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Senate confirms Jack Lew as Treasury Secretary	19:15 CNN Money - Economy
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Forex Flash: USD/JPY 90.00 key for whether there is consolidation or correction - BBH	19:12 FXstreet - Forex News
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New PM for troubled euro member Slovenia	19:09 EUbusiness.com
US Senate approves Lew as new Treasury chief	19:07 GMA News - Economy
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Forget Italy: Fiscal union is unlikely to mend the euro’s defective heart	19:02 City AM - The Forum
Forex: AUD/USD keeps on surging; RBA March cut priced at 17%	19:02 FXstreet - Forex News
FOREX: Ringgit Higher Against Dollar In Early Trade	18:59 Bernama - Malaysian National News Agency - Markets
U.S. Senate approves Lew as Treasury chief	18:57 Yahoo! US
UK, China in talks on currency swap	18:55 China Economic Review - Columns
Khairpur special economic zone inaugurated	18:53 The News International - Business
Bond buying plan available for use: ECB	18:53 The News International - Business
‘State Bank to continue bringing inflation rate down’	18:53 The News International - Business
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Gold Heads for Worst Monthly Run Since ‘97 as ETPs Fall 104 Tons	18:41 Bloomberg - Markets
Nikkei Up Sharply Amid Weaker Yen	18:40 The Wall Street Journal
Senate Confirms Lew at Treasury	18:31 ataxingmatter (Weblog)
Economic crisis ‘balkanized’ global finance	18:26 The Washington Post
Treasury Wine Profit Beats Estimates on Higher Asia Sales	18:25 Bloomberg - Industries
Japan Stocks Rebound, With Yen Easing	18:22 Fox Business - Tech & Gadgets
Efficiency of China economy 'sliding'	18:22 China Daily - BizChina
US easing spurs inflation fears	18:22 China Daily - BizChina
Weak yen attracts Chinese online shoppers	18:22 China Daily - BizChina
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Crisis ‘balkanized’ global finance	18:17 The Washington Post
Jacob J. Lew Confirmed as Secretary of the Treasury	18:14 US Department of the Treasury
NZ business confidence climbs to 19-month high, exports lag	18:14 Scoop - Business
Dow Average Rises to 5-Year High; Euro, Italy Bonds Gain	18:06 Bloomberg - Personal Finance
Euro Advances Against Dollar on Easing Italy Concern, Bernanke	18:06 Bloomberg - Personal Finance
Dollar rebounds on capex figures	18:06 WA Today - Business - National
Jack Lew confirmed as new US treasury secretary	18:06 South China Morning Post - Money
Swan welcomes Lew as US Treasury secretary	18:05 Business Spectator
Eurozone credit growth slows down: ECB	18:05 China.org.cn - Business
Senate confirms Jacob Lew as Treasury secretary	18:01 LA Times
Economic development chief faces bruising fight	18:00 Miami Herald - Business
Hong Kong forecasts rebound in economy	17:57 FT.com - Asia
Oil & Gas Salaries Rise Amid Economic Slump	17:55 oilprice.com
Lew confirmed as US treasury secretary	17:55 Business Spectator
Report predicts 8% China Q1 economic growth	17:54 China.org.cn - Business
Venezuela Plots Currency Moves	17:52 The Wall Street Journal - Europe Edition
Forex: AUD/USD breaking above 1.0250 on bad local data	17:51 FXstreet - Forex News
Lew Wins Senate Confirmation to Be U.S. Treasury Secretary	17:46 Bloomberg - Economy
Australian dollar falls after CAPEX data	17:45 Business Spectator
Efficiency of China's economy 'sliding'	17:44 China.org.cn - Business
RBA Says Up to 34 Central Banks Holding Australian Dollars	17:44 Bloomberg - Industries
Hankook Says Weakening Yen Gives Japanese Companies Pricing Edge	17:44 Bloomberg - Industries
JPMorgan's Job Cuts Are Great News for the Economy	17:44 The Motley Fool
Aussie Dollar Climbs as RBA Cut Bets Pared After Spending Data	17:41 Bloomberg - Markets
Asian Stock Head for Fourth Monthly Advance on Economy	17:37 Bloomberg - Markets - Stocks
Forex: EUR/USD breaks through 1.3150 resistance	17:31 FXstreet - Forex News
Forex: NZD/USD pops on best NZ bizz conf in 18 months	17:31 FXstreet - Forex News
Georgians Supporting Georgians for a More Prosperous Economy	17:30 Yahoo! US - Business - Press Releases
2 to 4 hours old www.usagold.com --LIVE NEWS--
EU releases 144 mn euro for new rare disease research	17:19 EUbusiness.com

