.3 trillion or 59.4%. Within that amount: Medicare spending increases from $425 billion in 2009 to $953 billion in 2020 an increase of $528 billion or 124.2%; Social Security spending increases from $678 billion in 2009 to $1.20 trillion in 2020 an increase of $523 billion or 77.1%; and Medicaid spending increases from $251 billion in 2009 to $487 billion in 2020 an increase of $236 billion or 94.0%. Garret-Republican Study Committee

RICHARD BRANSON-OIL CRUNCH COMING

-Britain faces ‘oil crunch’ within five years, Richard Branson warns. An oil crunch more serious than the financial crisis threatens to strike Britain within five years, Sir Richard Branson and other business leaders have warned. Read more here-http://www.telegraph.co.uk/finance/financetopics/oilprices/7203172/Britain-faces-oil-crunch-within-five-years-Richard-Branson-warns.html

U.S. UNEMPLOYMENT

-Last Friday, the Labor Department reported that nonfarm payrolls (jobs) decreased by 20,000 in January. Today’s chart puts that decline into perspective by comparing job losses following the beginning of the current economic recession (solid red line) to that of the last recession (dashed gold line) and the average recession from 1950-1999 (dashed blue line).

As today’s chart illustrates, the current job market has suffered losses that are more than triple as much as what occurs at the lows of the average recession/job loss cycle.

It is also worth noting that 25 months after an average recession/job loss cycle began during the second half of the 20th century, the job market recouped all losses and was already in process of adding new jobs. At the same 25 month mark during the 21st century, the job market was still suffering losses. Read more here-http://www.chartoftheday.com/20100205.htm?T

Source: chartoftheday.com

-Job openings fell nearly one-quarter last year. In December there were 6.1 workers for every position to be filled. Read more here-http://www.msnbc.msn.com/id/35315598/ns/business-stocks_and_economy/

-A majority of companies in the Standard & Poor’s 500 stock index increased cash to a combined $1.19 trillion while simultaneously reducing spending, keeping a jobs recovery on hold. Caterpillar Inc., Eaton Corp., Walgreen Co. and General Electric Co. are among 260 companies that ended last quarter with $522 billion more than a year earlier after cutting capital spending by 42 percent.

Economists say the dearth of investment is keeping the jobless rate at about 10 percent as the U.S. emerges from its worst recession since the 1930s. “It’s not clear we are going to see the type of growth following this recession that we’ve seen in previous recessions,” Sandy Cutler, Eaton’s chief executive officer, said in an interview yesterday.

That view “is leading people to be cautious as to their rate of reinvestment, and right in parallel with that, in terms of hiring additional employees.” Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=aE6W8c9z9Bms&pos;=6

-Small businesses are becoming the Achilles heel of the U.S. recovery by limiting growth and job creation. Companies with fewer than 500 employees, such as Phoenix Technologies Ltd. and Sonic Corp., helped lead the economy out of the four recessions since 1980.

This time, they continue to cut capital spending and dismiss workers, eliminating 3,000 jobs in January, according to Roseland, New Jersey-based Automatic Data Processing Inc., the world’s largest payroll processor. Read more here-http://www.bloomberg.com/apps/news?pid=20601109&sid;=apZULWyXpqhE&pos;=10

REAL ESTATE-FORECLOSURES-MORTGAGES

-The real estate roller-coaster ride continued last year as the median price of U.S. single-family home plunged 11.9% to $173,200. The housing situation had been looking up earlier in the year, with prices gaining ground in the first nine months. But the increases weren’t enough to push the median home price above 2008’s bar of $196,600, according to the National Association of Realtors. Read more here-http://money.cnn.com/2010/02/11/real_estate/latest_home_prices/index.htm

-The next crisis: Commercial real estate. A congressional watchdog panel warned on Thursday that mounting commercial real estate losses could endanger the banking system and thwart economic recovery.

A total of $1.4 trillion in commercial real estate loans will require refinancing in the next four years, the Congressional Oversight Panel said in a report. More than half of those loans are underwater, written for properties whose value has dropped like a rock.

The expected losses when loans go bad could hit between $200 billion to $300 billion and threaten 3,000 small and mid-size banks with a disproportionate share of commercial real estate assets on their books, according to the panel.

The report is intended to “wave a red flag” to the White House and Congress that the commercial real estate loan market is going to get a lot worse before it gets better. Read more here-

http://money.cnn.com/2010/02/11/news/economy/tarp_commercial_loans/index.htm

-U.S. foreclosure filings rose 15 percent in January from a year earlier and exceeded 300,000 for the 11th consecutive month as modification programs failed to keep delinquent borrowers in their homes, RealtyTrac Inc. said.

