Scotland Sees Rise in Gold Demand Amid Independence Vote

Gold demand in Scotland has increased dramatically in advance of the country's vote on a referendum for independence from England this Thursday.

Demand is up 91% compared to the same period last year. England and Wales have also seen recent rises in demand ahead of the election.

For the past 307 years Scotland has been a part of England. If the Scottish do gain independence, many think it could trigger a domino-effect across Europe with separatist groups in several countries expected to be reinvigorated in their own independence movements.

It is not yet known if the referendum will move forward since recent polls have shown conflicting results.

Marc O'Byrne, a director at GoldCore in Dublin stated, “With continued sterling volatility and uncertainty about the future of the pound in the short term and possibly for the foreseeable future, the Scottish independence question is a major macroeconomic and monetary risk to the U.K.. They are parking some money in gold due to concerns about the outcome of the Scottish referendum.”

BullionVault, a British online commodities trading service said that the number of Scotland-based users grew by more than 40% in the past month.

In advance of the vote, pro-union rallies have been staged in London and independence rallies have been ongoing in Scotland.

O'Byrne cites volatility and weakening of the pound as the primary reason behind the recent interest in gold, "Diversification of a percentage of one’s savings out of pounds and into gold will act as a hedge against currency volatility. It will also act as a store of value in an environment of depreciating currencies.”

Richmont Mines Announces New Deep Exploration Drilling at Island Gold

Richmont Mines Inc, a Montreal-based mining and exploration company, announced today that it would begin an additional deep exploration program to test part of the plunge projection for the Island Gold deposit near Wawa, Ontario. This operation will be in addition to the currently operating mines and exploration efforts underway or so far announced for 2014.

The new Island Gold exploration will require four diamond drill holes to plunge 4,800 meters at a cost of $500,000.

So far, the Island Gold mine has produced more than 300,000 ounces of gold from 0-400 meters and output for 2014 is expected to reach 40,000 ounces.

In 2011, additional drilling was conducted beneath the existing mine which garnered favorable results and led to expanding the drilling operations in 2012 and even deeper explorations in 2013. These subsequent operations led to doubling revised output estimates from 508,000 inferred ounces at 10.73 g/t to 1.1 million at 9.3 grams per tonne.

The interim CEO Elaine Ellingham stated in a press release, "This new 1.1 million ounce resource under our operating Island Gold Mine came together very quickly. It remains open at depth and along strike, presenting some compelling potential for expanding this resource. These additional exploration drill holes will enable us to test the down plunge potential to the east of our existing resource base at depths of between 800 and 1,000 metres."

Richmont mines currently has 3 mines in operation in Quebec, Ontario, and Newfoundland. Since 1991, Richmont has produced over 1.4 million ounces of gold.

Pakistani Senate Forced to Reveal Individual Gold Assets

The Election Commission of Pakistan has revealed the amount of gold held by individual members of the Pakistani Senate yesterday.

Gold has always been used as a currency in the region and much of the demand for the metal is used for religious ceremonies and celebrations, so it is logical that many Pakistani Senators would hold gold assets, but what is perhaps a bit surprising is the large amount of gold they own.

The Senator owning the most gold was Nawabzada Saifullah Magsi, with 1,100 tolas of physical gold (approximately $533,000 worth) among his assets. The tola is a South Asian unit of measurement equivalent to about 3/8 of an ounce.

Twenty Five Senators possess gold totaling more than 309 million rupees (~$5 million).

There are currently 104 Pakistani Senators serving terms of six years. Elections are split between members every three years with strict requirements for specific representation of certain demographics such as minorities and women.

Pakistan has been a Federal Republic since 1947. The Election Commission of Pakistan, or ECP, was first founded on March 23, 1956 when the first constitution of the Islamic Republic of Pakistan was adopted but the commission was dissolved two years later after a coup d'etat. The ECP was reformed in 1962 but dissolved once more amid a popular uprising in 1969. It was finally re-established in its current form in 1973.

Peru Ups its Annual Gold Exports to India for 2014

Peru, the sixth-largest gold producer in the world, will likely have shipped more than $270,000,000 dollars worth of the precious metal to India by the end of 2014.

