Posts Tagged ‘Asia’

Australia Seizes 360M From Dormant Bank Accounts And All 50 U.S. States Are Doing This Too

Friday, July 18th, 2014

Do you have a bank account that you don’t actively use or a safe deposit box that you have not checked on for a while?  If so, you might want to see if the government has grabbed your money.  This sounds absolutely crazy, but it is true.  All over the world, governments are shortening the time periods required before they can seize “dormant bank accounts” and “unclaimed property”.  For example, as you will read about below, just last year the government of Australia seized a whopping 360 million dollars from dormant bank accounts.  And this kind of thing is going on all over America as well.  In fact, all 50 states actually pay private contractors to locate bank accounts and unclaimed property that can be seized.  In some states, no effort will be made to contact you when your property is confiscated.  And in most states, the seized property permanently become the property of the state government after a certain waiting period has elapsed.  So please don’t put money or property into a bank somewhere and just let it sit there.  If you do, the government may come along and grab it right out from under your nose.

In this day and age, broke governments all over the globe are searching for “creative ways” to raise revenues.  In Australia for example, the time period required before the federal government could seize a dormant bank account was reduced from seven to three years, and this resulted in an unprecedented windfall for the Australian governmentover the past 12 months…

The federal government has seized a record $360 million from household bank accounts that have been dormant for just three years, prompting outrage in some quarters amid complaints that pensioners and retirees have lost deposits.

Figures from the Australian Security and Investments Commission (ASIC) show almost $360 million was collected from 80,000 inactive accounts in the year to May under new rules introduced by Labor. The new rules lowered the threshold at which the government is allowed to snatch funds from accounts that remain idle from seven years to three years.

The rule change has delivered the government a massive bonanza with the money collected in the year to May more than the total collected in the past five decades combined.

Most Americans are not going to be too concerned about this because it is happening on the other side of the planet.

But did you know that this is happening all over the U.S. as well?

For instance, the waiting period in the state of California used to be fifteen years.

Now it is just three years.

And when California grabs your money they don’t just sit around waiting for you to come and claim it.  Instead, it gets dumped directly into the general fund and spent.

If you do not believe that California does this, just check out the following information that comes directly from the official website of the California State Controller’s Office

The State acquires unclaimed property through California’s Unclaimed Property Law, which requires“holders” such as corporations, business associations, financial institutions, and insurance companies to annually report and deliver property to the Controller’s Office after there has been no customer contact for three years. Often the owner forgets that the account exists, or moves and does not leave a forwarding address or the forwarding order expires. In some cases, the owner dies and the heirs have no knowledge of the property.

And it is not just bank accounts and safe deposit boxes that are covered by California law.  The reality is that a vast array of different kinds of “unclaimed property” are covered

The most common types of Unclaimed Property are:

Bank accounts and safe deposit box contents

Stocks, mutual funds, bonds, and dividends

Uncashed cashier’s checks or money orders

Certificates of deposit

Matured or terminated insurance policies


Mineral interests and royalty payments, trust funds, and escrow accounts.

And when a state government grabs your property, the consequences can be absolutely devastating.  The following is an excerpt from an ABC news report from a few years ago…

San Francisco resident Carla Ruff’s safe-deposit box was drilled, seized, and turned over to the state of California, marked “owner unknown.”

“I was appalled,” Ruff said. “I felt violated.”

Unknown? Carla’s name was right on documents in the box at the Noe Valley Bank of America location. So was her address — a house about six blocks from the bank. Carla had a checking account at the bank, too — still does — and receives regular statements. Plus, she has receipts showing she’s the kind of person who paid her box rental fee. And yet, she says nobody ever notified her.

They are zealously uncovering accounts that are not unclaimed,” Ruff said.

To make matters worse, Ruff discovered the loss when she went to her box to retrieve important paperwork she needed because her husband was dying. Those papers had been shredded.

And that’s not all. Her great-grandmother’s precious natural pearls and other jewelry had been auctioned off. They were sold for just $1,800, even though they were appraised for $82,500.

And some states are even more aggressive than the state of California in going after bank accounts.

In a recent article, Simon Black noted that the state of Georgia can go after “dormant bank accounts” after just one year of inactivity…

In fact, each of the 50 states has its own regulations pertaining to the seizure of dormant accounts. And the grand prize goes to… the great state of Georgia!

Georgia’s Disposition of Unclaimed Properties Act sets the threshold as low as one year.

In other words, if you have a checking account in Georgia that you haven’t touched in twelve months, the state government is going to grab it.

So much for setting aside money for a rainy day and having the discipline to never touch it.

As economic conditions get even worse, the temptation for governments all over the planet to grab private bank accounts is going to become even greater.

We all remember what happened in Cyprus.  When the global financial Ponzi scheme finally collapses, politicians all over the world are going to be looking for an easy way to raise cash.  And our bank accounts may be one of the first things that they decide to confiscate.

So please don’t keep all of your eggs in one basket, and check on all of your accounts in regular intervals.

In this day and age, it pays to be diligent.

Ext :

Monopoly money is no game nor investment

Friday, April 25th, 2014

The US would have exported a total of 215 metric tons of gold bullion to Hong Kong as well as other small quantities of Dore’ not yet specified.

Hong Kong is the only country to have received so much gold. If you have a close look at the table below, Switzerland comes in second at 150 metric tons.



August is the highest month at 30.7 metric tons.

According to the information released by the USGS, the US exported 57 metric tons of gold bullion to Hong Kong last January.

US total gold bullion export to Hong Kong

US total gold bullion export to Hong Kong

This new record is three times more than the amount of gold exported in January 2013 (17 tons) and 84% more gold than the record set in August 2013 (31 tons). Gold bullion goes from the US to the East;

Total gold exports in January 2014 (80.7 tons) nearly surpassed the total hit in March 2013 (80.8 tons).

Where was the majority of the remaining gold exported in January 2014?

Gold Bullion:

Australia 3.1 tons, Thailand 2 tons, Switzerland 1.5 tons and Singapore 1.0 ton.


Switzerland 10.6 tons, India 2.7 tons and United Arab Emirates 1.4 tons.

The Western countries carry on playing with Monopoly money whereas the Eastern countries accumulate as much gold as they can.

Fiat money or Monopoly money is no good. So much of if has been and still is printed out but is not backed by gold. It’s worth nothing. The Eastern countries have understood the importance of having gold. One should invest while prices are low.

Mexican Funds could consider investing in gold

Tuesday, February 11th, 2014

It would seem that Mexican pension funds are interested in gold and in particular after the lifting of years of strict investment regulations according to the World Gold Council.

Legislation from 2012 allowed Mexican pension funds to invest in gold and other commodities in 2013 and more over in foreign assets. Not such a long time ago, we also read about some pension funds in Japan (which actually hold the world’s second largest pool of retirement assets) which have also decided to invest in gold.

Mexican pension funds account for 22% of Mexican savings and could double up in assets by 2018 according to the Wall Street Journal . Although they will have to determine how much they can invest in commodities and foreign assets, they won’t be able to invest more than 10% of their assets in commodities.

One has to know that pension fund interest in gold rarely impacts the gold price  since it plays a very small role in the global market estimated at $236. According to Bloomberg, it was estimated  in 2012 that only $9 billions in Mexican pension assets will be eligible for commodities investment overall while US hedge funds sold gold heavily in 2013 .

