Estimated gold volume totaled 67,299 lots…which included 10,239 switches…as traders rolled over their May contracts into June and other months, rather than stand for delivery on April 30th. This same process is occurring in silver as well. Options expiry on the Comex [in both gold and silver] is tomorrow.

I was not impressed by the fact that the gold shares didn’t hold their gains in the last hour of trading as the Dow sold off. I don’t know if there’s anything to be read into that or not. The usual N.Y. commentator noted that…”Action like this usually heralds a serious bear raid.” We’ll see…as anything can happen around options expiry and first day notice. However, despite the gold shares’ poor performance, the silver shares did pretty well for themselves.

If you remember, Tuesday’s gold rally into the Comex open was subsequently hammered flat after that. Well, gold open interest actually rose 2,850 contracts to 339,226. Was it fresh shorting? Silver was also beaten down a bit on Tuesday, but not as much. Silver o.i. fell 422 contracts to 96,277. The cut-off for Friday’s COT was at the end of trading on Tuesday. Hopefully these numbers will be in it.

In other gold news, I see in the Comex Delivery Report for Wednesday that 56 gold contracts were delivered…and none for silver. As of the Comex open this morning, that leaves about 725 contracts left to be delivered in April. Over at the Comex-approved warehouses, silver inventories rose by 678,747 ounces…most of it into Scotia Mocatta. The U.S. Mint has updated its 1-ounce eagle production in both gold and silver…and they are as follows…one ounce gold eagles up another 44,500 last week…which brings the monthly total to 118,000. Silver eagle production rose another 575,000 to bring the April total to 1,868,000. We should get at least one more update before month’s end. There were no changes in either the GLD or SLV ETF’s alleged holdings.

The usual N.Y. commentator had the following comments yesterday…”On Tuesday, the European Central Bank’s weekly consolidated financial statement reported that a sale of gold by one captive CB produced a fall of €6.0 million (0.27 tonnes) in “gold and gold receivables”. Last week a 0.14 tonne sale was reported. The ECB itself has yet to run the 35.5 tonne sale of its own gold reported at the end of last quarter through the weekly statement (making a mockery of them). It did announce that the proceeds of gold sales have been ‘invested’ in dollars, a curiously indiscreet remark. Of course, reported sales are well below the amount notionally implied weekly pace of the second Washington Agreement on Gold. Also of note is the fact that the early rally in gold yesterday had the effect of taking The Gartman Letter out of its short position.”

Ted Butler sent an interesting piece my way yesterday. It’s the “BHP Billiton (NYSE:BHP) Production Report for the Nine Months Ended 31 March 2009″ Like Ted, I was only interested in their silver production numbers…and this [in a nutshell] is what it said… year/year silver production…down 11% [3.8 million oz.]…but compared to the prior quarter [Dec Q'08], silver production was down a whopping 24%. You can check out their production data on all metals. Except for natural gas and diamonds, their production is down across the board in just about everything. It’s the chart on Page 7 of this pdf file…and the link is here.

I haven’t had an ‘in other news’ paragraph for many a moon…but with so much happening, I just have to do one. In a marketwatch.com story…”Freddie Mac (NYSE:FRE) acting CFO found dead in apparent suicide”. I love the use of the word ‘apparent’. I wonder what dirty little [or big] secrets he took to his grave with him? In a story posted in The Wall Street Journal is the headline “GM Defaults.” It was only a matter of time, but now it’s official. The company CFO says the firm will not make its June 1st $1 billion debt payment. Let’s see what the bondholders do now. In a story in the New York Post yesterday, it was reported that The New York Times is facing “a cash crunch that could put it on the path toward insolvency.” [All the media, not just the print media, has seen their advertising revenues vanish. It's just as bad (if not worse) here in Canada. - Ed] And lastly, in a Bloomberg story I see that “Secretary of State Hillary Clinton said the U.S. effort to reach out to Iran will be coupled with the threat of ‘crippling’ sanctions should the regime in Tehran rebuff diplomacy to curb its nuclear program.” [I bet the boys in Tehran are just shaking in their boots...LOL! - Ed]

I have three stories today. The first was posted at upi.com and arrived in my in-box via Jim Sinclair over at jsmineset.com. Once again Hillary Clinton is beaking off about another country that represents a ‘moral hazard’ to the world. At first I thought she was going to discuss the United States…but no, it’s one of its own ‘allies’ or ex-’allies’…Pakistan. “Pakistan poses a mortal threat to the security and safety of our country and the world,” Clinton said. “And I want to take this occasion…state unequivocally…that not only do the Pakistani government officials, but the Pakistani people and the Pakistani diaspora … need to speak out forcefully against a policy that is ceding more and more territory to the insurgents…” It appears that, slowly but surely, the Taliban is taking over. The link to the story is here.

