Golden Minerals Company

In April, motivated by what I consider pure maliciousness, the SEC initiated a “cease and desist” administrative proceeding it deemed “necessary for the protection of investors and in the public interest” against Egan-Jones Ratings Co., a privately owned, 20-person firm based in Haverford, Pennsylvania, and against its principal owner, Sean Egan.

Egan-Jones, founded in 1995, is one of nine ratings companies that the SEC has accredited as “nationally recognized,” allowing the firm to rate the debt of sovereign nations, companies and asset-backed securities, among others. Notably, it is the only one of the nine that gets paid by investors instead of by the issuers of securities.

The bigger and better-known ratings companies -- Standard & Poor’s (owned by McGraw-Hill Cos. (MHP)), Moody’s Corp. (MCO) and Fitch Ratings Ltd. -- are paid by the Wall Street banks that underwrite the debt securities of corporate issuers. That is, the companies are beholden to the sellers of the products they are supposed to pass judgment on, not the buyers. That’s akin to allowing the Hollywood studios to pay the nation’s film critics for their opinions.

This op-ed piece showed up on the Bloomberg website at 4:33 Mountain Time yesterday...and I thank Manitoba reader Ulrike Marx for our first story in today's column. It's worth skimming. The link is here.

Regardless of who wins the presidential election in November or what compromises Congress strikes in the lame-duck session to keep the economy from automatic tax increases and spending cuts, 160 million American wage earners will probably see their tax bills jump after Jan. 1.

That is when the temporary payroll tax holiday ends. Its expiration means less income in families’ pocketbooks — the tax increase would be about $95 billion in 2013 alone — at a time when the economy is little better than it was when the White House reached a deal on the tax break last year.

Independent analysts say that the expiration of the tax cut could shave as much as a percentage point off economic output in 2013, and cost the economy as many as one million jobs. That is because the typical American family had $1,000 in additional income from the lower tax.

This piece showed up on The New York Times on Sunday...and I thank Donald Sinclair for sending it. The link is here.

Chairman Ben S. Bernanke defended the Federal Reserve’s unprecedented bond buying in his first comments since the Fed renewed the purchases last month, saying the program will spur growth, cut unemployment, help savers and support the dollar.

The central bank will sustain record stimulus even after the expansion gains strength, and policy makers don’t expect the economy to remain weak through 2015, Bernanke said today in a speech in Indianapolis. The U.S. probably won’t fall back into a recession even with growth too weak to reduce a jobless rate stuck above 8 percent since February 2009, he said in response to an audience question.

“We expect the economy to continue to grow,” Bernanke said to the Economic Club of Indiana. “Our concern is not really a recession. Our concern is that growth will continue but at a pace that’s insufficient to put people back to work.”

“We expect that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the economy strengthens,” Bernanke said in the speech. Still, policy makers’ forecast for the main interest rate “doesn’t mean that we expect the economy to be weak through” mid-2015, Bernanke said.

Based on the above, I'd say that we'll have QE for the next five years at least, even if inflation begins to raise its ugly head...and Bernanke is obviously prepared to destroy the dollar to get the job done. This Bloomberg story, complete with a new headline, was posted on their website mid-afternoon Mountain Time yesterday...and I thank Donald Sinclair for his second story in a row. The link is here.

"Transparency is not political interference," The New York Sun notes today in an editorial scolding Federal Reserve Chairman Ben Bernanke for seeming to warn Congress to stay out of what is actually Congress' proper business.

"It is way past time for the Congress to open up the Fed's operations for a proper inspection. The audit-the-Fed bill, more formally known as HR 459 or the Federal Reserve Transparency Act, passed the House by vote of 327 to 98. Does one think the House could be trying to tell the chairman something? Where does the Federal Reserve chairman come off entering the political fray to campaign against such a measure by the Congress that created the Fed?"

Of course transparency is a step toward political interference. But so what? As U.S. Rep. Ron Paul has noted, the Fed, unelected, in effect appropriates far more money than the elected branches of government. Besides, there is politics in everything; the only question is whether it is public, democratic politics or private, undemocratic politics, the latter being the Fed's kind.

The Sun's editorial is headlined "Bernanke Warns His Creator". I plucked it from a GATA release yesterday...and I thank Chris Powell for wordsmithing the above introduction. It's worth reading...and the link is here.

