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Commodities Drubbing Follows Chinese Reserve Requirement Hike, Even As Japan Boosts Capital, Prepares To Print
For those wondering what is causing today's most recent commodities drubbing look no further than the PBOC, which a few minutes ago announced it was hiking the RMB deposit reserve ratio by 50 basis points. Following the hotter than expected CPI print from Tuesday night, this is not unexpected, yet it merely makes the stagflationary outcome even more possible, as aside from inflation all other economic indicators pointed to a sharp slow down. And while China is tightening, Europe, as we predicted, will soon be forced to undo its most recent foolish rate hike, and likely loosen substantially following a crunch in the continent's industrial production. "Production in the 17-member euro area slipped 0.2 percent from February, when it advanced 0.6 percent, the European Union’s statistics office in Luxembourg said today. Economists had forecast a gain of 0.3 percent, the median of 25 estimates in a Bloomberg News survey showed. Production rose 5.3 from March 2010 after increasing an annual 7.7 percent in February." As a result, the EUR drop is causing the USD to jump yet again, causing futures and commodities to tumble. Simple. Or is it?
As if right on cue following our previous post about hyperinflation in Japan, and our expectations from earlier in the month about an imminent QEasing out of Japan, the BOJ just announced "next steps." Bloomberg reports:
The Bank of Japan has increased its ability to take “appropriate and flexible” policy action by increasing its capital reserves, executive director Masayoshi Amamiya said.
Speaking to lawmakers in parliament in Tokyo today, he added that the move to set aside 15 percent of the bank’s net income as legal reserves won’t trigger any immediate policy change.
For our extended thoughts on the matter read here and here. It appears that the Yen is about to become the world's most shorted currency once again following what appears a shift in posture to dramatically reallign it "assets" and liabilities. And guess what that money is going to buy once it hits the market. Surely more yen.
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Mo' Yen, BiatcheZ!
Was on Kitco moments ago, if you live in canada you cant buy any silver products...
ONLY shipping to US, Canucks are locked out.
https://online.kitco.com/bullion/completelist_USD.html#silver
Just a few days ago, I was rejoicing because I thought that I had stacked up at a phenomenal DIP!
Today my bullion dealer would sell me each round for more than 1,5€/ounce cheaper.
I guess this is why people say that silver is an emotional rollercoaster?!
That is amazing. Not much to pick from in their silver supplies either.
Scotia has Maples, and nothing else:
https://www.scotiamocatta-estore.scotiabank.com/stores/scotiamocatta/cat...
Yet interestingly enough, 3m bunds have continued to fall in price.
And interesting that the Yen is about the only thing to appreciate against the USD today. The speculators are sniffing out the easy money.
Silver, oil, ES, all correlating to AUD/JPY 30-second moves as usual.
The Yen's made a sharp turn. Is it possible the easy money has already been made, that Maasaki 'easy' Shirakawa has already eased?
everyone expects the USD to collapse...the Yen is in far worse shape.
I picked Japan to go first; thought the yen zone would faceplant a couple years ago.
The world is awash in yen the same as in dollars; everyone is tapdancing on a highwire.
What was it Max Keiser said? "The USD is the leper with the most fingers..."
Who said you can't print your way to prosperity?
Geez and I thought the drop was due to T Mosely buying silver on Ebay at spot + 10 FRN's.
60 by next week!!! ROTFLMAO
Hey, look everyone, it's two liars jerking each other off.
Let's leave them alone.
$33. You were warned. Now you pay. You suck asshole.
dude, you DID say 60 by next week. Just like you DID say all of Tokyo would be dead or evacuated by April 2.
Now, your "life savings" which is in silver...well, it's plunged by 33%. You have lost an astounding amount of your life savings in the span of a week. Now, I know this is probably only 300 bux or so, but still... LOL LOL
dltd
Gold feels ready for a sharp correction, test Feb lows...
Maybe the commodities drop has more to do with Timmah Jeethner and the Chinese meeting over manipulating markets so that everyone can stay solvent for another month.
agreed. there are no free markets on either side of the pacific.
Perhaps the markets actually believe that our government will reverse course, cut spending, Balance the budget, not raise the debt ceiling, etc....hahahaha
It would appear they are actually fearing that. If QE3 does not happen, then there will be a massive correction.
I believe QE3 is a certainty.
The stocks markets and FX markets still have not shown much doubt of QE3 not happening. As soon as they fall out of the bed, QE3 is on, publicly or not.
.
Who said the USD would just go off quietly into the night.
Looks like this is going to be more entertainment than I thought.
Is your new favorite combination of phrases after looking at the overnight night data similar to mine?
"What the fuck? how the mother fuck? this is such bullshit.. fucking motherfuckers...sick of this shit"
MORNING IN AMERICA !
Boker tov to our Jewish paper gamblers in New York City !