The second story was posted in London at news.bbc.co.uk…and is entitled “ ‘Deeper’ Recession Ahead Says IMF…” At the heart of the crisis is the continuing overhang of losses in the financial sector, which the IMF now estimates at $4 trillion, four times higher than it projected just one year ago. And it warns that the current outlook is “exceptionally uncertain, with risks still weighting on the downside.” [Ya figure! I'm sure glad these guys are here to tell us this. - Ed] I thank Brad Robertson for sending me the story…and the link is here.

My last article is posted over at garynorth.com. The headline itself is sure to raise the paranoia level of the average U.S. gold bug. It’s entitled “Why Gold Owners Are Targets of the Government”…and is a pretty good summary of the gold-price suppressing tactics of the central banks that GATA long has been publicizing. The link is here.

The money power denounces, as public enemies, all who question its methods or throw light upon its crimes. – William Jennings Bryan

As the IMF report mentions above…the current outlook is “exceptionally uncertain, with risks still weighting on the downside.” If they missed their guess by 400% in just one year…the mind boggles at the thought of how much they might be wide of that mark by this time next year…as this “greater depression” continues to gain strength. And, no doubt, a lot of governments [and their respective central banks] will burn their national currencies to the ground in an attempt to avoid the inevitable. I can’t think of a better reason to own gold and silver than that.

See you tomorrow.

Source: And Then There’s This…Thursday, April 23rd, 2009

The chart you’re looking at compares the South African rand’s performance (versus the U.S. dollar) and the iShares MSCI South Africa ETF (EZA). This is what’s called an inverse correlation. When the rand becomes inflated, South African companies don’t perform well.

The opposite is also true: When the rand gains in strength versus the U.S. dollar, South African companies perform better.

Over the past couple months we’ve seen exactly that. The interesting thing is South Africa is in the midst of a power crisis. In fact, many of its mining companies are scared they won’t have enough power to produce things like gold and platinum.

With aging power plants and failing infrastructure, South Africa needs an injection of investment cash into its power sector. And while its economy technically maintains a budget surplus, it’s constantly battling things like unemployment and poverty.

In short, a commodities bull run, with gold and platinum prices soaring, won’t mean much to the resource-rich country if it doesn’t have the power to produce them — or if the workers wage strikes against low wages and immigrant workers.

My take? Without some positive news on the situation soon, expect the EZA to drop back, and the rand to inflate a bit more. Here’s some numbers: EZA could drop to $110 and the rand versus the U.S. dollar could fall to a ratio of 7:1.

S.R. Nunnally

Editor, Taipan Trader

P.S. The US dollar has been rising in India and Pakistan, too… So sharply that one might expect a bit of a backlash here. Check out the chart, and see for yourself.

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Source: The Dollar IS Rising… In South Africa, That Is

Rising raw material prices, in particular rising food prices, are now causing real hardship and what represents a cause for shoppers in developed economies to grumble is a matter nothing short of life and death for the millions less fortunate around the world. This note considers what many emerging countries are doing and why their actions, far from alleviating the problem, are actually making matters worse.

Lord Mark Malloch Brown is a junior minister in the current Labour administration. He has a reputation for being forthright and often puts his colleagues’ hackles up. He is also the former deputy secretary general at the United Nations and an acknowledged authority on global issues of critical concern. His recent comments regarding the growing food crisis are significant both because he has identified some of the root causes and because he has taken steps to raise the matter where some of his more craven colleagues dare not.

Lord Malloch Brown describes, somewhat unoriginally, the confluence of factors he sees as serving to cause food prices to rise as a “perfect storm”. These factors are: a series of poor harvests in Australia, the incremental demand for improved diet caused by the newly prosperous parts of China and India, coupled with the now wide-spread process of biofuel “flag planting” on land previously devoted to the production of food stuffs. We would add a few additional factors, on which more below.

Bang on cue, the United Nations secretary general Mr Ban Ki-moon has warned that, if allowed to escalate, permanently higher food prices could not only damage global growth but also, possibly, global security too.

Rightly, the secretary general has stuck to the UN’s remit by indicating that an environment that has seen wheat prices double and the price of rice explode higher could seriously put back the process of global poverty elimination. “If not handled properly, this crisis could result in a cascade of others (including the imposition of quotas and the banning of exports) and become a multi-dimensional problem affecting economic growth, social progress and even political security around the world”.

The biofuels debate is interesting from a number of angles. Firstly, it is not absolutely true to say that the commitment of land to the production of biofuels automatically reduces food production everywhere (although that hardly makes the European Union’s full-on encouragement of plant-derived fuel right).

Supporters of biofuels tend to use the Brazilian experience as justification for the dash to plant-derived fuel alternatives, not that that country’s success should detract from the fact that there are a lot of other places where land which would otherwise have been used to grow food for human consumption has now been given over to the production of biofuel to feed machinery!

The EU could, for example, call a halt to its pre-announced intention to derive 5.75% of petrol and diesel to be manufactured from plants, although we understand the EU’s difficulties given growing stresses in the oil market too.

