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The World Financial Report – June 5th, 2012

June 5, 2012

GOLD

-CHART OF THE WEEK: Dow-Gold Ratio. For some perspective on the long-term performance of the stock market, today’s chart presents the Dow priced in another global currency gold (i.e. the Dow-gold ratio). For example, it currently takes less than a mere eight ounces of gold to ‘buy the Dow’ which is considerably less than the 44.8 ounces it took back in 1999.

Priced in gold, the Dow has been in a massive 12-year bear market. Recently, the downtrend of the Dow (priced in gold) has slowed to its slowest pace since peaking at the end of the previous century. In fact, the Dow (priced in gold) is now testing resistance of its reduced downtrend channel thanks in part to a significant correction in gold itself. Read more here-http://bit.ly/JPkCW6


www.chartoftheday.com

-Egon von Greyerz: $100 Trillion+ to be Printed, Expect Capital Controls. Read more here-http://bit.ly/KakKAr

-Egon von Greyerz: Market Chaos & Incredibly Important 200 Year Chart. Even if we “only” go to a Dow-Gold one for one ratio, at what level would that be? For many years I have forecast gold at $10,000 dollars, and that would mean the Dow would be at the same level. But remember this means that gold would go up 6 times from here and the Dow would be down 16%. With hyperinflation gold could go considerably higher. So investors who want to preserve their wealth in the next few years are likely to do much better by owning physical gold than stocks. Read more here-http://bit.ly/N1IJBw

-In the context of its secular bull market, and given that absolutely nothing has gotten better about the sovereign debt crisis only worse gold’s correction is nothing to be concerned about. I know the technical types will point to levels such as $1,500 as important resistance points and there’s no question that if gold was to break decisively below that level that a lot of autopilot trades would kick in and put further pressure on gold. Yet, when you view the market through the lens of hard realities, which is to say, by focusing on the intractable mess the sovereigns have gotten the world into in Europe, in Japan, in China and here in the US then viewing gold at these levels as anything other than an opportunity is a mistake. David Galland

-If gold is collateral for their bailouts, nations may want a higher gold price. Europe’s debtors must pawn their gold for Eurobond Redemption, Southern Europe’s debtor states must pledge their gold reserves and national treasure as collateral under a €2.3 trillion stabilisation plan gaining momentum in Germany. Read more here-http://tgr.ph/KqrbNZ

-The big new thing in gold capital adequacy ratios. Ross Norman looks at the implications for gold of an increased focus on the assets banks are allowed to hold as tier one capital. Read more here-http://bit.ly/LaTJrO

-Rick Mills: If ‘irreplaceable’ gold a Tier 1 banking asset what next? If the Basel Committee agrees to banks using gold as Tier 1 Capital it would create substantial demand for physical bullion and be an important step toward gold’s re-monetization. Read more here-http://bit.ly/LAwElc

-David Einhorn Trashes Buffett And Cash, But Loves Gold. Without ever mentioning gold, Einhorn mocks by imitation Buffett figurative stacking up of assets, using Omaha, Buffett’s home town, in the argument: “The debate around currencies, cash, and cash equivalents continues. Over the last few years, we have come to doubt whether cash will serve as a good store of value. If you wrapped up all the $100 bills in circulation, it would form a cube about 74 feet per side.

If you stacked the money seven feet high, you could store it in a warehouse roughly the size of a football field. The value of all that cash would be about a trillion dollars. In a hundred years, that money will have produced nothing. In a thousand years, it is likely that the cash will either be worthless or worth very little. It will not pay you interest or dividends and it won’t grow earnings, though you could burn it for heat.

You’d have to pay someone to guard it. You could fondle the money. Alternatively, you could take every U.S. note in circulation, lay them end to end, and cover the entire 116 square miles of Omaha, Nebraska. Of course, if you managed to assemble all that money into your own private stash, the Federal Reserve could simply order more to be printed for the rest of us.” Read more here-http://onforb.es/Nk9lLV

-Lawrence Williams: Gold an investment for the long term. Ignore the bumps and peaks. Historically gold is perhaps the only store of wealth that has stood the test of time. Politicians and bankers may manipulate the markets short term, but long term gold has always held it value. Read more here-http://bit.ly/KBSlwe

-Lawrence Williams: What if the gold megabulls are right? The economic conditions that would precipitate the massive jump in the gold price that many of the megabulls are predicting could be horrendous, but perhaps the politicians can carry on muddling through and keep up perception that all is well. Read more here-http://bit.ly/L0EiCo

-Ross Norman: Rationale for holding gold better now than 5 or even 10 years ago. Gold is currently doing what every other business sector is doing just ’sitting on its hands’ as shellshocked politicians and economists try to unravel the complexities of the global economic meltdown. Read more here-http://bit.ly/KMoFQA

-Jeffrey Nichols: Gold hasn’t lost its mojo upward path to resume. With the greenback merely “the best-looking horse on its way to the glue factory,” the global economic imbroglio will lead to gold regaining its mojo and hitting new heights. Read more here-http://bit.ly/L9NK77

-Geoff Candy: The flock of black swans facing gold. Deliberations on World Markets Author, Ian McAvity, believes that the world faces a number of major challenges that could see gold go significantly higher this year. Read more here-http://bit.ly/MUK9On

-John Embry: People Will Be Shocked at the Chaos Heading Our Way. “The only issue I have is they are trying to create the idea that gold is a risk asset. So when the risk-off trade is on and they are selling commodities and stocks, gold is lumped in with them. But I think the safest asset in the world, by a huge margin, is gold. What really troubles me about this whole risk-on/risk-off argument, as it applies to gold, is there is massive manipulation and interference in the gold market.

