Tehran Says Russia Partly Replaced Dollar With Ruble In Iran Trades

January 7, 2012 at 17:50


Tehran has replaced dollars with rubles in some of its dealings with Russia, an Iranian official was quoted as saying Saturday, as the Islamic Republic take steps to mitigate the impact of sanctions on its central bank. Speaking to Iran's Fars news agency, Tehran's Ambassador to Moscow Seyed Reza Sajjadi said the proposal for replacing the U.S. dollar with the rubles and the Iranian rial was initially made by Russian president Dmitry Medvedev to his Iranian counterpart Mahmoud Ahmadinejad last June. "Since then, we have acted on this basis and a part of our interactions is done in ruble now," Sajjadi said. New sanctions approved by U.S. president Barack Obama las...

Gold bugs’ unmerry Christmas

January 2, 2012 at 16:18


Santa brought the gold bugs quite a present last week. It was very big and extremely nasty. But maybe they can send it back. From the previous Friday’s close to the low on Thursday, the CME February gold contract plunged $82.10 or 5.1%. The gold shares, as tracked by the NYSE Arca Gold Bugs Index (HUI), were down 6.6% at their worst. Recoveries into the week's end enabled gold to finish down only 2.44% and the HUI down 2.54%. But by then, no doubt, most gold bulls were disgustedly drowning their sorrows. This was the reverse of what was supposed to happen. Thus, on the Friday before Christmas, the Japanese bullion dealer Mitsui remarked: "The gold price has gone...

China gold exchange restrictions will cut risk, not appetite

December 30, 2011 at 18:32


China's decision this week to channel all gold trading through Shanghai shouldn't dampen mainland investors' appetite for bullion, even as unauthorized trading platforms are forced to close, according to analysts. Tightened oversight of the gold market, including a ban on bullion trading apart from that directed through the official exchanges in Shanghai, comes after a year of volatile price moves for gold and silver. Unauthorized trading platforms have proliferated along with the boom in precious metals Analysts in Hong Kong said the move is likely an attempt to bolster investor safeguards rather than to discourage investment. Some investors had complained they'd b...

Gold Left Some Investors in the Dust

December 28, 2011 at 18:24


Gold has been among the best investments in 2011. Shares of gold miners? Among the worst. Gold is up 12% this year but shares of gold miners have fallen almost 16%. Smaller gold miners are down almost 40%, based on the returns of leading exchange-traded funds tracking those stocks. The surprising gulf has caused pain for some of the biggest names on Wall Street -- including John Paulson, George Soros, David Einhorn, Seth Klarman, and Thomas Kaplan -- many of whom piled into gold shares over the past year, sometimes by shifting away from gold itself. Bulls figured that gold miners had more upside than gold, partly because mining stocks outperformed during past ...

The Federal Reserve's Covert Bailout of Europe

December 28, 2011 at 15:40


America's central bank, the Federal Reserve, is engaged in a bailout of European banks. Surprisingly, its operation is largely unnoticed here. The Fed is using what is termed a "temporary U.S. dollar liquidity swap arrangement" with the European Central Bank (ECB). There are similar arrangements with the central banks of Canada, England, Switzerland, and Japan. Simply put, the Fed trades or "swaps" dollars for euros. The Fed is compensated by payment of an interest rate (currently 50 basis points, or one-half of 1%) above the overnight index swap rate. The ECB, which guarantees to return the dollars at an exchange rate fixed at the time the original swap is made, then ...

China Clamps Down on Gold Trading Frenzy

December 27, 2011 at 17:30


Gold exchanges in China outside of two in Shanghai are to be banned, authorities said in a statement released today. Gold exchanges have mushroomed across China, from the northern port city of Tianjin to Guangxi bordering Vietnam, as spot prices in the precious metal have soared to record highs and speculation has boomed. "No local authority, institution, or individual is allowed to set up gold exchanges," said the notice dated December 20 and jointly issued by the People's Bank of China, the Ministry of Public Security, and other regulators. The notice -- published on the central bank website (www.pbc.gov.cn) -- said the Shanghai Gold Exchange and the Shanghai F...

China, Japan to back direct trade of currencies, sidestepping dollar

December 26, 2011 at 22:48


Japan and China will promote direct trading of yen and yuan without using dollars and will encourage the development of a market for the exchange, to cut costs for companies, the Japanese government said. Japan will also apply to buy Chinese bonds next year, the Japanese government said in a statement after a meeting between Prime Minister Yoshihiko Noda and Chinese Premier Wen Jiabao in Beijing yesterday. The deals between the world's second and third-largest economies come as the 2-year-old European debt crisis keeps global financial markets volatile. Japan will start to buy "a small amount" of China's bonds, a Japanese government official said on condition of ano...