A total of 315,716 properties received a notice of default, auction or bank seizure last month, or one in 409 households, the Irvine, California-based seller of default data said today in a statement. Filings fell 10 percent from December.

Bank seizures, also known as real-estate-owned or REOs, may rise to a record 3 million this year, RealtyTrac said last month. About 66,000 delinquent loans out of a targeted 4 million by 2012 were permanently modified as of Dec. 31 under the Obama administration’s Home Affordable Modification Program, according to the Treasury Department.

About 787,000 mortgages are in trial programs that change loan terms, the Treasury said Jan. 19. “It’s almost inevitable that modifications will fail,” Michelle Meyer, New York-based U.S. economist for Barclays Capital Inc., said in an interview. “Over the next several months, we should see REOs increase at an accelerated pace.”

Foreclosure filings also fell in January of last year from December, only to rise in subsequent months, RealtyTrac said. “If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works,” James J. Saccacio, RealtyTrac’s chief executive officer, said in the statement. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=aGwcSA_UG5GU&pos;=3

-One-Fifth of U.S. Homeowners Owe More Than Properties Are Worth. More than a fifth of U.S. homeowners owed more than their properties were worth in the fourth quarter as the number of houses and condominiums lost to foreclosure climbed to a record, according to Zillow.com.

In the fourth quarter, 21.4 percent of owners of mortgaged homes were underwater, up from 21 percent in the previous three months and down from 23 percent in the second quarter, the Seattle-based real estate data provider said today in a report. More than one in 1,000 homes were repossessed by lenders in December, the highest rate in Zillow data dating back to 2000.

Underwater homes are more likely lost to foreclosure because their owners have a harder time refinancing or selling when they get behind on loan payments. U.S. home values dropped 5 percent in the fourth quarter from a year earlier, the 12th straight quarter of year-over-year declines, Zillow said. Read more here-http://www.bloomberg.com/apps/news?pid=20603037&sid;=at6VKvccpCzs

or http://www.reuters.com/article/idUSN0914378220100210

-Jumbo Mortgage ‘Serious Delinquencies’ Rise to 9.6%, Fitch Says. U.S. prime jumbo mortgages at least 60 days late backing securities reached 9.6 percent in January from 9.2 percent in December, the 32nd straight increase for “serious delinquencies,” according to Fitch Ratings.

“The trend line for delinquencies indicates the 10 percent level could be reached as early as next month,” Vincent Barberio, a Fitch managing director in New York, said today in a statement. The rate almost tripled in 2009, Fitch said.

Jumbo home loans are larger than government-supported mortgage companies Fannie Mae or Freddie Mac can finance. Their limits now range from $417,000 in most places to as much as $729,750 in high-cost areas. Loans in jumbo securities can be smaller than those amounts if they were issued in earlier years. Non-agency mortgage securities lack guarantees from Fannie Mae, Freddie Mac or federal agency Ginnie Mae. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=at0fpRHaUHhE&pos;=4

-No Exit in Sight for U.S. As Fannie, Freddie Flail. When Charles E. Haldeman Jr. became Freddie Mac’s chief executive officer in August, the ailing housing-finance giant had already consumed $51 billion of government money to stay afloat. It’s likely to need even more.

The Mortgage Bankers Association estimates that mortgage delinquencies won’t peak any sooner than the middle of this year. At the current pace, around 6% of Fannie’s loans and 4.9% of Freddie’s are expected to go into default over the next 18 to 24 months, producing losses that would raise the price tag on Treasury’s bailout to $175 billion, according to October estimates by investment bank Keefe, Bruyette & Woods Inc. The bank has since said that even that dire forecast is too optimistic.

Former FHFA head James Lockhart, the companies’ top regulator until last August, says the U.S. is unlikely to ever fully recoup its investment in the two companies. Read more here-http://online.wsj.com/article/SB20001424052748704362004575001042824028862.html

-Loews CEO Tisch Says U.S. Rang Hotel ‘Death Knell’. Jim Tisch, the leader of Loews Corp., said the U.S. did a “good job of killing” the hotel business by lambasting corporate travel and hurt American International Group Inc.’s ability to return bailout funds by curbing pay.

“The criticism that took place of group travel was really a death knell for the industry,” Tisch said yesterday in an interview at an office of the New York-based holding company, which owns hotels. “It’s easy for the politician to get the sound bite. What they are doing with those sound bites is putting maids and bellmen out of work.”