Gold's BFF

by Peter A. Grant

Feb 27, AM
(from USAGOLD.com) --

Gold is modestly lower this morning after posting the biggest one-day rise in about three months on Tuesday. The rise back above the $1600 level can be largely attributed to Ben Bernanke's clarification of Fed policy before the Senate Banking Committee.

When gold dropped sharply last week, it was weighed in part by more concerns expressed in the January Fed minutes about the effectiveness and costs of quantitative easing. The market read this as an increase in the risk that the Fed would be removing accommodations sooner rather than later. Bernanke put those concerns to rest yesterday, saying that the benefits of QE still outweigh the costs.

I'm not sure I personally agree with Mr. Bernanke, given that the costs have resulted in a Fed balance sheet in excess of $3 trillion. That's a lot of money in anyone's book; and yet economic growth remains tepid at best and the jobless rate remains elevated.
In fact, the latest data showed a 0.1% contraction in Q4 GDP and the unemployment rate ticked higher to 8% in January. One might expect a little better performance from a $3 trillion investment by the Fed on top of trillions of dollars in deficit spending over the last several years by the federal government.

Not surprisingly, the Fed chairman reiterate the guidance provided by the FOMC back in December. “The FOMC has indicated that it will continue purchases until it observes a substantial improvement in the outlook for the labor market in a context of price stability,” Bernanke said in his prepared statement. Translated that means the Fed will keep rates pegged at zero and continue with $85 bln in monthly asset purchases until the unemployment rate drops to 6.5%, or inflation as measured by PCE exceeds 2.5%, neither of which is going to happen any time soon.

Bernanke has proven once again to be gold's best friend. A truth that was nicely illustrated in yesterday's MoneyGame Chart of the Day, which showed gold's performance under the last four Fed chairmen.

Here's how they stack up:

G. William Miller from March 1978 through August 1979, gold rose 47.5%.
Paul Volcker from August 1979 through August 1987, gold rose 65.0%. (Note: This period includes the drop in gold from the January 1980 record high of $850)
Alan Greenspan from August 1987 through January 2006, gold rose +14.5%.
Ben Bernanke from February 2006 to present, gold has risen 182.9%.

Bernanke's term as Fed chairman doesn't end until January 2014. Based on the Fed's own central tendencies, the jobless rate will still be above the 6.5% target and inflation will still be in check, so presumably the central bank will still be engaged in super accommodative policy at that point. Consequently, I think the long term uptrend in gold is not in any immediate jeopardy.

There has been some speculation that Bernanke might not serve a third term even if asked. The retirement of gold's best friend of the last 35-years might be cause for concern, but Vice-chairman Janet Yellen is seen as a frontrunner to replace Bernanke. Yellen is an even bigger dove than Bernanke, and given enough time, I suspect she might prove to be an even bigger friend to gold.

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Opinions expressed in commentary on the USAGOLD.com website do not constitute an offer to buy or sell, or the solicitation of an offer to buy or sell any precious metals product, nor should they be viewed in any way as investment advice or advice to buy, sell or hold. USAGOLD, Inc. recommends the purchase of physical precious metals for asset preservation purposes, not speculation. Utilization of these opinions for speculative purposes is neither suggested nor advised. Commentary is strictly for educational purposes, and as such USAGOLD does not warrant or guarantee the accuracy, timeliness or completeness of the information found here.

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