They knock gold down at times when it should obviously be going higher. This engenders a lot of commentary saying something like, ‘Gold is down because the euro is weak,’ or ‘The Spanish banking problems are knocking gold down.’ If anybody stopped to think, they would realize that all of this stuff is wildly bullish for gold.

Yet, somehow they have convinced people because of price action, that gold is sold during chaotic times. That’s just false. Physical gold is not sold during turbulent times, but the reality is the paper gold market does experience heavy, manipulative selling. The bottom line is that gold will bounce back violently from this manipulation at some point.” Read more here-http://bit.ly/LGmsn7

-Currency depreciation will keep driving gold up, John Embry tells MineWeb. Read more here-http://www.gata.org/node/11425

-John Embry: Powers that be succeed once again in trashing gold. Read more here-http://www.gata.org/node/11429

-John Hathaway: Central Banks & Wealthy Are Now Big Buyers of Gold. Hathaway had this to say about gold bouncing solidly off the low $1,500 level: That’s very encouraging. That was a very good test of the December low at $1,523, and it seems to me we are in good shape for six months or more. It could be (gold gaining) for the next two years.

I would not be surprised to see gold revisit $1,900 sometime this year, and maybe even trade over $2,000. You know we are starting to see a lot of central bank buying of gold. The central banks know the story. You have to say they are informed buyers. They are just adding to their gold reserves.

If you’re a wealthy Chinese businessman and you are accumulating all kinds of wealth in the form of Chinese currency, you’ve got no place to go. You basically have a currency you can’t exchange, other than black market, for anything. So, silver and gold are the go-to alternatives. Their banking system (China’s), it’s hard to believe I can say this, but it’s worse than the one in the West.

When asked about gold, Hathaway responded, “We’re kind of in a grind. I think we’re going to be backing and filling, but I do think that before the year is over, and maybe as soon as the summer, we could see $1,900 again. You know the fuel for gold to go up has never left.

Gold went up and had this long correction of nine months. I think it’s over with. It got everybody scared, for sure. Gold seems to have found its footing. The things that drove gold up are still alive and well, and maybe even more so than they were last year. The technical position of the market following this correction is much more solid than it was nine months ago.

So I expect the rest of this year to be pretty good for people invested in precious metals and gold mining stocks. I can tell you that I was in California last week and I met a lot of people who are very familiar with the issues. They are buying physical gold. Wealthy, private investors are buying gold. I think the follow through will be very, very rewarding for people who can write the buy tickets here. I know people’s hands are shaking.

People are generally turned off by the downside action of the last nine months, but if you want to put new money to work, this is the time. These are the conditions that lead to very good returns. We are sort of on the verge of a transition to a different monetary regime. I don’t know the outcome, but I do think that almost any scenario would involve a significant re-pricing of gold. Read more here-http://bit.ly/MDheLZ

-Robert Fitzwilson: Investors Are Unprepared For The Coming Detour. Read more here-http://bit.ly/JGgRhV

-Newmont CEO Richard O’Brien: China Doing Everything It Can to Get Gold. Read more here-http://bit.ly/Jshdr9

-Michael Pento: Is This 2008 Again For Gold & Gold Shares Or Is It Rally Time? Read more here-http://bit.ly/KbuHLU

-James Turk: This Coming Disaster Will Be Worse Than Lehman 2008. Read more here-http://bit.ly/JU3Ots

-James Turk: Escalating Bank Runs, Many Banks Will Not Survive. The whole fiat currency system is so corrupt that the only way you can really protect your savings is if you buy physical gold or physical silver. You have to exit the fiat currency system completely if you are worried about bank runs. I think people should be worried because many banks around the world are largely insolvent. They are not likely to survive in their present forms. There are going to be a lot more bank runs before this crisis is over. Read more here-http://bit.ly/LiRVzQ

-James Turk: Paper gold pitfalls. Read more here-http://bit.ly/L5Pr92

-Dan Norcini: This May Accelerate Into Full-Blown Panic & Collapse. Read more here-http://bit.ly/LUZxIo

-Rick Rule: Three Things That Will End This Bear Market. Read more here-http://bit.ly/KYA5iT

-Keith Barron: This Move Will Be Highly Inflationary & Where to Deploy Cash. Read more here-http://bit.ly/K4HBN4

-Tom Fitzpatrick: US Dollar Strong, What to Expect From Gold & Global Equities. Read more here-http://bit.ly/Jt5CYT

-Central Banks boost gold holdings yet again. Latest figures from the IMF show that Central Banks have continued to increase their gold holdings significantly in April, after a big increase the previous month. Read more here-http://bit.ly/KFE7dV and http://www.gata.org/node/11413

-Shivom Seth: Monsoon and marriages to see Indian gold demand, and prices, soar. Prediction of normal monsoons in India and the onset of the wedding season are set to ensure that investment demand for the precious metal will rise sharply in the next quarter. Read more here-http://bit.ly/JZPP3h