In nearly six decades of running a dairy in central California, Mary Cameron made a name for herself in a male-dominated industry: She led several dairy organizations and was honored as Outstanding Dairy Producer of the Year.

But the 82-year-old Cameron — who still drives a tractor and supervises her Hanford dairy — is on the brink of losing her life's work. She can no longer pay the bills. Her bank has classified her loan as distressed. And she can't afford enough feed for her 900 milking cows and 1,000 heifers.

"I have been in this business for 57 years and I have never been in financial trouble like I am right now," said Cameron, who runs the Atsma-Cameron Dairy with her two sons. "I'm on the verge of bankruptcy. It's horrible and inexcusable."

Since 2008, California has lost nearly 300 dairies, with 1,668 remaining as of January, according to the California Department of Food and Agriculture. There are no official estimates on how many dairies have shuttered in 2012 — but interviews with dairymen and experts indicate several hundred dairies could be in danger of going under.

This 2-page AP story was picked by news.yahoo.com Internet site on Saturday. You may think that this is a strange story for a must read, but I was raised on a farm...and as they say, you can take the boy out of the country, but you can't take the country out of the boy. This story goes right to the heart of the inflationary pressures that are boiling just under the surface for food prices...not only abroad, but here at home in North America. I thank Washington state reader S.A. for digging this story up on our behalf...and the link is here.

Tens of thousands of Spaniards and Portuguese rallied in the streets of their countries’ capitals Saturday to protest enduring deep economic pain from austerity measure, and the demonstration in Madrid turned violent after Spaniards enraged over a long-lasting recession and sky-high unemployment clashed with riot police for the third time in less than a week near Parliament.

The latest violence came after thousands of Spaniards who had marched close to the Parliament building in downtown Madrid protested peacefully for hours. Police with batons later moved in just before midnight to clear out those who remained late because no permission had been obtained from authorities to hold the demonstration.

Some protesters responded by throwing bottles and rocks. An Associated Press photographer saw police severely beat one protester who was taken away in an ambulance.

Spain’s state TV said early Sunday that two people were hurt and 12 detained near the barricades erected in downtown Madrid to shield the Parliament building. Television images showed police charging protesters and hitting them with their batons,

This story showed up on the france24.com Internet site on Sunday...and I thank Roy Stephens for his first offering in today's column. The link is here.

Here's how bad the economic crisis has gotten in Spain, according to The New York Times' Suzanne Daley:

"So pervasive is the problem of scavenging that one Spanish city has resorted to installing locks on supermarket trash bins as a public health precaution."

The need to ask for help is deeply embarrassing, Daley write.

Some families go to food banks in neighboring towns so their friends and acquaintances will not see them.

This story was posted on the businessinsider.com website last Wednesday...and I thank Bill Busser for sending it our way. The link is here.

Spain plans to borrow 207.2 billion euros ($266.5 billion) next year, the Budget Ministry said today, as pressure builds for Prime Minister Mariano Rajoy to tap the European rescue fund instead of financial markets.

Spain’s debt will widen to 90.5 percent of gross domestic product in 2013 as the state absorbs the cost of bailing out its banks, the power system and euro-region partners Greece, Ireland and Portugal. This year’s budget deficit will be 7.4 percent of economic output, Budget Minister Cristobal Montoro said at a press conference. Spain’s 6.3 percent target will be met because it can exclude the cost of the bank rescue, he said.

Spain’s borrowing plans may test investors’ willingness to continue financing the government with the European Central Bank waiting to buy the country’s debt should Rajoy agree to conditions. The government this past week unveiled 43 measures designed to boost economic growth that Economic and Monetary Affairs Commissioner Olli Rehn said go beyond the European Union’s recommendation for Spain’s restructuring.

This article showed up on the businessweek.com Internet site on Sunday...and I thank Washington state reader S.A. for his second story in today's column. The link is here.

If French President François Hollande thinks he can assuage the bond markets by dishing out tax-heavy austerity instead of genuine reform, he has been given very bad advice.

His tragically-misguided budget offers no strategic plan to reverse -- or even to stop -- thirty years of slow national decline. He offers no worthwhile measures to slim the Leviathan state, now a Nordic-sized 55pc of GDP, without Nordic labour flexibility or Nordic free markets.

