Friday, September 30, 2011

Is The 24hgold / eBay Widget Trying To Tell Us Something?

Update, 12:03 AM, 1 Oct 2011

The widget NOW shows a 25% premium of physical to spot in gold, but a HUGE 86% in silver! Maybe it's one of those anomalies that happen over there at eBay...

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Many of you now that I have been trying to find a way to keep track of actual physical gold prices vs. the spot gold quotations from the COMEX. There are two relatively easy ways to do this:

1) Call the coin shops or check with the gold sellers (Tulving, APMEX, Gainesville, etc.)

and

2) Monitor the 24hgold / eBay widget (found at 24hgold.com, at the bottom of the home page).

Since I check the price of gold at least once a day at 24hgold, I often take the time to check the widget, which tells us the premium of the US Gold Eagle offered at eBay vs. the spot price. The "widget" price is always higher than spot (as it should be, as the Eagle has some 3% silver and 5% copper to make the coin resist scratches, that of course is over and beyond the 1 troy oz of gold).

For sometime now I have been monitoring this, and occasion comment on it both here and at Zero Hedge when I see something interesting. Well, I think that the widget HAS been interesting since the Big Plunge in gold prices starting about 10 days ago.

I just checked the widget, the eBay price is an impressive 25% over spot, the highest I have ever seen! The Silver Eagle eBay premium is a very high 42% as well. During the past several days, I have seen the widget showing at least 11% over spot (and up to 20%), which is higher than the normal 5% - 9% which is the great majority of premiums I have seen in the past.

FOFOA teaches us that the "paper price" (COMEX) of gold may very well go down (as physical buyers cannot get the physical so the paper becomes worth less -- oversimplifying) yet the actual, real price of physical goes up.

I am NOT announcing that FOFOA's ideas are about to happen, but the widget, imperfect as it is (and several people have let me know that eBay is a playground for thieves too, although others have told me they buy & sell there regularly with few / no problems) MAY show an increasing scarcity of physical gold for retail buyers (we "shrimps") like us.

I saw NO evident shortage when I bought recently, although the two coin shops I buy from typically have NO 2011 or even 2010 Gold Eagles (my preferred gold investment).

What say you? Reader "Jonny Bahrain" a few days ago told us that there were shortages of retail bullion product there in Manama, Bahrain. Please comment or let me know if YOU see any shortages or have similar observations. If I hear something, I will say something! (thanks Madame Secretary Napolitano!).

Tuesday, September 27, 2011

Photos From a Wedding

For the moment, the below two links are the only way I can get some photos from my niece's wedding last weekend. I will update with more photos later on (when I can get some from my wife and/or daughter).

The below photo and article are courtesy of The Beaufort Gazette:

Mix, Stapleton | islandpacket.com

My sister-in-law Vicki (mother of the bride) posted the below 10 photos:

http://www.facebook.com/media/set/?set=a.2423181627485.144007.1489817980&type=1

Monday, September 26, 2011

More Or Less Self-Explanatory

From the "Stats" of my blog, earlier today I crossed 10,000 Pageviews (well, OK, probably some 2000 - 2500 are my own, as I have to visit to write and edit).

Pageviews today
4
Pageviews yesterday
76
Pageviews last month
1,757
Pageviews all time history
10,013

I would like to thank you all, dear readers, of my blog.

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I noticed that I picked up one or more readers from RUSSIA! I wonder what brought you here... The article on the KH-9 satellite?

Also, yesterday, I had more viewers from BRAZIL than the USA! Obrigado, Brasil!

I BTFD, Bz!

Today when we were coming home from my niece's wedding we attended over the weekend (and so passing by the "other" coin shop), I bought more gold!

Spot was $1601 at that moment, I paid $1682, so a hair over 5%. 24hgold's/eBay's widget has THEIR price at some 16% over spot, so I feel OK about my purchase (no shipping or insurance charges either).

---

Earlier in my career as a Junior ZeroHedge Commentator (JZC), I wrote "ad nauseum" that gold was a GIFT at under $1500 (and this first started when gold was about $900). While gold at $1620 or so is not the gift it once was, I do believe that TPTB and the speculators (= "weak hands") have given us a short-term gift of lower gold prices.

Could they go lower still? Sure. But, the future is very bright for gold. And I ate my own dog food today by buying more.

---

Because PLATINUM Eagles are so hard to find nowadays, I always ask at each coin shop I visit. For a couple years now, the answer is always "no". Today, the same guy had a Platinum Eagle, a 2009 Proof in the Mint box. He wanted $400 over spot, I hemmed and hawed, but went for it ($1950). It is a beautiful coin, and while I know that I am NOT into numismatics (as a whole), this was a purchase that made me feel all warm and fuzzy as well.

