Negative Interest Rates and Equities Bubbles

The Market Gage - Dillon Gage's Precious Metals Newsletter

A story in today’s Wall Street Journal caught my attention. After reading in the past that individuals in the EU and other countries are not the only ones heavily invested in stocks in THIS country, but Europe’s insurers
are investing in ways not typical for their industry.

What paid the bills in the past for the likes of Allianz SE were low risk bonds, now some new investments they have chosen are not typical, like investing in a military garrison for the U.K.’s Parachute Regiment, a Texas wind farm and a sixteen mile sewer tunnel in London.

Negative interest rates around the globe have forced investors, insurance firms and others to look for any type of return and take uncharacteristic chances to boost the bottom line. So when does this all end? Will it end when our Fed becomes the leader in the world and raises rates. What happens when corporate earnings fizzle out, which might be just around the corner.

In the event the Fed is forced to go the other way, I can’t even think what would happen if negative interest rates hit our shores. CDs, remember those investments? Senior citizens relied on those investments to give them some sort of return to subsidize their Social Security payments. Now they are forced into the stock market adding to that bubble and they too are making some uncharacteristic choices just to survive.

When this equity bubble bursts, will gold get a boost or will the price of gold suffer the same fate as equities as higher interest rates boost the dollar and crush the price of gold. Or will gold be the only safe haven investment?

With the election right around the corner, let’s not forget there are 469 seats in the Congress (34 Senate seats and all 435 House seats) that are up for election November 8th and they might be even more important than who winds up in the White House. It seems that because the two presidential candidates as so very entertaining, these down ballot races have little or no coverage. So believe it or not, the real big story will be whether or not the Democratic party will be able to regain control of the Senate. In order to achieve that, they will have to gain 5 seats. And let’s not forget the Supreme Court. The sudden death of Justice Antonin Scalia in February this year has made the outcome of the 2016 senate election even more important. A 60-vote confirmation is required in the Senate to confirm the next Justice. As we see what’s at stake at this year’s election, it has NEVER been more important to get up and cast your vote in the most important election this country have ever experienced.

Don’t miss your chance. Our county depends on YOU!

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


New London Gold and Silver Contract Announced

The Market Gage - Dillon Gage's Precious Metals Newsletter

I’m sure by now my readers are tired of reading about the Fed and the wonderful job they are doing and listening to which way the price is gold is headed. So I figured I would share a little about a conference I attended last week during Gold week in New York City.

I think it’s important to keep everyone informed of market developments. Hence, I give you LMEprecious, the new London Gold and Silver contract.

LMEprecious is the collaborative initiative created by the London Metal Exchange, the World Gold Council and a group of leading industry players to introduce an innovative, new exchange trading loco London precious metal products.

This new monthly futures contract is expected to launch in the first half of 2017. They claim the LMEprecious futures contract will deliver a choice for market participants,
modernizing the gold and silver markets to better reflect the needs of global players in the precious metals arena.

Working together with key market participants, the platform and open outcry will offer
market participants a choice of using a broker or a platform to execute their trades.

I’m told that 60 percent of the world’s gold activity is conducted in London.

The new contracts will be cleared by LME Clear, the clearing house for the LME. LME Clear currently clears over 600,000 contracts each day, with an annual traded notional value of 12 trillion dollars, equating to 4 billion tonnes of industrial metals.

The lot size for the gold contract will be set at 100 troy ounces and silver set at 5000 troy ounces. Represented minimum purities are .9995 for gold and .999 for silver. All contracts will be for London delivery only.

I’ll take a wait and see attitude on this contract and watch how tight the bids and offers will be and how it compares to the CME contact.

I just wanted to share with you what’s new in the precious metal arena and I hope in the future you will allow me to continue to be your informant, reporting on new developments that affect how we conduct our business every day.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagles Sales as of 9/22/16

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on September 22th. Changes below reflect the sales since our last report on September 16th.

Gold
Coin Sales in oz. /#coins + from 9/15/2016
One oz.
538,000
538,000
22,500
22,500
Half oz.
27,500
55,000
500
1,000
Quarter oz.
27,500
110,000
500
2,000
Tenth oz.
68,000
680,000
2,500
25,000
Total
661,000
1,383,000
26,000
50,500
Silver
Coin Sales in oz. /#coins + from 9/15/2016
One oz.
30,155,500
30,155,500
305,000
305,000

Fed Says No To Interest Rate Hike

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The Federal Reserve committee announced today that there will be no change in interest rates.

We await the Chairwoman’s comments at 2:30 EST today, to hear if she will exhibit a dovish tone or a hawkish tone regarding futures rate changes.

Fed minutes chatter is the same as previous meetings, all decisions will be data dependent. Based on recent economic data they have no case to change rates.

The chairwomen’s comments can have just as much impact on the price of gold and all markets as a rate change, as she shares her thoughts and the thoughts of the FOMC in a few minutes.

The next FED meeting is scheduled for November 2, 2016.

Current odds of a rate hike in November after today’s announcement is set at 26 percent.

All this does is making December the true date for a rate change, if the data is compelling.

Enjoy the reminder of your day.

Disclaimer:This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


All Eyes On Today’s Fed Meeting

The Market Gage - Dillon Gage's Precious Metals Newsletter

Fed rate decision day…or is it?

The price of gold getting a boost this morning after the Bank of Japan announced they will be introducing a zero interest rate target for ten-year government bonds.

Japan’s central bank also announced they are keeping rates unchanged.

In essence, they will be deepening the bond yield curve by going from longer term bonds to buying short term JGBs. They will also cut the deposit rate deeper into negative territory from 10-20 basis points.

This decision has not come without criticism because this creates more problems for their banks that borrow at short term rates and tend to lend at long term rates. This in my opinion will only discourage banks from making new loans. This decision also can have an impact on the economy as folks question the sustainability of their financial system.

As the BOJ decision was announced, our ten-year government bonds fell a bit to yield 1.691 percent after closing yesterday at 1.687 percent. Our thirty-year treasury bonds fell to yield 2.438 after closing at 2.429 percent. Let me remind my readers that bond yields move the opposite of prices.

The FED will announce its decision at 2 pm Eastern time. Then at 2:30, Fed chairwomen Janet Yellen will brief the media. The consensus is for the Fed to leave rates unchanged until December. In the event they raise rates today, (only a 15 percent chance according to the CME FED WATCH TOOL) it would be a surprise to the market especially after what transpired in Japan overnight.

In my opinion, in the event they do raise rates today (that will be a very bold move by the voting Fed presidents) I expect our markets to get slammed. They better have some compelling data to back that decision up, which most believe, would be a very bad decision on their part to raise rates in a world where negative interest rates are becoming the norm.

Have a wonderful Wednesday.

Disclaimer:This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold Keeps Its Head Up Prior to This Week’s Fed Meeting

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold keeping her head above the $1,310 level as we await hearing from the Federal Reserve and the Bank of Japan later this week.

The FOMC meets Tuesday and reports at 2pm est. on Wednesday. The Bank of Japan reports after their markets close on Wednesday.

Economists are not sure what the Bank of Japan will do. Banks in Japan are calling for the BOJ to put an end to negative interests rates and falling yield curves that are putting them out of business.

Since the BOJ reports first, I’m sure the BOJ will give our FOMC some guidance and help them with their decision.

