Lunch Box Bomb Scare Turns into Bullion Chase

Thursday, November 21, 2013 2:21:01 PM America/Toronto

By Sujoy Dhar | November 20, 2013

Two lunch boxes hidden in the toilets of a Jet Airways plane triggered first a bomb scare and then a smuggling probe as the tins were found to contain 12 gold bars each, a senior customs official said on Wednesday.

Smuggling is on the rise into India, one of the world's biggest buyers of gold, after the government raised import duty to a record 10 percent and slapped restrictions which have shrivelled supplies into the domestic market.

The Jet Airways plane had arrived at Kolkata's international airport from Patna on a domestic flight, but normally operates between the gold trading hub of Dubai and Mumbai, home to India's largest gold market. It was undergoing routine cleaning when maintenance staff discovered the two small tins.

"There was a bomb scare immediately when the bags were spotted in two separate toilets at round 1 a.m., but later we found they contained 12 pieces of gold bars in each," Additional Commissioner of Customs at the airport, Rameshwar Meena, told Reuters.

"The gold bars are from Dubai for sure. The flight had come from Patna to Kolkata last, but its basic route is Dubai-Mumbai."

The bars weigh 1 kg (2.2 pounds) and are about the same size as a portable smart phone. Meena said the haul was worth 73.68 million rupees. Customs officials said there had been five cases over two months involving a total 100 kg.

"We feel that what we catch is less than 10 percent or so and there are so many groups operating, it is impossible for us to keep a check," said an official at the revenue intelligence department, who asked not to be identified as he is not authorised to speak to the media.

Finance Minister P. Chidambaram said this month the measures had prompted a slight rise in smuggling, but his officers had said no one could bring in more than 5 kg.

"You cannot carry more than 5 kg of gold and still go undetected," he told CNBC TV18.

At Kolkata, Meena said investigators were questioning airline and airport staff. Profiles of passengers on the flight from Dubai were being checked.

The revenue intelligence officer said a man had been arrested in an earlier case on suspicion of concealing 5 kg of gold in the toilet of an Air India plane in Dubai. He left the plane in Mumbai and another passenger removed the gold after it had flown on to Goa.

Crews are now on alert for passengers lingering in the loo.

"We are educating (our staff) about aircraft maps of how toilets are in an Airbus or a Boeing. We are also asking the aircraft crew to tip us off about people who spend slightly more time in toilets," the revenue intelligence officer said.

Comments | Posted By Jamie Cohen

Even when they get it right, they get it wrong

Tuesday, October 29, 2013 9:58:18 AM America/Toronto

For those of you walking to into Canadian banks lately, you will notice that some of the Canadian banks have started marketing the selling of gold and silver bullion. It sounds really great to be able to purchase bullion from your existing bank.

However….

If you explore further you will find:

  • The premiums are outrageous, they are much more expensive than Canadian Bullion Services
  • An example; AS of Oct 28 2013, CIBC is currently charging approximately $5.50 premium  per ounce on Silver Maple Leaf coins compared to Canadian Bullion Services which are charging approximately $3.00 premium per ounce on Silver Maple Leafs. CIBC is currently charging approximately $112.00 premium per ounce on Gold Maple Leaf coins compared to Canadian Bullion Services which are charging approximately $59.00 premium per ounce on Gold Maple Leafs
  • You can only buy up to $9,500 CAD in any 48 hour period
  • You are forced to buy in Canadian Dollars and the exchange rates are awful!  Three to four percent above the futures price compared to the one percent fee when dealing with CBS, which unlike the banks accepts US funds or Canadian.
  • The other banks are not much different in there extreme pricing and exchange rates
  • The banks charge an administrative fee whereas CBS does not.
  • The banks offer very little if any customer service whereas CBS provides weekly newsletters, one on one communication with bullion specialists
  • The banks make the whole process quite difficult and confusing whereas CBS have worked very hard to make purchasing bullion easy.
  • The banks have an extensive application process which requires disclosing your Social Insurance Number and keep this info on file which may be shared with government agencies.  CBS requires very little information and do not ask for SIN for online orders and only provide information to government agencies if a police investigation is underway about a specific client.