It will be interesting to know how Mexican pension funds perform with gold in the future. There again, are we talking about ETF or real physical gold … ?

To be continued …

The Australian Nugget 1 ounce

Monday, December 16th, 2013

The Australian Gold Nugget is a popular series of Gold bullion coins issued by the Perth Mint. They
have legal tender status in Australia and are one of the few legal tender bullion coins to change
their design every year, the most notable other being the Chinese Panda.


Australian Nugget 1 ounce

Australian Nugget 1 ounce

Australia issued its first Gold Nugget coins in 1986. From 1986 to 1988, the reverse of  these coins featured images of various Australian Gold nuggets, hence the name. From 1989, the design changed to feature different Kangaroos, a more world-recognised symbol of Australia. The coins are sometimes referred to as Kangaroos but the name

Nugget seems to have stuck. The coins up to 1 Toz change design each year. Each year, a Proof edition is issued and that design becomes the bullion coin design for the following year.

The coins have a unique market niche for two reasons; a “two-tone” frosted design effect and individual hard plastic encapsulation of each coin. Provided they remain as they came from the mint, the quality is maintained and thus premium.

The initial sizes offered were 1/20 Toz, 1/10 Toz, 1/4 Toz, 1/2 Toz and 1 Toz. In 1991, the 2 Toz, 10 Toz and 1 Kg sizes were added. These were created with the intention of using economies of scale to keep premiums low. The face values of the two larger coins were lowered in 1992 in order to bring them more in line with the smaller sizes.

In October 2011, the Perth Mint created a one tonne Gold coin to break the record for the biggest and most valuable, previously held by the Royal Canadian Mint. It is approximately 80 cms diameter and 12 cms thick. The face value is A$1 million but at the time of minting, the Gold price made it worth over A$53 million.

As mentioned, the reverse of the coin features in the early years a Gold nugget and thereafter a Kangaroo. It states the year of the coin, the weight and Gold fineness.

There is also a mintmark ‘P’ which signifies the Perth Mint.

The obverse features a profile view of Queen Elizabeth II designed by Ian Rank-Broadley. The portrait is surrounded by her name, the denomination of the coin and the word AUSTRALIA.

The Australian Gold Nugget coins should not be mistaken for the Australian Lunar Gold Bullion coins. Both coins are minted by Perth Mint and have 999.9‰ fineness but Lunar coins use different animals from the Chinese calendar instead of the Kangaroo.

Investment Advice

There are various grading systems in use around the world. However, the British system is as follows:

All Nugget coins are issued as pure Gold finewness, 999.9‰ and in theory have a low premium just above the value of the Gold.

However, their intrinsic beauty makes them very collectable and they attract good premiums.

As with any coin, the best quality grades will attract the best premiums. The three early years in particular will be those with the highest premium. Although the coins

were issued in Proof form, many were unpacked and have thus been damaged and are at lower gradings. The mintage figures for all sizes of Nuggets are in general quite low, thus every coin will have numismatic premium value also. All round, the Nugget is both a collectable and investable product.


Confidence in physical gold

Tuesday, December 10th, 2013

According to and also confirmed on, the Shanghai Stock Exchange would have delivered more gold than Fort Knox in the States. Needless to say the strong impact that would have on the gold price in the forthcoming future.
Some people even expect tapering to happen again or at least at some point.

Shanghai stock exchange
Shanghai Stock Exchange

The dollar is being printed on such a large scale that it leads to a complete devaluation of the US currency. That may be a satisfaction to the American to have more bank notes printed out but on the other side this does not help other countries like China who is presently sitting with some $3.7 trillion of foreign exchange reserves – other countries are actually in a pretty similar case with lesser quantities but still the concern remains …

Kingworldnews visited the Shanghai Stock Exchange in 2009 and said that they had delivered some 8655 tons of gold since 2009. The Chinese bought something like 1.700 tons of gold in the first eight months of this year. It means that gold is actually feeding the Chinese’ foreign exchange reserves. We know that the renminbi is already the second largest currency used in global trade … How long before the dollar becomes fully obsolete ?

Let’s have a closer look at the dollar :

Well, one should be scared when looking at that 14 year perspective published on

a 14 year perspective for the de-dollarization

a 14 year perspective for the de-dollarization

In our article published on Nov 19th 2013 – China remains the world’s largest gold consumer in Q3’13 – we were actually talking about the lack of confidence in the global financial market and systems altogether. As Jim Sinclair was saying ‘Credibility speaks to Confidence and Confidence speaks to Gold’.

Soon we may have part of our savings confiscated. How trustworthy are the banks? 

Investing in physical gold has never been so important. Making it affordable to everybody is our main concern and feasible thanks to our LSP.

For further information with regards to the confiscation in the USA, please read our article The Great Confiscation : Gold ownership was illegal in the USA from 1933 to 1975.

The Panda 1 ounce

Wednesday, December 4th, 2013

The Chinese Gold Panda is a popular series of Gold bullion coins issued by the People’s Republic
of China in Proof-like, brilliant uncirculated quality. They are issued in a range of sizes between
1/20 Oz and 1 Oz with larger 2 and 5 Oz coins being additionally issued in some years.

panda 1 onceChina issued its first Gold coins bearing the Panda design in 1982. These were limited
to sizes of 1/10 Troy ounce along with 1/4 Toz, 1/2 Toz and 1 Toz. From 1983, the 1/20 Toz size was added and additionally a 2 Toz and 5 Toz coin is sometimes issued.
These strikingly beautiful coins are always issued in Proof-like brilliant uncirculated quality and prove very popular.
A different design was issued each year until the 2000. When the 2001 edition was announced, so too was a freeze of the design and thus the 2002 Panda is identical to the 2001. Collectors spoke up on behalf of the annual change and China responded by reversing their policy so that from 2003 onwards, the designs again change each year.
However, on the reverse side, it always features the endangered Giant Panda. It also features the size, Gold fi newness and monetary value.
The main design on the obverse of the coin has hardly changed, save for minor detail changes in the image. It features Beijing’s famous Temple of Heaven (Tien Tien) in the centre with Chinese characters on the top saying “Zhonghua Renmin Gongheguo” meaning People’s Republic of China and at

the bottom the year of issue. If it is a commerative issue, the theme will also be marked here.
There was an adjustment of the face values of the coins in 2000/2001 – please see
the table overleaf for details.
The Chinese mints usually do not employ mintmarks. In certain years, there have
been minor variations in items like the size of the date, the style of the temple and
so on. These allow the numismatist to identify the originating mint. In some years,
but not all, other marks and Proof marks (signifi ed by a ‘P’) have been added. The
four mints involved in the production of the Panda are Beijing, Shanghai, Shengyang
and Shenzhen.

Investment Advice


All Panda coins are issued as pure Gold fineness, 999.9‰ and in theory have a low premium just above the value of the Gold.
However, their intrinsic beauty makes them very collectable and they attract good premiums.
As with any coin, the best quality grades will attract the best premiums. The early years in particular will be those with the highest premium. Although the coins were issued in Proof form, many were unpacked and have thus been damaged and are at lower gradings. The mintage figures should be carefully examined – the number originally minted is quoted but it has been found that production continues for various years, hence the total mintage may be quite a bit higher some years after.




All investment coins sold by

are EF quality or above.

