The Michael Fuljenz Metals Market Report: August 2012, Week 2 Edition

America's Gold Expert, Mike Fuljenz, Sets Unparalleled Industry Awards Record

Nationally-known rare coin and bullion expert Michael Fuljenz, of Beaumont, Texas, won six more prestigious industry awards at a ceremony held in conjunction with the World's Fair of Money in Philadelphia on August 9, 2012. Since 1986, he now has won an unparalleled 43 awards in 10 different categories from the Numismatic Literary Guild (NLG), a respected nonprofit organization composed of authors, editors and publishers who cover rare coins, paper money and precious metals.

"No one else I can recall has ever won in so many diverse categories over the years," stated NLG Executive Director Ed Reiter, a former columnist for The New York Times.

The latest awards presented to Fuljenz were:

• Best Radio Report for his Beaumont radio show emphasizing consumer protection cautions about selling gold and silver coins to so-called "hotel buyers" who move from town to town and may only offer to pay pennies on the dollar
• Best Web Site Article for a story Fuljenz wrote about the motto, "In God We Trust"
• Best Dealer Publication for Fuljenz' Personal Gold Guide." This was the fifth consecutive year he has won in this important category
• Best Non-Commercial Video for his educational seminar on gold and consumer protection presented at the Money Show of the Southwest in Houston
• Best Television Report for Fuljenz' segments on the program "NRA's Guns & Gold" shown on the Sportsman Channel
• Best Commercial Video with consumer education advice about buying and selling rare coins and bullion.

"I received my first Numismatic Literary Guild award back in 1986 as the Best Magazine Columnist. I was thrilled to get an award back then, and I am truly honored now to be recognized so many times since then by my peers," said Fuljenz who is known as America's Gold Expert.

In addition to this year's honors in six categories, he also has received awards in four other categories over the years for writing and broadcasting journalism achievements adding up to the unmatched record of 43 NLG awards in ten separate categories.

The NLG was founded in 1968 and annually presents prestigious awards to recognize excellence in journalism in numismatic topics, both in hobby/trade and in mainstream, general news media nationwide and worldwide.

In addition to the latest NLG awards, Fuljenz was honored by the Press Club of Southeast Texas earlier this year with first place Excellence in Media Awards for his Personal Gold Guide brochure and his weekly online newsletter, the Mike Fuljenz Metals Market Report.

The World's Fair of Money is an annual, international event sponsored by the nonprofit, congressionally-chartered American Numismatic Association.

Mike Fuljenz is a nationally-known rare coins and precious metals expert. He is a former authenticator, grader and educational seminar instructor for the Congressionally-chartered American Numismatic Association. Fuljenz is a frequent interview guest on radio and TV news and personal finance programs, as well as a community leader in his hometown of Beaumont, Texas.

Could We See a Repeat of Last August's Rapid Surge in Gold Prices?

Gold stayed above $1600 during all of last week, recovering strongly from its dip to the mid-$1550s in mid-July. Gold, silver and stocks each rose by 1.1% last week.

Last year at this time, gold began to take off in a three-week surge from $1623 on August 1 to $1877 on August 22, in the first part of what mainstream analysts called a "blow-off bubble top" in gold. At the same time, the stock market suffered unprecedented volatility with several consecutive days of multi-hundred point Dow Jones index swings. This summer has been absolutely peaceful by comparison, with a narrow trading range for both stocks and gold. Maybe it's the diversion of the Olympics and an election year, but people seem to be enjoying their panoramic view of TV sports and ignoring the major markets.

Since mid-June, gold has been in a narrow trading range of between $1550 and $1625. Few markets stay in such a narrow trading range for very long. They break out, one way or another. The most important questions gold investors face now are: (1) Why is gold in such a narrow trading range when the bullish fundamentals and global economic threats are obvious? And: (2) Which way is gold likely to move next?

To answer the first question, natural resource expert Lawrence Roulston wrote: "The price of gold, like any other commodity, is determined by the daily trading activity, which reflects only a very small portion of the total holdings of gold. The price is set by those who go in and out of the market. The majority of gold holders who hang onto their gold are not counted in the daily price setting. On any given day, the balance of sellers versus buyers, reacting to daily news headlines, determines the short-term price."

Roulston also points out that, in the last decade, gold has appreciated at an average rate of 19% per year. "There have been wild fluctuations along the way, but the trend is up." Gold is flat, he says, because, "At this moment, investors prefer the perceived certainty of the negative real returns on U.S. Treasury Bills or German bonds to the near-term uncertainty of gold or most other assets. That could change quickly."

Echoing this view, Dan Norcini says the gold and silver markets are stuck in a trading range "because the hot-money crowd has currently lost interest in them and is putting its money to work in other markets for the time being, as they chase profits. Markets in sideways patterns do not make money for hedge funds."

Central Banks Are Buying Gold Again

Another factor pointing toward a coming gold surge is a revival of central bank interest in gold buying: (1) The South Korean central bank said that they bought 16 tons of gold in July, their third such purchase in what looks like a long-term buying program. (2) Turkey reported that their July gold imports were 35 tons, their third highest purchase on record and 46% above June. As we've reported here before, Turkey is trading gold for Iranian oil, so some of this gold may be headed for Iran. And (3) Hong Kong reported that net shipments of gold to China soared in June. In the first half of 2012, China imported 382.8 tons of gold from Hong Kong, vs. just 64.95 tons in the first half of 2011. China also mined 177 tons of gold in the first half of 2012, according to the China Gold Association, so China is absorbing a lot of gold.

Turkey must keep buying heavy amounts of gold in order to continue their gold-for-oil swaps with Iran, a nation hungry to unload its oil in a world that has mostly embargoed its oil exports. As a result of this heavy traffic in gold, Turkey is encouraging its citizens to hold their gold in banks, by allowing tax-free gold transactions, gold checking accounts and other benefits. Gold deposits in the Turkish banking sector have now reached an estimated $7.69 billion (about 150 tons), according to the World Gold Council.

Metals Market Report Archive >