-China’s biggest bank wants to get into gold leasing. Read more here-http://www.gata.org/node/11419

-War against gold can be reported only from the East. Read more here-http://www.gata.org/node/11418

-Gold and Silver Update with Bill Murphy from GATA. Watch more here-http://bit.ly/MP0SlW

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SILVER

Gold to silver ratio at 50 to 1 with gold at $2,000 the silver price would be $40.00

Gold to silver ratio at 40 to 1 with gold at $2,000 the silver price would be $50.00

Gold to silver ratio at 30 to 1 with gold at $2,000 the silver price would be $66.67

Gold to silver ratio at 20 to 1 with gold at $2,000 the silver price would be $100.00

Gold to silver ratio at 15 to 1 with gold at $2,000 the silver price would be $133.33

Gold to silver ratio at 50 to 1 with gold at $2,500 the silver price would be $50.00

Gold to silver ratio at 40 to 1 with gold at $2,500 the silver price would be $62.50

Gold to silver ratio at 30 to 1 with gold at $2,500 the silver price would be $83.33

Gold to silver ratio at 20 to 1 with gold at $2,500 the silver price would be $125.00

Gold to silver ratio at 15 to 1 with gold at $2,500 the silver price would be $166.67

-”At the low point Wednesday May 30, silver was down by more than a dollar from Friday’s close, while gold was down more than $40, before both came back somewhat. I’d attribute the decline to HFT manipulation and further attempts to induce speculators to sell into collusive commercial buying. Considering the dreadful news from Europe, I wouldn’t know what else to attribute the decline to.

In a sense, I feel sorry for those who don’t believe in the manipulation premise, because if it wasn’t manipulation behind this decline, any other reason would sound hollow. Yes, I’m still living in a sort of twilight zone where world financial conditions are more conducive to strong gold and silver prices than at any time in my personal experience, yet those prices are weak instead.”

“This has not been an easy time for silver (and gold) investors, mainly due to this counterintuitive and debilitating price action. My own view is that none of this price weakness is accidental or coincidental. I sense the recent takedowns have been designed to break the spirit of silver and gold investors.

Sadly, I fear the manipulators, led by JPMorgan, have succeeded in demoralizing some investors, all under the lie of hedging and market-making. I suppose this is as it must be in a manipulated market. I can only speak for myself in that I wouldn’t think of selling here and I know that the ingredients for an explosive rally are in place. I don’t know the timing or circumstances of that explosive rally to come, so I am not going to dwell on that aspect.” Ted Butler via Ed Steer Casey Research-Read more here-http://bit.ly/KOfwXp

-China’s SHFE silver futures contracts expected to have impact on global market. The Shanghai Futures Exchange’s silver futures contracts, the first of their type to be offered in China, give Chinese investors a new way to bet on the precious metal. Read more here-http://bit.ly/KXe47R

-Big commercials aggressively covering gold and silver shorts, Arensberg says. At the Got Gold Report, Gene Arensberg examines trader positions on the gold and silver futures exchanges and finds them as bullish as they’ve been in years. He says the large commercial traders are aggressively covering their short positions. Read more here-http://www.gata.org/node/11427

-Dr. Jeffrey Lewis: Low Baltic Dry Index and Negative Real Rates Make Silver Attractive. Read more here-http://bit.ly/LaejZO

-Ted Butler gives up on the CFTC and wants all commissioners out. Read more here-http://www.gata.org/node/11414

-Wall Street Journal says Comex has been classified as ‘too big to fail.’ Read more here-http://www.gata.org/node/11412

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CHARTS OF THE WEEK-QUOTES-QUICK HITS

-CHART OF THE WEEK: This Famous Chart Of The Mega-Bears Is Back. Read more here-http://read.bi/KfAXnO

-CHART OF THE WEEK: Half of U.S. Lives in Household Getting Benefits. 49.1%: Percent of the population that lives in a household where at least one member received some type of government benefit in the first quarter of 2011. Cutting government spending is no easy task, and it’s made more complicated by recent Census Bureau data showing that nearly half of the people in the U.S. live in a household that receives at least one government benefit, and many likely received more than one. The 49.1% of the population in a household that gets benefits is up from 30% in the early 1980s and 44.4% as recently as the third quarter of 2008. Read more here-http://on.wsj.com/KCuiBs

-Many U.S. unemployed facing early end to benefits. More than 100,000 Americans out of work longer than a year in six states and Washington, D.C., are expected to lose their unemployment checks this summer, pushing the total cut off this year to more than 500,000. Economists say the cutbacks will lower the unemployment rate but hurt consumer spending. Read more here-http://usat.ly/KMLkNe

-US Planned Layoffs Jump 53%: Challenger Report. Read more here-http://bit.ly/LJZ3Bb

-At the Hyundai plant in Montgomery, Alabama more than 20,000 people have applied for one of the 877 job openings. Read more here-http://bit.ly/NempCv

-CHART OF THE WEEK: Canadian Building Jobs Boom While U.S. Busts. Canadian construction employment is surging to a record amid public works projects, energy investment and homebuilding, even as U.S. building jobs fall to the least in more than 65 years. Read more here-http://bloom.bg/Nj08Dx