For further information: +44 (0)203 318 5612


Wednesday, February 6th, 2013

By Mark Rogers

Currently being played in London is a revival of British dramatist Peter Nichols’s 1977 farce Privates on Parade, which is based on the writer’s own experiences  in the Combined Services Entertainment,  the wartime ENSA (Entertainments National Service Association) in its post-war incarnation, and is set in the Malaya Emergency. The revival has received rave reviews, which are posted in large display outside the theatre.

The Guardian reviewer summarises the politics lying behind the play, which is posed as a question: what was the British Army doing in Malaya anyway? Was it “protecting a corner of the empire from communism, or preserving the commercially vital rubber trade?”

This is the sort of confusion that underpins the anti-globalization view, and, still, today, the subject of communism. In the first place, the Army was putting down an insurrection: that it was a communist one means that it was more than merely a local one. The rubber trade was indeed vital. And given that we know what communists do when they take over an economy, the real answer to that question is: both.

But there is a further moral and intellectual maladjustment lying behind the phrasing, and one that plagued the twentieth century, and which it is still the fashion to indulge in.

Why is it assumed that trade is dishonest and that an economic motive is invariably tacky, devious and immoral? Indeed, the need to dress up the question as implying that the first motive was a cover-up for the latter, implies that so immoral are economic motives that even those who entertain them know that this is the case. But – people need jobs, people need goods (even anti-capitalist cyclists need rubber for their tyres), these are the motives for economic activity from time immemorial, and they are blatantly obvious. Marx it was who began the habit of thinking that economic motives were furtive, but another source of the blame for this type of thinking must be Keynes who had a more aesthetic disdain for economic motives.

Readers curious as to why articles of this nature should be appearing on a gold investment website should read: GOLDCOIN.ORG: MIXING POLITICS AND NUMISMATICS

And for background on the writer: CONFESSIONS OF A LAW AND ORDER ANARCHIST

And for a review of one of the most important books on the financial crisis published last year: THE MESS WE’RE IN: WHY POLITICIANS CAN’T FIX FINANCIAL CRISES


Wednesday, December 26th, 2012

THE ROYAL EXCHANGE by Joseph Addison (1672-1719)

There is no place in the town which I so much love to frequent as the Royal Exchange. It gives me a secret satisfaction, and, in some measure, gratifies my vanity, as I am an Englishman, to see so rich an assembly of countrymen and foreigners consulting together upon the private business of mankind, and making this metropolis a kind of emporium for the whole earth.

I must confess I look upon high-change to be a great council, in which all considerable nations have their representatives. Factors in the trading world are what ambassadors are in the politic world; they negotiate affairs, conclude treaties, and maintain a good correspondence between those wealthy societies of men that are divided from one another by seas and oceans, or live on the different extremities of a continent.

I have often been pleased to hear disputes adjusted between an inhabitant of Japan and an alderman of London, or to see a subject of the Great Mogul entering into a league with one of the Czar of Muscovy. I am infinitely delighted in mixing with these several ministers of commerce, as they are distinguished by their different walks and different languages: sometimes I am jostled among a body of Armenians, sometimes I am lost in a crowd of Jews, and sometimes make one in a group of Dutchmen. I am a Dane, Swede, or Frenchman at different times, or rather fancy myself like the old philosopher, who upon being asked what countryman he was, replied that he was a citizen of the world.

Though I very frequently visit this busy multitude of people, I am known to nobody there but my friend Sir Andrew, who often smiles upon me as he sees me bustling in the crowd, but at the same time connives at my presence without taking any further notice of me. There is indeed a merchant of Egypt who just knows me by sight, having formerly remitted me some money to Grand Cairo; but as I am not versed in the modern Coptic, our conferences go no further than a bow and a grimace.

This grand scene of business gives me an infinite variety of solid and substantial entertainment. As I am a great lover of mankind, my heart naturally overflows at the sight of a prosperous and happy multitude, insomuch that at many public solemnities I cannot forbear expressing my joy with tears that have stolen down my cheeks. For this reason I am wonderfully delighted to see such a body of men thriving in their own private fortunes, and at the same time promoting the public stock; or, in other words, raising estates for their own families, by bringing into their country whatever is wanting, and carrying out of it whatever is superfluous.

Nature seems to have taken a peculiar care to disseminate the blessings among the different regions of the world, with an eye to this mutual intercourse and traffic among mankind, that the natives of the several parts of the globe might have a kind of dependence upon one another, and be united together by this common interest.

Almost every degree produces something peculiar to it. The food often grows in one country, and the sauce in another. The fruits of Portugal are corrected by the products of Barbados; the infusion of a China plant sweetened with the pith of an Indian cane. The Philippine Islands give a flavour to our European bowls. The single dress of a woman of quality is often the product of a hundred climates. The muff and the fan come together from the different ends of the earth. The scarf is sent from the torrid zone, and the tippet from beneath the Pole. The brocade skirt rises out of the mines of Peru, and the diamond necklace out of the bowels of Hindostan.

If we consider our own country in its natural prospect, without any of the benefits and advantages of commerce, what a barren, uncomfortable spot of earth falls to our share!

Natural historians tell us that no fruit grows originally among us besides hips and haws, acorns and pig-nuts, with other delicacies of the like nature; that our climate of itself, and without the assistance of art, can make no further advances towards a plum than to a sloe, and carries an apple to no greater perfection than a crab; that our melons, our peaches, our figs, our apricots and cherries, are strangers among us, imported in different ages, and naturalized in our English gardens; and that they would all degenerate and fall away into the trash of our own country if they were wholly neglected by the planter, and left to the mercy of our sun and soil.

Nor has traffic more enriched our vegetable world than it has improved the whole face of nature among us. Our ships are laden with the harvest of every climate: our tables are stored with spices and oils and wines; our rooms are filled with pyramids of China, and adorned with the workmanship of Japan; our morning’s draught comes to us from the remotest corners of the earth; we repair our bodies by the drugs of America, and repose ourselves under Indian canopies.

My friend Sir Andrew calls the vineyards of France our gardens, the spice-islands our hot-beds, the Persians our silk weavers, and the Chinese our potters. Nature indeed furnishes us with the bare necessaries of life, but traffic gives us a great variety of what is useful, and at the same time supplies us with everything that is convenient and ornamental. Nor is it the least part of this our happiness that while we enjoy the remotest products of the north and south, we are free from those extremities of weather which gave them birth; that our eyes are refreshed with the green fields of Britain at the same time that our palates are feasted with the fruits that rise between the tropics.

For these reasons there are not more useful members in a commonwealth than merchants. They knit mankind together in a mutual intercourse of good offices, distribute the gifts of Nature, find work for the poor, and bring wealth to the rich and magnificence to the great. Our English merchant converts the tin of his own country into gold, and exchanges his wool for rubies. The Mohammedans are clothed in our British manufacture, and the inhabitants of the frozen zone warmed with the fleeces of our sheep.

When I have been upon the change, I have often fancied one of our old kings standing in person, where he is represented in effigy, and looking down upon the wealthy concourse of people with which that place is every day filled. In this case, how would he be surprised to hear all the languages of Europe spoken in this little spot of his former dominions, and to see so many private men, who in his time would have been the vassals of some powerful baron, negotiating like princes for greater sums of money than were formerly to be met with in the royal treasury!

Trade, without enlarging the British territories, has given us a kind of additional empire: it has multiplied the number of the rich, made our landed estates infinitely more valuable than they were formerly, and added to them an accession of other estates as valuable as the lands themselves.