Peru's ambassador to India announced at the 11th India International Gold Convention that the two countries are considering entering into a Free Trade Agreement to better facilitate commodities trading. Such a deal could increase overall trade between the two countries by up to 2 billion dollars. Trade between the two countries has been growing an average of 25% year to year without the FTA, but a new deal could increase the growth to 60 to 70%.

India is currently the 2nd largest consumer of gold in the world behind China and the largest importer of gold. Imports from Peru currently make up about 0.06 percent of overall gold imports. The new FTA would allow India to bring in more gold in dore form. India primarily purchases refined gold from overseas, only about 10% of all the gold imported is in raw form. By purchasing more raw gold, India can save on pricing as well as support local manufacturing and refining jobs.

Peru's ambassador to India, Javier Paulinich told reporters "We exported $106 million in 2012 and it rose by 150 per cent to $270 million in 2013, and three Indian investors have invested in gold mines in Peru. The numbers are expected to rise in following years."

Peru produced approximately 5 million ounces of gold last year.

Chicago Mercantile Exchange (CME) to Offer Hong Kong Gold Futures Contract

The Chicago Mercantile Exchange, the commodities exchange that recently took over the "Silver Fix" (in partnership with Thomson-Reuters), announced today that it will begin offering a gold futures contract for physical delivery in Hong Kong. The new contract is part of CME's efforts to tap into the large gold markets of Asia.

Harriet Hunnable, executive director of metal products at CME told the Wall Street Journal, "This contract will provide a precise risk management tool to the Hong Kong market. We know that there are customers who want exposure to what is happening here."

Asia accounts for 70% of the world's annual gold consumption. The WGC and Wall Street Journal have reported that physical buying of gold has "been relatively subdued" this year, but both outlets fail to take into account that according to a Reuters report earlier this year,  China has been deliberately obscuring its gold imports: 

“China has begun allowing gold imports through its capital Beijing, in a move that would help keep purchases by the world’s top bullion buyer discreet at a time when it might be boosting official reserves. The opening of a third import point after Shenzhen and Shanghai could also threaten Hong Kong’s pole position in China’s gold trade, as the mainland can get more of the metal it wants directly rather than through a route that discloses how much it is buying.”

Earlier today the Shanghai Gold Exchange announced 11 new gold contracts that would be open on its international board in the Shanghai "free-trade zone" as part of efforts to inject more foreign currency into the Chinese precious metals market. The move is part of a series of recent efforts by the country to exert more influence over global pricing of the metal.

The SGE will also offer a secure storage facility capable of housing 1,000 tonnes of gold for foreign entities to facilitate quick transactions.

AngloGold Ashanti to Split International Operations

The New York Times reported today that one of the world's largest gold mining companies, the South African-based AngloGold Ashanti, will separate its international business from its domestic operations.

The corporate headquarters are to remain in South Africa, but the international arm of AngloGold Ashanti will be based in London. The company plans to list its shares on the London Stock Exchange with additional listings in Johannesburg and New York. Completion of the restructuring is expected some time next year.

AngloGold Ashanti stated that the reorganization would "simplify the structure of its businesses and allow their management teams to be more economically competitive." Dividing company operations would also allow investors to more accurately determine valuation.

The separation will require approval from AngloGold Ashanti shareholders. The company plans to retain a 65% stake in the company and offer the remaining stock to current shareholders.

The international arm of the company is expected to undergo a name change as well.

Board member Michael J. Kirkwood will leave to serve as chairman of the new company. He is currently the chairman of Circle Holdings.

AngloGold Ashanti plans to issue an additional $2.1 billion in shares in order to raise capital to finance the transaction as well as reduce some of its existing debt.

The company currently has 20 active mines in 10 countries and produced 4.1 million ounces of gold in 2013.

Canadian Mint Introduces New Queen Elizabeth II Numismatic Coin

The Royal Canadian Mint has begun a four-coin series honoring Queen Elizabeth II. The series will feature the various portraits of the queen that have appeared on Canadian coins throughout her reign.

The first coin in the series features an effigy of Queen Elizabeth II that was originally created in 1952 by British sculptor Mary Gillick. The portrait appeared on Canadian coinage from 1953 until 1964. The effigy of the then 27-year old queen was created for use on the coinage of several British commonwealth countries.