So, take heart, especially if you are in the market to buy PMs soon. They are not PRINTING any more of them!

EDIT (10:50 PM ET):

While the coin shop had no shortage of AGEs or Buffalos, they had NO 2010s or 2011s...

Sunday, September 25, 2011

24hgold.com / eBay Widget

shows a 20% premium over spot for American Gold Eagles! That is the highest I have ever seen it. eBay price is some $1979 vs. gold spot at $1644 (9:36 PM ET).

24hgold.com

BTFD, Bz!

Which is what I am going to do tomorrow on the way home barring a $100 move up in the price of gold.  On the way home tomorrow from the really big wedding of my niece (I will eventually write that up as it was a BIG wedding (300 people), I will try to include pictures.

If anyone is nervous, go read FOFOA's latest:

fofoa.blogspot.com

A 15% decline in gold's (intra-day) peak of $1915 price ought not worry anyone, this kind of thing happens all the time.

I have no worries as NO financial problems have been fixed nor have ANY of the criminals gone to jail.  That means the worst for our economy is still ahead until we face our problems and solve them,  And that does not look likely to happen soon.

Thursday, September 22, 2011

Gold: Jonny Bahrain And Price Plunge

Reader "Jonny Bahrain" just emailed me this note:

Hi Robert,

I thought I would share the following story with you and your readers:

Yesterday I went to the Souk (Arabic for market) in the centre of the capital city Manama to buy some gold.

In a particular area aptly named the Gold Souk there are lots of shops that sell only 18-24kt jewelry, jewelry makers, precious metal castors, goldsmiths and a couple of bullion exchanges.

I always go to the same bullion shop as it is owned by Mr Bhatia (who is always the only guy in the shop) and who offers the lowest spread between what he'll buy and sell at, but I forgot it was closed for afternoon 'snooze' time (1pm to 4pm), as are all shops in traditional areas of the country (FYI they open again from 4pm till 9-11pm, which is pretty convenient).

So I went to other jewelry shops just as they were closing and they told me there are no 1oz bars in Bahrain - they've run out!!

Suspecting this was a cunning ruse to try to make me buy whatever sizes they had I went away and came back to see Mr Bhatia only to be even more stunned - he had no gold for sale at all, and no 1kg bars of silver either!!!!!

Without sensationalizing the story too much, I think he may have been anticipating a price surge following the FED's announcement of Operation Twist and so did not want to sell at a lower price but cannot be sure. The alternative is he genuinely has run out from some combination of high demand and supply constraints.

Either way it is a shocking thing to be told there is no gold for sale from my trusted supplier - I was imagining the day when I go up there and no shop is offering any gold for sale at all <gulp>

In the end I went to the an FX exchange that sells gold and bought a 20g bar and a 1 Tola (Indian measurement that equals 11.664g), which together make 2% over 1oz.



end Jonny's note


24hgold.com has a decent (not perfect) widget on their home page.  I just checked it (6:15 PM ET 22 Sept. 2011) and the premium is a VERY HIGH (for them) premium of 12%.  Normally, the premium to spot is typically between 6% - 8%.


Jonny above mentioned that *maybe* some vendors may not want to sell after the plunge of the past couple days, thinking that they may sell for less than for what they bought their gold.


I am on the road now (going to see my niece get married this weekend), so I am not able to check the two coin shops I use for my gold purchases and so cannot (of course) see if there are any shortages of gold.


I can say that last I checked (yesterday?) Tulving that he had NO gold kg bars...


So, I put out a call to my readers:


Please advise if you have seen any shortages of gold!


-----


Regarding the plunge in gold prices, my GUESS is that there are two things going on here:


1)  Gold is being sold to raise funds for recent stock market losses


2)  Yeah, probably some manipulation going on...


As always, your congenial host would suggest that you go to tfmetalsreport.com for his remarks (and insightful commentators) for their ideas and comments.


Plunge, schmlunge!  Gold has these ups and downs all the time.  I have been a buyer for decades and have seen this kind of action a lot.  If you can, take advantage of what TPTB are doing for you, the gift they are giving you...  Allowing you to buy gold a better price than a few days ago.  Take the gift...

Monday, September 19, 2011

Rolling Bearings Manufacturing: Rings And Rollers Of Steel!

Two of my readers have out-and-out asked me recently to write something on bearings (and two other readers had bearing related matters for me), so OK, here we go.