Sunday, August 12th, 2012

The Gold Mine Effect by Rasmus Ankersen, published by Icon Books, London, July 2012

Reviewed by Mark Rogers

Rasmus Ankersen, the “High Performance Anthropologist”, is an enthusiast, driven by a “fierce curiosity”. Eliminated from a career as a footballer by a knee injury at the age of 19, he became a football coach.

Early in this career, while Mr Ankersen was coaching at a Danish football academy, he and his fellow coaches failed to spot potential in a young Danish footballer: they thought his talent insignificant, only taking him on because they needed to make up numbers. This player, Simon Kjaer, went on to a stellar career.

Mr Ankersen’s frustration over this failure “ultimately led to [him] selling everything [he] owned and setting off to travel the world for six months.” The result is this book: he selected six of the most astonishing Gold Mines in sports, to meet the coaches, to train with the athletes, to evaluate at first hand the training regimes, and discover the “secret” of high performance.

His first conclusion is that: “The secret is not a secret.”

It is important to recognise that while his book is about what motivates high achievers in sport, the lessons learned are applicable to other areas of achievement. While such discussions are kept to a minimum, once the reader has grasped the point it becomes easier to work out these applications, one of the most important being to education, which will be dealt with in due course.

The Gold Mines

The title of the book is only half metaphorical: the athletes and sportsmen and women he studies win inordinate numbers of Gold Medals at World Championships and the Olympics. Why?

Why is 70% of Kenya’s Gold Medals in world long distance championships won by athletes from the Kalenjin tribe, which numbers three million and constitutes just 10% of Kenya’s population?

Why has Russia in a mere few years become the source of 25 per cent of the players on the world women’s top 40 ranking list?

Why does a diesel burnt track, with a disintegrating gym and no facilities worth speaking of, in Kingston, Jamaica produce most of the world’s best sprinters?

And where do the great Brazilian footballers come from? “In the 2010/11 Champions League, the world’s finest club tournament, 79 Brazilians had time on the pitch, compared to only 25 Britons, 26 Germans and 49 Spaniards – and not a single Brazilian team takes part in the competition!”

The other two Gold Mines are South Korea, from whence come 35% of the world’s best female golfers, and Bekoji, an Ethiopian village, which turns out the world’s best middle distance runners.


Mr Ankersen’s researches in the field and in the literature prove the facile nature of many of the more magical explanations for these successes. Usain Bolt’s father claims his son’s achievements are rooted in the properties of the yellow yam that was Bolt’s favourite food as a child. The more ubiquitous genetic explanations get a sound drubbing: there are no African “running” genes, no South Korean “lady golfer” genes, no Brazilian “footballing” genes: in the case of the latter two, this ought to be obvious as golf was not invented in Korea nor football in Brazil.

The conceptual results of this adventure into the Gold Mines are highly illuminating: merely listing the concepts will give the reader a ready idea of how they apply on and off the sports field.

(1)   The secret is not a secret.

(2)   What you see is not what you get.

(3)   Start early or die soon.

(4)   We’re all quitters.

(5)   Success is about mindset, not facilities.

(6)   The successful coaches are more like godfathers.

(7)   Not pushing your kids is irresponsible.

(8)   Who wants it most.

The Most Interesting Concept…

 … is number (2). The mistake that many coaches make is a cause/consequence fallacy: the potential for future performance is deduced from current performance. Stephen Francis, the Jamaican sprinting coach, is adamant that this doesn’t work: he wants the story behind the performance. Current performance may only demonstrate that the runner is already operating at the limit of his abilities. Good coaching, constant training in an atmosphere of encouragement, contribute to current performance but are not a sufficient guide to potential achievement. Mr Francis is notorious for taking on athletes that everyone else gave up on – turning them into Gold devouring winners!

Asafa Powell, for example, had been turned down by every club he approached before he arrived at Mr Francis’s burnt out track of grass. The Maximizing Velocity and Power Track and Field Club was founded when Mr Francis (who is not an athlete but a statistician) sold practically everything to set it up: in the early days, in order to ensure that his athletes had enough to eat, he couldn’t afford running shoes – so they trained barefoot!

What Mr Francis saw in Asafa Powell was a person “who at the age of seventeen ran the 100m in 10.8 seconds. He’d been to a poor high school with a bad coach and hadn’t trained much at all. The training he had done consisted of him going over to G.C. Foster College in Kingston, looking at the way they trained, then going home and doing the same thing. ‘This told me that Asafa probably had considerable underexploited potential,’ Francis explains.”

Applied Insight

It is immediately apparent how this principle is widely applicable: it ought to set up an elementary early warning system for recruitment and promotion in any sphere of business. “As Capital One’s CEO, Richard Fairbank, put it … ‘At most companies, people spend 2 per cent of their time recruiting and 75 per cent managing their recruiting mistakes.’”

It is equally applicable to schools, which are historically notorious for misjudging or overlooking ability, though this wouldn’t apply to a musical academy in Berlin with a reputation for turning out pupils who go on to join the best orchestras or become supreme solo performers. This figures in the book because it was the venue of an experiment the results of which “would challenge the most fundamental conceptions of what leads to elite performances.” These results are also a vindication of the concept that the “secret is not a secret”. The crucial factor is: practice. This sounds obvious, but while for decades some mysterious innate talent, some welling of the subconscious or other arcane process as plumbed by psychoanalysis or other fashionable therapy-based analysis was thought to be the key, the obvious was ignored.

The violinists were divided into three groups for the experiment: the virtuoso best, the second best, not star material but still very good to the point of having a performance career, and the third who would probably only ever be teachers. What distinguished the three groups? Simply the amount of time they practised. That, however, still did not explain the difference between the very good and the very best. Further probing revealed that the very best not only practised harder than anyone else while at the academy, but had practised over the years before coming to the academy and had started much earlier.

Not Pushing Your Kids Is Irresponsible

Number seven in the list of concepts, this is the most controversial. Education, education, education… but for whom, how, where and what? For some twenty years the British state’s Qualification and Curriculum Authority has insisted that the primary purpose of education is the cultivation of self-esteem. Children must not be exposed to anything that could cause some children to succeed while others fall behind.

This also means that children must not be pushed: this is the whole meaning of “child centred education”, that children will be naturally drawn out over time, that talent and achievement however mundane are somehow “innate” and are therefore not allowed to appear early for fear of it withering on the bough (something that never worried Mozart or his parents) – this is the poisonous doctrine at the heart of the failure of state education. Formal rule-based learning is abolished under this doctrine on the fallacious reasoning that rules are straight-jackets rather than springboards. The claim is that those who are exposed to learning rules are then confined by them and learn only to hate what they have learned. But think: do those who have learned and practised the rules of cricket give up in disgust once they have mastered them?

The vicious fallacy behind this thinking is exposed throughout this book, and particularly in relation to the success of the Gold winners in tennis from Russia and in golf from South Korea, for these successes are founded on a group of people largely despised by the British education system: parents. These parents not only push their children, but give up everything to stand behind their children, following their training, keeping log books of practice at home – in short, getting involved. Indeed, so important was the parental input that Mr Ankersen discovered, he goes on to say that to be casual about their children’s success, to be indifferent to what it really takes to master anything, is the true parental sin. And the other crucial insight, the one that was also found at the Berlin academy, was that these children started very young, as young as five or six.  