Adorned by a laurel wreath, the profile of the queen shows her draped in a flowing garment and is encircled with the inscription, "Elizabeth II Dei Gratia Regina" which is Latin for "Elizabeth II, by the grace of God, Queen."

The reverse of the coin holds another symbol of Canadian identity, the sugar maple leaf and bears the inscription of the year, "2014," and a face value of "10 dollars." The botanical engraving was done by Celia Godkin.

Packaged in a Royal Canadian Mint-branded maroon clamshell with a black beauty box, the coin retails for C$ 649.95 and contains 7.8 grams of 99.99% pure gold. Of special interest to numismatic collectors will be the limited minting of the coins. Only 1500 of each coin will be struck.

Agnico Eagle Mining Acquires Cayden Resources in Buyout

Agnico Eagle Mining company announced yesterday plans to purchase Cayden Resources in a deal that involves the buyout of all outstanding and issued shares of the company.

Cayden shareholders will receive .09 of an Agnico Eagle share and C$0.01 for each Cayden share. The total number of Agnico shares to be issued under the arrangement will be 4.86 million shares, which is based on the number of Cayden shares currently outstanding and will equal about 2.3% of the total outstanding Agnico Eagle shares.

Cayden has 100% interest in two properties, one is the El Barqueňo property, which stretches more than 41,000 hectares in the Guachinango gold district in Jalisco, Mexico. The El Barqueňo property holds several gold bearing zones that have been identified by trenching and drilling.

Tim Haldane, the Senior Vice-President of Operations said in a press release, "From a technical perspective, El Barqueňo bears a lot of similarities to Pinos Altos in the early days. The property has tremendous exploration upside and several prospective zones that we believe can ultimately support heap leach and/or milling operations, which would allow us to build another meaningful business in Mexico."

The other property Cayden offers Agnico is the Morelos Sur property, approximately 13,000 hectares in the Guerrero gold belt in Guerrero, Mexico. Preliminary exploration by Cayden has revealed gold in the soil at La Magnetita and Tenantla.

Finalization of the transaction will be subject to approval by Cayden Security Holders as well as Mexican anti-trust and other regulatory approvals. Under specific circumstances, if the deal is to fall through, a termination fee of $5.7m will be paid by Cayden to Agnico.

Cayden Resources is a Canadian exploration company that operates primarily in two jurisdictions in Mexico.

Agnico Eagle is a Canadian mining company that has been in operation since 1957. Agnico currently operates nine mines in Canada, Finland, and Mexico. Every year since 1983, Agnico Eagle Mining has declared a cash dividend.

Jack Daniels is Giving Away a Kilo of Gold

Jack Daniels is giving away a kilo of gold to promote the middle eastern launch of its new whiskey, "Jack Daniels No. 27 Gold". The limited-edition double barreled whiskey is only available in select duty free stores across Asia, the South Pacific, and now Dubai.

The new recipe is based on the original No. 7 formula, but at the end of distillation is put into "golden-hued" maple wood casks for a "warm and luxurious finish". It is the first permanent addition to the Jack Daniels family since the introduction of "Gentleman Jack" in 1988.

Anyone who purchases any Jack Daniels product at the Duty Free store in Terminal Three of the Dubai International Airport during the month of September will be entered into the drawing to win the kilo of gold.

Tony McIver, the Area Director of Forman Travel Retail said, “When any discussion involves Dubai International Airport, Dubai Duty Free and Jack Daniel’s Tennessee Whiskey, you are talking about three Gold Medal entities.  So when it was determined that No. 27 Gold would be introduced in Dubai Duty Free we simply had to go with a promotion that is really special and unique;  hence, the kilo of gold giveaway.”

Tastings of the new whiskey will be held at Jack's Bar and Grill in Concourse A of the Dubai International Airport. Travelers will be able to view the prize of gold at the shop until the contest is concluded. The winner will be selected in October.

September is Historically the Best Month for Gold

Business Insider reported today that since 1969, gold has seen gains of 2.16% on average during the month of September, making it the best month of the year to buy or own gold.

