Why Gold Is Going Higher David Galland, Casey Research
While there are many reasons that gold and silver are going to keep moving higher as the fiat currencies trend lower, at our recent Casey Research Summit in Boca Raton, faculty member Mike Maloney pointed out a fact that, while obvious in hindsight, I had never heard mentioned previously.
Namely that during the last major precious metals bull market in the 1970s, only about 10% of the world could own gold - either due to legal restrictions or a lack of liquid capital.
Today, few countries prohibit gold ownership, and a far higher percentage of the world's population has transitioned out of poverty.
China provides the most germane example, having legalized gold and silver ownership for private citizens in 2004, and through the explosive growth in national GDP that has caused Chinese gold purchases to skyrocket.
Confirming the point, the following is an excerpt from a recent Wall Street Journal article:
Chinese investors are snapping up gold bars and coins, buying more than ever before in the first quarter of 2011 and overtaking Indian buyers as the world's biggest purchasers of the metal.
A growing middle-class in China is raising the appetite for gold there.
China's investment demand for gold more than doubled to 90.9 metric tons in the first three months of the year, outpacing India's modest rise to 85.6 tons, the World Gold Council said in its quarterly report on Thursday. China now accounts for 25% of gold investment demand, compared with India's 23%.
The report underscores the rising appetite for gold among the growing middle-class in China. Fears of the country's soaring inflation, as well as a search for new investments, is luring investors to gold, and marketing of the precious metal has also increased in recent months.
"I think people will be surprised by the strength in the Chinese demand, but we think this is a trend that is set to continue," said Eily Ong, an investment research manager at the gold council.
Notoriously active savers, stashing away on the order of 50% of their income, the Chinese are increasingly opting for gold over the renminbi to stash their wealth.
For those wondering just how big a development this is, consider that in 2007, just before investing in gold became "the thing to do," gold demand in India was 61% of the world's total while China's gold demand was only 9%.
In other words, India is no longer the only elephant in the gold vault. And they are not alone - investors around the world are now able, and willing, to buy gold as a way of protecting their wealth from the inevitable decline of the fading fiat currencies.
I still don't think we are out of the woods on a commodities correction, but there are so many black swans floating overhead that literally anything can happen, at any time. Thus buying in tranches on pullbacks over the next four to six months still makes a lot of sense.
But in the longer term, gold has almost nowhere to go but up.
Caledonia, which produced around 17 700 oz of gold in 2010, expects to ramp up to its targeted 40 000 oz/y by around the third quarter of this year, and should see costs move down to around $550/oz, Learmonth said.
The company has commissioned a new 10 MVA diesel-powered plant, which it can use to power the mine and facilities if the grid power is interrupted.
Caledonia, like other miners in Zimbabwe, signed a special agreement with local utility Zesa to guarantee uninterrupted power supply, in return for a big premium on electricity prices.
The new system is working well, and the company has lost only around a “couple of hours” all year, but saw the need for the generators because of broader concerns over the power supply situation in Zimbabwe, Learmonth said.
“And obviously it's vital that we keep going, because if we don't produce we lose money hand over fist.”
The Blanket mine was halted from October 2008 to April 2009, because of "continuing nonpayment" of foreign exchange by the country's Reserve Bank, for the sale of gold delivered to the Bank's Fidelity Printers and Refiners.
But the mine reopened after the government approved a new policy under which gold producers can market and sell their gold directly and are also allowed to keep the payment for their gold in foreign exchange.
COPPER
As for the Zambian prospects, the company is reluctant to talk about the copper potential until it has some drilling results to rely on, Learmonth said.
“Everyone wants to know about the copper, but as soon as we have something we will tell them,” he said. "For now all we are saying is that there is copper to the right of us, the Vale/ARM joint venture, there's copper to the south in Konkola and then there's also copper to the north.”
Caledonia would look to take any base-metals discovery as far along as it could by itself, he said.
“We're not just going to sit around waiting for someone to come tickle our tummies. We've got the competency to do it ourselves."
Caledonia ramps up gold output - Monday, 30 May 2011 11:27 www.financialgazette.co.zw Staff Reporter.
Toronto-listed Caledo-nia Mining Corporation, which owns a gold mining asset in Zimbabwe, Blanket Mine, had reported a gold production increase of 17 percent to 7,322 ounces during the first quarter of 2011, compared to 6,235 ounces in the fourth quarter 2010 (Q1 2010: 3,129 ounces).