The attitudes he discovered in Russia and South Korea are contrasted with tennis in Britain. So concerned that the Wimbledon Championships have failed to produce a winning Briton for so many decades, the government and the Lawn Tennis Association throw £60 million a year at the sport. State of the art training facilities with every luxury and comfort exist – to which bored parents bring their children and then sit waiting outside the practice courts, reading paperback fiction and willing the session to be over so that they can get to the hairdresser.

Facilities or Motivation?

Brazil’s footballers owe their success to one single factor: the endless dribbling and scoring that they engage in year in, year out on the street corners of the favellas from a very young age. High on the hills above and beyond the favellas sit the family homes that successful footballers have built to rescue their families from the slums, acting as an inspiration to the next generation of footballers. The godfather of Brazilian football, Eurico Miranda, asserts that “95% of them have been created on the street corners … This is the kind of head start that you can’t catch up with. The biggest mistake they make in Europe is being too well organised. Brazilian footballers are not the product of organised talent development. … Our academies … just have to make sure not to ruin the raw material they take in. The work has already been done for them.”

Stephen Francis, the coach of the Jamaican sprinters, declares that he will never change his training ground. For one thing, it eliminates, sometimes at the very beginning, those athletes who look for glory but aren’t prepared to work for it and expect to train with all the mod cons and comforts. The Kenyan runners live semi-monastic lives up in their mountains, running, eating, sleeping and running again.

The book is full of surprising and convincing insights, and the most important theme running through it is the problem of “innate” talent. A small but interesting experiment conducted at Hong Kong University puts this into perspective.

Organised by Carol Dweck, a psychologist at Stanford University, students were given several challenging tasks; once completed, half the students were praised for the effort put into them, and the other half were praised for their intelligence. As a result, subsequent tests produced interesting results. Those praised for intelligence became passive and reluctant to perform the most challenging assignments; those who had been praised for effort simply kept on improving.

Even more instructive was what happened next: the children were asked to write letters to those at another school describing “their perceptions and experiences of the tests they had undergone. … Forty per cent of the students who were praised for their intelligence had lied about their results in the tests. They claimed that their test results were better than they actually were.”

Subsequently, these children were offered a chance to improve their language abilities. All classes at the University of Hong Kong are conducted in English, so it was assumed that the children would jump at the opportunity. “It transpired, however, that the majority of the students who had been praised for their intelligence preferred to stay at home and abandon the course.” This is a fascinating insight into the sort of problems that may be caused by the “innate talent” assumption: it “shows what happens when people end up in an environment that exclusively celebrates their natural talent and not, say, their commitment and application. They begin to define themselves by that talent-description, and when times get tough and that self-image is threatened, they have difficulty with the consequences, to the point that they would rather lie than be exposed as untalented.”

There is no doubt that the High Performance Anthropologist knows how to get results – and goes about it in a highly original and thought-provoking manner: the book is pure Gold!

Readers curious as to why a gold investment website should be running articles of this nature should refer to this statement:  GOLDCOIN,ORG: MIXING POLITICS AND NUMISMATICS?


Sunday, June 3rd, 2012

By Mark Rogers

This is not an oxymoron. It is unfortunate that we live in an age when it is perfectly possible to link these concepts in this way.

I have been writing for for six months now, and thought it might be an idea to try to summarise my outlook, or, as they say, where I “come from”.

I come from Hong Kong. And that simple statement has coloured my entire political outlook. Indeed, during my childhood and youth in the colony I suppose I scarcely had one beyond the knowledge that we were free, especially as we also knew what was just across the border.

I will go further and say that Hong Kong was the freest polity in the world during the twentieth century. We were certainly exceptionally free of politicians in the modern sense of the word. There was an elected Legislative Council, which was little more than a local government authority charged with managing the basic public amenities, and although there were occasional attempts to politicise it, they never got anywhere.

Hong Kong: no welfare state

And there was no poverty, though there were of course poor people: but poverty as it exists in places like India and South America simply didn’t exist in Hong Kong, indeed, beggars were exceptionally uncommon. The government may have contributed, for example, small grants to schools for one-off purposes – the provision of new text books, perhaps – but there was no welfare provision on the scale that we have become accustomed to in Europe – and which is all but destroying the latter.

Medical treatment was freely available to all who needed it, whether they could pay for it or not. All doctors were private, and the hospitals were chiefly operated by missionary or religious organisations. The latter provided very expensive private ward treatment for the wealthy, which in turn subsidised treatment for those who could contribute either a fraction or nothing of the cost. There were also imaginative schemes run out of hospitals, such as the despatch of teams of nurses into the low cost housing or squatter hut areas, to discover those who needed treatment, to administer it for as long as necessary and to try not to hospitalise patients (unless they needed surgery) on the grounds that people got better more quickly surrounded by friends and family.

Community Chest

Chinese families were strong, partly as a result of tradition, and partly reinforced by the greater solidarity brought about by family losses as a result of the persecutions of Mao’s China. These bonds in turn produced an exceptionally strong philanthropic disposition on the part of Hong Kong’s rich, which in the course of time resulted in the setting up of The Community Chest. This brilliantly conceived idea, originating in such business organisations as The Rotary Club and The Lions, was based on the Chinese sense of “face” and the need not to lose it. Practically, it was designed to collect on a regular basis routine charitable donations into one fund which then was able to distribute those funds according to the immediate needs of all the regular charities, thus ensuring that at any given time the most pressing needs of any given charity did not go underfunded.

The face came in thus: regular lists of the names of donors were published in the paper of record, The South China Morning Post, in descending order of generosity, but without publishing the amount. Hong Kong’s wealthy knew pretty well how much they were all currently worth, and could therefore calculate the likely donations of their business rivals from their position in the list – and could therefore work out how much more they ought to give to try to outdo their rivals!

The immense commercial success of Hong Kong

This depended fundamentally on two things: its harbour and, in its modern history, its Financial Secretary, Sir John Cowperthwaite. He certainly did not suffer interference gladly:

“Asked what is the key thing poor countries should do, Cowperthwaite once remarked: ‘They should abolish the Office of National Statistics.’ In Hong Kong, he refused to collect all but the most superficial statistics, believing that statistics were dangerous: they would lead the state to fiddle about remedying perceived ills, simultaneously hindering the ability of the market economy to work. This caused consternation in Whitehall: a delegation of civil servants were sent to Hong Kong to find out why employment statistics were not being collected; Cowperthwaite literally sent them home on the next plane back.” (From an obituary which can be found here; there is another, fuller one, here.)

The economic success of the colony was also, of course, underpinned by the English Common Law. And the legal system operated in an unusually “pure” form; unencumbered by having to cope with government intervention at every level of private and public life, the lawyers and judiciary were able to work on the basic principles of the common law, precedent and equity. This was complemented (especially in the rural areas of the mainland and outlying islands) by recourse to native law and custom where either the parties requested it, or the magistrate thought it more appropriate. There is a marvellous account of life as a Magistrate in the rural New Territories of mainland Hong Kong: Myself a Mandarin, by Austin Coates (Frederick Muller, London, 1968, subsequently reprinted, Heinemann Asia, Hong Kong 1980; Oxford University Press Hong Kong 1987; and Oxford Paperbacks 1988).