Today I received the below from Peru re a sale we made recently (and so was the catalyst to get me to write this now):

Tax ID
Doc
Doc No.
Salesman
Cash/Credit
Codigo
Qty
Price
Dsct
Amount
1006xxxxxx
F
0061997
OF
B5-1/2        
28698
0.03
0
$860.94


Allow me to explain.  On September 6 (not listed above, to save horizontal space), we sold 28,698 pcs of steel ball "B5-1/2" (B5 being a Chinese brand of steel ball, the 1/2 is a one half inch size steel ball).  That "Qty" of 28,698 pcs is the FIRST TIME (newer readers may want to track down my article "Ameru Trading del Peru S.A." in my June (I believe, perhaps May) archives) we have ever sold anything over 20,000 pieces at one pop.  OK, the unit price is just $0.03, but still.  Hey, it is a good excuse to start my bearing article...

To begin with, rolling bearings are in almost all cases made with "52100" steel, its properties are here.  52100 steel is fairly hard, and has about 1% Carbon (for hardness) and about 1% Chromium.  FYI  and a bit O/T, stainless steel has up to 20% chromium.  Some bearings are made with stainless steel, particularly for harsh chemical environments, but stainless is not as good (because it is not hard) as 52100 for typical applications like wheels of cars.

Most rolling bearings (at least the ones we buy and sell) consist mainly of the three below components:

-- rolling elements (balls or rollers)
-- inner and outer rings
-- cage (to hold the rolling elements in place inside the bearing

The rolling elements are typically made from 52100 steel that is supplied in wire form, wire approximately of the diameter of the rolling element.  The wire is snipped off, and the steel chunks then go into a series of machines that grind them into balls and later polished.  There are various grades of precision and other  specifications (roundness, roughness, etc.) that the bearing manufacturers ask for.  In some cases, the bearing manufacturers "farm out" the rolling element manufacturing to specialists, a great example is NN, Inc., ticker NNBR on NASDAQ.  NNBR has a spectacular price chart (for devotees of stock trading), having fallen to 1 from about 20 in 2008/9 and back up to 16 or so, and now down again.  Of interest is the fact that "tapered rollers" (going into tapered roller bearings, "Timken" type bearings, "TRBs") are hardly ever farmed out, in that the technology is more difficult and the TRB manufacturers want this proprietary.

The inner and outer rings are made two different ways (depending on the size, how many are to be produced in that production run, etc.):

-- they can be made by hot-forging
-- or machined from precision tubing (supplied by steel companies)

I myself had the great pleasure of twice visiting a bearing plant in Spain some 12 and 15 years ago.  This was a small (and using OLD technology)  manufacturer of rolling bearings.  For the rings, they made them both ways mentioned above.  Both times they were forging pieces.  And while in their offices talking with their Export Director we could hear & feel the *poom* sound of the forge pounding the steel pieces into shape.  I believe they used their forge for the high production pieces as well as their large size bearings (say with an outer diameter of over 4 inches).  After forging, the steel pieces went on to be precision ground and polished (and later assembled with the rolling elements into completed bearings).

They used other machines to cut and grind steel tubing (tubing fairly precise in its ID and OD to save them work) for bearings they machined only.  IIRC, they machined rings only in their shorter production runs.

The steel cages are usually supplied by outsiders, the steel quality is not as important nor are other specs, as long as they fit OK and are softer than the other bearing components, that is all that is needed.

The various components are then assembled by other machines.  After assembly, the bearings then go on to get heat treated.  There are two schools of thought (or at least there were):

Case Hardened (in which the heat treatment is somewhat shorter and hotter to make the steel harder on and near the surface, while the interior is left more malleable).

Through Hardened (in which the whole bearing's steel is hardened all the way through).

There are (were) long running arguments about which was "better".  Some material science guys said case hardening was better, in that the bearing would not crack as easily (eg, when a wheel bearing hits a nasty pothole), but the through hardening guys said the bearing was tougher if the whole piece was hardened.  I am not an engineer nor do I know enough about steel to say who might be correct.

After heat treatment, the bearings are allowed to cool, they are then sent on to be packaged and shipped.  In some cases, however, the bearings will often get a rubber seal or steel shield (to help keep out dirt), the seals or shields are usually bought from outside companies as well.

---

In the near future, I will write about some of the world's bearing companies.  What they produce, how they compete and what their niches are.

Saturday, September 17, 2011

Review Of This Weekend's Barron's (Dated 19 Sept)

As I was pulling up to park at 7-11 today, I wondered if I would buy the current issue of Barron's, as I have mentioned before sometimes I do and sometimes I do not.

---

Well, when I saw the Cover Story (advising readers of the special "Penta" section they have every couple of months or so), I could not resist.  Penta is their special section subtitled "Trusted Advice For Families With Assets Of $5 Million Or More".  Do you want to see how the Really, Really Rich (acronymed the "RRR" from here on) live nowadays?  Check out Penta...

