Digital Gold Currencies under scrutiny

E-Gold News
E-Gold is in trouble right now. 1MDC’s site showed the following message today:

ATTENTION

Friday Apr 27 2007 – 4AM UTC

It appears that a U.S. Government court order has forced e-gold(R) to freeze or block all of 1mdc’s accounts.

All of 1mdc account’s have been frozen at e-gold for unknown reasons.

Please note that it appears a few accounts of a small number of large exchangers and users of e-gold have also been frozen overnight. (Millions of Euros of gold have been involved in this event.)

If the freeze or court order in the USA is reversed, your e-gold grams remaining in 1mdc will “unbail” normally to your e-gold account and all procedures will be normal.

We suggest not panicking: more will be known on Monday when there will be more activity in the courts.

You CAN spend your 1mdc back and fore to other 1mdc accounts. 1mdc is operating normally within 1mdc.

However, you should be aware that for now the e-gold remains under the court order.

Ultimately e-gold(R) is an entirely USA-based company, owned and operated by US citizens, so, e-gold users operate by the decisions of US courts regarding the disposition of e-gold. Even though 1mdc has no connection whstsoever to the USA, and most 1mdc users are non-USA, e-gold(R) is USA based.

You are welcome to email “team@1mdc.com”, thank you.

To read up on this situation, I suggest you go over to Jude’s NOBS blog. Also read more about it on InfoWorld.

I transferred all my E-Gold to my Forex broker (North Finance), so I will still be able to wire it to a bank. For those who have a lot stored in E-Gold, I suggest you do the same. (Scoop: DrunksWorld & Jude’s NOBS blog)

Gold News
As I predicted earlier, Gold has made its temporary pullback before getting ready to ride the bulls again. For Gold investors, I advise to wait until the next rise signalling that the correction is over and Gold will become bullish again.

Spot gold prices rose against the US Dollar as New York opened today as Washington announced the slowest quarterly GDP growth in four years.

Gold rose to $678 per ounce just ahead of the London PM Fix after trading flat throughout the Asian and early European sessions.

Against Sterling and Euros, however, gold was little changed.

The overnight market in Asia was slow ahead of a 3-day holiday in Japan and then a week’s shutdown in China starting on Tuesday.

“I think sentiments remain positive,” said one Hong Kong dealer. “What happened in this market is just a correction.”

Gold had risen for seven weeks running before dropping 1.7% during the first half of London trade Thursday.

Source: BV

Dollar News
This Friday the Dollar made a flash pullback against the Euro because of GBP numbers rolling in. Though I think this move underscores the fundamental weakness of the Dollar, it seems the average U.S. consumer will remain blind to this problem.

CHICAGO – Stop all the fretting: The U.S. consumer is not going to collapse anytime soon. Most likely, she never will. Although Friday’s report that the U.S. economy grew at its slowest pace in four years gave wind to what is becoming an age-old debate about whether the consumer can continue to hold up the economy, there’s no reason to get heated up about it.

“If you bet against the consumer, you’re going to lose every time,” said Art Hogan, chief market strategist at Jeffries & Co. That, he insists, has been as true over the past 10 years as it has the past 50 and then some. The rate of the increase might be puny, but the economy will hobble along, and consumers will continue to find ways to buy the things they want. Economists are nearly unanimous in this conclusion: Americans will never stop wanting to keep up with the Joneses.

Friday’s GDP numbers underscored just that. Rising energy prices coupled with a weak housing market slowed things down a bit, but the growth in the first quarter was led — once again — by consumer spending

Source: MW

CHICAGO – The U.S. economy is riding four straight quarters of subpar growth, creating a dilemma for the Federal Reserve as concerns about a possible recession rise even as price pressures stick around.

Economists contend it is difficult for the United States to bump along in first or second gear for too long without “the big engine that could” slipping into neutral.

Source: Reuters

Once a Week
Since I have gotten a job in consultancy, I now have little time left to keep blogging daily. This means I will be issuing updates only once a week from now on.
Edit: This could be even less, as I am much busier at the moment than I was before.