The Law and Order Anarchist

This background, filled out over the years by my reading and my experience at close quarters of the British welfare state (the family courts, where the state is especially intrusive), has given me a deep distrust of welfare as a political process. Indeed, in the light of my observations and recollections of Hong Kong, the Welfare State seems to me to be truly the oxymoron: in order for the political class to establish and administer welfare systems, they must have onerous tax regimes which end up destroying the financial base upon which the welfare systems depend. Better by far to leave people alone to look after themselves, as indeed they did, through friendly associations, credit unions and the like (all of which flourished in Hong Kong) before the welfare state took over.

So, the problem with the modern polity is that by increments, state intervention destroys wealth creation and so destroys the ability of governments to “look after” people and equally destroys the ability of people to take care of themselves, until, reaching the very nadir of intervention (Nazism and Communism), huge numbers of people are themselves destroyed.

Another lesson from Hong Kong is that the legal arrangements come first and must be based ultimately on respect for property and freedom of contract. If the state takes over the administration of private life – from business and manufacturing, to education and health, to sports and the arts, and all other private spheres – then the legal basis of society is eroded, and, amongst other things, governments themselves become harder to render accountable.

I am, therefore: an anarchist when it comes to the size of the state; a liberal – and how sad and revealing that that once robust concept now has to be qualified – a liberal in the nineteenth century Gladstonian sense, because I believe in freedom; and a conservative because I do not believe that freedom is an abstraction: it must be embodied in institutions, which of necessity are anchored in their histories, and the most important of these is the law: historically the Anglosphere’s Common Law is the most productive and protective of individuals and their livelihoods.

The Border between Freedom and Tyranny

This must have happened when I was eight or nine. It was the time of the Cultural Revolution. Those who could, fled to the border with Hong Kong; the government’s policy was that anyone who crossed the border was welcomed (as had been the policy at the time of the Great Leap Forward in the 1950s and the revolution itself in 1949). The border was composed of a closed off portion of Hong Kong’s territory which consisted largely of villages and their fish farms, and then the river which constituted the border itself. In this low lying district, there was a hillock on top of which was the Police Border Post.

My father had some influence and was able to wangle a visit to this Post one midnight, taking me with him. In that part of the New Territories there were hardly any lights: all was black, with a few stars and in the greater distance the high and remote mountains of southern China dim against the horizon.

The ordinary soldiers of the Red Army border patrol had been assisting refugees to escape across the river during the daytime; when word of this got back, Peking sent in the teenage Red Guards to stop it.

As we stood on the Border Post, we could see far to the east and the west along the length of the river, little flashes of light, flicking on and off, on and off, like fireflies. But they were not fireflies: they were flashes of torchlight – under the cover of darkness, the old soldiers of the border patrol were still assisting their fellow Cantonese to escape.

Those little golden glows, flicking ever so swiftly and surely on and off, guiding people to the freedoms of Hong Kong: work and prosperity and a sense of human dignity, the opposite of all the socialisms that have destroyed human purpose so often throughout the twentieth century – and still threaten. Hong Kong, the moral and political gold standard.


Monday, May 14th, 2012

By Mark Rogers

Welfarism undermines democracy: this is one of the manifest lessons of the eurozone crisis, and is seen in many ways, the most recent being the Greek elections in which the fissiparous nature of the political system was dangerously apparent, with the running being made by minority parties with unrealistic and self-aggrandizing agendas. Instead of there being any attempt at shrinking the state, more, and more aggressive, groupuscules want more of the same: “Syriza’s idealistic economic programme calls for providing students with free meals and doling out pensions equal to final salaries. Mr Tsipras says the state should hire 100,000 more workers to help reduce unemployment.” (The Economist, May 12th 2012). Is this “idealism” or ignorance (though the latter is, of course, the handmaid of the former)? After all one of the things that brought the Greeks to their knees was the number of people entitled to government largesse.

When the Greeks received the first bailout from the Germans, Papandreou publicly thanked the German government and people for their largesse and acknowledged that as a result the Greeks would have to do some serious cleaning up, starting with an attempt to find out how many people worked for the government. They didn’t know! This is welfarism with an insouciance.

Democracy and accountability

The idea that democracy is a device to hold government to account implies a responsible, independent citizenry and limited government. One of the things that the government is to be held accountable for is limitations on its growth. The welfare state, instead, thrives on factional interests which seek to carve out niches for themselves at the expense of others, with the state as overlord and facilitator – and therefore at the mercy of being captured by the bolder interest groups.

The Founding Fathers of the American Constitution wanted to strike the right balances between majorities and minorities, while recognizing both that majorities could become tyrannous and that minorities could descend into factionalism. The balances that the Founding Fathers sought were to prevent majorities from dealing with minorities in the old-fashioned European way – i.e. simply eliminating them, whether through exile or execution. This meant allowing minorities a functioning place within the body politic accommodating their ways where they were beneficial without creating vested interests which might put the public order at risk.

While it is self-evident that the Constitution of the U.S.A. has not prevented the growth of big government or the gradual assimilation of the American people to welfarism, it is also clear that modern government’s most serious derogation from constitutional principle is the emergence of the centralized state as a faction in itself. Large civil services become an end in themselves; the purveyors of welfare form a huge vested interest group, averse to change that may damage their own position however it may benefit the taxpayers who fund them.

While it is usual to equate freedom with democracy and welfarism with fairness, in fact there is no logical or historically necessary connection between freedom and democracy, nor is welfarism necessarily fair. In fact, the larger the state’s involvement in wealth distribution, whether it is by cash transfers, or manipulations of the educational and health systems, the more that the least admirable moral qualities are promoted in the welfare state: envy and greed.


The welfare state encourages the vice of entitlement, actively encouraged by the administrators of the welfare state – through education, through multiculturalism and through the benefits system. If bankers are thought to be too quick to justify their salaries, it is only done in the language of the welfare state which all are encouraged to use. (An aside on bankers: while, as has been maintained here, here and here,their remuneration is an utterly inadequate basis for the crisis, bankers at least operate in a world of more immediate accountability: recently shareholders have risen to the task of curbing pay in relation to poor performance.)

Envy in the East?

I grew up in Hong Kong (my political and economic gold standard). That there were exceptionally wealthy people was well-known, but they tended not to live celebrity lives and had risen to their riches, in many cases from extreme poverty, through hard work and good judgment. That everyone had a chance to better themselves to the extent that they were prepared to work for it because the tax system was simple and equitable, meant that envy was at a discount in Hong Kong – people tended rather to admire the rich because they were hard working and philanthropic, and because each and all had the opportunities open to them to advance to similar riches. A breeding ground for hard work, thrift and imaginative enterprise rather than envy, greed and carping.


Thursday, May 3rd, 2012

By Mark Rogers

While there is much speculation that there are moves afoot in some countries to rein in the private ownership of gold (see here and here), it is encouraging to read the following story (originally posted at L’Or et L’Argent) about how Singapore is opening up its markets to gold. This is yet another move in the free Asian economies to strengthen their positions, a welcome strength in view of the economic turmoil in the developed world and in China, whose economic future seems very uncertain.

Given that the following article points out the strong position of gold in Hong Kong, readers might like to read this fascinating account of gold dealing there; amongst other interesting points is the note that the Chinese Gold and Silver Exchange Society is the world’s oldest gold dealing exchange. Gold and stability could have no sounder exemplification than the growth of Hong Kong as one of the world’s strongest economies throughout the twentieth century and still leading the way in the new millennium!