Today’s Fedwatch Tool shows a 15 pct. chance of a rate hike being announced on Wednesday.

Watch out: If there are any surprises from either The Bank of Japan or our Fed, the markets I expect will react violently, as most are expecting no changes.

Keep a close eye on the markets as the decisions are released. In the meantime, most Wall Street traders expect the market to be quiet thru Wednesday and most are not participating in the gold market at this time.

Have a wonderful Monday.

Disclaimer:This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Silver ETF Inflows Set All Time Highs

The Market Gage - Dillon Gage's Precious Metals Newsletter

I find it fascinating that with metal prices in a slow decline, the silver ETF inflows each day continue to set all-time highs. Current holdings in silver ETFs have reached 664 million ounces. By contrast, the Gold ETFs of late have been experiencing outflows caused by comments from various Fed presidents. Some continue to insist that they need to raise rates at the September meeting.

All the Fed members have to do is open the window and look across the pond to Germany and they will see that the yield on the 2-year bund today is yielding negative .67 percent and their 5-year bund is yielding .50 percent. Bund prices and yields move in the opposite directions and a negative yield implies that investors are paying the German government for the privilege of holding their cash. (If you are thinking that the word “bund” is a typo, bund is the German word for a bond issued by Germany’s Federal Government, equivalent to our U.S. Treasury bond. I just wanted to clarify that.)

We all know that the data does not support a rate hike and all their individual comments only cause unnecessary volatility in prices. If we look today at The CME FED FUND Watch tool, we see that the chances of a rate hike in September are at 15 percent, November is at 23 percent and December at 53 percent.

Most Wall Street insiders believe in December the street will force the Fed hands by pressuring them to put up or shut up on raising rates .25 basis points. I’m sure each of the “hawks” on the committee pray every evening before they go to bed that the data improves and takes the pressure off before they need to decide in December.

At the CME Gold dinner and the IPMI dinner in New York this week, all the chatter between attendees was about the lack of transparency from the Fed. Unfortunately, Fed comments are the ONLY thing that has any influence on the price of gold.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagles Sales as of 9/15/16

The following chart includes the year to date totals from the U.S. Mint as of 5pm on September 15th. Changes below reflect the sales since our last report on September 8th.

Gold
Coin Sales in oz. /#coins + from 9/15/2016
One oz.
515,500
515,500
12,000
12,500
Half oz.
27,000
54,000
500
1,000
Quarter oz.
27,000
108,000
1,000
4,000
Tenth oz.
65,500
655,000
1,000
10,000
Total
635,000
1,332,500
14,500
27,000
Silver
Coin Sales in oz. /#coins + from 9/15/2016
One oz.
29,850,500
29,850,500
810,000
810,000

Platinum’s Moment in the Headlines

The Market Gage - Dillon Gage's Precious Metals Newsletter

We spend a lot of time and energy in the Market Gage blog discussing the economic factors that move the needle in the gold market, but what about our industrial metal cousins, platinum and palladium? We ask because, as it turns out, there is a newsworthy event that has just occurred in the platinum marketplace.

As reported by Mining.com, investors saw a quick jump in prices (+1.6% to $1,058.70/oz) yesterday in the platinum market and it had nothing to do with demand, but rather supply. Specifically, there will be less output of it for a while. It turns out that one of the top platinum producing mines run by Anglo American Platinum (Amplats) is being forced to shut down one of its five operating smelters for furnace maintenance. The stoppage is expected to last at least four months.

Effect on the platinum market was immediate, but that doesn’t mean this industrial metal’s spot prices will be impacted long-term. However, platinum is up 22% on the year with yields expected to meet or exceed 2016 predictions right down the line.

So what’s up with the market this morning? Here’s the look at press time:

  • Gold– Experiencing a bit of a lift, sitting at the mid-$1,320s
  • Silver– Resting nicely above $19 an ounce
  • Platinum– Has settled back a bit after yesterday’s flurry to the upper $1,030s.
  • PalladiumFlat in the mid-$650s.

Hope you enjoyed the change of scenery. Here’s to a productive Wednesday!

Disclaimer: This editorial has been prepared by the trading staff of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Brainard Talks Prudence in Rate Hikes – Gold Jumps

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Markets rebound after speech by Fed Reserve Governor Lael Brainard calling for “prudence” in rate hikes.

Stock market and the Gold market loves her comments, but I think the rally will be short lived.

Here are the five main highlights from Brainard’s speech:

  1. Inflation Has Been Undershooting, and the Phillips Curve Has Flattened
  2. Labor Market Slack Has Been Greater than Anticipated
  3. Foreign Markets Matter, Especially because Financial Transmission is Strong
  4. The Neutral Rate Is Likely to Remain Very Low for Some Time
  5. Policy Options Are Asymmetric

The economy has seen welcome progress on some fronts in recent months, supported by the cautious approach taken by the Committee and a corresponding easing in financial conditions: The labor market has continued to improve, consumer confidence has remained high, and we have navigated past near-term risks from abroad. But…Brainard says:

“This asymmetry in risk management in today’s new normal counsels prudence in the removal of policy accommodation. I believe this approach has served us well in recent months, helping to support continued gains in employment and progress on inflation.”

Brainard notes that market-based measures of inflation compensation have softened to the downside and have not recovered even though oil prices and the dollar’s exchange rate have stabilized. This is another factor arguing against the case for a preemptive rate hike, she said.

As she shared her opinion, the Dow Industrial average received a boost, hitting a day’s high of over 178 points in the plus column.

Gold had a short lived rally as she spoke. I expect after she’s done, gold will go back to its sell bias mode.

What more can I say? One more case in point on the effects of Fed governors’ comments.

Enjoy the rest of your day.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Possible Sept. Rate Hike Suppresses Precious Metals

The Market Gage - Dillon Gage's Precious Metals Newsletter

Finally there is someone at the Fed that has some common sense…maybe?

Atlanta FED President Dennis Lockhart said today he would not discuss his opinion of what the U.S. central bank will likely do at its September, November, or December meetings as “financial markets seem to be very sensitive to remarks of Fed speakers at the moment.” Sounds great, I feel better.

What he did share was that he believed that recent economic data “warrant a serious discussion of a policy rate increase.”

Really, on what promising data did I miss?

So even though he said he wouldn’t give an opinion on what the Fed should do at the next three meetings, he’s thinking a rate hike might be appropriate?

Hold on, I’m scratching my head. Did we all get that? I need to read that a second time.

Today’s CME FED Watch tool predicts a 24 percent chance of a rate hike in September.

Looking at the markets this morning, all four metals are in negative territory. Platinum and Palladium are taking the biggest hit. Silver might have caught what Hillary has that has put it on the shelf for a few days. Gold’s recent bullish momentum seems to be fading away as we look to test the next level of support at $1,318 in the December contract.

Overall, the fear of a September hike has the precious metal market in a sell bias until the next Fed meeting (or next Fed comment).

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


FLASH GAGE – Here We Go Again!

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IT NEVER ENDS

Boston Fed President Eric Rosengren a voting member said today that he backed gradual interest rate hikes. He indicated that waiting too long risks some asset markets like commercial real estate “becoming too ebullient.”

He said, “My personal view, based on the data that we have received to date, is that a
reasonable case can be made for continuing to pursue a gradual normalization of monetary
policy.”