-CHART OF THE WEEK: Facebook Epic Fail Is Decade’s Worst Large IPO. Facebook Inc. initial public offering, which set a record for technology companies by raising more than $16 billion, also has the distinction of producing the worst return among the largest U.S. deals of the past decade. Read more here-http://bloom.bg/JZ1aqv

-Facebook IPO Seen Deepening Investor Distrust of Stocks. Facebook Inc. initial public offering, plagued by trading errors and a 16 percent drop in the share price, will push more individual investors out of a stock market they already distrust after the financial crisis. Read more here-http://bloom.bg/JX7gl3

-Citigroup Lost $20 Million on Facebook IPO Trades. Citigroup’s Automated Trading Desk had trading losses of around $20 million stemming from Facebook’s botched initial public offering on Nasdaq OMX Group’s U.S. exchange, a source with knowledge of the situation said on Friday. Read more here-http://bit.ly/KpsoDr

-Richard Russell: Important, Major Bear Market Signal. Important Dow Theory, The D-J industrial Average recorded a high of 13,279.32 on May 1, 2012. This Dow high was not confirmed by the Transports. The two averages then turned down and broke below their April lows. This action confirmed that a primary bear market is in progress it was a textbook bear signal. I consider the April-May action to be a continuation of a primary bear market that started on October 9, 2007 with the Dow at 14,164.53.

We are now dealing with the latter part of the primary bear market that began in 2007. Subscribers should now follow a course of utmost caution. I believe that the bear signal is telling us that Greece will default, to be followed by Spain, and the whole Eurozone may then fall apart. Read more here-http://bit.ly/JxOrdq

-Marc Faber: 100% Chance of Global Recession. Faber again warned that economies of the world may be on the brink of a serious slowdown. Faber indicated that while investors remain focused on Greece and Europe other issues, bigger issues are looming. And they’re more threatening. “As an observer of markets whenever everyone focuses on one thing like Greece and Europe maybe they miss issues that are far more important such as a meaningful slowdown in India and China.” Read more here-http://bit.ly/MBT9VK

-Taleb Says Euro Breakup ‘Not a Big Deal’ as U.S. Scariest. Nassim Taleb, author of “The Black Swan,” said he favors investing in Europe over the U.S. even with the possible breakup of the single European currency in part because of the euro area’s superior deficit situation.

A breakup of the euro “is not a big deal,” Taleb said at an event in Montreal. “When they break it up, there will be a lot of fun currencies. This is why I am not afraid of Europe, or investing in Europe. I’m afraid of the United States.”

The budget deficit as a proportion of gross domestic product in the U.S. amounted to 8.2 percent at the end of 2011, government figures show. That’s twice the 4.1 percent ratio for euro-region countries, according to data. “Of course Europe has its problems, but it’s in much better shape than the United States,” Taleb said. He voiced similar concerns about U.S. prospects at a conference in Tokyo in September. Read more here-http://bloom.bg/NaVBmt

-Peter Schiff: Why The Dollar Has Not Collapsed Yet. Peter Schiff thinks that the main reason why the dollar hasn’t collapsed yet is because there’s a false perception that Europe is in worse shape than the United States. “We are exacerbating our problems,” Schiff says. “We are going deeper and deeper into debt. It doesn’t mean that we’re not going to have a day of reckoning. It just means when it comes, there’s a lot more to reckon with.” Read more here-http://read.bi/JTLlx6

-13 Bears Offer Dark Forecasts For The Markets And The Economy. Read more here-http://read.bi/JNQNGn

-Rob Arnott: Lost Confidence & Stocks to Plunge 20% to 30%. There is certainly a danger of it accelerating into a nastier situation. What we need to do is find some resolution of the problem. The problem is spending money we don’t have. The consequence of spending money we don’t have is runaway indebtedness, which sews the seeds for a Greek style default. Read more here-http://bit.ly/LIsX9c

-Eric Sprott & David Baker: The Real Banking Crisis, Part II. Read more here-http://bit.ly/KvxwHz

-Time Bomb? Banks Pressured to Buy Government Debt. US and European regulators are essentially forcing banks to buy up their own government’s debt a move that could end up making the debt crisis even worse, a Citigroup analysis says. Regulators are allowing banks to escape counting their country’s debt against capital requirements and loosening other rules to create a steady market for government bonds, the study says. While that helps governments issue more and more debt, the strategy could ultimately explode if the governments are unable to make the bond payments, leaving the banks with billions of toxic debt, says Citigroup strategist Hans Lorenzen. Read more here-http://bit.ly/LM5qEh

-Debt crisis: a $46 trillion problem comes sweeping in. Bad stuff, they say, comes in threes. We’ve already got the banking and the eurozone sovereign debt crises. Next comes the corporate funding crisis. Read more here-http://tgr.ph/KXshBu

-Gross Says Low Quality of Debt Threatens Monetary System. Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., said the lower quality of sovereign debt represents a threat to the global monetary system. Read more here-http://bloom.bg/NiS4T9

