How Many Bitcoins Is An Ounce of Prevention Worth?

bitcoinThe very recent publicity surrounding the U.S. Department of Homeland Security actions against the Bitcoin exchange Mt. Gox resulting in the shutdown of its operations has caused a great jolt in the virtual currency world. Without judging the merits of the operations of Bitcoin in this virtual currency marketplace, I find it very difficult to believe that it has placed itself in such jeopardy.

In recent years, FinCEN has issued a flurry of rulings and guidance that define the various types of financial institutions that qualify as Money Services Businesses. They culminate in FinCEN’s March 18th guidance that lays out the responsibilities of users, administrators and exchangers of those virtual currencies. Entering into this particular type of financial market, it would have been prudent to consult with the experts. Knowing that there is an international regulatory framework focused on money laundering and terrorist financing, alarm bells should have sounded long ago that, sooner or later, some sort of adverse action would occur. [Read more...]

I Love New York City!

music harmonyPeople often ask me about my commute. Then they seem more interested in my walk to the office which is 17 blocks from Port Authority. They wonder why I do it everyday. The primary reason is because by avoiding the subway I spend more time breathing the air and enjoying the sights and sounds. It really makes me feel alive.

This morning I was rewarded with live music as a band was playing a beautiful melancholy love song outside the Fox building on Sixth Avenue. I stopped and listened for a few minutes joyfully. I guess later I can figure out who the band was by looking it up on the internet but for now I can just say it put a smile on my face. Like a beautiful painting, a gorgeous view of nature, so is a band that plays in excellent harmony. What a nice gift this morning, I hope that you all get something special in your day as I did this morning. This is why I walk and love New York City.-Miguel Perez-Santalla

#Gold Still Shows Signs of Life

Life2You would think with the continued weakness in the Eurozone that it would be enough to stabilize gold and silver. However, yesterday’s GDP number did nothing but drive more money into the US Dollar and US Equities. Then today we had the incredibly growing unemployment numbers in Spain and France. But even this was not enough to help.

The Dollar remains King and walking in this morning as the US 8:30 data came out It was a mixed bag as CPI was slightly better and Housing Starts were worse than expected. But the Building Permits number offset the negativity of the Housing Starts and caused another rally in favor of the US dollar as gold was getting dumped again. Gold hit as low as $1370.

But then the Philadelphia Fed Survey came out shockingly lower than expected at minus 5.2 when they were expecting a positive number. Just like a patient suffering a heart attack and lying on the ground, gold was shocked back to life. The high it hot today was in the range of $1398 just not enough to go over that psychological $1400 level.

But the good news is gold and silver are still alive. The bad news is it is still a bear market and needs a lot of physical therapy before it can get on its feet anytime soon. Gold is trading now at $1387 and silver at $22.72 Somehow during this US Bull Run I expect that there will be something to change direction again. Another few signals like the Philadelphia report today and gold bulls may have a reason to smile again.- Miguel Perez-Santalla

Is there Still Debt? No, so says #Gold Market

debtToday’s Retail Sales number was very good and due to this positive note gold was immediately put into a down turn. Then when Business Inventories report came out lower than expected it began to recover. The pressure overhanging the market from the renewed discussions of the Fed pulling back on QE is still the real culprit to the drop of the last few days.

But is that the only story for gold? No, though spring fever has hit and the more ominous news is discounted it doesn’t mean it is not there. Europe continues in crisis as Greece does not look able to match many of the goals set for its recovery back to a liquid asset class. Cyprus, silent in the news, remains a festering sore that the bandage seems to be falling off. Finally, the infection has spread to the small country of Slovenia and fears that another bailout is inevitable are ignored. Also, unemployment remains high in Spain, Portugal and other parts of the EU. It reminds me that a person can easily lose a lot of blood from many cuts as opposed to one large one. So what kind of bandages does the ECB have in its medicine cabinet?