He does not tell us how he will stem the slide in France’s share of eurozone exports over the last decade, down from 17pc to 13pc, or what he will do about the disastrous swing in France’s trade balance from a surplus of 2.5pc of GDP to a deficit of 2.4pc since 1999.

He proposes nothing credible to restore France’s viability within EMU, or to stop public debt spiralling beyond 90pc of GDP. Instead he has served up the most drastic retrenchment in forty years, at the worst possible time, and in the worst possible way. And markets are supposed to applaud?

Ambrose Evans-Pritchard tees Hollande up and drives him down the fairway in this scathing piece posted on The Telegraph's Internet site early yesterday evening. I thank Ulrike Marx for her second offering in today's column...and the link is here.

Chanting "resistance", demonstrators took to the streets of Paris on Sunday to protest against austerity policies and Europe’s new budget treaty, in the first major demonstration since President François Hollande took power four months ago.

Tens of thousands of people marched through the sunny streets of Paris on Sunday to protest against an EU fiscal treaty requiring governments to commit to stricter economic practices, in the latest in a string of anti-austerity rallies across Europe.

The march, which organisers say drew 80,000 people, weaved its way across the east of Paris, near the historic Place de la Bastille, with demonstrators chanting “resistance, resistance”, while hundreds of flags and protest signs bobbed above the crowd. Others sang, “Hollande, do you know where we’re going to stick your treaty?”

This story was posted on the france24.com website late on Sunday evening Paris time...and I thank Roy Stephens for his second offering in today's column. The link is here.

One of the most mind-boggling debates going on in euroland right now – only one of many, but particularly guaranteed to make the head spin, this one – is over the build-up of so-called “Target 2” claims and liabilities. Target 2 is the mechanism by which money is transferred around the euro area to ensure that each national central bank has sufficient euros to fund its banking system.

Accumulated cross border claims are now so extreme that they threaten to leave German taxpayers with huge losses should the euro break up, or any one of its members leaves.

What makes this debate of particular importance is that it is German opposition to debt pooling in the eurozone that is generally thought, at least among the periphery nations, to be the biggest barrier to crisis resolution.

If only the Germans would agree to treat Europe’s debts as one, rather than the separate responsibility of 17 different sovereign nations, then all this nastiness would go away. Well, through Target 2, it can reasonably be argued, these debts are already being shared, only many Germans don’t yet know it and it certainly hasn’t cured the crisis. The euro has stuffed the Germans just as much as the Spanish, Italians and Greeks.

This story appeared on The Telegraph's Internet site fairly late yesterday evening...and I thank Roy Stephens for sending it along. The link is here.

German Chancellor Angela Merkel must “come clean at long last” and admit that Greece will need help for another seven or eight years, the German opposition leader said over the weekend.

“The Greeks must stand by their commitment, but we must give them time. We cannot tighten the screws any further,” said Peer Steinbruck, the Social Democrat candidate for chancellor. He said the political and economic fall-out from Greek ejection from the euro would be devastating and must be avoided.

The plea came amid reports that Berlin is so worried that a Greek crisis would spin out of control that it is ready to back the next €31bn payment to Athens under its EU-IMF Troika rescue, despite failure to comply with the terms. Wirtschaftswoche, a German news magazine, said Greece’s parliament merely needs to vote on a list of detailed reforms.

Ambrose is at it again. This commentary was posted on the telegraph.co.uk Internet site early yesterday evening...and I thank Ulrike Marx for finding it for us. The link is here.

Greece's creditors have been less than impressed with the country's willingness and ability to carry out much needed reforms. But Europe is likely to continue supporting the country anyway -- out of fear of the consequences should the country go bankrupt.

They're at odds, once again. The recent standoff in Athens between Poul Thomsen, chief envoy of the International Monetary Fund, and Greek Finance Minister Yannis Stournaras was, by all accounts, rather heated. Stournaras even threatened to resign rather than implement the cuts Thomsen was calling for, reported the New York Times.

"It doesn't matter to me," the IMF envoy allegedly replied, and then left.

On Friday, Sept. 21, it was time for the "Men in Black," as the Greeks call them, to depart once again -- without having accomplished anything. The troika, consisting of representatives of the IMF, the European Commission and the European Central Bank, had had enough.