-Iran claims to have replaced SWIFT system for international payments. Iranian central bank governor Mahmoud Bahmani says the country has designed and implemented a new system for conducting international transactions. Bahmani said on Saturday the new system, which has already been activated, would replace Worldwide Interbank Financial Telecommunication, the SWIFT system. On March 15, SWIFT CEO Lazaro Campos said in a statement that the society has decided to discontinue offering services to Iranian banks subject to financial sanctions imposed by the European Union. Read more here-http://www.gata.org/node/11417

-China and Japan almost ready to cut U.S. dollar out of their direct trade. Japan and China will likely initiate a foreign exchange system in which the yen and the yuan can be directly exchanged starting in June at the earliest, sources have said. The Japanese and Chinese governments have entered the final phase of negotiations to establish foreign exchange markets in Tokyo and Shanghai and will likely reach an official agreement soon. Currently the two countries’ currencies are exchanged via the U.S. dollar and thus foreign exchange commissions are relatively high. Read more here-http://www.gata.org/node/11416

-Argentina adds restrictions for travelers buying dollars. Argentina is making it harder for people to buy U.S. dollars to pay for travel abroad. A new rule published Monday says anyone wanting to buy dollars for travel must first prove their money was obtained legally, and provide the tax agency with trip details including why, when and where they are traveling. Many Argentines declare only part of their wealth and income to evade taxes, and use black-market currency exchanges to convert their inflationary pesos into dollars.

Travel agencies are the latest target since they manage multiple currencies and offer customers black-market rates for their money. President Cristina Fernandez is cracking down to keep hard currency from flowing out of Argentina, which needs the dollars to maintain its central bank reserves and pay debts. Read more here-http://www.gata.org/node/11420

-China Stimulus May Be 2 Trillion Yuan, Credit Suisse Says. The Chinese government’s stimulus in response to the nation’s economic slowdown will probably be as high as 2 trillion yuan ($315 billion), half the size of 2008’s package, Credit Suisse Group AG said. Read more here-http://bloom.bg/KxmrEk

-Jeff Rubin: Here’s Why I Blew It With My $200 Oil Call. Read more here-http://read.bi/JXaO6I

-Infographic: How The US Economy Uses 5 Major Forms Of Energy. Read more here-http://read.bi/KYei99

-The Vatican Bank Chief Has Been Ousted After A No Confidence Vote. Read more here-http://read.bi/Kthiih

-Pope’s butler charged over leaks scandal. Read more here-http://reut.rs/Kqjkhn and http://bloom.bg/MUPLba

-Buffett Says Free News Unsustainable, May Add More Papers. Warren Buffett, whose Berkshire Hathaway Inc. struck a deal this month to acquire 63 newspapers, said he may buy more publications as the industry rethinks whether to offer free content on the Internet. Read more here-http://bloom.bg/KTNiLX

-Hedge fund boss found guilty in $600 million fraud. Magnus Peterson, the boss of collapsed hedge fund business Weavering, has been found guilty of defrauding investors and ordered to pay hundreds of millions of dollars in damages. Read more here-http://reut.rs/KcOXyw

-Australian Becomes World’s Richest Woman. Read more here-http://bit.ly/JdyHHA

-Wall Street Titans Out earned by Media Czars. Think Wall Street is the land of plenty when it comes to compensation? Think again. If 2011 pay to top executives is a window into the Wall Street compensation machine, then compared with other industries the entertainment media, for instance the bloom is definitely off the rose. Read more here-http://bloom.bg/LAfaRU

-World’s Happiest Countries. Read more here-http://bloom.bg/KGWyio

-Hundreds of words to avoid using online if you don’t want the government spying on you. Read more here-http://bit.ly/L4p6Ip

-Anarchist group vows to wage ‘low level warfare’ on Olympics. An anarchist group has vowed to wage “low level warfare” against Britain, sabotaging financial institutions, transport, and the military in the lead up to the London Olympics. Read more here-http://tgr.ph/Kw3AtA

-Barton Biggs Spoke With A Well-Connected Businessman Who Says Saudi Arabia Has A Plan To Bankrupt Iraq And Iran. Read more here-http://read.bi/LN74cM

-Panetta: U.S. is Ready to Stop Iran from Creating Nuclear Weapons. Read more here-http://bit.ly/LqSCXJ

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RARECOLOREDDIAMONDS.COM

-Rarecoloreddiamonds.com Featured Diamond of the Week. This week’s Featured Diamond is a 1+ Carat Radiant Cut Fancy Intense Yellow Green Diamond. Harold Seigel-See video of the Diamond here-http://bit.ly/KYVsCH

-Biggest pink diamond ever to go under hammer sells for over Twice its estimate after fetching $17m at auction. The Martian Pink, 12.04-carat pink diamond the largest ever to hit the auction market sold for over double its original estimate when it went under the hammer for $17.4m through auction house Christie’s. The incredibly rare gem, is one of only two pink diamonds in the world which are said to be of ’significant size’, along with a 23.60-carat Williamson Pink diamond, which was presented to Queen Elizabeth II as a wedding gift. Read more here-http://bit.ly/KZAQHX

-Colored Diamond Auction Results: Christie’s Hong Kong Magnificent Jewels, May 29 2012. See Auction Results here-http://bit.ly/KHycZ2, http://bit.ly/M7Iy8u, and http://bit.ly/JugKVs.