Singapore’s move comes in tandem with growing speculation amongst gold observers that there is a slow but sure momentum building up to a return to the gold standard. The financial turmoil in Europe and the erosion of the US economy is fundamentally a crisis of paper money and cannot continue without a major shift towards the kind of stability that a properly backed currency provides. This shift will come either when the relevant governments realise that such a resolution of their problems needs to be carefully managed – or it will be forced upon them if they continue to do nothing other than roll the printing presses, which will in the end precipitate a catastrophe of an order such that even they will not be able to deny the obvious.

I shall in the very near future be posting reviews of Detlev Schlichter’s Paper Money Collapse and James Rickards’s Currency Wars, which contain detailed analyses of how our present woes are the inevitable result of fiat money, and, in Rickards’s book, an outline of how a return to the gold standard should be managed.


Singapore bows before Gold

The world’s fourth largest financial centre is seeking to open itself to the gold market. Thus, it has decided that tax cuts will apply to precious metals including gold.

The Finance Minister Tharman Shanmugaratnam confirmed a month ago that an exemption would be made to the 7% tax rate, hitherto applied to gold and all other precious metals, in order to encourage growth in trade negotiations and in particular as an incentive for producers to participate in the market.

Singapore will thus be able to compete on an equal footing with other neighbouring markets open to the gold trade, the most important being Hong Kong where producers prefer to sell their bullion – free of tax. It is evident that having to pay a 7% tax in Singapore discourages investors. This measure is completely logical and fair since no kind of taxes should be applied to a safe haven investment – the latter being basically currency.

This reduction will be initiated as of next October – which prompted certain declarations to be made at the time this measure was made public, for example, `that an important producer has expressed a particular interest in opening a factory in Singapore in the light of the announced tax change’ and furthermore that there will be more gold trading companies present in the country.

Gold has risen sharply and this is why there is so much competition between countries which are putting in place strategies to meet current requirements. If Singapore wishes to compete with its Asian neighbours who have a significant advantage, it will be extremely advantageous for it to adopt this fully justified initiative which will enable the gold market to benefit from a fall in tax or an exemption. By maintaining high taxes, Singapore has risked putting off all potential investors – the latter being welcomed with open-arms in Hong Kong and Japan.

The BRIC attack: A major political event

Friday, April 27th, 2012

Translated from an original article by Charles Sannat, Director of Economic Studies,, Paris

The Fourth Summit of the BRIC nations, a major political event.

This is a huge story and yet has gone largely unreported by the major western media. On the 29th of March in New Delhi, the Fourth Summit of the BRIC nations took place (Brazil, Russia, India, China).

“The BRIC nations (Brazil, Russia, India, China and South Africa) should no longer use the US Dollar in their bilateral exchanges. That is what was decided on Thursday the 29th March, 2012, during the Fourth Summit of leaders of these five nations in the Indian capital”.

Source: and

The following was decided during this meeting: an essential step was taken towards a “multipolar” global monetary system. March 29th 2012 will undoubtedly not be the date remembered in history as marking the end of the era of the Dollar. Nonetheless, the change is major.

Towards an overhaul of the IMS

We are entering a phase of disintegration of the International Monetary System as we know it. Our monetary system dates back to the Bretton Woods agreement of 1944 which was brought to an end by the Jamaican agreement of 1976 (this ended the gold standard).

So what will happen now? Stock markets are starting to fall because the issuing of European bond funds is doing badly or is disappointing (depending on your degree of optimism about the outcome of this policy), which is the case for Spain and now Italy.

What one must understand is that according to the current economic system it is the surpluses of some which finance the deficits of others, thus creating a balance. In other words, western countries are in a chronic deficit which has been, and I stress has been, financed by the major Asian exporting nations on the one hand (China and India) and the oil-producing nations on the other.

For the last few years, nobody was lending to western states (by this we mean the US and Europe) which now find themselves in an irreversibly compromised situation.

It is this lack of external funds which is pushing the central banks, the FED and the ECB to massively intervene in the markets. The only option that remains for us is indeed the use of the printing press and the creation of money with all the negative consequences that follow.

Though this Fourth Summit of the BRIC nations is a founding step towards the overhaul of the IMS this is certainly not the ultimate goal.

Ground-breaking events in international relations

Discussing the topic of the monetary system without mentioning the political dimensions would be a mistake. The future International Monetary System will be shaped by the international balance of power and alliances between the major players in the context of the fight for access to energy and agricultural resources and in the broader sense to raw materials. A strong axis is taking shape amongst the BRIC countries, and Iranian diplomacy is also far from insignificant.

The trans-Atlantic relationship remains strong despite the strains and divergences. Lastly, one should not imagine that the United States of America will let their status as world leaders slip away without a colossal “fight”. American policy has always been based on a simple concept: “America First”.

We are thus entering a new phase in the current crisis:

In 2007, the subprime crisis led to a financial and stock market crisis.

The financial crisis led to an economic recession.

The economic recession lead to massive state intervention in the form of stimulus packages which resulted in massive debts for these states.

The debt crisis can only lead to a major monetary crisis.

The monetary crisis (which is on its way) will lead to the restructuring of the International Monetary System.

And… the manoeuvres have already begun. The global repercussions will be deeply felt, as the International Monetary System is to the global economy what tectonic plates are to geology. We are touching upon the essential part. The tremors will truly be felt.

Will you be ready?


Saturday, March 10th, 2012

An occasional series of curiosities of Gold, its history and ideas about it.

By Mark Rogers 

The Ancient Greeks had no gold.

So much has come down to us from the Ancient Greeks – philosophy, history, poetry, architecture and sculpture – that it is often forgotten that the Greeks were a relatively poor people for much of their history. What we know of the ancient Greeks was made possible by the defeat of the Persians, firstly by the Athenians at Marathon in 490 B.C., and then again in 480 B.C. when a large Greek army beat the Persians at Salamis. Without these defeats, the Greeks would have been subsumed under the despotic Persian Empire – with incalculable results not only for Greek culture but the whole of European history.

These defeats were the triumph of an agrarian and small city-state civilization, a people who struggled in fierce competition even to subsist on silver, over an Empire which at the time of its defeat had amassed a considerable proportion of the known world’s available gold; the robust determination of the Greeks not to vanish into an oriental despotism secured their victory over such a wealthy power, backed by gold.

Until then, gold had been centred on a territory bounded by Egypt, Asia Minor and the Black Sea; henceforth, gold was to move steadily into Europe, first through the agency of the Greeks and then the Romans.

But the Greeks had no gold of their own; indeed, they knew so little of the sources of gold that they were inclined, out of a sense of awe, to exaggerate the fame and riches of ancient sources such as the River Pactolus: this was the most renowned source of gold in the ancient world. Its identity now uncertain, it then flowed down from Mount Tmolus in the highlands of Anatolia, bearing vast quantities of alluvial gold, which tended to be the natural alloy electrum, “white gold”, composed of random quantities of gold and silver. In spite of Greek exaggeration, these quantities were huge enough, providing a rich source throughout the Persian and later Greek periods. Upon this wealth of gold was created the kingdom of Lydia, the most famous monarch of which was Croesus.