Gold hits 11-month high

Gold News

Physical gold bullion prices rose at the start of Asian trade Monday, hitting a fresh 11-month high above $693.60 per ounce before slipping 0.4% to the London opening.

Spot gold prices for Good Delivery bars began the week in London at $690.80, nearly $3 higher from last Monday.

Gold closed Friday in New York higher for the seventh week running. It’s now added more than 9% against the US Dollar since March 5th.

“Bullish technicals are drawing a lot of buying in gold,” reckons Shuji Sugata, a manager at Mitsubishi Corp.

“The strength in platinum is also lifting sentiment for gold.” (Click here for more on the upcoming platinum ETF…)

“Basically, gold is heading towards $700, but the market may need fresh factors to test that level.”

Gold remains off its Feb. highs versus the other major currencies, however.

Versus the Euro, gold started today’s European session at €508.80 per ounce. It broke €522 per ounce on Feb. 26th.

Against the Japanese Yen, physical gold for immediate delivery closed Tokyo today at ¥81,790 per ounce, more than 1.2% off its two-decade top of Feb. this year.

Gold for delivery in Feb. ‘08 rose 0.8% at the Tocom to equal $698 per ounce.

And versus the Pound Sterling, spot gold prices opened London at £345.20, still 1.3% off the peak of eight weeks ago.

Gold for British investors continues to lag thanks to Sterling’s quarter-century highs against the Dollar.

Source: BV

Dinar News
The value of the Iraqi Dinar is still slowly rising as organisations, banks and officials in Iraq try to restore the economy of the struggling country.

Unadim Kana, deputy chairman of the Economic Committee of the House of Representatives unveiled the intention to hold intensive meetings with a number of academics, economists and businessmen in order to get acquainted with the real need for appropriate economic laws

The ongoing process of economic transformation in the country in order to draft laws formula developed and approved in Parliament.

Source: Al Sabaah (Translation: DinarTrade)

Forex News

London saw below-average activity in continued selling of the JPY crosses, following Asia’s lead on the back of a couple of news clips. The first, as discussed in the Asian update, was related to talks of Japan setting up a state investment fund. The second piece of news was the debt rating upgrade of Japan. Standard & Poor’s announced a one level rise to AA, bolstering the Japanese currency. (S&P is a financial services company that rates stocks and corporate and municipal bonds, among other entities, according to risk profiles.)

USDJPY traded off the 118.70 level to the 118.35 support zone. The JPY crosses stayed heavy, with EURJPY lower by another 30 pips from Asian lows. In other majors, EURUSD and Cable saw a day of retracement after a steady uphill climb the past few weeks. EURUSD was heavy once under the 1.3580 level, and Cable was a fast mover once under 2.0000 only to be supported around 1.9975. Look for the next big level in the pair to be 1.9950 if this retracement extends further.

On the news front in the London time zone, we saw UK Money Supply released with a firmer than expected reading. UK March M4 money supply rose to +1.0% MoM and +12.8% YoY from Feb’s +0.9% and 12.7% respectively. The market had been expecting a gain of 0.8% in the month and 12.5% in the year. The action following the release was fairly muted on the data as this was seen as a second tier number in the market.

There was some chatter from a few ECB officials during the session, with Constancio, Draghi, and Garganas all hitting the newswires.

Ø Mario Draghi, Italy’s governor on the European Central Bank, warned that there is a need to be ‘very vigilant’ on Eurozone inflation risks, stating that monetary policy is still accommodative and it’s vital to anchor inflation expectations.

Ø ECB Governor Vitor Manuel Ribeiro Constancio said it is vital to be alert on Eurozone inflation risks, with wage talks now being critical to the ECB’s view of inflation risks. Constancio is the head of Portugal’s central bank.

Ø Garganas joined Constancio in his observation of the Euro’s strength, suggesting that the stronger currency may weaken the case for further rate hikes. Nicholas C. Garganas is the Governor of the Bank of Greece.

Source: EFX

Stocks News

Dutch bank ABN Amro on Monday paved the way for the largest-ever banking takeover by backing an offer from the U.K.’s Barclays worth around 67 billion euros ($91.2 billion).