The Chicago CME - New York COMEX - J.P.Morgan mafia cabale once again in the business of hammering silver, the great enemy to the Central Bank fiat confetti system that is flooding dollars into all corners of our world.
I found out that the mighty hand behind CME group, which owns NYMEX,COMEX,CBOT and GLOBEX is none other than Leo Melamedovich, a Polish-Jewish immigrant, who fled the Holocaust and founded CME in Chicago.
http://en.wikipedia.org/wiki/Leo_Melamed
http://en.wikipedia.org/wiki/American_Jews
New Yorks history is inseparably connected to German-Jewish immigrants.
What do you think where all the Feinsteins, Goldsteins/Goldstones, Grünbergs/Greenbergs, Katz, Katzenbergs and Silverberg/Silberbergs are coming from ?
It was Frederick II, King of Prussia, who gave them their surnames.
Oh, and before I forget it, Henry Kissinger and Bruce Willis were born in Germany.
Mises and Rothbard were Jewish as well. They wrote some of the best critiques of the whole stinking system over the pass 100 years.
Kudos to a user and ex-runner on CMEs trading floor, here on ZH, for giving me the hint.
I forgot your name, mate, sorry.
Remember when the Free Silver Movement was considered evil because it was inflationary?
Times change, eh?
Stagflation Bitchez!!!!!
China is the biggest buyer of PMs and commodities.
China tightening = less demand from China = Kaboom.
This is, of course, an old story, but I mentioned it months ago.
If only you guys had listened.
The bugs are a gullible lot. They read some bs on the Internet and next thing you know they are on ZH spewing falsehoods. Well, silver is showing its true colors now and there is plenty of supply to go around.
Instead of listening to reason, the bugs would rather ride their conspiracy theories to the poor house. This fact has led me to conclude that they are born losers and little can be done for them.
Silver bugs were warned now they pay. Shed no tears for the herd.
This bug is still deep in the money over here... I'm not worried - went through this same bullshit when Au struggled to get through $1k. Now look at it. As long as the Fed prints - wealth preservation is the order of the day.
why are you here pretending to help people?
Not sure why people give Math Man so much shit...he has actually been pretty accurate about some of his predictions. Granted, most don't give a fuck about paper silver, but if you listened to him you could have made a ton in SLV puts. Seriously.
He's also a lot better than these newer trolls who simply "lol" at us silver bugs. Math Man brings some much needed contrary opinion to the board. I agree that the majority of the board is contrarian, but there are many levels other than just "Cramer" and "smart money." There can be disagreements between silver bulls about the paper price, short term pricing, worldwide demand outlook, etc. I think in 3-5 years ultimately physical silver wins out and trumps all paper/ETFs. But TPTB are very determined to keep the price suppressed, and in the short term they can absolutely smash the price to the downside. Yes, premiums have gone up, but Eagles still have come down from about $55 to $40. A nice buying opportunity, but also there is a lot of money to be made if you like to gamble with a small % of your assets in the SLV or AGQ. And while most here think it's funny to post pics of the USD as toilet paper, it isn't quite there just yet. We may still have a good 1-3 years of somewhat contained prices. I mean, gas and food have gone up, but in a true hyperinflation they would be much, much higher. If gas stays below $5 per gallon for the next 2 years I would call that a pretty stable price, compared to what is coming when prices hit $10, $20, $50, $100 etc in short order. You can keep 85-90% of your investments locked up in physical bullion, and the other 10% or so playing some SLV or GLD options, and if you happen to hit big you can cash out and buy more physical. Not sure why that's the worst idea in the world.
The bottom line is that Math Man called for $20 silver this summer, and he might be right. But everyone should be happy if that happens...the silver bugs can load up on the cheap, and Math Man gets more paper from his SLV puts.
I'm glad the price has come down, I have added to my physical position in the past 2 weeks, just bought some yesterday. But I'm also glad it came down because it puts things in perspective. Silver's ride up won't be a straight shot. We aren't a lock to hit $100 or $200 or $1000 by year's end. But who the fuck cares? I'm 25 years old, I have a lot of time to keep accumulating silver....I would hate if I woke up tomorrow and it hit $500/oz. I want to keep adding to my position. I have more than 99.999999% of people my age, but that's not enough. I wasn't smart enough to be buying at $4, $7, or even $15, but I did start dipping my toes in around $16 and have added since then.
Anyway my point is this. Junk Math Man, and me if you want, but look at his posts, he has been more correct on the short term movements than almost anyone here. I imagine if silver did hit $20 by August, people would have to quickly backtrack or STFU while Math Man gloats. It's just funny that people can't see it from both sides. I think tmosley etc have great points, but I also think Math Man brings up some good points. I try to see both sides and use them to make more (fiat) money, and also to add to my physical. For now I feel safe holding fiat for short periods of like 1-3 months, which some people make out to be a huge fucking risk but in reality the dollar isn't going to go to 0 overnight, there is too much at stake for it to simply collapse without a huge struggle.