 The high premiums charged by the banks remind me of converting  money from Canadian dollars to U.S. Dollars or vice versa. Other than the airport, probably the worst place to convert money is at the local branch of a bank. The best place to convert money is a specialized FOREX dealer.  It goes the same for buying gold and silver bullion. If you want the best price and superior service, you need to buy from Canadian Bullion Services.

 

Comments | Posted By Jamie Cohen

COMMODITIES-Gold rallies on weak U.S. jobs data; Brent oil up

Wednesday, October 23, 2013 10:35:27 AM America/Toronto

By: Barani Krishnan | NEW YORK, Oct 22 (Reuters)

Gold surged on Tuesday after weaker-than-expected U.S. jobs creation in September boosted the precious metal's safe haven edge, while the dollar's sharp fall against the euro lifted other commodities priced in the U.S. currency.

Geopolitical and supply-demand concerns pushed some markets higher. Benchmark Brent crude oil out of Europe edged higher after news of a deterioration in relations between the United States and key OPEC oil producer Saudi Arabia.

U.S. crude prices, however, fell after the U.S. Energy Information Administration reported higher inventories of oil. That drop weighed on the Thomson Reuters/CoreCommodity CRB index, which counts on U.S. crude as its main component. The CRB closed nearly a quarter percent lower, despite some sharp gains in several markets it tracked.

Nickel and silver led the advancers on the CRB, rising at least 2 percent each. Cocoa, copper, lean hogs, aluminium and gold all rose about 1 percent or more. 

Gold's most active futures contract on New York's COMEX settled up 2 percent at $1,342.60 an ounce after surging to a three-week high of $1,344.70.

Gold rallied while the dollar fell to its lowest in nearly two years against the euro after the soft U.S. jobs data for September raised expectations the Federal Reserve will have to stimulate the economy at the current pace into 2014.

U.S. nonfarm payrolls rose by 148,000 last month, the Labor Department said, well below the 180,000 forecast in a Reuters poll. The data raised worries the world's largest economy had lost momentum even before a government shutdown this month.

"We were not even close to the 180,000 number ... the main takeaway is that Fed tapering is still a long way away, probably not for this year and that's the reason why everything shot up - equities, commodities and gold in particular," said Robin Bhar, a metals analyst with Societe Generale in London.

"The next 24 hours are crucial because on what we have just seen, gold should hold and even move higher if the dollar weakens."

The spot price of bullion traded at above $1,340 an ounce by 4:00 p.m. EDT (2000 GMT) after touching a session high at $1,344.46.

Oil's benchmark Brent crude rose after a source close to Saudi policy said Riyadh would make a "major shift" in dealings with the United States in protest against Washington's perceived inaction over the Syria conflict and U.S. overtures to Iran.

The planned change in ties between the energy superpower and its traditional U.S. ally would have wide-ranging consequences, including on arms purchases and oil sales, the source said.

Benchmark Brent crude oil out of Europe's North Sea closed up 33 cents, or 0.3 percent, at $109.97 a barrel, after a session peak at $110.94. U.S. crude settled down $1.42, or 1.4 percent, at $97.80 a barrel. 

Comments | Posted in Blog By Jamie Cohen

LBMA CEO Sees Record Interest in 'Good Delivery' Approval

Tuesday, October 1, 2013 10:02:00 AM America/Toronto

Dow Jones & Company, Inc. | October 1, 2013

The number of gold and silver refiners seeking the London Bullion Market Association's official stamp of approval for "good delivery" is at record levels, driven largely by increased scrutiny on the ethical sourcing of precious metals, the LBMA's chief executive said Tuesday.  

Comments | Posted By Jamie Cohen

How to choose your Canadian bullion dealer

Friday, August 9, 2013 9:36:20 AM America/Toronto

There are several bullion dealers out there where you can buy silver and gold coins from, the questions is who.  These are some of the most important questions you should be asking.

