Friday, February 12, 2016

James Turk, John Williams, Yannis Tsitos & Bob Hoye (encore).

Feb. 12, 2016
Featured Guests:
James Turk, John Williams, Yannis Tsitos & Bob Hoye (encore).
(guest order - alphabetical)

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Summary:
  • President and Director of Goldsource Mines (GXS.V), Yannis Tsitos makes his show debut.
  • Peter Spina has chosen his firm as the top PMs stock opportunity of 2016.
  • With close to 30 years to perfect his work, President Tsitos knows how to turn a small mining company into a world-class operation.
  • The company vision includes expanding to a medium sized gold producer. The South American project shows great potential.
  • Many of the Guyana based gold deposits are located near the surface, making extraction profitable.
  • The only English speaking nation in S.A., Guyana is a pro-mining, former British colony, offering additional appeal to operations.
  • His management team boasts 250 years of experience, adding significant shareholder value.
  • First gold production by Christmas on their flagship property for merely $480 cash cost-$630 all in cost per ounce, merely half the spot price.
  • Goldsource has an affiliation with major producer and key shareholder (5%), IAMGOLD, adding strategic synergies.
  • Shareholders benefit from the coal property in Canada, with significant resources and exploration potential.
  • James Turk of GoldMoney.com returns to the program with less than sanguine comments on the domestic economy.
  • Half of 25 year olds in the US are living in their parent's homes, struggling to make ends meet.
  • The statistic is emblematic of the erosion of the economic affluence of the middle class.
  • The issue stems from lost purchasing power of the currency, resulting from profligate monetary expansion.
  • When income is adjusted for inflation and related expenses, most employees earn far less than medieval serfs.
  • The desperation of the situation is exacerbate by the off-shoring of tens of millions of high paying jobs, due to NAFTA and related policies.
  • The persistence of gold backwardation (current spot lower than future price) should not occur, as it presents an arbitrage situation.
  • Since 2000, gold has appreciated over 11% on average each year and held it's purchasing power much better than most competing asset classes.
  • The US dollar is lower, while stocks and bonds have hardly budged since that point, while gold has ascended at least four fold, $250 to over $1,000.
  • Economist John Williams of Shadowstats.com returns to the show.
  • The true underlying economic situation, hidden within the "official" economic data, is less than encouraging.
  • The typically cool-headed and collected economic-sleuth is unnerved by Fed policies.
  • His work indicates that the economy never recovered from that ominous period, resulting in the current stagnation.
  • Our guest echoes American economist Dr. Frank Knight who noted: economics is simple.
  • John Williams uncovers fingerprints of gold market manipulation / rigging, likely stemming from official sources.
  • His analysis indicates a US dollar endgame scenario of less than sanguine consequences.
  • The host suggests an alternative hypothesis: the PBoC is aggressively promoting China's Yuan currency to the IMF, as a global reserve currency alternative, as seen by the recent currency pegging to the Swiss Franc.
  • Therefore, dollar strength resulting from imminent US rate hikes in 2016 and dovish moves by the ECB, PBoC and the BOJ, are responsible for most of the 12 month dollar rally and resulting commodities weakness.
  • John Williams and the host agree that the perfect panacea for the typical investment portfolio remains PMs, the ideal insurance policy.
  • Chris welcomes back Bob Hoye, senior investment strategist of Institutional Advisors.
  • The discussion begins with the news from South America, that the Venezuelan government has plans to sell the national gold stockpile.
  • If implemented, the operation would undo the significant efforts of the late Hugo Chavez.
  • Global central banks are inadvertently supporting the PMs community - policymakers at the PBoC and EU announced new monetary stimulus plans.
  • The EU finance minister is considering a plan to lower the benchmark lending rate further into negative territory, an unprecedented event.
  • The Fed Chair shocked investors this week, noting that if domestic economic conditions continue to deteriorate, negative US lending rates could be helpful.
  • Some market watchers inferred from the speech that Fed officials might not raise rates in 2016.
  • The CME Group Fed Funds Futures contracts suggest that investors are now placing high odds that rates will increase sharply, to 1-2% or higher, as soon as next year.
  • Bob Hoye notes that Fed policymakers may not set rates, but actually follow the market trend in rates.
  • For instance, the 2 year T-Bill seems to lead Fed interest rate policy (Figure 1.2).
  • Our guest notes that the PMs market could be building a base, in advance of the next bull market.
  • He outlines his Christmas Bonus indicator, based on the Broker / Dealer index via the ETF (IAI).

Show Host
Chris Waltzek
About Chris
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