Gold production in April 2011 was 2,737 ounces. The average cash cost per ounce of gold produced decreased by 18 percent to US$648 compared to the fourth quarter 2010 (Q1 2010: US$807).
Average achieved price per ounce of gold was US$1,397 (Q1 2010: US$1,1 07) and gross profit for the quarter - before depreciation, amortisation and administrative expenses - nearly doubled to US$5,248,000 compared to US$2,815,000 in the fourth quarter 2010 (Q1 2010: US$449,000).
At March 31, 2011, the company had net cash and cash equivalents of US$1,406,000 (December 31, 2010:US$398,000).
"During the quarter Cale-donia made considerable progress in removing the remaining constraints to Blanket achieving the targeted annual production rate.
The 2011 drilling program commenced in March 2011 at the Konkola West area of the Nama base metals project in Zambia," the company reported.
Stefan Hayden, president and chief executive officer, said: "I am very pleased to report a strong first quarter performance for 2011. The increased production coupled with the continued strength in the gold price and a reduction in Blanket's cash cost resulted in a substantial improvement in Caledonia's profitability and cash generation.
"We have made significant progress during the current quarter to address the remaining constraints which, once solved, should enable us to reach our target of 10 000 ounces per quarter.
A new ore pass was raise-bored and commissioned on May 13, 2011. "The commissioning of the complete standby generating system commenced on May 16, 2011 and is expected to be completed by the end of May, after which Blanket will be able to maintain full operations during any interruption to the normal power supply. I am confident that Blanket will achieve its targeted quarterly production from the third quarter of 2011.
"The drilling programme at the Nama base metals project in Zambia commenced in March 2011 to identify typical copper-belt type mineralisation. This drilling programme is expected to be completed by the third quarter 2011."
Blanket mine is wholly owned and operated by Caledonia Mining Corpo-ration, who acquired the mine from Kinross Gold Corpor-ation with effect from April 2006.
Blanket mine is a well-established Zimbabwean gold mine, which operates at a depth of approximately 800 metres below surface and currently has a production capacity of 40 000 ounces of gold per annum. Blanket also holds significant brownfield exploration and development projects both on the existing mine area and on its satellite properties which are within trucking distance of the Blanket metallurgical recovery plant.
The Blanket Mine is located in the south-west of Zimbabwe approximately 15km west of Gwanda, the provincial capital of Mata-beleland South.
Gwanda is 150 km south east of Bulawayo the country's second largest city and 196 km northwest of the Beit Bridge Border post with South Africa, and 560km from Harare, Zimbabwe's capital city.
Access to the mine is by an all-weather tarred road from Gwanda, which is linked from Beit Bridge to Bulawayo and Harare by a national highway.
The mine is Caledonia's producing gold mining asset.
The group's other mining assets are a platinum project in South Africa and cobalt and copper projects in Zam-bia.
admin on Jun 17th, 2011 and filed under Local News, Main Headline.
HARARE – Speculation around President Robert Mugabe ’s health reached fever pitch yesterday after the frail 87-year-old leader visited the Medical Chambers in the Avenues area of Harare.
Business around the medical facility came to a halt when Mugabe’s long motorcade — comprising overzealous security outriders, top-of-the-range Mercedes Benz vehicles, his limousine and medical team blocked the entrance to the upmarket clinic.
This is not the first time that the Zanu PF leader has visited the facility in the recent past.
Medical Chambers, which houses specialists such as neuro-surgeons, cardiologists, orthopaedic surgeons, urologists, psychiatrists and other internal medicine specialists, does not admit patients and deals with emergency specialist diagnosis and treatment.
The Daily News managed to sneak as far as the pharmacy on the ground floor where soldiers and plain clothes security details manning the entrance tried to Mugabe visits Harare’s Medical Chambers blocked our news crew.
Workers at Medical Chambers who spoke to the Daily News later in the day said it was difficult to tell which doctors Mugabe had visited as the facility had been “flooded” with security officials.
“Mugabe was definitely here although we don’t really know where exactly he went because people were not being allowed to move from one floor to another. This place is for specialist doctors where they conduct various tests and give treatment. But it is difficult to tell what exactly the problem with the president is because everyone is afraid of saying anything,” said a worker, who spoke after Mugabe left the clinic.
Mugabe spent more than an hour at the chambers before his huge entourage made its way out.
Presidential spokesperson George Charamba was not available for comment yesterday evening as his mobile was not reachable.