So for all who hold equity positions you can thank Mr. Rosengren for a 270 pt. decline in the Dow so far today.

The price of gold and silver under pressure also after his comments holding right at the support levels I indicated this morning. My fear is, if the dollar strengthens further this afternoon, I believe both gold and silver support levels will be violated bringing more momentum to the down side.

My advice is watch the horizon. In other words keep a close eye on the markets this afternoon.

Have a nice weekend.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Physical Precious Metals Show Some Life

The Market Gage - Dillon Gage's Precious Metals Newsletter

Some life seen in the physical market, exhibited by domestic refiners reporting an increase in demand for product over the last two weeks. They say it’s a lot different from the last two months where they were making outbound calls looking to raise some cash to buy new lots of scrap material.

Some indicated that during the summer months, the shelves were getting heavy and they were tired of looking at all the products they had so a reduction in some premiums were in order.

So everyone’s feeling a little better as the worst seems behind us all in the physical arena.

We can look forward to the debates, the September FED meeting, and the presidential election outcome to create some demand for metals. Some billionaires are making news with their opinions, like Mark Cuban expecting a crash in the equities if Donald Trump is elected. All this chatter from prominent individuals such as FED presidents, Donald, Hilary and billionaires such as Mark Cuban, George Soros and Carl Icahn, has the ability to effect the markets.

In the meantime, we witness a slightly stronger dollar this morning putting a little pressure on the price of gold. Silver also feeling like she’s coming down with something, as the fun days when she was over 20 seems to be fading fast.

But there is hope, as demand in the ETF market continues to flex its muscles. Silver ETF holdings hitting an all-time high this week continues to support the fact that in a balanced portfolio, metals is a key component.

My professional chart gurus are asking for some time to show what they are made of and want to share their levels of support if the market trends downward. So in gold, the first level of support is close by at $1,332 in the December contract and $19.37 in the December contract for silver. They expect the market to hold these levels. I believe they are up two dinners on me.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagles Sales as of 9/8/16

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on September 7th. Changes below reflect the sales since our last report on September 2nd.

Gold
Coin Sales in oz. /#coins + from 9/1/2016
One oz.
503,500
503,500
12,500
12,500
Half oz.
26,500
53,000
500
1,000
Quarter oz.
26,000
104,000
1,000
4,000
Tenth oz.
64,500
645,000
1,500
15,000
Total
620,500
1,305,500
15,500
32,500
Silver
Coin Sales in oz. /#coins + from 9/1/2016
One oz.
29,040,500
29,040,500
170,000
170,000

FLASH GAGE – Where is your Gold and Silver?

flash-post

Someone likes the Precious Metals Group as an investment.

ETF Silver holdings reached an all-time high today at almost 667 million.

Gold ETF holdings today reached their highest level since June 2013.

Some financial advisors reported this morning that some of their clients who were previously only equity and bond investors, are starting to look at alternative investments to balance their portfolios and their choice is Gold and Silver ETFs.

I for one, reading what is going on around the globe, would prefer owning physical Gold and Silver over paper precious metals. The reason is, if and when there is a crisis, I want the metal in my hand or in an authorized depository where I can obtain delivery in an instant.

We all know the commercial slogan: “What’s in your wallet?”

My question to you is: “WHERE is your investment?” It’s important to know where your Gold and Silver is if you need it and want to take delivery.

Have a wonderful Thursday


FizTrade™ Upgrades User Experience

fiztradeupgrades
Online Platform Offers Flexibility and Speed For Precious Metals Industry

ADDISON, Texas (Sept. 8, 2016) – Dillon Gage Metals, an international precious metals wholesaler, reports that their online trading platform has been optimized to further enhance the customer experience. FizTrade, which is shorthand for “physical trading,” is upping its game for its network of dealers, already praising it as the best full-service platform of its kind.

After interviewing active users and analyzing usage trends on the platform, FizTrade was redesigned to further improve the clients’ needs while enhancing the user experience. Immediately visible to users is the ability to buy and sell metals, track orders, obtain account notifications, product specials and view all analytics. In redesigning FizTrade, Dillon Gage recognized that their clients’ time is valuable. By transferring the most frequently used elements of FizTrade to the main dashboard, their clients benefit.
Continue reading “FizTrade™ Upgrades User Experience” »


FLASH GAGE – Richmond Fed Pres Comments on Sept. Rate Hike

flash-post

Federal Reserve Bank of Richmond’s President, Jeffrey Lacker, said today there is a “strong case” for a rate hike in September. Lacker said recent GDP and employment numbers point to a recovery in the second half of 2016. He also indicated that he believes that Fed interest rate policy was likely too low and the Fed needs to “make up some ground” on rate policy.

This is getting beyond ridiculous. As the comment was released, profit taking came into the gold market and the price of gold declined.

I am amazed how these comments are allowed as each time a Fed President takes a position it has an impact on many markets, especially ours.

As I reported when the last Fed meeting minutes were released, there seemed to be a split down the middle between the doves and the hawks on the committee in regards to when or if to raise rates.

I once again appeal to Chairwoman Janet Yellen to restrict comments made by the Fed Presidents and let the minutes of each meeting speak for themselves. The whole thing creates unnecessary volatility to the markets and it’s not necessary in my opinion.

When the time comes, cast your vote. In the meantime you should stay silent. There is no benefit to anyone to hear each of their opinions outside the meetings,

Enjoy the rest of your day.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Lots of Questions – Is Gold the Answer?

The Market Gage - Dillon Gage's Precious Metals Newsletter

Was the Brexit vote just the tip of the iceberg of things to come? Do you think German Chancellor Angela Merkel is having second thoughts on making a decision last year to allow 1.1 million refugees and migrants into Germany? One would think she does after the message sent by voters in a far-right party in Sunday’s election in Germany. An alternative party that opposes Merkel on her immigration stance came in second over the weekend, sending a message to Merkel that she better think twice before making commitments like that in the future.

Do we know what country will join the UK and start their own referendum to part ways from the European Community? Front Nation leader Marine Le Pen has said that if elected she will hold a referendum on whether France should take the same stance as the UK.

Don’t look now but the Netherlands, Austria, Finland and Hungary have the same plans.

So what does this all mean for the price of gold? (After all, you are reading a gold comment letter.)

If you speak to many financial advisors as I do each week, you’ll hear that for the most part, they report
that most of the rally in the equity market is from money being invested from folks over the pond. Does that investment send a strong message that folks in the EU are worried that an investment on their shores is a bad idea? After all, many are looking at negative interest rates and need to find a place to put their money.

More and more people are predicting a breakup of the European Community in the next few years. As I said in previous comments, now that the UK is gone, how can France and Germany support the rest of the countries in the EU? One just has to look as the mess Greece is in.

An article published Monday in Express, a London publication, said, “A Greek crisis could topple the Brussels project, top rating agency warns.” Leading experts at Fitch have warned, “that the stricken Mediterranean country remains the biggest threat to the future of the EU, despite seven years of grueling recession and austerity imposed from Berlin and Brussels.” Athens has the highest debt and unemployment rates in the world and has everyone in the EU asking themselves, why are we continuing to support them?

Debt, the word sounds familiar? What about our debt? (And I’m sure you are as tired of reading about it as I am writing about it.) No one is addressing the problem. Our debt and the debt in countries in the EU is not going away anytime soon.

