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Author: Dorothy Kosich
Unprecedented demand, a shortage of blanks, and restrictive policies and regulations continue to exacerbate what is almost becoming a chronic shortage of gold and silver coins authorized by the U.S. Mint.
The U.S. Mint has again "temporarily" suspended sales of almost all of its gold uncirculated and proof coins, along with nearly all of silver uncirculated coins because of the limited availability of blanks.
The mint no longer offers for sale the American Buffalo Gold Proof fractional coins and four coin sets are no longer available. Meanwhile the mint will no longer offer American Buffalo Gold Uncirculated Coins.
The 2009 American Buffalo One-ounce Gold Proof Coin is scheduled to go on sale in the second half of the 2009 calendar year after an acceptable inventory of 24-karat gold blanks can be acquired.
The U.S. Mint Online Product Catalog says production of the American Eagle Gold Proof and Uncirculated Coins has been temporarily suspended due to the "unprecedented demand" for American Eagle Bullion Coins for which all available 22-K gold blanks are being allocated.
In the catalog, the government says it will resume the American Eagle Gold Proof and Uncirculated Coin Programs "once sufficient inventories of gold bullion blanks can be acquired to meet market demand for all three American Eagle Gold Coin products."
Congressionally authorized American Eagle Bullion coins are aimed at providing investors an effective way to invest in precious metals. Prices may change on a daily basis as the platinum, gold and silver markets may fluctuate. The mint does not sell the bullion coins directly to the public, but distributes them in bulk through a network of official distributors, who meet government financial and professional criteria, which must be attested to by an internationally accepted accounting firm.
So far this year, the mint has sold 700,000 ounces or 700,000 gold bullion coins, compared to last year's total sales of 860,500 ounces of gold or 1,172,000 bullion coins.
Federal laws and regulations say the gold must be newly mined in the United States. Only a handful of refineries meet the standards and regulations to produce the blanks for the coins.
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Tuesday, July 14, 2009
U.S. Mint gold, silver coin sales 'temporarily suspended' - again
Government Sachs Executives Sell $700 Million in Stock: Report
NEW YORK (Reuters) – Goldman Sachs Group Inc (GS.N) executives sold almost $700 million worth of stock since the collapse of rival Lehman Brothers last year, the Financial Times said on Monday.
The newspaper said that most of the stock sales took place while the biggest U.S. investment bank was bailed out by the government with $10 billion of taxpayer money, according to filings with the Securities and Exchange Commission.
A Goldman Sachs spokeswoman declined to comment.
Goldman executives sold stock worth $691 million between September 2008 and April 2009, more than the $438 million in stock sold between September 2007 and April 2008when the average share price was substantially higher, the Financial Times said.
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Fed Independence or Fed Secrecy?
Rep. Ron Paul
Texas Straight Talk
Jul 14, 2009
Last week I was very pleased that hearings were held on the independence of the Federal Reserve system. My bill HR 1207, known as the Federal Reserve Transparency Act, was discussed at length, as well as the general question of whether or not the Federal Reserve should continue to operate independently.
The public is demanding transparency in government like never before. A majority of the House has cosponsored HR 1207. Yet, Senator Jim DeMint's heroic efforts to attach it to another piece of legislation elicited intense opposition by the Senate leadership.
The hearings on Capitol Hill provided us with a great deal of information about the types of arguments that will be levied against meaningful transparency and how the secretive central bankers will defend the status quo that is so beneficial to them.
Claims are made that auditing the Fed would compromise its independence. However, by independence, they really mean secrecy. The Fed clearly cherishes its vast power to create and spend trillions of dollars, diluting the value of every other dollar in circulation, making deals with other central banks, and bailing out cronies, all to the detriment of the taxpayer, and to the enrichment of themselves. I am happy to challenge this type of "independence".
They claim the Fed is endowed with special intellectual abilities with which to control the market and that central bankers magically know what the market needs. We should just trust them. This is patently ridiculous. The market is a complex and intricate thing. No one knows what the market needs other than the market itself. It sends signals, such as prices, that should be reacted to and respected, not thwarted and controlled. Bankers are not all-knowing and cannot ignore the rules of supply and demand. They might act as if they are, but their manipulation of the market just ends up throwing it wildly off balance, which gives us the boom and bust cycles.
They claim the Fed must remain apolitical. No organization is apolitical that relies on the President to appoint the Chairman. In fact, it is subject to the worst sort of politics power to create trillions of dollars and affect the value of every dollar in the country without the accountability of direct elections or meaningful oversight! The Fed typically enacts monetary policy that is favorable to particular administrations close to elections, to the detriment of long term considerations. They do this partly because of the political appointee process for the Chairmanship.
The only accountability the Federal Reserve has is ultimately to Congress, which granted its charter and can revoke it at any time. It is Congress's constitutional duty to protect the value of the money, and they have abdicated this responsibility for far too long. This was the issue that got me involved in politics 35 years ago. It is very encouraging to finally see the issue getting some needed exposure and traction. It is regrettable that it took a crisis of this magnitude to get a serious debate on this issue.