There are a few reasons why gold prices go up at the end of summer nearly every year. One is that gold demand in India typically rises prior to festivals honoring Ganesha and for Diwali (the Hindu festival of lights). Additionally, India has a "wedding season" that coincides with autumn and gold is traditionally purchased for the bridal trousseau and given as gifts in the form of jewelry. Another reason that gold demand (and prices) increase during September is the end of the Islamic month of Ramadan, where gold is also traditionally given as gifts. 

But what has an even greater impact than this increase of physical gold demand is that historically, September has been the worst month of the year to buy stocks. Of course, this causes investors to cut back on stock purchases and hedge the losses to their portfolios with gold. 

Frank Holmes, the Chief Investment Officer for U.S. Global Investors said, "[September] has been the worst-performing month since 1950 for all of the major indexes and exchanges, including the Dow, S&P 500 Index, NASDAQ and Russell 1000 Index."

Over the past 20 years, gold has seen gains every September except for 5. In the years 1996, 2000, 2006, 2011, and 2013 gold closed below what it opened for the month.  

Samsung Loans Galane Gold $5M in Exchange for $50m Worth of Gold

According to a press release distributed by Galane Gold yesterday, Samsung has agreed to loan the company $5M in exchange for a minimum of 1,607 ounces of gold per month over the next 2 years. 

The total amount of gold to be repaid by Galane will be 38,568 ounces. At current prices, that equates to about 50 million dollars worth of gold. 

According to the press release, "[Galane] intends to use the proceeds of the facility to repay early and in full the outstanding debt and accrued interest owed to IAMGOLD Corporation with the balance for general corporate and working capital purposes."

Galane must be desperate for funds and Samsung is likely happy to oblige as there are not many investments one could make that would return you more than 10 times your principle in only two years. 

Galane Gold is a publicly traded, un-hedged mining and exploration company operating in Botswana. 

Samsung C&T Ltd. was founded in 1938 and was the first Korean company to lead overseas sales. It is the parent company of Samsung Group. 

Gold Smuggling Rises Along Tibetan Border

16 kilograms of gold have been confiscated along the border of Tibet and Nepal in the past 3 weeks, a marked increase due to weakened security caused by flooding and landslides that have blocked many of the main roads in the area.

Four sherpas have been caught smuggling around 4 kilos of gold each, for which they were reportedly promised 30,000 Rs per kilogram ($4,875) upon safe delivery of the metals in Kathmandu. That equals  about 1/10th of the spot price for gold.

Recent smuggling attempts have all been on foot due to the recent flooding and landslides. Before the natural disasters disrupted road travel, most of the gold was smuggled using vehicles. A vehicle can easily transport a million dollars worth of concealed gold.

Efforts are currently underway to strengthen security efforts along the border to stem the illegal flow of the precious metal.

China and India account for 70% of global gold demand. India has seen an increase in recent weeks due to upcoming religious festivals and where gold is given as gifts and used for ceremonies. China recently reconfigured their gold reporting in order to obscure their overall demand.

Argonaut Gold Releases Revised Mineral Estimate for New San Agustin Mine

Argonaut gold has recently completed the first phase of drilling at its San Agustin pit mine near Durango, Mexico and released updated resource estimates for the project on Friday.

The new estimates indicate a 200% increase of deposits over what has been the "historic understanding of the property."

The recently completed drill phase at the pit mine has indicated resource estimates of 845,000 ounces of gold and 28.2 million ounces of silver within 82.2 million tonnes of material. The data reveals a grade of .32 grams of gold per tonne, and 10.7 grams per tonne for silver.

"Phase 1 of the drilling was completed ahead of schedule and under-budget," the company announced in a press release on August 22nd. Argonaut hopes to again increase its estimates as phase 2 of the drilling will cover an additional 16,000 meters.

"We are very pleased with the work done on the San Agustin project to date. The Phase I drill program was completed ahead of schedule and under budget. This resource is only composed of oxide and transition material. Conceptually, the planned preliminary economic assessment (“PEA”) is intended to evaluate the San Agustin property as a heap leach operation." said Pete Dougherty, the CEO of Argonaut. "All of the necessary engineering work, base-line permitting studies, land acquisition and other activities are well underway. We anticipate that a PEA (preliminary economic assessment) for the project will be completed by year-end."