The Penta Cover Story is "Goodbye, Family Fortune" and shows a rich young punk leaning up on his car, wads of money spilling from his pants pocket with a horrified Mom & Dad there in the background in front of their mansion...  The picture is to die for...  So, that article is the one I review first.  "Goodbye, Family Fortune" is the latest article on an old problem.  What can you do if your kid is a lazy Shi'ite who mismanages the money that his ancestors worked so hard for?  It turns out it is not just English that has the expression "Shirtsleeves to shirtsleeves in three generations", the Dutch and the Chinese have their own very similar versions.  The article tells some horror stories and then goes on to suggest that parents begin educating their little schnitts about how to care for their money, money that was not easily earned in the first place.  It turns out that there are "Boot Camps" for educating Junior (mentioned is one that the U. of Chicago has twice a year: four days for only $8950.00...).

To get you all better into the spirit of how the "RRR" live, there are other articles there in the Penta section as well: "Ferrari Fever" (where rich Ferrari owners can take to the tracks in special races!), "Mansions of the Sea" (in which the author tells of the joys of renting 100 foot yachts during the Holidays), "Hot Watches" (describing ultra-expensive Swiss watches, the Patek Phillipe 'Grand Complication Ref 5216' sells for $785,000, bitchez!).  To balance it all out, there was also a handy article ("Audit Alert") in which Karen Hube tells what's up with recent IRS actions re the RRR and how to lower your profile...

Hey!  This is a public service I am offering here!  You NEED to know how your Superiors (er, the very rich) live!  Don't shoot the messenger!

---

Alan Abelson's latest "Downer, man" article touches upon Congress (among registered voters, only 6% of them said that most members of Congress deserve to be re-elected [R. Mix Note: uh, then WHY do they keep getting re-elected?]).  He then goes on to say that Germany may be too weak to carry the burdens of the PIIGS over there...  Finally, he has his doubts about the recent impressive advances in the stock market recently, but he is, after all, the Barron's Perma-Bear, probably kept there on display like a bear at the circus...

---

There is apparently a nice "Contrary Indicator" out there, that when over 30% of newly minted Harvard MBAs head to Wall Street, we are due for a tanking in the stock market.  We are at about 37% now.  The record high was 41% of the Harvard MBAs off to Wall Street -- and that was in 2008.  Hah!  Ruh roh!

---

Michael Santoli's "History Lessons" mentions two of my favorite as well as the financial community's highest rated books:

The Black Swan, (Taleb, N. N.)    (of course)
This Time is Different, Eight Centuries of Financial Folly (Reinhart and Rogoff)

The latter is must reading (uh, you know, if you are into that) in that "This time is NOT different", and what historically happens when countries get too far into debt (short version: it ain't pretty).  I recommend highly both books.

---

Jim Mctague's "D.C. Current" column excoriates (rightly IMO) both the Rs and the Ds for fiddling while the economy burns.

---

Visteon (car parts maker), Tyson Foods and certain European companies get the thumbs up in other articles.

There is an interesting article on some LatAm banks, putting out a bullish case for banks in Colombia, Chile and even Peru (Credicorp, the parent of Banco de Credito in Peru, "our (Ameru's) bank"!).

---

My FAVORITE article this week was Leslie P. Norton's interview with Jim Grant!  Two choice quotes will adequately sum up how Jim feels about everything:

"The euro is Confederate money."   [Ha ha!]

"It is the nature of gold that its valuation must forever be a mystery.  It earns nothing.  It pays no dividend.  No conference call, no management to call up and complain to.  What I do think is gold is simply the reciprocal of the world's faith in the institution of managed currencies.  It is one divided by T, where T stands for trust.  And trust is a shrinking number, and will continue to shrink.  Therefore I am still bullish on gold, bitchez."  [No, he did not say that last word, I just put that in there to see if you were still awake...]

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Nothing new or of real interest (to me) in the Market Week section, not even over at "Commodities Corner", the article there explains the recent divergence of prices of Brent Crude and W. Texas Intermediate Crude, a story well covered at ZH.  Only a tiny movement in the Fed "Total" on its balance sheet.

Bottom Line: if you want to see how the "RRR" live, buy this weekend's edition!

KH-9 Spy Satellite, Photos From Today's Exhibition

Update (11:00 PM ET)!  Apparently most (all?) of the images were not visible.  Here's a GREAT article (with photos) one of my friends just sent me re this unusual exhibition of the KH-9 spy satelite:

http://www.onorbit.com/node/3850

I'll try to fix the below pictures anyway.