It is no longer a secret that Mugabe has not been feeling well for some time now, with medical experts saying people of his age are expected to suffer a number of ailments, including prostate cancer, that are associated with that age group.
At the Sadc troika on politics, defence and security meeting in Livingstone in March, Mugabe had to be moved around in a golf cart because he was having difficulty walking.
The frail-looking Mugabe has made at least five trips to the Far East for medical treatment since the beginning of the year, although he claimed in an interview with state-owned media that he was fit enough to reach 100 years.
Mugabe’s aides have vigorously denied that the 87-year-old has prostate cancer, claiming instead that he has problems with his eyes.
But medical experts say that while it may be true that he has problematic cataracts, this would not require visits overseas — hence the more likely scenario that it was something more serious such as prostate cancer — a disease which is common among people of his age.
A medical expert who spoke to the Daily News last night also said there were, in some instances, links between prostate cancer and cataracts.
“Apparently, men who took tamsulosin hydrochloride, which treats urinary retention, were at high risk of developing complications after cataract surgery.
Mugabe’s illness is causing a lot of division within Zanu PF with several party heavy weights jostling to succeed him.
“Even the military has waded into the issue, with one service chief apparently also keen to take over power from the octogenarian who has avoided either naming or grooming — which has left his party deeply divided.
Constitutionally, if the president is incapacitated the last acting vice president will take over the reins until elections can be held within three months.
Sadc leaders have also voiced concern about whether Mugabe was still fit to rule given his advanced age and failing health, and have urged him to step down.
Regional leaders, human rights organisations and the MDC have all raised concerns that the military, and not Mugabe are in charge of the country.
Mugabe’s wife, Grace is also sick as exclusively revealed by the Daily News in March.
University of Zimbabwe Political Science lecturer John Makumbe recently said Zimbabweans deserved to know if the president was ill or not because a significant amount of money had been spent on the president’s trips while civil servants were denied salary increments.
Makumbe said releasing information on the state of the president’s health was a matter of transparent governance where people had the right to know about the health of the president and his wife.
“If he was not ill why would he go to Livingstone with six medical doctors?
“We think the smart thing to do is to step down. Nobody will chase him away.
“To assume that at 87 he still has what he had at 37 is guess work, ” Makumbe said.
The outspoken university lecturer also urged Mugabe to step down while Morgan Tsvangirai was still at the helm of MDC.
“It’s time for him to take a rest, with a person like Tsvangirai still in charge of the MDC.
“He should take advantage of that and leave because he will not take him to the Hague. Other guys will parade him along First Street,” Makumbe said. Email This Email This
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5 Responses for “Mugabe rushed to the hospital…..”
Charles Jana says: June 17, 2011 at 6:47 pm
…I can already picture marange diamonds all over the coffin!! Reply arne says: June 17, 2011 at 8:09 pm
Maybe we should also thank Mugabe for actually saving us three million bucks by going to specialist doctors around the corner, rather than ones 10,000 miles away. Reply Skint War Vet says: June 17, 2011 at 9:30 pm
Zvapresser. There was no fuel to take him overseas. This week the airline was forced to cancel regional and international flights when fuel suppliers blocked delivery of Jet A fuel, demanding the airline pay its debts first. Reply Skint War Vet says: June 17, 2011 at 9:34 pm
What about this:
Mugabe thought Mandela was dead: report
PRESIDENT Robert Mugabe mistakenly referred to his South African counterpart Jacob Zuma as Nelson Mandela, and then in an attempt to correct his mistake suggested South Africa’s first black leader was DEAD, reports said on Friday. Mugabe made the gaffe while addressing SADC leaders at a weekend summit on Zimbabwe hosted by South Africa, the Zimbabwe Independent newspaper reported, quoting “unimpeachable” sources. After Zuma, SADC’s point man on Zimbabwe, had presented a report, Mugabe took the floor and began: “May I compliment our facilitator for the report given verbally. We would want it in writing. This is different from Livingstone [SADC troika summit] where we didn’t see the report. “We were not happy with what happened. I have spoken to Mandela, sorry Zuma, about it. We would want to rebut some allegations.” In an attempt to brush aside his mistake, Mugabe is alleged to have said: “May Mandela’s soul rest in peace.” Mugabe, 87 this year, is said to have quickly realised his mistake again and added: “I hope he is in good health.”