This story showed up on the spiegel.de Internet site yesterday...and I thank Roy Stephens for sending it our way. The link is here.

Greece will bring forward painful budget cuts to end a decade of primary deficits while grappling with a sixth year of recession, according to a 2013 draft budget.

The government unveiled a tough austerity budget after Finance Minister Yannis Stournaras met the so-called "troika" of International Monetary Fund, European Commission and European Central Bank inspectors, whose approval is vital to unlock the next slice of aid, urgently needed to avoid bankruptcy.

Greece will aim for a primary surplus before debt service of 1.1pc of GDP next year, the first positive balance since 2002, after a 1.5pc deficit in 2012. But the economy will continue to shrink for a sixth year by 3.8pc.

Economic output will have declined by a quarter since 2008 in a vicious spiral of austerity and recession, with the most heavily indebted eurozone nation repeatedly missing targets set under its EU/IMF bailouts and at risk of being forced out of the single currency area.

This article was posted on the telegraph.co.uk Internet site mid-afternoon BST...and it's Roy Stephens final offering in today's column. The link is here.

Iran's currency, the rial, fell as much as 18% on Monday to a record low against the US dollar, according to media reports.

It dropped to as much as 35,000 to the dollar, according to agencies citing currency exchange sites in the country.

The currency has reportedly lost 80% of its value since the end of 2011.

The fall suggests economic sanctions imposed over its disputed nuclear programme are hitting economic activity ever harder.

This BBC news item was posted on their Internet site mid-afternoon BST yesterday...and it's well worth reading. I thank West Virginia reader Elliot Simon for his only contribution to today's column...and the link is here.

The first blog is with Keith Barron...and it's headlined "Expect Aggressive Stimulus as Gold to Smash Through $2,000". Next is this blog with Michael Pento. It's entitled "Continued Destruction of Money & its Impact on Key Markets". The third blog is with Robert Fitzwilson, the founder of The Portola Group...and it bears the headline "Big Changes are Coming, but the World Will Not End". Next comes James Turk...and his blog is titled "No Profit Taking in Gold & Silver, Even After Huge Run". The last blog is with Michael Pento once again. It's headlined "KWN Exclusive - Today the Fed Unofficially Announced QE4". The audio interview is with BMO's Don Coxe.

Laxmibai Karanure sifts through the heavy bangles and necklaces that make up her life savings, working out which pieces to sell from the 100 grams of gold she holds to tide her family over during the drought at their farm.

The 55-year-old Karanure's heirlooms will add to a booming recycling trade, which could account for up to half of India's consumption this year and boost a fledgling refining industry.

The surge in recycling also comes as India looks set to be overtaken by China as the world's biggest consumer of gold, after a hike in import duties in March and a rapidly weakening rupee pushed local gold prices to record highs.

The potential for recycling is huge with India's 1.2 billion people estimated to have stored up about 20,000 tonnes of gold in the form of jewellery, coins and bars, according to an estimate from industry body the World Gold Council -- about three times the holdings of the U.S. Federal Reserve.

This Reuters story, filed from Mumbai, was posted on their website very late on Sunday evening BST. I thank Ulrike Marx for finding it for us...and it's definitely worth reading. The link is here.

Starting Monday, October 1st, the Southeast Asian city-state is scrapping a 7% tax on gold and silver in an effort to turn the city into a precious-metals trading hub to rival London and Zurich, where value-added taxes don't apply to the investment-grade gold trade.

Investors have flocked to gold and silver in recent years as the world economy sputtered. The most nervous among them shunned the futures and funds often used to invest in gold and instead bought bars, ingots and coins to stash their wealth.

Singapore, touting its image as a safe, stable, and few-questions-asked haven for investors, is hoping to store an increasing amount of that gold and silver.

"There has been a dramatic increase in customers wanting to move out of paper, that is over-the-counter gold, and into physical," said Cedric Chanu, director, Asia precious-metals trading at Deutsche Bank. "We're seeing customers wanting to move their gold from Europe into Singapore."

This subscriber-protected story was posted on The Wall Street Journal website on Sunday...and it's in the clear in this GATA release...and I thank Ulrike Marx for sending it our way. It's more than worth your while...and the link is here.

On Tuesday, September 25th, I did an audio interview with Michael over at the metallwoche.de Internet site. He sent me the link to it yesterday...and if you think that what I have to say might be worth your while, the link is here. It runs for 14:22 minutes.