More Than 700 Line Up For First Chance at New JFK Gold Coins

photo courtesy of Twitter user @Fox29Jennifer

The line stretched around the block this morning with more than 700 queuing up for the first chance at new gold coins honoring JFK at the U.S. Mint in Philadelphia.

Almost all of the people in line were working for private coin dealers-- the mint has put a 1-coin limit per person and is only offering 500 of the commemorative pieces today. The coins will eventually be available for purchase through the U.S. Mint's website. But first-day editions are usually considered to be more valuable and more desirable, and can be authenticated with a dated receipt.

Some of those waiting in line had been there since the afternoon of the day before and more than 200 people toward the end of the line were turned away by mid-day.

The coins are retailing for $1,240 per coin, and each one is enclosed in a commemorative mahogany case. Those waiting in line on behalf of dealers will make around $400 per coin.

First in line was Joe Grover, a veteran in a wheelchair. Grover lined up around 2:30 on Monday afternoon. Private security guards were waiting outside to escort several of the proxy buyers to a hotel where they would finalize the deal with gold dealers.

Further added value comes from the Kennedy association. The fascination with the late president continues more than 50 years after his death.

Here is a video of the new gold Kennedy coins in production.

Gold From North Korea is Making its Way Into U.S.

When the Dodd-Frank Wall Street Reform and Consumer Protection Act was passed in 2010, a little-known provision of the bill stipulated that American companies would have to disclose to the SEC their supply chains of gold, tin, tantalum, and tungsten.

This was part of an effort to reduce or eliminate the procurement of metals from the conflict-stricken Democratic Republic of Congo. It's widely known that American companies, notably electronics manufacturers, have been sourcing some of their materials from the rebel-controlled mines in the D.R.C. for years.

But a surprising revelation from the SEC filings was that 67 companies disclosed they had been using gold that originated in North Korea. These companies included Hewlett-Packard, Ralph Lauren, IBM, Deere, and Williams-Sonoma. Many of these companies use suppliers that are based abroad, and have little direct control over their mineral sources. In a statement released by IBM, the company stated that it depends on its suppliers to "procure minerals from responsible sources" and adhere to American regulations.

North Korea produces around 12 tons of gold per year and is believed to hold around two thousand tons in reserve, valued at more than 8 billion dollars. One way the gold from North Korea could be entering the U.S. is via China.

China does not have the same trade sanctions against North Korea as the U.S. and investment advisor GoldCore estimated that the country imported at least 2 tons of gold from North Korea in 2012.

Stemming the flow of North Korean gold to the U.S. could prove to be difficult for a number of reasons. A large dollar amount of gold could be in a small quantity, which would be tough to track and gold that is processed in China would be indiscernable from North Korean gold.

Newmont Waihi Gets $1 Billion in Funding For New Correnso Mine

Newmont Waihi has received a billion dollars in funding for the completion of the new Correnso Mine located in Waihi, New Zealand. The mine should be operational by the end of 2014.

In April, the company finished the access tunnel to the mine and is currently working to determine the purity and quantity of the deposits in the ground.

The ore is approximately 130 meters below the surface, but the current conditions of the proposal dictate that operations will be conducted 157 meters underground.

Construction of the new mine was stalled by a lengthy legal battle and protests from locals as it is directly underneath a residential community of 45 homes. Public hearings were held for the citizens of Waihi to voice their concern over blasting that will occur underneath the neighborhood.

Glen Grindlay, the general manager for Newmont Waihi stated that the new mine would be a modern operation (gold mining has been occurring off and on in Waihi since the 1800s) and that tight restrictions would be in place to reduce the worries of the locals. "This is a new mine with new conditions. While they are workable for us, they certainly place some very tight restrictions on our operations." said Grindlay.

Last year, the mine was granted approval by the Environment Court and a 12-year permit for operation.

The mine will be accessed by spiral decline and drives from two other Newmont mines, the Favona and the Trio.

This marks the first ever sub-residential mine in New Zealand. The company plans to offer real-time monitoring of vibration events of the operations online as well as a blast notification system that can alert residents of upcoming blasts via text, email, or phone.