-          Do does the dealer have a variety of gold and silver coins and bars?

-          Confirm they only sell what they have in stock?

-          Did you do a google search on the bullion dealer?

-          How quick is the shipping?

-          Do they have a physical office you can visit?

-          Do they have a variety of ways you can pay for your bullion?

 

Comments | Posted By Jamie Cohen

What You Need to Know about Gold and Silver - Week 2

Friday, August 2, 2013 11:58:47 AM America/Toronto

Our 2nd week will focus on bullion bars: silver bars and gold bars

Read More
Comments | Posted By Jamie Cohen

What You Need to Know about Gold and Silver - Week 1

Friday, July 26, 2013 11:04:21 AM America/Toronto

This week we will be starting a 15 week series of commentary on the pros and cons of having exposure to gold and silver in different ways. The 1st week will focus on hold silver coins and gold coins:

Read More
Comments | Posted By Jamie Cohen

The Astonishing news out of Singapore this Week

Tuesday, June 11, 2013 2:27:37 PM America/Toronto

The Deutsche Bank has launched its second-biggest gold-storage vault in Singapore that can hold up to 200 tonnes of the metal as it looks to capture surging global demand for physical bullion.

 

Not surprisingly, it has been reported that Deutsche Bank has been the biggest buyer of physical gold and silver over the last few months as gold and silver dropped about 20%

Of course, we all know that JPMorgan opened a similar facility at the Singapore Freeport in 2010.

Comments | Posted in Blog By Jamie Cohen

Gold Bears Pull $20.8 Billion as BlackRock Says Buy: Commodities

Monday, May 13, 2013 4:01:00 PM America/Toronto

By Elizabeth Campbell - May 13, 2013 9:04 AM ET

Is the Party Over for Commodities?

Hedge funds increased bets on lower gold prices after investors pulled a record $20.8 billion from bullion funds this year while BlackRock Inc. (BLK), the world’s biggest money manager, said it’s still bullish.

Speculators held 67,374 so-called short contracts on May 7, 6.4 percent more than a week earlier, U.S. Commodity Futures Trading Commission data show. The net-long position dropped 10 percent to 49,260 futures and options. Net-bullish wagers across 18 U.S.-traded raw materials climbed 5.8 percent to 582,265, with gains for cocoa, cotton and hogs.

Gold is having its worst start to a year since 1982 after dropping 15 percent and sliding into a bear market in April. Holdings in exchange-traded funds backed by bullion tumbled to the lowest since July 2011 even as central banks print money on an unprecedented scale to boost growth. BlackRock’s President Robert Kapito said May 9 he would still buy the metal, echoing billionaire John Paulson, who’s sticking with a bullish view even after losing 27 percent in his Gold Fund last month.

“People have been told the world is going to end for five years, and it hasn’t, so they’re finally moving on,” said James Paulsen, the Minneapolis-based chief investment strategist at Wells Capital Management, which oversees $325 billion of assets. “So even when crisis flashes now, you don’t get the same upside, and then in good times, you get more downside, and that’s what you’re getting in gold as the Armageddon premium is coming out.”

 

Gold Declines

Gold futures fell 1.9 percent to $1,436.60 an ounce on the Comex in New York last week. The Standard & Poor’s GSCI Spot Index of 24 commodities slid 0.3 percent, and the MSCI All-Country World of equities added 0.9 percent. The dollar climbed 1.2 percent against a basket of six major currencies. A Bank of America Corp. Index shows Treasuries dropped 0.6 percent. Gold for June delivery fell 0.3 percent to $1,432.60 an ounce by 9:02 a.m. in New York.

Bullion slumped last week after a May 9 government report showed the average number of Americans filing for jobless benefits over the past month dropped to the lowest since November 2007. Federal Reserve Bank of Philadelphia President Charles Plosser said that day unemployment will probably decline to 7 percent at the end of 2013 and he would favor reducing the Fed’s $85 billion monthly pace of bond purchases next month. Plosser doesn’t vote on policy this year.