I can’t remember in the short period of time I’ve been writing for Dillon Gage that I used so many question marks in one daily comment.

So what more do I need to say in today’s comment to paint the picture that owning physical gold is one investment you will be happy to own when the world economies are in shambles?

I am sure you have heard all the wild far away numbers some crazies have predicted in the price of gold? If these stories keep developing maybe they could be right but for the wrong reasons.

After reading all this information I think I’ll change my favorite color to “YELLOW.”

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Jobs Numbers Boost Precious Metals

The Market Gage - Dillon Gage's Precious Metals Newsletter

As the week comes to a close, precious metals remain quite sensitive to even the slightest movement among leading market indicators. Much like objects in the side mirror on your car, a looming interest rate hike on the horizon was thought to be much closer than indicated. However, a late-breaking performance survey on Thursday showed unexpected weakness in the manufacturing sector.

Today’s weaker than expected job report strengthens the argument of those who say there will not be an interest rate hike anytime soon. However, most market insiders do foresee an interest rate hike in the near-term, but that could also mean December—after the U.S. Presidential election. August’s job report of 151,000 is significantly lower than the expected 180,000, with the jobless rate remaining basically unchanged at 4.9 percent. Of course, August is historically a sluggish economic month with September sparking movement. The question is…how will August’s job number’s impact the Fed’s September 20th meeting?

Silver is having a banner year in 2016, with prices up 44 percent from January through August. This includes both physical silver and the silver-backed ETF and mutual funds. Sales of silver coins are also skyrocketing, with a 29 percent increase in just the first quarter of 2016—coming on the heels of 2015’s record-breaking year.

It’s been an interesting week and the precious metals market news shows no signs of slowing as we enter a new month. All four metals jumped with the job number release this morning. Here’s a peak at the activity at press time:

  • GoldAfter lingering around 1,310, gold initially jumped up $18, but has settled to $1,323.
  • SilverThe grey metal’s 24-hour position in the 18.80s was boosted $.40, settling now to $19.18
  • PlatinumThis metal leapt $15 from the upper 1040s, but has quickly fallen lower, hanging now in the mid $1,050s
  • PalladiumThis metal has also backed off quickly from the impulsive $10 boost from the upper $660s. Palladium now rests in the lower $670s.

Have a wonderful and safe Labor Day Weekend…


American Eagle Sales as of 9/1/16

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on September 1st. Changes below reflect the sales since our last report on August 26th.

Gold
Coin Sales in oz. /#coins + from 8/25/2016
One oz.
491,000
491,000
17,500
17,500
Half oz.
26,000
52,000
500
1,000
Quarter oz.
25,000
100,000
000
000
Tenth oz.
63,000
630,000
2,500
25,000
Total
605,000
1,273,000
20,500
43,500
Silver
Coin Sales in oz. /#coins + from 8/25/2016
One oz.
29,040,500
29,040,500
410,000
410,000

Gold Hits Fork in the Road

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold has seemed to hit a fork in the road. The retail investor is nowhere to be found as they listen to conflicting reports and opinions by big bank and brokerage house economists on which way the price of gold is headed. The main reason for all the confusion is the lack of transparency from various Fed officials.

As the dollar continues to flex its muscle, gold continues its downward trend headed to the level everyone’s watching, the $1,300 dollar physiological level of support.

Let’s look at the data on both sides of the ledger so that you can come up with your own opinion. Remember the fork in the road is in front of you and you have to choose the direction of your investment.

Bullish data for the price of gold:

  • Negative interest rates are expanding around the world, making gold in those countries an attractable investment.
  • The US debt continues to spiral out of control and no one is addressing this major issue.
  • Entitlements continue to increase and no politician has the guts to address the problem as they all believe it will be political suicide.
  • We cannot ignore the cost of health care going forward. Seems we are losing the fight for affordable healthcare as the insurance companies and doctors head for the hills, unwilling to participate in plans that pay them peanuts for care.
  • Underfunded state pension plans. The federal government can print money, what can the states do when bankruptcy is their only option.
  • ETF Gold purchases have not seen any significant redemptions, as we view the fund holdings just off slightly from the 2016 highs.
  • The European community still has not come up with a plan to support the continued refugee crisis hitting their shores.

You might not agree will all these bullish comments, but in a global economy we must remember all markets are connected. Any significant news in the world can trigger algorithm programs that can affect any and all markets at the same time.

Bearish data for the price of gold:

  • Central banks cut their purchases of gold in the second quarter this year to the lowest since 2011, said the World Gold Council.
  • Fed Chair Janet Yellen said the U.S. economy is in an expansion mode which in turn gives the FED some ammunition to raise rates soon.
  • The FOMC expects moderate growth in GDP and inflation raising to 2 percent in the next few years (giving the dollar a reason to strengthen consequently lowering the price of Gold).
  • The Chairlady also indicated, based on this economic outlook, that the FOMC continues to anticipate that gradual increases in the federal funds rate will be appropriate over time. The question I continue to ask is, ok when and will the data support her claim?

Data that can swing either way:

  • “The Brexit vote consequences” pushed under the rug for the time being. Could be a significant factor going forward, but it’s too early to tell. Can France and Germany cover the cost to support the whole European community?
  • If you look at both sides of the ledger you will see that in the long term, physical gold will be the investment of choice for many, as the world’s financial condition deteriorates. You just need to be patient and wait for the smoke to clear in Washington
    between the election and any rate hikes.

Where is your entry point?

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Dillon Gage Metals Hires Industry Insider Michael Kramer

kramer
Precious Metals Veteran Brings Extensive Trading Knowledge

ADDISON, TX (Aug. 25, 2016) – Dillon Gage Metals, an international precious metals wholesaler, has announced that industry veteran Michael Kramer has joined the company, effective immediately. Kramer will have a primary focus on working with wholesale accounts, many of whom have already traded with him for decades.

Kramer spent his entire 37-year career in the precious metals industry with Manfra, Tordella and Brooks (MTB). What began on the ground floor of their retail department led to a successful multi-decade journey through their precious metals trading ranks, eventually becoming president of the organization.

“The addition of a precious metals industry veteran of Michael Kramer’s caliber to the Dillon Gage Metals team is invaluable,” stated Terry Hanlon, president of Dillon Gage Metals. “Michael brings extensive trading knowledge and priceless industry relationships to our organization. He will undoubtedly contribute to Dillon Gage’s unparalleled service standards our customers have come to rely on.”

“I’ve spent my entire career in the industry and Dillon Gage Metals’ reputation in the metals business is formidable,” said Kramer. “I am honored to join their elite organization and remain confident that the contributions we’ll make together will greatly benefit the existing and future customer bases of the company.”

For more information, please visit www.dillongage.com or call (800) 375-4653

# # #

Contact:
Jeffrey Cheatham
Senior Account Manager
TrizCom PR
(972) 247-1369
jeffc@trizcom.com


FLASH GAGE – Dollar Rises | Gold Under Pressure

Dillon Gage - Flash Market Update

Gold under pressure this afternoon as the price of the dollar strengthens. Dollar index on the highs for the session at $ 96.13 as more and more traders have expressed the belief that a stronger dollar is in the cards, which in turn puts pressure on the gold price.