Newmont is also planning to test a new warning system called the Tsunado, which will be a small device residents can keep in their homes that will play a short piece of music a few moments prior to a blast. The intention of the Tsunado device is to minimize the "startle effect" that comes with vibrations immediately following a blast.

Ron Paul Tells CNBC "Gold Could Go to Infinity"

In an interview with Jackie DeAngelis of CNBC, former U.S. Representative Ron Paul reiterated that he still believes in gold and that it "could go to infinity."

"I remember watching gold when it was 35 dollars per ounce and we thought if it ever hit one hundred dollars, the world would come to an end. And then a thousand dollars. So no, it's good as long as we continue to do this (print money). You know, it could go to infinity because people just leave the dollar..."

Jackie DeAngelis countered that with all of the geopolitical unrest currently taking place around the world, "you'd expect gold to be higher right now." 

The former congressman pointed out that "Long-term and economic law says if you print a lot of paper money, the value of that currency will go down, and things and most prices will go up and indeed, gold always goes up against that currency." 

Dr. Paul was hesitant to make concrete predictions about the price of gold though. "I don't get in the business of saying in a year or two or three it's going to be two or three or four thousand dollars because it really challenges the basic fundamental beliefs of the Austrian school, to make these kinds of predictions.” 

He was also quick to downplay any minor bumps or jumps in the price of gold. "Markets do these things-- they go up sharply and sometimes they take a rest. Six thousand years of history shows that gold always retains value, and paper always self-destructs." 

While "infinity" is difficult to visualize, it is not hard to see that Dr. Paul has a valid case for gold's continued rise. Over the past century, since the creation of the Fed, the dollar has lost 98% of its value while gold has steadfastly risen in the face of economic uncertainty. 

The entire interview can be seen here. 

Chinese Now the Leading Foreign Purchaser of U.S. Real Estate

Forbes has confirmed what many already suspected: the Chinese are buying up more U.S. real estate than anyone else. And they're not buying junk either. Wealthy Chinese investors are now the most prolific purchasers of luxury high-end real estate in New York City.

It's estimated that nearly a third of all the apartments along Central Park, between 5th Avenue and Park Avenue are currently vacant and owned by foreign investors. The majority of these are Chinese.

In 2013, foreign real estate transactions in the United States totaled more than 68 billion dollars. Of that 68 billion, the Chinese accounted for 12.8 billion worth of U.S. property sales. And it's growing.

A number of analysts believe that China is currently in the midst of a housing bubble that could be on the brink of bursting.

CBS' 60 Minutes did a story last year that showed that the country has entire cities in various stages of construction and completion with no one to live in them. In 2011, it was estimated that there were more than 64 million vacant apartments in the country.

That same year, a law was passed in China which limited Beijing housing ownership to two per family in the city, and imposed a ban on sales to anyone who had not resided in the city for at least 5 years. This caused a drop in domestic sales, but there is no such stipulation for foreign purchases.

Of course, this has led the wealthier and more savvy Chinese investors to seek investment opportunities abroad, with many eyeing the U.S. as the juiciest.

And they're not just looking at New York. Most of the Chinese real estate purchases are occurring in California. In February, one of China's largest real estate developers, the Greenland Group purchased a 6-acre lot in downtown Los Angeles for 1.5 billion. It will be the largest mixed-use development in the state. 

The Baccarat Hotel

It would be cause for alarm if China was only buying a high quantity of properties. And they are. But what is more alarming is that they are buying the best properties available.

And many of these Chinese investors are so eager to buy they will purchase a new property sight unseen. A client of Douglas Elliman bought two apartments inside the Baccarat Hotel and Residences on West 53rd st for $13 million each, without ever setting foot inside the building.

India is Hoarding Swiss Gold and Silver

The Swiss government is reporting that for the month of June, India accounted for 42% of its precious metal exports. The country shipped 4.3 billion dollars worth of gold during the month of June, of which 1.8 billion was destined for India.

Switzerland's gold exports for 2014 have already totaled more than 35.2 billion dollars, with India accounting for more than 7 billion of that total so far this year.

The rupee price for gold has risen more than 400% in the past ten years, but despite this dramatic increase, demand for gold continues to remain strong for the country.