Fund Outflows

Money managers withdrew $1.27 billion from gold and precious-metals funds in the week ended May 8, according to Cameron Brandt, the director of research for Cambridge, Massachusetts-based EPFR Global, which tracks money flows. This year’s outflows of $20.8 billion are the largest withdrawals since the firm began tracking the data in 2000.

A majority of the 38 analysts surveyed by Bloomberg last month predicted the metal will decline in 2013, ending a 12-year bull run. Billionaire investor Warren Buffett said May 2 that gold has no appeal even after the rout. The drop in global ETP holdings wiped $37.4 billion of value from the assets this year, while more than $4.6 trillion has been added to the value of global equities, data compiled by Bloomberg show.

Paulson favors the metal even after his Gold Fund saw declines of about 47 percent this year, according to two people familiar with the matter. Paulson & Co. is the biggest investor in the SPDR Gold Trust (GLD), the largest bullion ETP. The metal helps diversify portfolios, BlackRock’s Kapito said in an interview with Tom Keene on “Bloomberg Surveillance.” Kapito said he would “still be a buyer of these short-term technical blips.” BlackRock is the top investor in the iShares Gold Trust.

India, China

Physical demand for gold drove an 8 percent gain in prices from a two-year low on April 16. Indian imports reached more than 100 tons in April, now valued at $4.7 billion, and shipments probably will top that again this month, according to refiner MMTC-PAMP India Pvt. The country’s gold imports were 860 tons last year, the London-based World Gold Council estimates. Consumption in China rose 26 percent in the first quarter from a year earlier, the China Gold Association said May 7.

Gold surged 62 percent since the end of 2008 as the Fed was joined by central banks in Europe and Japan in printing unprecedented amounts of money, almost doubling sovereign debt to more than $23 trillion, a Bank of America index shows. Twelve analysts surveyed by Bloomberg expect prices to rise this week, with 10 bearish and five neutral.

‘Lining Up’

“People are still lining up in China and India to buy the physical gold,” said John Kinsey, who helps manage about C$1 billion at Caldwell Securities Ltd. in Toronto. “Europe has got a stimulus program. The U.S. has a stimulus program. Japan has a stimulus program. You’d think there would be huge inflation coming with all this debt that’s being printed.”

Even as economists at Morgan Stanley and Credit Suisse Group AG predict policy makers will keep deploying stimulus, consumer prices have remained stable. Inflation expectations as measured by the break-even rate for five-year Treasury Inflation Protected Securities on April 18 reached the lowest since November.

Deutsche Bank AG cut its outlook for this year’s average gold prices by 6.4 percent to $1,533 on May 10. That would be the lowest annual average since 2010. The bank said last month the metal could drop to as low as $1,050.

Funds raised wagers on costlier crude oil by 5.5 percent to 204,534 contracts, the highest in five weeks, the CFTC data show. Investors trimmed bets on declining copper prices to a net-short position of 16,798, from 23,368 a week earlier.

Farm Bets

A measure of speculative positions across 11 agricultural products jumped 19 percent to 236,184 contracts, a fourth consecutive gain. Wagers on a corn rally jumped 35 percent to 61,632 futures and options. Investors boosted their net-short holding in wheat to 10,444, from 5,779 a week earlier.

The S&P GSCI Agriculture Index of eight commodities fell 1.7 percent last week, the third drop in four weeks. The gauge fell 5.5 percent this year. Global farmers will harvest the biggest grain and soybean crops ever, boosting food reserves, the U.S. government said May 10. U.S. corn inventories will double as farms recover from the worst drought since the 1930s.

“The decline in the commodity market that we’ve seen in the last several years coincides with inflation risk really being low,” said Nelson Louie, the global head of commodities at New York-based Credit Suisse Asset Management, who helps manage $10.9 billion. “Over the last several years, investors have gone into gold as market risk has become more elevated, but more recently as some of these issues have subsided, there’s been an unwinding of that trade.”