Non-farm payroll numbers are to be released Friday and the if the numbers are favorable it will give the hawks on the Fed committee more ammo for a rate hike in September.

Most Wall Street gold traders I speak with are still enjoying the summer sun and the ones who are in the office are very comfortable carrying a short position as the bids dry up below.

CME Fed watch tool predicting a 24 pct. chance of a rate hike at the September Fed meeting and I expect the odds will increase as more favorable economic data is released.

Good rest of your day.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Dollar Stronger on Fed Comments

The Market Gage - Dillon Gage's Precious Metals Newsletter

Friday’s comments by Federal Reserve Vice Chairman Stanley Fischer have strengthened the dollar and put pressure on the price of gold this morning.

He indicated that the U S economy has strengthen, with strong jobs data in the last three months. He had seemed to hedge his bet that rates will be on the table at the September meeting by saying, “the problem with this economy is there is so many numbers each day. You have to try and figure out what is the main thrust of what’s going on in the economy.”

Continue reading “Dollar Stronger on Fed Comments” »


Gold Goes Volatile

Dillon Gage - Flash Market Update

The price of gold extremely volatile as Yellen’s comments hit the wires.

CME Fed watch tool which predicts a possible rate hike at the next Fed meeting in September dropped after her comments from a 21 pct. chance of a rate hike to 18 percent rallying gold and equities.

Headlines:

  • Solid growth in household spending
  • Fed needs to retain new tools from crisis
  • Fed has tools to fight the next recession
  • Interest on reserves to play a key role for years
  • 2 trillion QE could fight next recession
  • Anticipated gradual rate hikes appropriate if data suggests
  • Fed should research price level targets

It’s the same old story with a twist. The Fed always wanted to have a cushion to cut rates in the event that the economy takes a turn for the worst. That’s why many of the voting members wanted a rate hike. Now it seems that they are in better position to fight a failing economy, so it’s not so urgent to raise rates because of the tools available to them now.

So, if you read between the lines and interpret what she meant, in my opinion, it was to give the market a signal that all is well, but not great with the economy and we will not raise rates unless the data is convincing, Period.

In turn gold is up $ 20 dollars after being slightly negative as her comments were being released.

Have a wonderful weekend.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagle Sales as of 8/25/16

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on August 25th. Changes below reflect the sales since our last report on August 19th.

Gold
Coin Sales in oz. /#coins + from 8/18/2016
One oz.
473,500
473,500
9,000
9,000
Half oz.
25,500
51,000
500
1,000
Quarter oz.
25,000
100,000
500
2,000
Tenth oz.
60,500
605,000
1,500
15,000
Total
584,500
1,229,500
12,000
27,000
Silver
Coin Sales in oz. /#coins + from 8/18/2016
One oz.
28,630,500
28,630,500
480,000
480,000

Gold Motionless In Advance of Jackson Hole Summit

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold virtually motionless as the market awaits some news from Federal Reserve chair Janet Yellen’s speech Friday at Jackson Hole.

For those who are not familiar Jackson Hole, it is typically a mountain resort for skiers and mountain climbers. Every summer it turns into the site of an exclusive conference of central bankers who are responsible for global monetary policy.

The title of this year’s conference is: Designing Resilient Monetary Frameworks for the Future. I’ve asked a few prominent Wall Street traders to shed some light on what that might mean and most said they have no clue.

I have heard the same response from many traders when asked if the FED is in touch with reality and their response was the same “it seems they no clue on what to do regarding a rate change.”

So it’s no surprise that the price of gold remains motionless as we wait for the Fed Chair’s comments.

CME’s FEDWATCH Tool gives just a 24 pct. chance that a rate hike will happen at the September Fed meeting.
November’s meeting is showing a 29 pct. chance and December a 52 percent chance.

No wonder the Gold ETF market has been flat for the past week or two with no significant moves either way
with inflows or redemptions.

Many news guests on CNBC, FOX and Bloomberg have also expressed their frustrations with Fed policy.

If you remember I reported on a Flash Gage last week that it seems after reviewing the minutes from the last Fed meeting, voting participants are split down the middle trying to decide if a rate hike is appropriate.

It seems that the only news that moves the price of gold these days are stories of a possible rate hike. Whatever happened to supply and demand issues and inflation worries?

As I’m in the process of completing my comment this morning, I see the price of gold break thru the important level of support at $1,332 in the December contract down $ 14 .00 quickly from when I started this report so I’m scrambling to find the news that created this sell off.

Looking at times and sales it looks like at 8:40 Eastern time, someone sold 10,000 contracts of December gold causing the market to drop $ 14.00. Looking at all the news wires available to me I find NO news that would justify that sell off.

If any significant news is released I will be right back with a Flash Gage report.

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold Starts Week on Two-Week Low

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold starts off the week at a two-week low. A stronger dollar and recent conversations with some Fed presidents have taken the “bull” out of the market for the short term.

Some domestic refinery employees I spoken with say, “inventories on some products are building on the shelves and not moving, so to increase our cash flow we have no choice but to drop premiums.”

Far East selling overnight has pushed silver below the $ 19.00 level, as bidders in the gray metal seem to be avoiding the market because of the lack of demand seen for physical products. Some silver traders have adopted a wait and see position before jumping back into the market.

Looking at the United States mint website, it’s clear how slow the Silver Eagle demand has been over the last few months. Let’s look at the numbers:

  • May 2016: 4,498,500 one ounce coins sold
  • Jun 2016: 2,837,500 one ounce coins sold
  • Jul 2016: 1,370 ,000 one ounce coins sold
  • Aug 2016: 580,000 one ounce coins sold (Thru Aug.18th)

In comparison from the same months last year:

  • May 2015 2,023,500 one ounce coins sold
  • Jun 2015 4,840,000 one ounce coins sold
  • Jul 2015 5,529,000 one ounce coins sold
  • Aug 2015 4,935,000 one ounce coins sold

Comparing the last three full months year to year, the United States Mint has seen a decline of 30 percent and August 2016 sales looks like it’s shaping up to be down 77 percent from Aug. 2015.

So to say a cloud has developed over the market might be an understatement, but one always has hope that in the end, negative interest rates, a possible meltdown of economies in Europe and the effect here at home of our presidential election will boost the price and start up demand in our markets once again. Remember these days, a rally back in the price of Gold and Silver is virtually
a news story away.

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold’s “Medical” Prognosis

The Market Gage - Dillon Gage's Precious Metals Newsletter

So far this year, speculative demand in the ETF arena along with central bank purchasing of gold has driven gold up from the lows in December of $1,046 to where we are trading today in the $1,340 area.

Those investors who had insight and bought on the lows are a very happy group, but the question remains now, where do we go from here? Some gold market watchers have reported seeing gold in a hospital emergency room in cardiac arrest.

The doctors have called for any member of the FOMC Committee to perform CPR, but no one at the FED could find a GPS device to locate the hospital. So the doctors have requested the electronic inflation pads to shock Gold, but it seems the available voltage is too low to make an impact. Meanwhile, the chants from all the metal dealers outside the hospital yelling “don’t let her die, don’t let her die,” have reached the ears of the doctors in the ER.

Oh look, it’s Donald Trump and Hillary Clinton arriving at the hospital.