-Lot 3766: A Colored Diamond Ring By Harry Winston. Set with a brilliant-cut fancy intense pink weighing 12.04 carats, mounted in 18k gold, ring size 7. Estimate $8,400,000-$12,000,000. Price Realized $17,480,721. See more here-http://bit.ly/MY25HI

-Lot 3765: An Important Colored Diamond And Diamond Ring. Centering upon a rectangular-shaped fancy intense pink diamond weighing 3.11 carats, flanked by half-moon diamonds, mounted in 18k white gold, ring size 5¼. Estimate $1,800,000-$2,300,000. Price Realized $2,042,394. See more here-http://bit.ly/KZusjW

-Lot 3762: A Rare Colored Diamond Ring. Set with a pear-shaped fancy brown-yellow diamond weighing 40.94 carats, mounted in 18k rose gold, ring size 5½. Estimate $1,100,000-$1,500,000. Price Realized $1,535,031. See more here-http://bit.ly/KWtZxD

-Lot 3761: An Important Colored Diamond Ring. Set with a cushion-shaped fancy vivid yellow diamond weighing 10.81 carats, to the pavé-set brilliant-cut yellow diamond gallery and three quarter-hoop, mounted in 18k gold, ring size 5¼. Estimate $1,300,000-$1,900,000. Price Realized $1,390,071. See more here-http://bit.ly/Jub6lX

-Lot 3759: A Colored Diamond and Diamond Ring. Set with a pear-shaped fancy yellow diamond weighing 11.50 carats, flanked by tapered baguette-cut diamonds, mounted in 18k gold, ring size 5¾. Estimate $160,000-$230,000. Price Realized $375,345. See more here-http://bit.ly/LfjYxy

-Lot 3753: A Suite Of Colored Diamond Jewellery. Comprising a necklace designed as a series of graduated heart-shaped fancy yellow diamonds, each within a brilliant-cut yellow diamond surround, spaced by brilliant-cut yellow diamond florets; and a pair of ear pendants en suite, mounted in 18k gold, necklace 43.2 cm long, ear pendants 3.5 cm long. Estimate $620,000-$840,000. Price Realized $748,101. See more here-http://bit.ly/JQ8BMr

-Lot 3752: A Colored Diamond And Diamond Ring By Harry Winston. Set with a marquise-cut fancy intense yellow diamond weighing approximately 15.04 carats, flanked by a trio of marquise-cut diamonds, mounted in 18k white and yellow gold, ring size 7. Estimate $520,000-$770,000. Price Realized $592,786. See more here-http://bit.ly/NeylUH

-Lot 3751: A Colored Diamond and Diamond Bracelet. Designed as a line of vari-cut multi-coloured diamonds and a rectangular-shaped diamond weighing approximately 1.44 carats, each within a brilliant-cut diamond surround, mounted in platinum, 17.7 cm long. Estimate $310,000-$450,000. Price Realized $468,534. See more here-http://bit.ly/KImddR

-Lot 3750: A Colored Diamond And Diamond Ring. Of foliate and bud design, the terminals set with a pear-shaped fancy intense yellow diamond weighing approximately 2.00 carats and a pear-shaped brownish pink diamond, joined to the pavé-set brilliant-cut diamond hoop, mounted in 18k white, rose and yellow gold, ring size 5¾. Estimate $37,000-$49,000. Price Realized $38,829. See more here-http://bit.ly/Lfnmsb

-Lot 3749: A Colored Diamond And Diamond Ring. Set with a heart-shaped fancy deep brownish orangy yellow diamond weighing approximately 2.20 carats, within a brilliant-cut diamond surround, mounted in 18k white gold, ring size 5¾. Estimate $20,000-$32,000. Price Realized $22,650. See more here-http://bit.ly/KZwZe4

-Lot 3743: A Diamond And Colored Diamond Ring. Set with a heart-shaped diamond, within a two-tiered brilliant-cut pink diamond surround, joined to the brilliant-cut diamond gallery and half-hoop of foliate motif, mounted in 18k white and rose gold, ring size 3½. Estimate $3,900-$6,500. Price Realized $24,268. See more here-http://bit.ly/KTr1xN

-Lot 3741: A Colored Diamond, Diamond And Rock Crystal “Lotus” Ring By Scavia. Set with a marquise-cut fancy brownish pink diamond weighing approximately 3.49 carats, to the tapered fluted rock crystal shoulders and rectangular-shaped diamond borders, mounted in 18k white gold, ring size 6¼. Estimate $52,000-$77,000. Price Realized $64,715. See more here-http://bit.ly/KTrShX

Lot 3542: A Colored Diamond And Diamond Ring. Set with a cushion-shaped fancy intense yellow diamond weighing approximately 4.49 carats, flanked by tapered baguette-cut diamonds, mounted in 18k gold, ring size 5½. Estimate $62,000-$84,000. Price Realized $77,140. See more here-http://bit.ly/Kx4R56

-$194,000 diamond encrusted gold coins on sale to celebrate Queen’s jubilee. Read more here-http://bit.ly/LTLUsM

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SOVEREIGN DEBT

-CHART OF THE WEEK: Euro Zone Debt. The chart looks at debt in the euro zone. See each country’s general government gross debt as a percentage of GDP. Each column is broken down by 2011 figures, 2012 forecast and the average debt from 2002-2011. Read more here-http://bit.ly/KoAdtg