Comments | Posted By Jamie Cohen

2013 American Eagle Bullion Coins Skyrocket in April Sales

Wednesday, May 8, 2013 9:37:00 AM America/Toronto

2013 American Eagle Bullion Coins Skyrocket in April Sales

by Mike Unser on May 6, 2013 

United State Mint sales of bullion coins soared in April, a standout for a month that tends to be historically slower for the 27-year-old American Eagle gold and silver coin series.

 Demand is brisk for U.S. Mint bullion coins. In comparing four-month totals for this year against sales from last year, it took until October to match current 2013 Gold Eagle sales, mid-July for similar 2013 Silver Eagle sales and all of last year to equal 2013 Gold Buffalo coin sales.

Demand for physical bullion surged last month as gold and silver prices plummeted. Sales of both U.S. Mint 22-karat gold coins and 99.9% pure silver coins hit an all-time high for the month of April, and they were sharply higher than in March and from the same time last year.

2013 American Eagle Gold Bullion Coins

April sales of American Eagle gold coins rallied to 209,500 ounces, surging 237.9% atop March sales of 62,000 ounces and soaring 947.5% higher than sales of 62,500 ounces from a year ago. The pace was the quickest for a month since the December 2009 tally of 231,500 ounces.

Buying was so brisk that the U.S. Mint depleted its inventory of the smallest one-tenth ounce Gold Eagle. The Mint had to temporarily suspend its sales on April 22.

Year-to-date Gold Eagle sales total 502,000 ounces. Last year sales did not top 500,000 ounces until October 16.

 

2013 American Eagle Silver Bullion Coins

March sales of American Eagle silver coins jumped 4,087,000 ounces, notching a sixth highest all-time monthly ranking. The level is 21.8% higher than the prior month’s 3,356,500 ounces and 168.9% stronger than the same time last year when sales reached 1,520,000 ounces.

For the January through April period, Silver Eagle sales stand at 18,310,000. The bullion coins have never hit 18 million so early in a year. Last year sales did not top 18.3 million until July 16.

American Buffalo Gold Bullion Coins

April sales of 24-karat American Buffalo gold coins reached 37,000 ounces, more than tripling the 11,000 ounces sold in March and the 9,000 ounces from April 2012.

Year-to-date Gold Buffalo sales total 132,000 ounces, already matching annual 2012 sales.

America the Beautiful Five Ounce Silver Bullion Coins

The U.S. Mint has not yet released any of the 2013-dated America the Beautiful Five Ounce Silver Bullion Coins. All older-dated inventory sold out on March 1, 2013. Year-to-date sales are at 63,100 coins, which equates to 315,500 ounces.

Sales Across All U.S. Mint Bullion Products

Below is a breakdown of the latest U.S. Mint bullion coin sales by product type, month and year-to-date. For comparative purposes, added are monthly sales totals from a year ago. All sales are in the number of bullion coins sold, not in the amount of ounces.

Monthly and YTD Sales US Mint Bullion Coins
(# of coins)

 

Last Year April

 

January 2013

February 2013

March 2013

April 2013

YTD Sales

American Eagle Gold (1 oz)

19,000

124,500

68,000

54,000

187,500

434,000

American Eagle Gold (1/2 oz)

0

17,000

5,000

4,000

14,000

40,000

American Eagle Gold (1/4 oz)

2,000

24,000

12,000

10,000

26,000

72,000

American Eagle Gold (1/10 oz)

5,000

110,000

70,000

35,000

85,000

300,000

American Buffalo Gold (1 oz)

9,000

72,500

11,500

11,000

37,000

132,000

ATB Silver Coins (5 oz)

200

28,960

14,340

19,800

0

63,100

American Silver Eagle

1.52M

7.498M

3.3685M

3.3565M

4.087M

18.31M

Comments | Posted By Jamie Cohen