I feel better already, I’m sure one of them can help gold recover. No, no, let’s not debate on what course of action to take. Look at those two who can’t agree on anything. The Doctor has determined to keep gold alive they will have to put her on life support ’til November.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagle Sales as of 8/18/2016

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on August 18th. Changes below reflect the sales since our last report on August 12th.

Gold
Coin Sales in oz. /#coins + from 8/11/2016
One oz.
464,500
464,500
7,500
7,500
Half oz.
25,000
50,000
1,000
2,000
Quarter oz.
24,500
98,000
500
2,000
Tenth oz.
59,000
590,000
1,500
15,000
Total
562,500
1,202,500
10,500
26,500
Silver
Coin Sales in oz. /#coins + from 8/11/2016
One oz.
28,150,500
28,150,500
455,000
455,000

FLASH GAGE – FED Minutes Released / Gold Reacts

Dillon Gage - Flash Market Update

Just flip a coin you might have a better chance predicting what will be the outcome at the next FED meeting. Minutes from the last FED meeting just released reveals:

  • FED open market participants split down the middle on whether a rate hike is needed soon.
  • Some voting members saw rate hike warranted soon.
  • Some officials wanted to wait for more data before agreeing to a rate hike.
  • Members saw low inflation risk from strong job gains.

      Initially on this news, we viewed a knee jerk reaction in the price of gold. Probably algorithm programs lighting up the board, down $ 15 dollars in an instant. Once all the news was absorbed by the market we are right back to where we were just before the report.

      This debate reminds me of the comic short film with Abbot and Costello: WHO’S ON FIRST?

      Enjoy the rest of your day.

      Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold Trading Holding Its Breath Prior to FOMC Minutes Release at 2 pm

The Market Gage - Dillon Gage's Precious Metals Newsletter

Gold opens up the trading day awaiting the release of the latest FOMC minutes at 2pm Eastern time today. Gold still sitting in a trading range as most Wall Street gold traders enjoying some time off in the Hamptons.

CME Fed tool watch, a barometer of the odds of an expected rate increase before the minutes are released show:

  • A rate hike in Sept. at 15 percent
  • A rate hike in Nov. at 16 percent
  • A rate hike in Dec. at 53 percent

The December assessment goes along with the comments made yesterday by Atlanta Fed President Dennis Lockhart who indicated he will support at least one rate increase before the end of the year. He believes, or shall I say he hopes, to see a strong third Quarter GDP figure which in turn will be just the data needed to increase rates at the December 14th meeting.

Most of the business’s new channel reporters are expressing frustration over the “do they or do they not raise rate signals” given by various Fed Presidents. Some are calling for “let’s just get it over with as we are all tired of reporting this madness.”

Equities hit all-time highs this week and job growth is strong, so just raise rates a quarter in Sept. and relieve all of this suspenseful nonsense and let the market do what it does best, trade on earnings and fundamentals.

It’s time to hear the news that’s not reported on the TV that will have a major impact on the price of gold going forward. As I indicated before, I expect the spark that will trigger a major rally in the price of gold will come from Europe.

  • The Migrant crisis continues to invade all parts of Europe. In Greece, Save the Children reports the number of migrants arriving in the Greek Islands has nearly doubled in recent weeks, putting pressure on already overcrowded camps.
  • A report today that the Swiss-Italian border frontier is becoming the flashpoint in Europe’s migrant crisis. Families looking to cross the border are being turned away, living without shelter, food and no sanitary facilities. Human right groups have called for clarifications from Switzerland over migrants claims that they have been denied a chance to speak to boarder authorities about asylum law. In essence the Swiss border is closed.
  • German also has its hands full with reports from INTEL that ISIS “hit squads” had entered into Germany with the hordes of migrants and there is irrefutable evidence that they are building an undercover command post planning the next attack.

So when do you think there will be a total uprising in countries like Germany and France? Folks are sick and tired of this, and as some call it an invasion into their country. There is no doubt in my mind that this was the main reason the BREXIT vote went the way it did.

Conflicting cultures, unemployment, lack of housing, no jobs, all fuel the fire between locals and migrants. Looks like government officials have no clue how to handle this crisis. So in my opinion, an economic crisis in Europe is right around the corner. The question remains what will be the catalyst that sparks the fury? A major terrorist attack? A civil uprising in France or Germany?

All this news just gives more credence that owning physical gold is a wise move for any informed investor.

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold Price Off to Quiet Start

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold starts off the week on a quiet note. A lack of economic news around the globe causing light volume this morning in the CME gold and silver futures. Dollar index close to unchanged this morning also helps to keep the price of gold steady.

The commitment of traders report released Friday showed the funds reduced their net long position by 7,736 contracts week ending August ninth. Position reported 9,930 contracts of long liquidation and 1,594 contracts of short covering. Seems to me that some funds are getting impatient with the price of gold consolidating at these levels and so they are flattening out some of their positions to find a better place to invest their dollars.

The gold ETF market had small inflows on Friday and silver reported some redemptions.

Silver also sitting in a trading range with the price slightly higher on light volume.

Overall just a quiet summer Monday to start the work week.

If you read my report on Friday, you’ll remember one trader sang a song to me to indicate where he thought the market was going: “See you in September”

Well here’s my song for today. Let’s all join in:

Roll out those lazy, hazy, crazy days of summer
Those days of soda and pretzels and beer
Roll out those lazy, hazy, crazy days of summer
Dust off the sun and moon and sing a song of cheer.

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Gold and Silver Feeling Pressure from Short Day Traders

The Market Gage - Dillon Gage's Precious Metals Newsletter

All-time highs in the Dow, S&P and Nasdaq yesterday. Highest settlement in crude yesterday since July 22nd.

Overseas money still dominates the inflows into equities looking for yields and dividends and that’s just what they are getting. The question remains, can this continue or have we reached the top.

The price of gold and silver is feeling the pressure from the short day traders as they know that no one will stand in their way and bid the market up. So the shorts will have their way with their trading strategy until something changes. The 8:30 am government data could bring a STRONG bid back if numbers surprise, which in turn will cause the day traders shorts to cover immediately.

Some retail internet dealers have been sharing that their market is so very quiet that an immediate vacation is in order. One character started singing the song, “See you in September”. Not very funny, I’m not amused. I enjoy a busy market.

So as the market looks for a support level to hang its hat on, I turn to my technical friends to fill the gap for me. Gold’s first level of support below is not until $1,332 in the December futures contract and silver must hold the $ 19.48 level also in December for the markets to still hold an upward future trend. Some Wall Street traders are still looking for any pullback in the price of gold to jump back in. I would take the same stance as I believe holding physical gold for the long term is a must for any balanced portfolio.

For those who understand the CME Gold and Silver future spreads an interesting play has developed in the September / December Silver switch. The CME Sep / Dec switch as we call It, is currently yielding 2.4 percent. I find it very interesting because interest rates are virtually zero. So for the players who want to hold on to their long silver positions in futures, it’s costing them a nice piece of change to do so.

What I believe is happening, is the funds are rolling their long holding positions in silver and the speculators are making them pay up to do so by widening the spread. Government regulations have eliminated the banks from playing in this market, as they have big time in the past. So all you now have are the hedge funds holding their long positions in a bull market and the speculators who know that the funds for the most part have to roll out their positions if they want to stay long and most believe the funds don’t really care if the Sept / Dec switch is trading at 2 cents or 12 cents like it is today.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagles Sales as of 8/11/16

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on August 11th. Changes below reflect the sales since our last report on August 5th.

