<b>Buying Gold</b> in the Olympics and in the Global War for Talent
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<b>Buying Gold</b> in the Olympics and in the Global War for Talent
Posted: 20 Feb 2014 05:40 AM PST
Entire nations are going head to head in the global war for talent — and using citizenship to buy it. Countries eager to make a splash in the Olympic Games offer "plastic passports" to promising athletes from other regions. The Pew Research Center estimates that at least 4% of the athletes competing in this year's Games are representing countries other than their birth nations. This practice isn't new, but it's been on the rise in recent years. In In 2012, the New York Times published a round-table debate about it. Writers discussed reforms, but no one questioned the premise that, in the 21st century, talent is and will remain mobile.
As University of Toronto professor Ayelet Shachar explained in a Yale Law Journal article: "Countries seeking to attract Nobel Prize contenders, gifted technology wizards, acclaimed artists, promising Olympians, and other high-demand migrants have come to realize the attractive power of citizenship. This represents a significant shift in the conception of citizenship — turning an institution steeped with notions of collective identity, belonging, loyalty, and perhaps even sacrifice into a recruitment tool for bolstering a nation's standing relative to its competitors."
Loyalty to a company may be an artifact of yesteryear, but loyalty to one's country is generally considered an important part of a person's identity. But some Olympians change citizenship when their nationality hampers their ability to practice their sport at the highest level. They become less loyal to their country than to their profession or industry.
Consider one of the brightest stars in the 2014 winter games, short-track skater Viktor Ahn, who won a gold medal for Russia last week — and three gold medals for South Korea in the 2006 Olympics. After a falling-out with Korean sports authorities, Ahn looked at both the U.S. and Russia as potential new homes, deciding ultimately to emigrate to Russia, where there were fewer Olympic-level skaters to share resources with. Russia, he felt, could invest more in his success.
Ahn's story upends conventional wisdom about national character. An athlete from a non-individualist country emigrates in order to maximize his potential — but he doesn't move to the U.S., so often the home of choice for top performers dissatisfied in their native countries. Ahn changed his first name to "Viktor," for victory and also in honor of a Russian rock star of Korean descent, and he studied Russian. After his win, he draped himself in the Russian flag and wept. The phrase "mobile talent" implies rootlessness, but the ability to commit to one's new environment — broadly and deeply, as Ahn did — is crucial to succeeding in it.
South Koreans have reacted to the story of Viktor Ahn — but their anger is not, in general, directed at Ahn. In November, 61% of a sample polled by Gallup Korea said that they understood his decision to migrate. After his 2014 gold medal win, the KSU — the Korean skating union — endured heavy criticism from fans and the media, with even the president launching an investigation into what went wrong. Rather than characterizing Ahn as a traitor or a mercenary, Koreans were angry at their own institutions for treating such a valuable asset so carelessly.
South Korea may make changes in the wake of Ahn's emigration, and other nations should learn from his example. They can no longer treat quitters like traitors. As Ayelet Shachar pointed out, governments now view emigrants as "immensely important remittance providers, generous supporters in times of crisis in the home country, foreign investors (through specialized bonds, for example), builders of transnational knowledge networks, and ambassadors of good will." All this, of course, holds equally true in the business world: Performers who leave your company today may appear tomorrow as clients, suppliers, or consultants.
So both sending and receiving nations — or organizations — can benefit when talent migrates. The thing is, mobile talent isn't always portable. Even top performers need a platform from which to succeed. They require infrastructure, training, and commitment.
In business, many people are discovering this the hard way. Long after the demise of corporate loyalty and the emergence of "Brand You" and "Free Agent Nation" ideology, managers and executives still, far too often, approach job changes in a reactive, nonstrategic fashion. They make moves based on short-term gains — more money, a chance to escape a disliked boss — instead of long-term growth and development. (For background on other 21st century challenges of managing your career, see our article "Manage Your Work, Manage Your Life" in the March issue of Harvard Business Review.)
Companies, as well, assume risk when they hire star performers. Organizations often poach top talent from competitors in order to rapidly and dramatically increase their capabilities. Having scooped up top talent, however, it can be tempting to fall prey to the "plug and play" fantasy and assume that the new hires will automatically succeed in their new environment.
Like countries that woo high-performing athletes such as Ahn, fast-tracking them to citizenship and Olympic glory, companies must provide their new stars with the training, coaching, and continuing investment that will allow them to soar — and make them want to stick around.
September Is (Still) The Best Month For <b>Buying Gold</b>! | Zero Hedge
Posted: 14 Sep 2014 07:21 AM PDT
At Sprout Money we have been advocates of gold for as long as we can remember. In our opinion, every portfolio should have some exposure to the yellow precious metal regardless of the profile of the investor.
It is one of our favorite investment themes and it will remain to be so for a long time…
The reason for that is simple: the gold price has been in a secular bull market since the year 2000. We stick to that view despite the fact that in 2011 gold fell into a cyclical bear market and started crumbling just short of 2,000 dollar per ounce.
Different elements were at the source of gold's decline:
First and foremost competition came from the stock market, which has been in a cyclical bull market since 2009 on the back of the financial crisis.
Secondly, the dollar has been gaining momentum again and makes gold look like a less attractive investment.
The overall sentiment is a third element that cannot be underestimated, however, and is related to psychological factors and the media.
A majority of participants of the weekly Kitco News Gold Survey indicated that they expect the gold price to decrease, for example. In their opinion, gold will have a tough time dealing with the improving macroeconomic landscape in the US and the looming interest rate increase.