---

Something interesting came up yesterday and today that caught my attention (and so took some of my time).  The Washington Post had an article that said that the previously TOP SECRET / TK "KH-9" imagery satellite would be on display for ONE DAY ONLY (today, Sat., Sept. 17).

I emailed many of my friends and family and was pleased to see that our daughter and her boyfriend went to see it!  This satellite was very valued among imagery analysts because it could take pictures of LARGE AREAS of interest.  Even if the imagery was not of the very high quality of the satellite before and the satellite after (all of that information, AFAIK, remains Top Secret).

Anyway, here are some pictures from the Air & Space Museum's annex in Chantilly, VA hosting the exhibition:








This satellite was affectionately known as the Big Bird, it measured some 60 feet long and 10 feet in diameter.  This was considered extremely advanced technology even in the early 1980s when I got to look at the imagery.

Oh, do I wish I could have a "Hall Pass" to troll through current imagery...

I asked them to let me know if they saw nosy Russians or Chinese there taking pictures...  Her boyfriend informed me that there WAS one guy taking detailed photos with a thick foreign accent, wonder what he wanted?

Friday, September 16, 2011

News!

Since gold more or less took care of itself today, I may wait another day or so before I crank out another piece on gold.

At the request of one of my readers, I will soon write another article on bearings.

This will be the FIRST time that I will write an article "upon request".  Since he knows who he is, I will leave it at that, other than:

THANKS!

Thursday, September 15, 2011

No, I Have not Forgotten About Gold...

Tomorrow I will review what has been going on in gold.

The best reference I can give now would be: tfmetalsreport.com.

I am ALMOST inclined to call this an opportunity to BTFD...

Zero Hedge Analysis, v. 2.4

I present below the latest results from my analysis (analyzing Zero Hedge articles and Categories):

ZH_Current_Meme_Index, 15-Sep-2011

Below table is number of ZH articles examied from Sept. 13 - 15.  Again, I did not include certain articles (RANsquawk and others that did not seem to offer a "meme").


Category / Meme
# Articles
13-Sep
14-Sep
15-Sep
Bailouts
5
5
Banksters
8
2
6
BRICs
2
2
China
1
1
China/Europe
4
1
3
Economic Indicators
13
2
4
7
Europe/Default
24
5
14
5
FX/Derivatives/Trading
1
1
Gold
2
2
Hedge Funds
2
2
Housing
1
1
Market Analysis
3
3
Middle East
1
1
Munis
1
1
Obama
3
1
1
1
Obama/Scandal
4
1
3
Other
4
2
2
Political Left
1
1
Political Right
1
1
Politics/General
1
1
PsyOps
1
1
Stocks/HFT
10
2
3
5
Treasuries
2
1
1
Total ZH Articles Reviewed
95




       
Below table shows outlook on each subject reviewed by the article.  A positive number is a favorable outlook, a negative one is unfavorable.  A "zero" indicates an equal number of "1"s and "-1"s.


Category / Meme
Total + / -
13-Sep
14-Sep
15-Sep
Bailouts
1
1
China/Europe
-2
-2
Economic Indicators
-5
-1
-2
-2
Europe/Default
-21
-5
-12
-4
Gold
1
1
Hedge Funds
-2
-2
Housing
-1
-1
Market Analysis
-2
-2
Middle East
-1
-1
Obama
-1
-1
Obama/Scandal
-4
-1
-3
Stocks/HFT
-2
-2
0
Treasuries
-1
-1


---

Comments:


1)  Three days worth of Zero Hedge articles is not very many.  Clearly, the "Stories du Jour" are going to mentioned the most often.  ZH is famed for breaking news.  There IS enough data to see certain trends, but there is NOT enough data for me to make informed comments on how ZH communicates "memes" out to the world other than the above.

2)  The mega-Europe/Default meme is still the big one, but, it is as well THE "Story du Jour".  ALL of those stories were negative in outlook for Europe.

3)  But, there are some trends emerging from the above (increasing attention today paid to Bailouts, Banksters, and Obama/Scandal).  There might be interesting insights into seeing how these trends in ZH memes change over time.

4)  I have data on Contributors and Guest Posts, but I have not gotten around to examining them yet (esp. to see if there are differences between Contributors, for example, and "Tyler Durden" pieces).

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I now invite my readers to comment on whether the above seems to be useful to you or not!  Please send me your emails or comment below!


I still have not decided how much work to put into this project, and/or whether or not to change directions or try something else (for example, waiting on a GOLD thread, and tabulating positive and negative comments).

Zero Hedge, as I have found, has a HUGE data-set!  It must be like Heaven for analytical DBAs working there...