Gold
Coin Sales in oz. /#coins + from 8/4/2016
One oz.
457,000
457,000
16,000
16,000
Half oz.
24,000
48,000
000
000
Quarter oz.
24,000
96,000
000
000
Tenth oz.
57,500
575,000
1,500
15,000
Total
562,500
1,176,000
17,500
31,000
Silver
Coin Sales in oz. /#coins + from 8/4/2016
One oz.
27,695,500
27,695,500
150,000
150,000

U.S. Productivity Slump/Weak Dollar Bolster Gold

The Market Gage - Dillon Gage's Precious Metals Newsletter

Gold prices seen rallying this morning off a weaker dollar and off a report of weak economic data that was released yesterday. The U.S. Labor Department showing second quarter productivity in the U.S. falling 0.5 percent, its third consecutive quarter of decline.

That’s not what the FED Presidents were hoping for after a strong job number was released last week.

Mixed economic data will continue to handcuff the FOMC from raising rates anytime soon, which in turn
supports the continued rally in the price of the yellow metal.

Silver is enjoying her sister’s success this morning, as strong buying was reported from some Far East traders overnight.

South African Platinum miners’ wage negotiations intensify as its becoming as one observer put it, “starting to get ugly,” so violence is not out of the question. As the labor negotiations seem to grow further apart every day since beginning in July, we see the price of both platinum and palladium experiencing strong rallies. The price of platinum this morning, not seen at these levels since April last year and palladium since June last year.

I always like to watch the ETF market as it gives the investor a good look at what a large group of individuals are thinking about the precious metals markets. Overnight we witnessed a small increase in gold and a small decrease in silver holdings. With today’s strong rally in all four metals I think you will see inflows across the board reported tomorrow. Buyers in the ETFs, for the most part, were responsible for the increase in the price of gold this year.

Let’s take at look at news over the pond that can affect the price of gold long term.

Turkish President Erdogan’s recent threat to re-open migrant routes into Europe from Turkey yesterday, will mean a possible 3 million more migrants heading into Europe. Just what Germany and France need right now after Brittan’s vote to say goodbye to the EU in the Brexit vote. There are 2.8 million Syrian refugees in Turkey without counting the thousands of Iraqis and Afghans currently in Turkey, all fleeing the horrible conditions in their countries. The fact remains, how in the world will the EU be able to support these poor families with employment, housing and food? And let’s not forget something that’s equally important are the issues with conflicting cultures living side by side. The question remains, in the near future, will this turmoil result in an economic crisis hitting all of Europe? In my opinion it HAS to be a GREAT concern for the powers to be of both France and Germany. There are so many issues that need to be addressed in the European Community, and NO-ONE seems to have any answers.

The smart long term gold investor will take into account all these worldwide news items and have the ability to make a smart decision in determining what percentage of his or her portfolio should be in physical gold or silver.

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


2016 Has a Silver Lining

The Market Gage - Dillon Gage's Precious Metals Newsletter

While it seems that the financial media is rightfully focusing on the uplift in the gold market, let’s not leave silver back at the proverbial train station. Silver, in fact, has done even better YTD in 2016. While gold is up approximately 27% YTD, silver has rocketed up in value over 44% YTD. Many investors are happy to use silver as a hedge against any future volatility in the gold market. One precious metal protecting another can elicit an amazing outcome.

It’s not just physical silver that’s catching investor’s eyes. The silver exchange traded fund (ETF) market has had a record-setting amount of activity so far in 2016, what we call “inflow.” ETF holdings in ounces have jumped from 43 million ounces to 662 million—a record high. Net long position of COMEX silver futures are also skyrocketing, from over 6,200 contracts at the close of 2015 to around 80,000. Now that’s a shiny silver lining if there ever was one!

In the coin market, interest in silver is up almost 30% over 2015—which was a record-setting year of its own. Portfolio diversification is a great fit for silver due to its fundamentals.

This Morning’s Market Snapshot

After taking a hit on Friday from the positive U.S. Jobs reports, all four metals managed to find and maintain a :

  • Gold– Slightly off Friday, but still I the mid-$1,330s
  • Silver– After dipping about $.20, Silver has regained its berth in the mid-$19.80s
  • Platinum– This is the lone metal that has almost regained its pre-Jobs report level and is sitting at the mid-$1,150s.
  • Palladium– This metal has struggled a bit dipping to $690 overnight, currently hovering at $695.

Here’s hoping your week gets off to a wonderful start…

Walter Pehowich is on vacation, so today’s commentary was compiled by Dillon Gage Staff.

Disclaimer: This editorial has been prepared by the staff of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


American Eagle Sales as of 8/4/2016

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on August 4th. Changes below reflect the sales since our last report on July 29th.

Gold
Coin Sales in oz. /#coins + from 7/28/2016
One oz.
441,000
441,000
6,500
6,500
Half oz.
24,000
48,000
000
000
Quarter oz.
24,000
96,000
000
000
Tenth oz.
56,000
560,000
500
5,000
Total
545,000
1,145,000
7,000
11,500
Silver
Coin Sales in oz. /#coins + from 7/28/2016
One oz.
27,695,500
27,695,500
75,000
75,000

Jobs Report Bursts A Strong Precious Metals Week

The Market Gage - Dillon Gage's Precious Metals Newsletter

It’s Friday, and up until this morning’s jobs report (more on that later), the week just kept getting better and better in the precious metals market. Yesterday saw news reports both at home and abroad predicting the continued strength of gold as an investment.

Let’s start overseas as we continue to see sustained fallout from England’s Brexit decision back in June. It’s a pretty gloomy financial outlook for Britain, as the Bank of England just slashed its main interest rate down to 0.25%–a record low. In response, the Bank has begun quantitative easing procedures of its own by expanding government bond purchases. So far, the Sterling has dropped another 1.5% in value, but spot gold shot up 0.5%.

Outlooks such as this one continue to prop up gold on the global stage. As of this writing, fully one quarter of all global bonds are offering negative yields. Many experts are openly predicting a steady march of $1,500 per ounce over the next six months. And with gold up 29% YTD, it sure seems possible that this ride will continue.

Lastly, geopolitical events around the world are still causing enough regular concern to continue lifting gold to new heights. What we’re seeing is this–the demand in the global currency markets has so far allowed gold to witness the biggest rally in U.S. dollar terms since 2008. That’s big.

BUT now for the big news on America’s shores this morning. U.S. job numbers are in and they are big. The Labor folks report 255,000 new jobs for July, a much stronger rate from just two months ago. To put into perspective how big a surprise this is to the experts, economists in a Reuter’s poll had predicted an increase of just 188,000 for July. And this is the second straight month of job growth. All eyes and ears will be on Janet Yellen later this month when she addresses the Jackson Hole monetary policy symposium as this sustained growth is once again inspiring talk of an interest rate hike later this year.

The precious metals market responded to news by stepping off their strong numbers. Here’s a look at the stats:

  • Gold-The yellow metal dipped more than $10 an ounce. Currently holding in the mid 1,340s
  • Silver-The metal is sticking its toe below the $20 mark, a place it has rarely visited over the past month.
  • Platinum-Another metal that dipped more than $10 when the jobs report was announced, but it is still hanging tough well above $1,100
  • Palladium-After spiking above $700, Palladium slumped this morning to just below that number on the jobs news.