Gold needs to hold on above $1436 level or technical traders will begin selling. Gold at this moment is trading $1436 and Silver is at $23.74. It won’t bring the longs any comfort to know that the future will be better especially that for now it looks like we may continue to drift lower. Miguel Perez-Santalla

 

US Government Deficit to Worsen as Population Shrinks

baby futureIn an article today in the Wall Street Journal the following comment was made:

The government has roughly $16.7 trillion in debt, with numbers rising because the government still spends more money than it brings in. And while the short-term deficit is shrinking, both parties know it is projected to widen dramatically in coming decades as the U.S. population ages unless changes are made to curb the growth of programs like Medicare.

I point this out because our future problems are being exacerbated by the Obama Administration in the outright promotion of population control. Their demand for mandatory coverage for both Abortion (the murder of children in and out of the womb) and Contraception ( by drugs, devices and condoms), as if having children is a disease, is an obvious affront to the people of this country. Not only does this administration spend what we do not have but where they spend will only  continue to create problems for this nation in the future such as they are having in Singapore and Europe due to depopulation.

When will the people of this country wake up and realize that children are a gift that produce?  And not a burden as the social engineers want us to believe. Miguel Perez-Santalla

Smells rotten……#gold does not rot

imageFor most of the day gold was hovering little higher than $1472 an ounce. Late into the afternoon circa 3 o’clock gold started taking a pounding as the US dollar seemingly gained new found strength. This morning’s report of Eurozone unemployment at 27% was no change. The US Jobless Claims were better than expected but not by much. What is going on?

Ignoring subpar growth in the US with continued easing and a weak global environment Fed President Evans was quoted as saying “inflation is undershooting the Federal Reserve’s ideal, but it is not so low that the central bank should move to add still more stimulus to the economy” However this comment was made early on in the day.

Then later in the day we get fed another tidbit from the central bank of the United States “ A sustained recovery in the housing market appears to be under way,” Elizabeth Duke, a board member at the Fed, said today. This seemed to pave the way for a stronger dollar and promptly all the other currencies were being dumped.

I tire of these knee-jerk reactions.

How can it be that the housing recovery that is being fueled by foreign money can be considered anything but status quo at best? Personal income has not risen and the housing prices continue to rise this is a combination for disaster. And with the rest of the global economy tepid, where is the boom in business and pay supposed to come from?

Still the market dictates the price and as of this afternoon gold is trading at $1458 an ounce down roughly $14. Silver is trading at $23.74 down $.18. Still stuck in a range both gold and silver are not looking good. But neither is the global economy. Something is rotten in Denmark and it’s not the cheese. Miguel Perez-Santalla

Allan Ramlall – New Contributor

ImageI have asked my great friend Allan Ramlall to also become a contributor. He has been involved with precious metals, foreign exchange and money service businesses for 30 years. He has a truly international view of the world and his most recent focus with the National Association of Money Transmitters and related business is sure to help us to see different factors that may affect out markets and our lives.

As close friends it has always been a pleasure to work together and celebrate together. I hope and believe that the joy he brings to life he will also bring to the readers in his upcoming contributions. Miguel Perez-Santalla

Patricia Cauley – New Guest Contributor to My Blog

patricia-bwOn the suggestion of my friend David Bray I have asked Patricia Cauley to contribute to the blog. I am giving her free rein to also write about other commodities. This will help rounding out perspectives on the sector and how it may or may not affect precious metals.

Patricia has been in the metals markets for many years, currently working for Metalprices.com, and is well-respected by her colleagues. We work together on the board of the New York Chapter of the International Precious Metals Institute and I can say that I have a great affection for her as a friend as well.

I am certain that this will enhance what I have been trying to do for many years. Share market knowledge, not just report it, but as real people and how it affects us as individuals as well.Miguel Perez-Santalla

Gold Market, Lost DIrection, Lost Mind

ImageIn what can be only described as a recovery day for gold the yellow metal was not able to do more than recover yesterday’s losses. With no concrete market news to affect the fast money we saw only a mild reversal. Until we break out of the range between $1435 and $1485 we can expect to be bored for some time.

The high for gold today was nearly $1477 and is trading now at $1471, The high for silver today was $24.08 and is currently trading at $23.88. With all the base metals in the green today I would have expected silver to have a better day, sadly it is anemic at best.Miguel Perez-Santalla

Bloomberg; Alix Steel and I discuss Gold

Bloomberg; Alix Steel and I Discuss Gold Investor Index