-Biggest Greek bank warns of dire euro exit fallout. If Greece left the euro, living standards would plummet, incomes would be slashed by more than half, and inflation and unemployment would skyrocket, the National Bank of Greece warned on Tuesday. Read more here-http://reut.rs/KazIpW

-Greece to Exit Euro, New Currency to Fall 60%: Citi. Greece will leave the euro zone next year and the country’s new currency will “immediately fall by 60 percent,” according to Citi chief economist Willem Buiter. Read more here-http://bit.ly/LhW7fx

-Dallara Says Greek Euro Exit May Exceed 1 Trillion Euros. The cost of Greece exiting the euro would be unmanageable and probably exceed the 1 trillion euros ($1.25 trillion) previously estimated by the Institute of International Finance, the group’s managing director said. Read more here-http://bloom.bg/Kyn6Hm

-Greek Exit Could Trigger 50% Fall in Euro Stocks. Euro zone stocks could plummet up to 50 percent if Greece makes a disorderly exit from the euro zone, a research note from Societe Generale. Read more here-http://bit.ly/K5hW5J

-Greek Exit From Euro Seen Exposing Deposit-Guaranty Flaws. The threat of Greece exiting the euro is exposing flaws in how banks and governments protect European depositors’ cash in the event of a run. National deposit-insurance programs, strengthened by the European Union in 2009 to guarantee at least 100,000 euros ($125,000), leave savers at risk of losses if a country leaves the euro and its currency is redenominated. The funds in some nations also have been depleted after they were used to help bail out struggling lenders, leading policy makers to consider implementing an EU-wide protection plan. Read more here-http://bloom.bg/LEeqvQ

-Greece Will Leave Europe On June 18, Says Money Manager They’re Lazy Cheaters, And Germany’s Sick Of It. Greece will leave the euro zone on June 18 if the populist government wins the country’s elections on the 17 as the rest of the euro zone rounds on “cheaters,” Nick Dewhirst, director at wealth management firm Integral Asset Management, told CNBC.com.

“The euro zone is a club but you get cheaters who get away with it until everyone finds out and at that point you need to remove them otherwise everyone will cheat. It’s better for Greece to leave,” Dewhirst said. He added that Greek society was built on cheating and scheming, saying “everyone does it” but that voters elsewhere in the euro zone were now calling Greece to account. Read more here-http://read.bi/KJOHnu

-IMF looking at Spain bailout: report. Read more here-http://on.mktw.net/K06kfG

-Greek Fund Provides 18 Billion-Euro Bank Capital Boost. The Hellenic Financial Stability Fund disbursed 18 billion euros ($23 billion) to Greece’s four biggest banks as part of a recapitalization plan that may enable the lenders to return to the European Central Bank for funding. The banks will receive bonds issued by the European Financial Stability Facility, which approved the transfer last week. Read more here-http://bloom.bg/JIysKV

-Spain faces ‘total emergency’ as fear grips markets. Spain is facing the gravest danger since the end of the Franco dictatorship as the country is frozen out of global capital markets and slides towards an epic showdown with Europe. Read more here-http://tgr.ph/KdjyeW

-Money flies out of Spain, regions pressured. Spaniards alarmed by the dire state of their banks are squirreling money abroad at the fastest rate since records began. Read more here-http://reut.rs/KLawTt

-Bankia Bailout Cost Too High as Investors Shun Spain Debt. Bankia group risks dragging the rest of Spain into its vortex. As Spain’s third-biggest bank asks Prime Minister Mariano Rajoy’s government for 19 billion euros ($24 billion), international investors are tallying the potential cost for the rest of the industry and betting he won’t be able to foot the bill.

With foreign investors shunning Spanish debt, leaving national banks to fund the government, the nation’s 10-year borrowing costs compared with Germany’s are near a record. “The problem for Spain is that they can’t simply finance all this by issuing debt,” said Edward Thomas, who helps manage $6 billion as head of fixed-income investment at Quantum Global Wealth Management in Zug, Switzerland. “It’s a perfect storm for Spain, with more banks now being sucked in.” Read more here-http://bloom.bg/JSQoOd

-Lloyd’s of London preparing for euro collapse. The chief executive of the multi-billion pound Lloyd’s of London has publicly admitted that the world’s leading insurance market is prepared for a collapse in the single currency and has reduced its exposure “as much as possible” to the crisis-ridden continent. Read more here-http://tgr.ph/Lojtng

-Central Banker Calls Euro Zone Structure ‘Unsustainable.’ The president of the European Central Bank, Mario Draghi, warned Thursday that the structure of the euro currency union had become “unsustainable” and criticized political leaders who he said had been slow to respond to a regional debt crisis now well into its third year. Read more here-http://nyti.ms/LIU8RU

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U.S. DEBT-DEFICIT

-CHART OF THE WEEK: What America’s $11.44 Trillion In Household Debt Looks Like. Read more here-http://read.bi/KuWCq6

-Debt-Ceiling Deja Vu Could Sink Economy. Europe is crumbling. China is slowing. The Federal Reserve is dithering. Yet the biggest threat to the emerging U.S. economic recovery may be Congress. John Boehner, the leader of the House Republicans, has promised yet another fight with the White House over the debt ceiling the limit Congress has placed on the amount the federal government can borrow.