His eponymous (“as rich as Croesus”) wealth had a considerable impact on the Greeks. He was a sophisticated Hellenophile who went to great, indeed munificent, lengths to conciliate Greek feeling by the gold which he offered to the shrine of Apollo at Delphi – that most important of all the religious cities in the ancient Greek world, renowned for its political acumen and internationalism. Herodotus recounts that he  not only gave cups of gold and couches covered in gilt and silver, but also an immense quantity of ingots:

“He melted down a great quantity of gold and fashioned ingots from it, making them six palms [i.e. about 18 inches] in length and three in breadth, and one palm high; and their number was one hundred and seventeen. Four of these were of pure gold, each weighing two and a half talents [i.e. some 550 lbs in all]: the others were of gold alloyed with silver, weighing two talents each. And he also had made a lion of pure gold weighing 10 talents … and two mixing bowls of great size … of which the golden one … weighed over eight and a half talents. … He also sent the golden figure of a woman 3 cubits high … and dedicated his wife’s necklaces and girdles.”

Estimating that the ingots made of the alloy contained at least 50% gold then Croesus’s benefaction must have contained a minimum of 7,500 pounds of the yellow metal.

(Source for this article: C. H. V. Sutherland, “Gold, Its Beauty, Power and Allure”, 3rd revsied and enlarged edition, Thames and Hudson, London, 1969)

Gold demand mid-year review

Sunday, July 31st, 2011

We are late July and it is time to look at the gold accounts for the first half of 2011! Hinde Capital Fund Management conducted a study in June 2011 entitled “A Golden Renaissance, Precious Metal Dynamics ” which confirms the upward trends in physical gold (but not in “paper gold”).
Another analysis conducted by Goldsphere Edmond from the Rothschild Fund also confirmed this rise in demand in countries with a strong geopolitical risk despite stagnant mining production.
We were expecting a correction in the Gold Trend this summer and yet just the opposite has happened.
The Eurozone and American debt crises have helped this push upwards which has not been this significant since the beginning of the century.
Gold has risen an average of 19% per year since 2001. It is now facing an unprecedented demand.
Since the United States imposed the dollar as the world’s reserve currency and then subsequently flooded the market with it to increase consumption, the dollar has been heavily devalued. Their ability to stifle the price of gold has waned and globally investors have sought to ditch large reserves of weakening dollars for something safer. These investors initially thought the Euro may be the path to take but they got it wrong again and are now flooding into the only sure refuge which is physical gold. It is incredible how so many of these high flying know-it alls seemed oblivious to the obvious risks in the Dollar and then the Euro. Do they really research their options or just deal over expensive meals and golf holidays. Could they not see the blatant crisi of Sovereign debt affecting the major economies of the world? One has to ask what they have been doing for the last ten years and how apparently well-informed intellects make such poor judgments? (Must be the constant intoxication of self-appreciation, greed, drugs and alcohol)

A steadily increasing demand since 2003

Particular strength can be found in emerging nations where the demand for gold is rising to the detriment of the Green-back: 12% for India and 21% for China. Also, Mexico has filled its coffers of 93 tons of gold in the 1st quarter of 2011. Asia accounts for 62% of the demand, some of it cultural such as in India, but also other countries now active in the market are seeking to catch up for lost time (private investment now allowed in China) but also because “Governments wish to increasingly diversify their foreign exchange reserves and to disinvest from the US dollar or other currencies in trouble” (Option Finance Agency, France).

Other sectors such as jewellery are also in high demand (+ 55%) despite the rise in the price of gold (+ 3.1%). For this first half of 2011, the demand increased overall by 25%.
The paradox is that the demand for investment is still low, which proves that the course gold has nothing to do with any speculative flows. Indeed, it is also estimated that there is a mass of net flows out of “paper gold” (such as ETFs) equivalent to 55 tonnes. Overall, investments in gold are less and less by speculators, which is positive for the gold price trend. The attraction of a safe haven and sure value during these difficult and uncertain times is populating the gold investment market with serious investors, both private and institutional. This is hardly surprising when one calculates the increasing risks attached to most other forms of investments (which are largely based on owning bits of paper and have proved catastrophic to large funds in recent years).

Physical gold, a healthy investment

This study also shows that despite a growing demand, mining production did not increase accordingly and in fact was virtually stagnant. Recent fears have also surfaced that South African mines will be closed by strike action.

Another surprising finding is that gold sold by individuals to be recycled is steadily declining. This shows that the masses wish to hold on to something of value and also that they are fed up with being ripped off by those crooks who run incessant TV ads.
Even in Greece and despite the crisis, gold plays its role as a life insurance and safe haven since it is often kept in the home. Despite the attractive gold prices Greeks will not sell that they already have and they are still likely to buy more as a protection for their future survival.
Finally, another unexpected discovery, physical gold investment is disconnected from gold shares (the gold shares represent only 1% of world market capitalization). This disconnection is partly explained by the increase in the costs of production for mining companies and the difficulties encountered by countries which are politically unstable (Burkina Faso, Côte d’Ivoire).

“Khrysos (Gold) is the child of Zeus, neither moth nor rust devoureth it; but man is devoured by this supreme possession” (Pindar, c. 522-422 BC).

Gold companies should eventually be seen as worthwhile value but for the moment it is physical gold that is benefiting from investment because it is a real, tangible asset that you own and not just a promise.

On we have always preferred physical gold to “paper gold” for many reasons, but if one were to cite a single reason it is that the providers/suppliers of  ETFs (Exchange Traded Fund) can fail themselves as a Company which means you lose everything as you do not own a specific piece or pieces of gold, they do. On the other hand, if all ETF holders asked to recover in physical form their investment in gold, it would be impossible because they have sold more ETFs than they have Gold– sound familiar? It is the equivalent of Fractional Reserve Banking but applied to gold because these providers work and think like banks – and we know where that type of mentality led us to!!
Unbelievable Shallow Arrogance
Finally, as we approach the eve of the US debt deadline it is worth paying note to the despicable behaviour of so called elected democratic representatives who would be chastised in primary school for the same childish squabbling. Worse still is listening to them speak as they grandstand before the world’s media playing out their silly games. They sound like caricatures from the Simpsons with their phony accents and voices and yet we are to believe these are the best the “greatest nation in the free world “has to offer – I pity regular Americans who are governed by such an inconsiderate bunch of self-interested marionettes. Here at we have previously discussed the true nature of these politocrats in “Conspiracy, Collusion and Con-men – Why don’t they want you to buy Gold?”

As they push ever closer to the deadline it seems that they actually want the US to default and let’s face it so should we all – it’s about time the Fed and the Financial giants got their come-uppance by losing everything so we could start again and hopefully with something better- honest would be a start. Their brinkmanship may just backfire as the markets decide to take them down anyway even if they agree!
We have previously referred to this in “Financial Meltdown and Black Swans – Myth or Reality?” .
Should the Dollar collapse, which is an increasing possibility even when they introduce QE3, Americans and the rest of us should prepare for hard times not yet witnessed by most of the generations alive.

To give you an insight we suggest  reading “The chaos of a currency collapse” and multiply the effects by millions!

The stage is set for the Chinese Yuan to take the place as the World’s Reserve currency and the American politicians are doing their best to make sure it happens!!

The strengthening demand for physical gold investment is no accident as more and more regular folk know they need to protect themselves before the chaos and crisis ahead.
Don’t miss the opportunity, buy some gold now as insurance against losing everything when the Wall St bell falls silent!



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"For a mountaineer, the important things are the effort, the posture and the muscles. The rope that holds him serves no purpose when everything works but it gives him a sense of security. In the same way, all gold does is ensure confidence; it's a safe haven."