About 75% of India's physical demand for gold is in the form of jewelry. The country has a long tradition of using gold for weddings and other rituals and is often seen as a store of value for even low-income Indians.

According to Forbes, there are expected to be more than 15 million Indian weddings in the next ten years, a fact that will undoubtedly increase demand for the precious metal.

Another factor affecting gold demand in India is its popularity among Bollywood actresses. Many young women hope to emulate their favorite movie stars by adorning themselves in gold. Gold is even a more popular fashion accessory than diamonds and other gems for the country.

India's massive demand for gold was actually eclipsed by China in 2013. And according to the World Gold Council, demand for gold in China is predicted to see at least a 20% jump for 2014. This is even as the country is reportedly intentionally under-stating their demand for the metal for geo-political reasons.

Former White House Advisor Calls for Return to Gold Standard

Peter Ferrara, who served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under President George H.W. Bush has called for a return to the gold standard in a new op-ed piece for Forbes this week.

He cites the declining purchasing power of the dollar and rampant inflation as the main reasons for why we should return to the gold-backed dollar.

"Tying the dollar to gold... meant that the dollar maintained its stable value, without inflation." writes Ferrara. "Since America abandoned the gold standard in 1971, the purchasing power of the dollar has declined by 85 percent. A dollar saved in 1971 was worth only 15 cents by 2012."

Ferrara asserts that a return to the gold standard would once again return "power to the people" as the value of the dollar and inflation rates would no longer be tied to the number of dollars printed by the Federal Reserve. "If the Fed increased the supply of dollars beyond the people’s demand for dollars, people would exchange dollars for gold. The people would consequently stop the Fed before it could create inflation."

He also dispels the commonly held myth that a return to the gold standard would mean that the amount of dollars in circulation would be directly tied to the amount of gold held in reserves. "The Fed could increase the supply of dollars to meet the demand for dollars, providing the money needed to service economic growth. As long as the supply did not exceed the demand, there would be no increased draw on the Fed’s holdings of gold due to the increased supply of dollars."

Ferrara believes that reinstating the gold standard would be simple. With legislation, Congress could instruct the Federal Reserve to tie the amount of dollars it was printing to the rising or falling price of gold. He also thinks that if the U.S. readopted the standard, other economies around the world would have to follow suit.

He may or may not realize that many of them are already secretly doing just that.

Eldorado Gold Corporation Updates Forecast with Higher Projections

Stock in the Canadian-based Eldorado Gold Corporation (NYSE: EGO) is rising this morning after the company posted revised forecasts with higher sales projected than what were originally predicted.

Gold output for the company increased 9 percent in the most recent quarter, eclipsing initial expectations. Eldorado sold a total of more than 190,000 ounces of gold, up from 176,260 ounces in the same quarter last year.

Eldorado CEO Paul Wright said in a statement "The company has finished the second quarter ahead of our expectations and the operations are now on track to deliver production at the high end of the initial full year range our teams had established."

The company also announced that earlier this year, the government of Turkey had approved plans for expansion of the Kisladag mine which will allow for production to increase to 20 million tonnes annually by 2016.

Perhaps more exciting for the company is the news that plans are being considered for a listing on the Hong Kong Stock Exchange. Eldorado Gold Corporation is the largest foreign gold mining company operating in China with three separate facilities, producing 300,000 ounces of gold each year.

Founded in 1992, Eldorado Gold Corp has operations in Brazil, Greece, Romania, Turkey, and China. The company takes extra care to ensure that its mines are safe and sustainable. Eldorado also works to promote local infrastructure projects, including providing drinking water, improving roads, and installing sewage systems, so that each mine makes a positive impact on local communities.

Gold Opens With Biggest Gains in 2 Weeks on Latest U.S. Jobs Report

The latest U.S. Jobs report showed fewer jobs added for the month of July than originally projected, causing a spike in gold purchases.

After the largest stock sell-off in six months, the Dow ended down for the year at market's close yesterday, adding selling pressure to world markets opening today.

It's not entirely clear what caused the sell-off yesterday, but it could be due to a variety of factors.

Banco Espirito, the Portuguese bank, reported a record loss yesterday which prompted its stock to drop 40%. Another cause for uncertainty is Argentina is expected to default on some of its bonds.