A combination of Barclays and ABN Amro would create the world’s fifth-largest bank and the second-biggest in Europe behind HSBC Holdings.

As part of the deal, ABN Amro would sell its Chicago-based bank, LaSalle, to Bank of America Corp. for $21 billion. But the agreement doesn’t set ABN Amro’s future in stone, as many analysts still expect a rival consortium to enter the bidding with a higher offer.

Source: MW

Options Trading
High Yield Weekly Digest has a great article touching on the subject of options trading seminars. Don’t be fooled. Scammers look nice, wear nice suits, and actually often believe they are not scammers at all. Learn and discern by reading more.

Legisi may go scamway

Scams
Recently a reader asked me to do research on Legisi. Since I have pulled out of high yield I have not had much time to do so. However, I did stumble upon this article on High Yield Weekly Digest. I agree with Tony Clifton, and advise anyone thinking about joining Legisi to stay out.

Another program to be wary of is the FX Offer, run by admin Andy. Although he successfully ran XLO and TFT before, the sour ending the saga had because of the sell off of the site to Tri Star Media Group had many investors lose their money. There is a more detailed review posted about it here. (Sources: TheDolphinsWink blog)

While we’re at it: don’t invest in Mutual Independence. They are probably scammers. (Source: NoPonzi blog)

Stay away from aegis.hk as well! They will scam you. (Source: ScamFraudAlert)

Gold News
Against my expectations, Gold recovers quicker than I thought. Or is this only a temporary move until we have seen a bigger drop. I expect this to happen when the Dollar, though growing weaker by the day, temporarily traces back.

Spot gold prices continued to recover in Asia on Friday morning, rising $6 from Thursday’s low to open London at $686 per ounce.

In Tokyo, the Nikkei stock index closed the week 0.5% higher as the Japanese Yen retreated on the currency markets.

Gold futures for Feb. ‘08 traded at the Tocom recovered to close the week equivalent to $690 per ounce.

Yesterday’s sell-off saw spot gold for immediate delivery find strong support at key levels.

Bouncing off $680 per ounce for US investors looking to buy gold, it also turned higher from £340 and €500.

Source: BV

Forex News

Over the past few trading days, we have seen a great deal of intraday volatility in the currency markets. The battle between top pickers and carry traders has been fierce with Asian and European traders opting for the former and US traders opting for the latter. Carry traders aren’t giving up quite yet as we see evidence of consistent buying throughout the US trading session. This is the same sort of price pattern that we saw yesterday, which indicates that the battle is continuing with no clear winner in sight. What the price action does tell us is that there are strong players on both sides of the spectrum and should one triumph over the other, the reversal or continuation will be just as sharp as the rally that we have seen over the past month. Dollar bearishness is still the dominant force in the market as economic data continues to disappoint.

Source: DFX

Stocks News

European shares gained ground on Friday morning as the mining sector bounced back from the previous day’s Chinese rate hike fears sell-off, pharmacy chain Alliance Boots agreed to a $21.3 billion buyout and SAP reported stronger net profit.

Source: MW

Dollar and Gold both decline

Dollar News
Heavy dollar decline seems to be all the theme lately, suggesting you read part 4 of a great series of articles about it here.

Gold News
Yesterday I was positive about a continuing bull market for Gold. I still am, but the recent drop in the price has altered my short term perspective. For those heavily invested in Gold I suggest you pull out while temporary bearish aftershocks of the 1.2% may affect the current value. Though I cannot be certain about this, I temporarily sold off my reserves.

Spot gold prices pulled back sharply from a fresh 11-month high overnight in Asia on Thursday.

Physical gold bullion for immediate delivery dropped nearly 1.2% – the fastest pullback since Thursday last week – on fears that the Beijing government may act to curb the latest surge in China’s booming economy.

China’s CSI 300 stock market index fell 4.7% today, the sharpest drop in a volatile market since the 9% drop in late Feb. that triggered a global sell-off in stocks, commodities and gold.