Jul 13, 2009
Rep. Ron Paul
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Monday, July 13, 2009
Significant Silver Withdrawals from COMEX
(Seeking Alpha) Ending last week with nearly 119 million ounces of silver (Moz) in the four COMEX depositories, this week the word has been get your silver while you can.
Slightly less than 2 million ounces of silver has been withdrawn from COMEX stocks in three days (July 6-8), with eligible silver dropping from 55.4 Moz to 53.5 Moz. Significant withdraws were experienced by HSBC Bank (HBC) (down 1.26 Moz) and Sottia Mocatta (down 546,000 oz). Brinks also registered a withdraw of 30,000 oz of silver.
The reduction is only 2% of total stocks that COMEX claims, however it is nearly 5% of eligible stocks that can be used for futures redemption. The remainder is registered, but is already allocated (owned) by other investors who are storing it in the vaults.
For leverage fans, that is 10 oz of silver under contract for every ounce of silver available. If you count the fact that COMEX allows you to purchase a contract with 10%, then actual leverage vs physical metal held by COMEX is closer to 100 to 1.
That should answer the question as to why someone would refer to it as "paper" silver. It should also generate a question as to why so much silver is starting to flow out of the COMEX.
By Ed Zimmer
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CIT Group Scrambles to Survive, Avoid a Run
(Wall Street Journal) CIT Group Inc. officials spent the weekend trying to hash out a plan that would help calm markets and convince customers and investors that it can work its way out of a deepening liquidity crunch.
Over the weekend, CIT representatives held discussions with members of Congress, government officials and regulators as they became increasingly nervous hundreds of small and midsize business customers may rush to withdraw funds or try to draw down credit lines.
CIT executives were worried that customers would be rattled by reports over the weekend that it hired a prominent law firm to prepare for a possible bankruptcy filing after so far failing to get additional government assistance.
Company officials and its advisers scrambled to accelerate a plan to address the company's long-term funding needs. Part of that plan, which has been in the works for some time, involves transferring more assets to CIT's Salt Lake City bank and moving cash to the holding company.
In a statement late Sunday, CIT said it is in "active discussions with its principal regulators on a series of measures" to improve its "near-term liquidity position."
The options being discussed include solutions that don't involve access to the FDIC's Temporary Liquidity Guarantee Program, even though CIT's application to that program is still pending.
The company said it is trying to transfer more assets, such as its trade finance and vendor finance businesses, to its bank. If those near-term transfers are approved by regulators, they would help improve its liquidity position, CIT added.
CIT had hoped to get some sort of short-term emergency financing from the government. But it was unclear whether government officials would be willing to step up. They have long felt CIT is not a systemic risk to the financial system and other lenders could step in to provide loans and services to small and midsize businesses, a CIT specialty.
While not as well known as the big commercial banks, CIT is an important test case for the Obama administration. It gives indications of the government's willingness to get involved with financial institutions that aren't deemed as too big to fail, but that play a significant role in the economy.
CIT is a lender to nearly a million mostly small and midsize businesses and companies, and while its failure may not jolt financial markets in a large way, it could hurt the flow of credit to many businesses to whom banks traditionally won't lend.
The government gave the bank-holding company $2.3 billion under the Troubled Asset Relief Program last year but so far hasn't included CIT in a separate program that would allow it to issue debt at low interest rates.
While CIT has limped through the credit crisis, the lender is nearing crisis point, facing $2.7 billion in debt due from now till year end that investors worry it may not be able to make.
By JEFFREY MCCRACKEN and SERENA NG
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Friday, July 10, 2009
China Attacks Dollar’s Dominance
China has launched its highest-profile criticism of the dominant role of the US dollar as a global reserve currency at a meeting of the world’s biggest economies.
Dai Bingguo, Chinese state councillor, raised the issue on Thursday when he joined the leaders of four other emerging economies for talks with the leaders of the Group of Eight industrialised nations – including US President Barack Obama – in the earthquake-damaged Italian town of L’Aquila.
The remarks, in front of Mr Obama, caused concern among western leaders, some of whom fear that even discussion of long-term currency issues could unsettle markets and undercut economic recovery.
Gordon Brown, Britain’s prime minister, said he did not remember Mr Dai making the remarks. But he said the focus should be on moving the world out of recession.
“We don’t want to give the impression that big change is around the corner and the present arrangements will be destabilised,” said Mr Brown.
”We should have a better system for reserve currency issuance and regulation, so that we can maintain relative stability of major reserve currencies exchange rates and promote a diversified and rational international reserve currency system,” said Mr Dai, according to the Chinese foreign ministry.
While he did not name the dollar, Mr Dai was unequivocal in calling for the world to diversify the reserve currency system and aim at relatively stable exchange rates among leading currencies.
The dollar weakened in subsequent trading, although it was difficult to tell whether this was due to the Chinese remarks or cross-currents in risk appetite and economic data.
By George Parker and Guy Dinmore in L’Aquila, Krishna Guha in Washington and Justine Lau in Hong Kong
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