If this sounds familiar, it’s because we suffered through an identical performance last summer. Our analysis of that episode leads to a troubling conclusion: It almost derailed the recovery, and this time could be a lot worse. Sometime around the end of this year, the federal government will bump up against its $16.4 trillion borrowing limit, as a direct result of spending and tax laws enacted by Congress.

To raise the limit, legislators must pass a separate law. In principle, the extra level of approval can serve as a useful mechanism, forcing Congress to debate its priorities. But refusing to raise the limit wouldn’t free the government of its existing spending obligations. Rather, it would leave the government with no choice but to default on its debts. Read more here-http://bloom.bg/KWWv3y

-Student-Loan Debt Rose to $904 Billion in First Quarter. Debt from educational loans in the U.S. rose 3.4 percent to $904 billion in the first quarter, according to the Federal Reserve Bank of New York. Read more here-http://bloom.bg/Njkk8g

-Providence Sets Deal to Curb Pensions, Prevent Bankruptcy. Providence Mayor Angel Taveras reached a tentative accord with union leaders and retirees that cuts pensions for workers including police and firefighters and will prevent bankruptcy for the Rhode Island capital.

The agreement is the latest to scale back public-worker benefits in states and cities from California to Maine seeking to curb pensions as costs have ballooned and investment returns have soured even as retirees live longer. Providence needs almost $1 billion to fulfill its contract promises after failing to make required contributions to its retirement system. Read more here-http://bloom.bg/JWaW6H

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REAL ESTATE

-Keith Jurow: Prepare For The Coming Housing Collapse. Read more here-http://read.bi/Kdap6b

-Home Prices in U.S. Fell at Slower Pace in Year Ended March. Home values in 20 U.S. cities fell in the 12 months ended March at the slowest pace in more than a year as lower borrowing costs and an improving job market gave sales a boost. The S&P/Case-Shiller index of property values fell 2.6 percent from a year earlier after a 3.5 percent drop in February, the group reported in New York. Read more here-http://bloom.bg/MVaFqC

-Pending Sales of U.S. Homes Decrease by Most in a Year. The number of Americans signing contracts to buy previously owned homes fell in April by the most in a year, indicating the U.S. housing recovery remains uneven. The index of pending home resales dropped 5.5 percent following a revised 3.8 percent gain the prior month, figures from the National Association of Realtors showed in Washington. Read more here-http://bloom.bg/NdMXDC

-Foreclosures made up 26% of U.S. home sales in first quarter. Homes in some stage of foreclosure accounted for more than one in four home sales during the first three months of the year, according to a report released Thursday. Distressed properties that were either in default, scheduled for auction or bank-owned accounted for 26% of all residential sales during the first quarter, up from 22% in the previous quarter and 25% a year earlier, RealtyTrac said. Read more here-http://cnnmon.ie/Ni8bQX

-Toll Buying Half of a 2,379-Home California Subdivision. Toll Brothers Inc., the largest U.S. luxury-home builder, is buying half of a Southern California subdivision approved for as many as 2,379 houses as demand for new single-family properties begins to recover. Read more here-http://bloom.bg/JPBLes

-Hoboken Homes Gone in 60 Minutes Signal U.S. Recovery. For the latest sign of a U.S. housing rebound, Toll Brothers Inc. Chief Executive Officer Douglas Yearley points to Hoboken, New Jersey: A couple torn between two condos last month at the sales office for its Hudson Tea complex decided to think about it over lunch. When they returned an hour later, both units were gone. Read more here-http://bloom.bg/JX66ML

-Corzine’s Hoboken Penthouse Sells at a 14% Loss for $2.8 Million. A Hoboken, New Jersey, penthouse belonging to Jon Corzine, the former chairman of bankrupt MF Global Holdings Ltd., sold for $2.8 million, 14 percent less than what he paid for it in 2008. Read more here-http://bloom.bg/JAnuG3

-Manhattan Penthouse Sale at Luxury Tower Sets Record. A duplex penthouse at a tower under construction on Manhattan’s West 57th Street went under contract for more than $90 million, setting a record for a single residence in the borough. Read more here-http://bloom.bg/NfcRaf

-U.K. Hometrack House Prices Jump as London Values Surge. U.K. house prices rose for a third month in May on gains in London, according to Hometrack Ltd., which said the euro-area debt crisis will weigh on the market and limit further gains. Read more here-http://bloom.bg/JHZiTa

-Iceland Property Bubble Grows With Currency Controls. Iceland’s crisis-management policies are creating the island’s next property bubble less than four years after its banking meltdown threw the economy into its worst recession. Prices for new homes touched a record last quarter, having surged 40.1 percent since the final three months of 2010, according to estimates by the National Registry of Iceland in Reykjavik. Average house prices have risen 11.3 percent since the market bottomed at the end of 2009, according to central bank data at the end of the first quarter. Read more here-http://bloom.bg/N98yxe

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© 2013, Worldwide Precious Metals Canada Ltd.
www.wwpmc.com

The World Financial Report – June 5th, 2012
Posted by Worldwide Precious Metals on Tuesday, June 5, 2012


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