Source: GV

Forex News

With no significant data on the US calendar, there is nothing preventing traders from selling US dollars. In fact, the dollar hit fresh 26 year lows against the British pound, 24 year lows against the New Zealand dollar and 2.5 year lows against the Euro before recovering. The recovery however was shallow as the EUR/USD, GBP/USD and NZD/USD all ended up back in positive territory. This is not a reflection of the market’s distaste for the US dollar or their pessimism about the outlook for the US economy.
…
The Euro is one step closer to its all time high after having taken out its 2 year high of 1.3594 this morning. With no major data on the Eurozone calendar, the latest push has been sparked by nothing other than more hawkish commentary from European Central Bank officials. ECB member Weber was the latest to remind the markets of upside inflation risk by saying that the rebound in the Eurozone economy will push wages and overall inflation higher.

Source: DFX

Stock News

European shares started in the red on Thursday, weighed down by mining companies Rio Tinto and BHP Billiton and some weakness in auto firms DaimlerChrysler and BMW.

Source: MW

Case for Gold growing stronger

Gold News
Didn’t we see this coming? Gold has broken an 11-month high on Monday. As the U.S. bubble keeps growing, Gold must grow along with it.

Physical gold for immediate delivery recorded its highest London Fix since May 18th 2006 on Tuesday at $688 per ounce.

In the spot gold market, prices broke back above $690 after hitting an 11-month high late in New York on Monday.

“Fresh funds are flowing into gold,” reckoned one Tokyo trader at Mitsubishi.

“Buying by Asian end-users also shows the market’s fundamentals are healthy.”

… Tuesday morning also brought news that US inflation rose 0.6% in March – in line with expectations – while “core” inflation excluding food and fuel slipped to 0.1%.

Putting the absurdities of an inflation index that ignores the cost of eating, heating and travel to one side, this news diminishes the threat of higher US interest rates ahead – and that’s typically been a bullish sign for gold during this bull market.

Meantime in London, the UK government announced that inflation in the cost of living rose to a fresh 16-year peak last month.

That drove Sterling up through the $2.00 mark for the first time since 1992, pushing the Sterling price of gold down to a 3-day low of £343.50 by the US opening.

Source: GV

This article also strengthens the case for Gold, as more and more investors around the globe are showing interest for the precious metal.

Forex News

Asia saw a mostly dollar selling tone after GBP/USD had a clean break through the psychological 2.0000 level. EUR/USD grinded higher and continues to base in front of the 1.3600 level. USD/JPY was weak and dragged JPY crosses lower with it as market rumors circulated that Japan may hike interest rates again in May.

Dollar sellers were helped in part by momentum in Kiwi from mixed data CPI data. Kiwi initially traded lower after Q1 CPI came in at .5% quarter over quarter vs. .6% consensus. However, Q1 CPI of non-tradables came in at 1.2% quarter over quarter vs. previous .8%. The higher number brought buyers in Kiwi and pushed it through the March 2005 highs.

With JPY crosses showing a bit of weakness after their recent rally, it seems that the focus in Asia may be focusing again on Japanese interest rates. It is widely believed that Japan is in a tightening cycle but the speed of interest rate increases is what is keeping the JPY weak. Should we see strong Japanese data going forward, expect more concern that Japan will raise interest rates sooner rather than later.

Source: EFX

Stocks News

European shares drifted lower on Wednesday morning, as declines in the auto and construction sectors offset gains from chip equipment maker ASML and Swiss drug maker Roche.
…
U.K. investors were keeping an eye on sterling, which traded at a high of $2.0104, a level not seen for 26 years. If sterling stays around the $2 level, it could place the profits of exporters under pressure.

Source: MW

Free Software
GiveAwayOfTheDay.com daily gives away free software packages with a license. Today features a business package called GoCRM. You can download it here. Be sure to BE ON TIME, as every offer expires after 24 hours.

GoCRM is a CRM system, designed to provide the simplest way for you to manage your everyday business tasks. Take control of your customers, suppliers, prospects, staff, quotes, orders and much more.

Source: GiveAwayOfTheDay.com

Scams
High Yield Weekly Digest has an interesting poll posted asking what you think is the biggest scam in the high yield industry so far. Want to know what the outcome is? Check out the poll here.