As Kitco states: "Out of 37 participants, 24 responded this week. Of those, five see higher prices, 18 see lower prices and one sees prices trading sideways. Market participants include bullion dealers, investment banks, futures traders and technical-chart analysts."
That is all nicely visualized on the infographic below.
It is important to know that most of the participants in these kinds of polls are gold bugs, which makes the result even more clear as a reference to the sentiment surrounding gold.
And then there are the classic 'short sellers' in gold, of which one can wonder what their hidden agenda is. Goldman Sachs, for example, stated on CNBC just last week that they are sticking to their original 1,050 USD per ounce price target for the end of the year.
Their commodity specialist gave his usual speech about the fact that safe haven buying because of the crisis in Iraq and Ukraine and the recent quantitative easing in Europe and Japan have supported the gold price a little bit.
According to this analyst the Fed is playing the part of the bad guy here, which is why he advises to short gold. The appetite for short selling is quite noticeable actually, judging by the open interest on the gold markets.
From a contrarian standpoint, that is more a symptom of a market that appears to be bottoming out than of an imminent crash, however. Meanwhile demand from retail investors seems to be stabilizing as well, as demand for gold coins like the Krugerrand or the American Eagle is slowly picking up.
And without anyone taking the time to write about it, physical gold deliveries in Shanghai doubled over the last two months. As with many things: if no one writes about it, you will find the truth at Sprout Money ;-).
The stronger demand for physical gold has the effect, moreover, of increasing the gearing of the shorts on the paper gold market.
Nevertheless, it seems like short sellers have tightened their grip on this market; open interest in gold increased which, in combination with a lower price, confirms that futures are being driven by an increase in short positions. The chart below makes that clear, especially from the 27th of August when the decline started.
This is another indication of the fact that the gold market is bottoming out.
The last thing you want to do now is state that a stronger dollar automatically leads to lower gold prices, because the recent momentum in the dollar has mostly been the consequence of weakness in other currencies; think of the strong decline in the yen as a result of the weaker Japanese economy. The ECB lowered interest rates to practically zero, and the British pound is sweating because of Scotland's independence campaign.
A more plausible analysis is that the investment community is still not worried about systemic risks in the financial system. The stock and bond markets are still doing very well, although volatility has picked up a bit. The perceived risk has declined.
But in the longer term there are plenty of risks left in the system and demand from growth markets will remain strong as well. Many countries in the Middle East and the Far East are still net buyers of gold; the demand from the central banks of China, Russia, etc. remains strong.
The chart below makes that quite clear!
Russian gold reserves 2011 - 2014 (per ton)
Decreasing exposure to gold in your portfolio therefore does not seem like a smart move at the moment. It would be like cancelling your Florida hurricane insurance in June. Keep gold in your portfolio and profit from this temporary weakness in the yellow precious metal's price and the sentiment on the market.
Those investors who like to time their purchases probably know already that September is the best month to buy gold as well, as evidenced by the following chart.
Gold has gained 3% on average in the month of September over the last 20 years, far ahead of November (1.8%) in second place.
The interesting part is that this usually is the result of a comeback from weaker circumstances, which is exactly the situation where in right now. Especially the weakness in the price is remarkable.
The coming months are definitely looking up for gold based on seasonal factors in countries like India and China, moreover, and it is most probable that the gold mining sector will capitalize on the revival.
In short, the current weakness in the gold price will once again be considered as a unique buying opportunity in hindsight. Unfortunately not many investors make use of these kinds of opportunities.
>>> Want to Know Where the Gold Price is Headed Long Term?
Sprout Money offers a fresh look at investing. We analyze long lastingcycles, coupled with a collection of strategic investments and concrete tips for different types of assets. The methods and strategies from Sprout Money are transformed into the Gold & Silver Report and the Technology Report.
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A Bullish Sign for <b>Gold</b> – Central Banks <b>Buying</b> Record Amounts of <b>...</b>
Posted: 16 Nov 2014 03:03 PM PST
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Alan Greenspan | The Enduring Power of <b>Gold</b> | Foreign Affairs
Posted: 30 Sep 2014 11:47 AM PDT
If China were to convert a relatively modest part of its $4 trillion foreign exchange reserves into gold, the country's currency could take on unexpected strength in today's international financial system. It would be a gamble, of course, for China to use part of its reserves to buy enough gold bullion to displace the United States from its position as the world's largest holder of monetary gold. (As of spring 2014, U.S. holdings amounted to $328 billion.) But the penalty for being wrong, in terms of lost interest and the cost of storage, would be modest. For the rest of the world, gold prices would certainly rise, but only during the period of accumulation. They would likely fall back once China reached its goal.
The broader issue -- a return to the gold standard in any form -- is nowhere on anybody's horizon. It has few supporters in today's virtually universal embrace of fiat currencies and floating exchange rates. Yet gold has special properties that no other currency, with the possible exception of silver, can claim. For more than two millennia, gold has had virtually unquestioned acceptance as payment. It has never required the credit guarantee of a third party. No questions are raised when gold or direct claims to gold are offered in payment of an obligation; it was the only form of payment, for example, that exporters to Germany would accept as World War II was drawing to a close. Today, the acceptance of fiat money -- currency not backed by an asset of intrinsic value -- rests on the credit guarantee of sovereign nations endowed with effective taxing power, a guarantee that in crisis conditions has not always matched the universal acceptability of gold.
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