“We have been called to heal wounds, to unite what has fallen apart, and to bring home those who have lost their way. Blessed are they who love their brothers and sisters as much when they are sick, as when they are well and of service. And blessed are they who love their brothers and sisters as well when they are far away, as when they are close. When you leave this earth, you can take nothing that you have received, but only what you have given.” Francis of Assisi
Not a bad forecast so far considering how bleak things looked on May 3. They always seem to look bleak, don't they? And the forecast was almost right on the money until about 24 hours ago. :)
Let's see how things progress. IF we get a more profound correction to 880 area, then we think the next leg up may be quite 'brisk.'
Is the gold bull over given the past two days of serious price smackdown?
In a word - No. Not even close. The gold bull is still intact and healthy, and going through the same corrective pattern it has seen several times over the past five years.
Additionally, the high risk in the banking sector is driving more people to allocate a portion of their personal wealth into the safety of gold. This buying offtake of supply is likely to strengthen the bull market over time as demand builds.
Given the charts and the action we have seen, we are raising our target for the next leg of the gold bull market to 1250+ in US dollars if we break up and out of this symmetrical consolidation pattern.
Let's see what happens.
Investors buy gold bars in record numbers
By Paul Farrow
2:27pm BST 22/07/2008
UK Telegraph
Volatile stock markets and a lack of confidence in the UK banking system has boosted demand for gold bars and coins from private investors to levels not seen for 25 years.
Tens of thousands of investors have rushed to buy gold from bullion dealers over the past year, during which the gold price has broken through the $1,000 barrier on occasions.
Tony Baird of Baird & Co, one the UK's biggest gold bullion dealers, said business was getting busier and busier – with punters investing £1,500 to £150,000 in gold bars and coins. Baird, who has been in the gold business for 40 years, claimed that demand was on a par with the late 1970s.
He added: "We have had queues in here. People are nervous of the stock markets and they are nervous of the banks. Northern Rock was a trigger and now Fannie Mae and Freddie Mac have stirred things up again this week."
BullionVault.com – the online marketplace for gold bullion bars – said that number of private individuals investing in gold has more than doubled over the past year. It now holds 3.5 tonnes of gold on behalf of UK investors compared to less than 1.5 tonnes a year ago.
BullionVault founder Paul Tustain said: "Gold is always a popular choice of investment when the economy slows."
It is not just physical gold that investors are chasing. People are buying Exchange Traded Funds that track the gold price.
ETF Securities saw record inflows on Tuesday with inflows of $265m. Gold ETCs recorded $225 million of trading on the London Stock Exchange (LSE) on the same day the LSE issued a report showing that gold ETCs took two of the top four spots in terms of trading volumes in June 2008 on the LSE’s ETC/ETF trading platform.
According to db Research, the independent research arm of Deutsche Bank the top three traded ETFs last month were all gold: Lyxor Gold Bullion Securities, ETFS Physical Gold ETF Securities Ltd and ZKB Gold.
Nik Bienkowski, chief operating officer at EFT Securities, said: "We are not surprised that commodities and more specifically gold ETCs continue to shatter records for trading volumes and inflows."
This news was released by Bloomberg simultaneously with an early release of the Fed's Beige Book which spoke about the "morose mood" of the public (morose: showing a brooding, gloomy, or sullen mood).
Doug Kass reports that "bank stocks just moved up on a story on the newswires that Bank of America (BAC) is going to buy back 75 miillion shares. Actually Bank of America is reducing its expiring 200-million-share buyback to 75 million shares (it had remaining authority of 190 million shares)."
Financial sector 'welfare queens' or just a simple case of market manipulation? Probably some of both.
It does not get much more "in-your-face" than this.
Bank of America to buy back up to 75 million shares
By Alistair Barr
1:52 p.m. EDT July 23, 2008
SAN FRANCISCO (MarketWatch) -- Bank of America said on Wednesday that it will buy back up to 75 million shares. The board authorized the giant bank to spend as much as $3.75 billion to repurchase stock during the next 12 to 18 months, it explained. The new program replaces an earlier 200 million-share buy-back plan that is expiring. Bank of America shares climbed 3.3% to $33.42 during afternoon trading on Wednesday.
AP
Bank of America declares dividend of 64 cents
Wednesday July 23, 1:55 pm ET
Bank of America declares dividend of 64 cents to be paid Sept. 26
CHARLOTTE, N.C. (AP) -- Bank of America Corp. on Wednesday declared a regular dividend of 64 cents.
The dividend will be paid Sept. 26 to shareholders of record on Sept. 5.
The board also declared a dividend of $1.75 for its 7 percent cumulative redeemable preferred stock, series B. That dividend will be paid Oct. 24 to shareholders of record on Oct. 8.