The developed world has hardly covered itself in glory on this matter either. In particular legitimate questions might be asked of Western countries’ commitment to what has become known as the “Washington Consensus”. Part of the reason why a number of African countries are now back on the verge of starvation is that developed nations, through their International Monetary Fund (IMF) conduit, actively encouraged many African governments to cut farming subsidies and focus instead on producing cash crops for export and by so doing, open up their previously closed economies.

That the plan has backfired is made obvious by the fact that many countries are now struggling to grow sufficient to meet basic levels of domestic demand. Whilst the UN falls back on its World Food Programme to raise sufficient funds to feed starvation zones, what is really required is greater research and development, improved credit facilities and ultimately a “green revolution” similar to that which took place in parts of Asia, not that the Asian experience is without its own pressure right now.

From the point of view of global economics there has always been a gulf between the “haves” and the “have-nots”. Generally speaking, the larger a country is, the greater the likelihood that it will be richly endowed with natural resources. The fact that not even the largest countries are so well endowed in every scarce resource is reflected in the fact that imported inflationary pressure has become a global issue. Indeed, some of the world’s largest and most populous countries are those with the greatest dependency on imported raw materials.

Estimated top global countries by resource production

The chart shows resource wealth, calculated using the most recent production data for energy, basic resources and agricultural products using average prices achieved over the previous quarter. Against this is plotted a countries’ wealth on a per capita basis, to show that some countries are likely to benefit significantly more than others. On this basis, Saudi Arabia, Canada, Australia and Russia stand out. The second chart (below) compares the global share of a country’s estimated resource wealth against its share of global population.

For investors in one uniquely positioned company it could mean extraordinary growth in the years ahead… starting precisely at midnight 2 June 2008.

Before I reveal why, let me explain why the boom times in the Gulf are here to stay for the foreseeable future…

Take Qatar…

Like its neighbours the Gulf emirate is in the midst of a massive economic boom.

As the world’s biggest exporter of liquefied natural gas, demand for LNG is soaring because the stuff is still undervalued compared to oil.

To produce all that gas to satisfy global demand, Qatar is bringing in hundreds of thousands of foreign workers to work in its booming energy and construction industries. They come from India and Pakistan and from the poorer Arab countries like Egypt to seek their fortunes…

Of course, if you have ever visited the region, you’ll know the Gulf States rely on cheap imported labour to keep their economies going.

But we’re seeing something on an entirely different scale right now.

So much so Qatar’s population has risen by a staggering 90% since 2004 to more than 1.4 million. It’s up 18% over the last year alone!

If you want to see the very definition of a boom town, look no further.

An economy growing six times faster than Britain

The Qataris are raking it in!

The economy grew by 14% last year and will repeat that performance this year, according to IMF estimates. The average income is expected to hit $80,211 this year – almost double what it was just four years ago.

What are the chances of us ever seeing something like that happen here in Europe? Pretty darn slim!

I’ll put that into perspective…

The IMF estimates the average personal income here in the U.K. was $45,301 in 2007 and will reach $48,071 this year. It expects the British economy to grow by 2.3% this year. So, if we’re lucky and the U.K. economy doesn’t get derailed by the credit crunch and plunging property prices, we’ll be a little bit richer than the Qatari’s were four years ago.

Not only that, the country’s vast gas reserves are expected to last for another century, so this story still has a long, long way to go. That boom is also paying-off big time for investors. Qatar’s share market hit a 28-month high on Tuesday.

You can see why I’d rather put my money down on the Gulf over the long-term… and you should too.

Because it’s not just Qatar…

The “backdoor” way in to the booming Gulf

We’re seeing a huge boom right across the Gulf region, but most international investors still haven’t got a clue on how to buy into this boom. Many think it’s too hard and risky getting exposure to the Gulf’s markets.

But it’s easier than you might think…

Here at Profit Hunter we’ve been well placed to profit from this phenomenon since December last year.

The company we’re invested in is making a fortune hoovering-up the region’s petrodollars and re-investing them in undervalued Western companies for the last 25 years.

It’s recently been investing a lot closer to home as well – their Gulf Growth Capital fund is investing in high-growth companies in the region.

It gives you a brilliant “backdoor” entry into the booming Gulf. But I’d act quickly if I were you…

Why you should buy in BEFORE 2 June

You see, not only is this company extremely undervalued, on Tuesday it announced that it will become one of seven constituent companies included on the MSCI Bahrain Index from 2 June.

The MSCI indices are the world’s leading family of global financial indices and are widely tracked by professional investors. The move is brilliant news for our company…

Why? Based on its market cap this potential goldmine will have a 17.8% weighting in the index and therefore automatically gets included in both the Frontier Markets Index and GCC Index.

This means investment funds that track these indices will HAVE to buy in. And with international investors increasingly interested in the Gulf and in the so-called “frontier markets”… this could give its share price a real punch.

If you’re looking to profit from the region’s energy boom without investing directly in the volatile energy markets, I think this is probably the smartest investment you can make.

Here’s how all the exclusive details can be yours.

Regards

Manraaj Singh
Editor
Profit Hunter

Source: One Emerging Gulf Market Stock About To Boom