World No. 3 gold bullion producer AngloGold Ashanti warned on Monday that an illegal strike could lead to cuts in its South African operations earlier than expected and raised the possibility that strikers could be sacked.

Gold mining in South Africa is generally on the decline as resources that have been mined for decades run out. AngloGold said 24,000 of its 35,000 workers have been on strike for a week.

"If the current unprotected strike continues, it compounds risks of a premature downsizing of AngloGold Ashanti's South African operations," chief executive Mark Cutifani said in a statement.

This Reuters story was posted on the mineweb.com Internet site yesterday...and I thank Ulrike Marx for her last offering in today's column. The link is here.

Steadily high prices for gold are having a dramatic impact on parts of Latin America, bringing a flood of foreign investment and stirring a gold bug among wildcat miners in the jungles.

Some of Latin America's poorest nations -- Bolivia, Honduras, and Nicaragua -- have seen their balance sheets strengthened by gold production, while major producers Peru and Mexico reap billions in foreign exports.

But even as miners unearth deposits of gold, they also open up veins of social discontent. Protests over gold mining have become the coin of the day in areas where villagers complain of water pollution, a lack of jobs, and environmental devastation.

This story showed up in the Kansas City Star yesterday...and I found it hiding in a GATA release...and the link is here.

We've written about our views on industrial metals and precious metals - and how, while silver is both, we look at it primarily as a precious metal. Today we have a look at the industrial side of silver and how that's changing rapidly.

The short version is that there are more solid, long-term reasons to be a silver bull than ever. Details below.

BIG GOLD's Jeff Clark and I have slightly different ways to play that, with his approach being more cautious than mine, but we both agree that any savvy investor today should go long silver ASAP, if he or she has not done so already.

That was Louis James' introduction to Monday's edition of Casey Daily Dispatch written by Alena Bialevich and Jeff Clark. It's a must read for sure...and the link is here.

When it comes to investing in gold, investors often see the world in black and white. Some people have a deep, almost religious conviction that gold is a useless, barbarous relic with no yield; it’s an asset no rational investor would ever want. Others love it, seeing it as the only asset that can offer protection from the coming financial catastrophe, which is always just around the corner.

Our views are more nuanced and, we believe, provide a balanced framework for assessing value. Our bottom line: given current valuations and central bank policies, we see gold as a compelling inflation hedge and store of value that is potentially superior to fiat currencies.

We believe investors should consider allocating gold and other precious metals to a diversified investment portfolio. The supply of gold is constrained, and we see demand increasing consistent with global economic growth on a per capita basis. Regarding inflation in particular, we feel that the Federal Reserve’s decision to begin a third round of quantitative easing makes gold even more attractive.

You know that the world is undergoing a paradigm shift when you see Pimco's researchers whispering sweet nothings in your ear about gold. This essay was posted over at the pimco.com Internet site yesterday...and I thank Donald Sinclair for his last story of the day. It, too, is worth reading...and the link is here.

U.S. Rep. Ron Paul today explains (again) why gold is good money and why his legislation to facilitate competition in currencies is necessary to defend the people against the government.

"Earlier during this Congress," Paul writes, "I introduced the Free Competition in Currency Act (H.R. 1098) to permit people to use gold as money again. By eliminating taxes on gold and other precious metals and repealing legal tender laws, people are given the option between using good money or fiat money. If the government persists in debasing the dollar -- as money monopolists have always done -- then the people would be able to protect themselves by using alternatives such as gold that are both sound and stable."

Paul's commentary is headlined "Gold Is Good Money" and it's posted at the paul.house.gov Internet site here. I stole "all of the above" from a GATA release yesterday.

Silver market analyst Ted Butler, first to expose the manipulation of that market, writes at GoldSeek's companion site, SilverSeek.com, that the big issue of manipulation remains the concentrated short position held by JPMorganChase.

Ted has a lot more to say about the silver price management scheme than mentioned above. This is an excerpt from his mid-week commentary that was posted on his Internet site www.butlerresearch.com last Wednesday for the benefit of his paying subscribers...and I'm glad to see that he's seen fit to publish this important work in the public domain.

If I had to pick just one story for you to read today...this would be it...and the link is here.