The Independent said Mugabe’s “slip-ups suggested loss of memory or confusion due to pressure”. Reply Isabel says: June 17, 2011 at 10:29 pm
The old-aged dictator and commander-in-chief-of-everything is slowly losing his marbles. Very soon he will think that all his CIOs are dead! I am sure the pair whose duty is to monitor this website won’t be too pleased, but it is coming to that I’m afraid. Reply
By Thelma Chikwanha, Staff Writer Friday, 17 June 2011 16:30
HARARE - Speculation around President Robert Mugabe ’s health reached fever pitch yesterday after the frail 87-year-old leader visited the Medical Chambers in the Avenues area of Harare.
Business around the medical facility came to a halt when Mugabe’s long motorcade — comprising overzealous security outriders, top-of-the-range Mercedes Benz vehicles, his limousine and medical team blocked the entrance to the upmarket clinic.
This is not the first time that the Zanu PF leader has visited the facility in the recent past.
Medical Chambers, which houses specialists such as neuro-surgeons, cardiologists, orthopaedic surgeons, urologists, psychiatrists and other internal medicine specialists, does not admit patients and deals with emergency specialist diagnosis and treatment.
The Daily News managed to sneak as far as the pharmacy on the ground floor where soldiers and plain clothes security details manning the entrance tried to Mugabe visits Harare’s Medical Chambers blocked our news crew.
Workers at Medical Chambers who spoke to the Daily News later in the day said it was difficult to tell which doctors Mugabe had visited as the facility had been “flooded” with security officials.
“Mugabe was definitely here although we don’t really know where exactly he went because people were not being allowed to move from one floor to another. This place is for specialist doctors where they conduct various tests and give treatment. But it is difficult to tell what exactly the problem with the president is because everyone is afraid of saying anything,” said a worker, who spoke after Mugabe left the clinic.
Mugabe spent more than an hour at the chambers before his huge entourage made its way out.
Presidential spokesperson George Charamba was not available for comment yesterday evening as his mobile was not reachable.
It is no longer a secret that Mugabe has not been feeling well for some time now, with medical experts saying people of his age are expected to suffer a number of ailments, including prostate cancer, that are associated with that age group.
At the Sadc troika on politics, defence and security meeting in Livingstone in March, Mugabe had to be moved around in a golf cart because he was having difficulty walking.
The frail-looking Mugabe has made at least five trips to the Far East for medical treatment since the beginning of the year, although he claimed in an interview with state-owned media that he was fit enough to reach 100 years.
Mugabe’s aides have vigorously denied that the 87-year-old has prostate cancer, claiming instead that he has problems with his eyes.
But medical experts say that while it may be true that he has problematic cataracts, this would not require visits overseas — hence the more likely scenario that it was something more serious such as prostate cancer — a disease which is common among people of his age.
A medical expert who spoke to the Daily News last night also said there were, in some instances, links between prostate cancer and cataracts.
“Apparently, men who took tamsulosin hydrochloride, which treats urinary retention, were at high risk of developing complications after cataract surgery.
Mugabe’s illness is causing a lot of division within Zanu PF with several party heavy weights jostling to succeed him.
“Even the military has waded into the issue, with one service chief apparently also keen to take over power from the octogenarian who has avoided either naming or grooming — which has left his party deeply divided.
Constitutionally, if the president is incapacitated the last acting vice president will take over the reins until elections can be held within three months.
Sadc leaders have also voiced concern about whether Mugabe was still fit to rule given his advanced age and failing health, and have urged him to step down.
Regional leaders, human rights organisations and the MDC have all raised concerns that the military, and not Mugabe are in charge of the country.
Mugabe’s wife, Grace is also sick as exclusively revealed by the Daily News in March.
University of Zimbabwe Political Science lecturer John Makumbe recently said Zimbabweans deserved to know if the president was ill or not because a significant amount of money had been spent on the president’s trips while civil servants were denied salary increments.
Makumbe said releasing information on the state of the president’s health was a matter of transparent governance where people had the right to know about the health of the president and his wife.
“If he was not ill why would he go to Livingstone with six medical doctors?
“We think the smart thing to do is to step down. Nobody will chase him away.
“To assume that at 87 he still has what he had at 37 is guess work, ” Makumbe said.
The outspoken university lecturer also urged Mugabe to step down while Morgan Tsvangirai was still at the helm of MDC.
“It’s time for him to take a rest, with a person like Tsvangirai still in charge of the MDC.
“He should take advantage of that and leave because he will not take him to the Hague. Other guys will parade him along First Street,” Makumbe said.
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