Have a wonderful weekend and stay tuned…

Walter Pehowich is on vacation, so today’s commentary was compiled by Dillon Gage Staff.

Disclaimer: This editorial has been prepared by the staff of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


A Lot of This Week’s Data Could Impact Gold

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold slightly lower this morning after settling yesterday at a two-year high. There’s a lot of market data to be absorbed later this week that could have an impact on the price of gold.

First off is Thursday’s Bank of England’s meeting. The BoE is expected to cut interest rates for the first time in seven years. The reason is the disappointing UK economic data of late, following the U.K.’s vote to leave the EU. The market is expecting the BoE’s Monetary Policy Committee to deliver a message that easing is necessary to counter the economic hit experienced after the Brexit-vote. The last time the BoE had a rate change was March 2009, when the decision was made to lower the rate to 0.5 percent during the worldwide financial crisis.

ADP jobs report released this morning shows an increase of 179,000. The National Employment report is a measure of non-farm private sector employment figures. This report had no effect on the price of gold this morning.

The market also awaits Friday’s U.S. employment figures. Many market participants question the accuracy of these numbers as seen in May only 38,000 jobs were created then in June 272,000. What caused the big difference month to month? The instant the May job number was released, reported way below the streets expectations, we saw gold rally $26 dollars in a blink of an eye. So many professional gold traders will just wait till the numbers are released on Friday before taking a position again.

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Dollar Index Drop Boosts Gold

The Market Gage - Dillon Gage's Precious Metals Newsletter

The price of gold opens up the trading week slightly lower on light trading volume overnight. Gold received a boost last week from a weaker dollar index. The dollar index fell Friday to 95.38, the lowest since July 5th this year.

Second quarter GDP reported at 1.2 percent, way below the estimate of 2.6 percent. This report continues to weaken the FED hands on the prospect of raising rates anytime soon. So in turn, with that news and the weaker the dollar, the price of gold rallied to current levels seen today. Now with no pending news for the market to digest, I expect gold to trade in a tight range again at these levels.   

 Silver still well supported over the $20 dollar level, even with many dealers sitting on excess inventory. Dealers continue to lower their bids on silver products, as some indicated this morning they are holding more inventory then they want to. As the market experiences the summer doldrums, I expect dealers will be lowering their bids further as some indicate enough is enough. Lowering their bids to unattractive levels will result in clients looking elsewhere for better prices. That’s a strategy that might come back to haunt them, but in some cases they have no choice.

The price of oil is on a slippery slope once again as some traders are expecting the price to test the $ 40 level. IEA (the International Energy Agency) reported that they estimated the second quarter 2016 worlds’ oil supply of crude exceeded demand by 200,000 barrels a day.   A strong case for lower prices is ahead.  

A couple of Wall Street Gold traders I spoke to this morning tell me they  will be trading oil today instead of gold. As one guy put it, trying to be funny, “I’m going in for an oil change today.” The traders I spoke with believe that with the attractive volatility, trading oil seems more exciting and will give them better opportunities to make a short term profit.

 Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.


Bank of Japan Disappoints The Market

The Market Gage - Dillon Gage's Precious Metals Newsletter

Bank of Japan disappoints the market this morning after announcing it has eased its monetary policy by increasing its purchases of exchange traded funds, but left interest rates unchanged. This news turned out to be a non-event mover for the price of gold. As I start to write this report this morning, we see the price of gold virtually unchanged, at the so called technical tight rope at the $1,332 level.

Continue reading “Bank of Japan Disappoints The Market” »


American Eagles Sales as of July 29, 2016

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on July 28th. Changes below reflect the sales since our last report on July 22th.

Gold
Coin Sales in oz. /#coins + from 7/21/2016
One oz.
434,500
434,500
6,000
6,000
Half oz.
24,000
48,000
000
000
Quarter oz.
24,000
96,000
500
2,000
Tenth oz.
55,500
555,000
2,500
25,000
Total
538,000
1,133,500
9,000
33,000
Silver
Coin Sales in oz. /#coins + from 7/21/2016
One oz.
27,620,500
27,620,500
175,000
175,000

Precious Metals Quiet This Morning Ahead of Fed Decision

The Market Gage - Dillon Gage's Precious Metals Newsletter

Metal markets are quiet this morning ahead of the Fed decision at 2pm EDT today. With little chance of a rate hike this afternoon, the market awaits to hear the comments from the Fed committee. With all the encouraging economic data of late, we expect the committee to express a hawkish tone which would increase the chance of a rate hike in September. I still believe that even with some encouraging economic data, the Fed will be hard pressed to raise rates anytime this year with the rest of the world’s economies struggling at best.

Continue reading “Precious Metals Quiet This Morning Ahead of Fed Decision” »


Gold Declines for the Second Week

The Market Gage - Dillon Gage's Precious Metals Newsletter

Gold net long spec positions declined for the second week in a row as more nervous longs head for the exit. On the positive side of the ledger, in the last two weeks ETF’s inflow continue in gold, but at a slower pace. Nonetheless gold trades at a 4-week low this morning as some Wall Street Traders are calling the gold market to test the $1,300 dollar level ahead of the Fed meeting later this week.

Continue reading “Gold Declines for the Second Week” »


Consolidation, Sideway Trading…Boring?

The Market Gage - Dillon Gage's Precious Metals Newsletter

Depending on who you are, whether a trader or investor in this market, we all use different terms to describe this type of price movement in gold. Technical traders call it consolidation, fund managers call it sideway trading and financial advisors call it boring.

Whatever term you prefer to use, the bottom line is the market is just sitting here looking for a direction. So the question remains, what bit of news would propel the market in one direction or the other?

Continue reading “Consolidation, Sideway Trading…Boring?” »


American Eagles Sales as of July 21, 2016

U.S. Mint Year to Date Sales of Silver and Gold American Eagles

The following chart includes the year to date totals from the U.S. Mint as of 5pm on July 21st. Changes below reflect the sales since our last report on July 15th.

Gold
Coin Sales in oz. /#coins + from 7/14/2016
One oz.
428,500
428,500
7,000
7,000
Half oz.
24,000
48,000
1,000
2,000
Quarter oz.
23,500
94,000
1,000
4,000
Tenth oz.
53,000
530,000
1,500
15,000
Total
529,000
1,100,500
9,500
26,000
Silver
Coin Sales in oz. /#coins + from 7/14/2016
One oz.
27,445,500
26,445,500
500,000
500,000

Everything You Need to Know about Rio’s Olympic Medals

Olympic2016
Dillon Gage Metals Talks Size, Composition and Value

ADDISON, TEXAS (July 21, 2016) – Dillon Gage Metals, an international precious metals wholesaler, is ready to educate the public on everything they need to know about the Olympic medals slated to be awarded at the 2016 Summer Games in Rio. And some of the facts may surprise you.

For openers, there’s the composition breakdown on the precious metals in each medal. The gold medals awarded to the best of the best are pretty much gold in name only. In reality, 92.5 percent of their composition is actually silver. Only one percent is actual gold (plated) with the remainder made of bronze. Silver medals are 96 percent silver and the bronze medals are approximately 97 percent copper.

Continue reading “Everything You Need to Know about Rio’s Olympic Medals” »