Loews’s hotel unit posted a $34 million loss in 2009, compared with a $40 million profit in 2008. Tisch, the chairman and chief executive officer of Loews, said group travel comprises about half the firm’s hotel business, and operations suffered as lawmakers disparaged corporate trips amid the $700 billion rescue of financial firms. In 2008, bailed-out AIG canceled about 160 events costing a total of $80 million. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=aq4ICuhr5BNY

GEOPOLITICAL NEWS

-Iran is now a ‘nuclear state’ says Ahmadinejad as thousands take to the streets. Read more here-http://www.dailymail.co.uk/news/worldnews/article-1250127/Iran-Revolution-day-protests-Islamic-Republic-nuclear-state.html or http://apnews.myway.com/article/20100211/D9DPTTKO0.html

-Iran atom bomb seen attainable despite snags: study. Read more here-http://www.reuters.com/article/idUSTRE61A42O20100211

-Tens of thousands of Iranians joined a rally in Tehran today to mark the 31st anniversary of the Islamic regime, and security forces clashed with opposition leaders and protesters who used the occasion to defy the government. Read more here-http://www.bloomberg.com/apps/news?pid=20601082&sid;=aZ9cokR1N9iQ

-Ahmadinejad warns Israel against any military move. Read more here-http://news.yahoo.com/s/nm/20100211/ts_nm/us_iran_israel_ahmadinejad

-Israel urges “crippling” sanctions now against Iran. Read more here-http://www.alertnet.org/thenews/newsdesk/LDE6181A8.htm

-Iran Sanctions Are Only Option, France’s Morin Says With Gates. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=aDR4xR89o02k or http://www.reuters.com/article/idUSTRE6172K420100208

-Russia Says Iran’s Nuclear Enrichment Violates UN Resolutions. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=aRWRZQiXsmhE&pos;=9

-Iran to make ‘advanced’ attack drones. Iran has begun making ‘advanced’ unmanned drones capable of carrying out ‘assaults with high precision’. Read more here-http://www.telegraph.co.uk/news/worldnews/middleeast/iran/7187418/Iran-to-make-advanced-attack-drones.html

-Iran says to unveil air defence equal to Russia system. Read more here-http://in.reuters.com/article/worldNews/idINIndia-45987720100208

-U.S. Uses Iran to Globalize Its Defenses, Russia Says. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=aRaApwzZO348

-U.S. Targets Iran Guard With Sanctions on Companies. Read more here-http://www.bloomberg.com/apps/news?pid=20601110&sid;=aZuUpNFuZAtc

-Al-Qaeda in the Arabian Peninsula number two Sufyan al-Azdi al-Shahri called for attacks against US interests “everywhere,” in an audio message released Monday. “American and Crusader interests are everywhere and their agents are moving everywhere,” Shahri said. “Attack them and eliminate as many enemies as you can.” AFP

-North Korea’s Kim Reiterates Denuclearization Pledge. Read more here-http://www.bloomberg.com/apps/news?pid=20601082&sid;=aAFwTc3K9m6Q

-Washington on Thursday dismissed Iranian claims of a leap forward in uranium enrichment and expressed concern that Iran appeared to have “unplugged” Google and other Internet service providers. Read more here-http://www.reuters.com/article/idUSTRE61A5CJ20100211

-Iran to suspend Google’s Gmail report. The government of Iran announced on Wednesday it would suspend Google’s e-mail service as it prepares to unveil a national e-mail service for Iranians, according to a news report.

The Wall Street Journal reported that the Iranian telecommunications agency will soon debut its new e-mail service, which Iranian officials hope will help develop national technologies and foster a certain level of trust between the government and its citizens. Read more here-http://money.cnn.com/2010/02/10/technology/google_iran_gmail/index.htm

-China PLA officers urge economic punch against U.S. Senior Chinese military officers have proposed that their country boost defense spending, adjust PLA deployments, and possibly sell some U.S. bonds to punish Washington for its latest round of arms sales to Taiwan. Read more here-http://www.reuters.com/article/idUSTRE6183KG20100209 or http://www.timesonline.co.uk/tol/news/world/asia/article7017951.ece

-China could debt bomb the U.S. by dumping or not buying their debt. Read more here-http://www.nypost.com/f/print/news/opinion/opedcolumnists/china_debt_bomb_onc23nzJdiQR7gTLkrwSpL

-President Barack Obama will meet with the Dalai Lama on Feb. 18 in the White House’s Map Room, presidential press secretary Robert Gibbs said. Obama’s plan to meet with the Tibetan spiritual leader has prompted criticism from Chinese government officials at a time when friction between the U.S. and China has been on the rise. Read more here-http://www.bloomberg.com/apps/news?pid=20601087&sid;=a_PfxJlEHavI&pos;=9

© 2010, Worldwide Precious Metals.
www.wwpmc.com

The Goldbugg Report – February 16, 2010
Posted by Worldwide Precious Metals on Tuesday, February 16, 2010

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