There are also many new economic indicator reports due for release today, including the U.S. and global manufacturing Purchasing Manager's Index.

With each day there is growing unease over escalating tensions in the Middle East and Eastern Europe, which is another strong motivator for investors to hedge their portfolios. This week the U.S. and Europe increased economic sanctions against Russia over the situation in Ukraine and Russia has recently entered into new trade agreements with Iran, North Korea, and India.

British Prime Minister David Cameron has compared Russia's recent actions to those of Germany just before the outbreak of World War II. He told the Telegraph that the UK was committed to resolving the crisis by economic means and that Britain would not start World War III over Ukraine.

With the Israeli-Palestinian conflict, and ISIS continuing to strengthen and gain support for dividing Iraq into separate states, many are worried about more than just what is happening in Eastern Europe.

Dow Posts Worst Loss Since April, Puts 2014 in the Red

The Dow plunged more than 300 points today, the steepest decline in six months.

Analysts say there is no single cause for the plunge, but concerns about the possibility of the Fed raising rates on the back of a more positive jobs market and poor projected earnings reports from several U.S. companies are looked to as potential drivers behind the sell off.

Other possible spurs for investor unease are the recent news that Argentina is expected to default for the second time in 13 years on bonds and concerns over the European Central Bank needing to offer more stimulus.

Joe Spinelli of Deutsche Bank said, "There are so many things coming to a head simultaneously, clients are wanting to get into a position to ride out any storm that might pop up."

Trading volume was higher than normal but was not at levels that would indicate a panic. Trading desks are seeing strong movement into more Exchange Traded Funds and commodities as investors seek to hedge their investments amid the current volatility.

 Stuart Lippman, a fund manager at TIG Advisors LLC in New York told the Wall Street Journal this week, "There's one thing for sure: History repeats itself, and this is starting to feel like a bubble"

Former Vice Chair of Goldman's Asian Operations to Join Barrick Gold Corp

Barrick Gold Corp has just appointed another former Goldman Sachs Group executive to its board.

Former Vice Chairman of Goldman, J. Michael Evans will be the new director of the world's largest miner of precious metal. He joins John Thornton, another former Goldman employee in the latest of a series of executive shake ups at the mining company.

Evans comes highly valued for his extensive experience in dealing with China. He served as chair of Goldman's Asia operations from 2004 to 2013 and the global head of Growth Markets from 2011 to 2013. Evans is also nominated to join the board of the Alibaba Group, a large Chinese E-Commerce company expected to go public later this year.

He is also a former Olympic Gold Medalist and holds a master's degree from Oxford University. He was named partner at Goldman Sachs in 1994.

Barrick Gold Corp announced earlier this month that CEO Jamie Sokalsky would depart the company and that his duties would be split among the executive board.

The Denver-based mining company is the largest gold producer in the world. With mines on five continents, Barrick produced over 7 million ounces of gold in 2013. The company is committed to corporate responsibility and for the past six years has been recognized by the Dow Jones Sustainability World Index.

Newmont Mining Corp Announces Plans to Construct $1B Mine in Suriname

The largest mining corporation in the U.S. announced yesterday that they plan to open a new gold mine in the country of Suriname in an effort to further cut operating costs.

Newmont Mining Corporation, based out of Denver, Colorado, was founded in 1916 and currently operates mines in the United States, Australia, Peru, Indonesia, Ghana, New Zealand and Mexico.

Now they are pushing into Suriname. Located on the northeastern coast of South America, Suriname is bordered by Brazil, Guyana, and French Guiana. The government of Suriname has an option to earn a 25% equity stake in the new mine.

Expected to cost around 1 billion dollars, the mine should be operational some time in 2016, if all goes according to plan. It is projected to have an output between 300,000 and 400,000 ounces of gold annually. The company predicts the mining cost per ounce to be around $750 to $850 per ounce, providing the company with a significant savings of 29% less than the company average.

This is the largest gold-related project to be undertaken in over a year, signaling increased confidence in gold futures. "At current gold prices, we estimate Merian could have a payback in less than four years." said Michael S. Dudas, an analyst at Sterne Agee & Leach Inc.