Nicely reasoned reply LRC.
I agree that we need guys like Math Man to present the bear case. I have not been carefully following his calls, but will take your word for it that he has been right on many trading calls. I have not junked him (yet, or at least when I have been sober, LOL)
I think the point Math Man misses is that most of us buyers of PMs are buyers with strong hands, and not traders. Most of us do not sweat the inevitable dips, and silver has ALWAYS been very volatile. Some even BUY TFD! NO ONE will ever get my gold (except my kid). I may roll over some more silver to gold if the GSR drops back into the low-mid thirties.
One other observation: I have yet to see ANYONE who says that they will trade their GOLD for SILVER. Silver for gold..., yes, but not the other way around. So, which metal is being held by the strongest hands? That would be gold. My hands. And the central banks.
Keep BTFD! (sarc) Silver bugs born to lose.
Yes the only people that lose money buy silver. No other commodities or markets are taking a hit.
What a fucking used bloody douchebag you are.
What other commodity has tanked nearly 40% in last week and a half? Loser.
Idiots like you see a bubble popping, smart money sees a huge buying opportunity, maybe one of the last good ones before all the quality silver, such as Eagles and Maples, is gone for good (at least in terms of trade for fiat). Unless you and all the other faggot trolls shorted AGQ up around $300+ STFU. And if you did, why not cash out now, because I heard from another faggot troll that if something triples in a year then it's bound to crash. Keep fucking around with fiat and paper, while the grown ups stack real, shiny silver.
Honestly, if silver tanks again and falls to $15 do you really think most people here would complain? Fuck, they would be tripping over each other to the nearest coin dealer, flea market, garage sale, or busy crashing APMEX with buy orders. Then again, you live in a different, phony world of paper, where the spot price of silver has "tanked" to around $33 yet the cheapest Eagles you can buy are still right around $40, unless you're buying 500+. So in reality we went from a high of about $55 down to $40, a big drop but nowhere near 40%. In the real world, silver has not gone down 40% from the highs. Maybe the paper price did, but hardly anyone here messes with paper, and those that do only put a small amount there just as a gamble.
What you and the faggot trolls keep doing is similar to me logging into an NFL message board and lecturing people about how bad the Mets suck. It's two different worlds, and sadly yours will end with you broke and/or homeless if you stick to paper. Unless, of course, you're just /sarc'ing us without telling us, if so, A+ effort.
I've been posting the truth for entire crash. There are other ways to hedge against monetary debauchery than buying grossly overpriced silver. SVM reported last night. You know what their cost of production was? -$5.81/oz. That's right after byproduct sales they are getting paid to mine silver.
http://silvercorpmetals.com/_resources/news/2011_05_11_News_Release_FY2011_Q4Results.pdf
So? That doesn't mean they can increase production. They can't magically increase demand for their by-products. Silver almost doubled between in 2010, but production only rose a measly 2.5%.
But you don't care about reality. Celebrate the fall of the paper price! Nevermind that this is likely to shut down the physical market for silver, making it literally impossible for the COMEX to source silver for the unprecedented number of paper longs who will stand for delivery at the end of this month.
As the paper price declines on infinite volatility, the COMEX will collapse. When the price started recovering a while back, I thought perhaps I was wrong, but now it seems that I wasn't. It looks more like paper will trend towards zero. Then--KABOOM.
Silver is getting crushed and you were buying the top. You the world's alsolute worst investor. You weree calling for silver at $49 by last Friday.
Buy more. It will be $24 soon.
You were warned and now you and your herd of sheep pay asshole.
You got beat up a lot as a kid.
Not a question....a statement.
-$5.81/oz
There is massive damage in silver market. The chart speaks for itself. No further comment.
then stop commenting. go away.
I think he is Blythe's cabin boy.
You should buy more. But I'll but you're chicken
There is no such thing as stagflation, the economy is always moving.
Where are all the idiot perma-bulls who attacked me and Bob Moriarty 3 weeks ago for top calling silver? Repeat after me morons: ALL PARABOLIC MOVES END IN COLLAPSE. Silver had nearly tripled in one year. If you listened to people like tmosely and didn't take money off the table you are an idiot.
Yeah, yeah, I know you are holding physical and therefore don't care about the paper price. Have you tried to selling your physical? Who will buy it without getting assayed?
Repeat after me: tmosley is not a daytrader. tmosley is not a daytrader. tmosley is not a daytrader.
Get back to him (and me) in about 3-5 years, if not sooner. Have fun trying to cash in your fiat, "assayed" or not, in 2016, for anything of real value. Later loser!
tmosley is a complete idiot.No concept of his stands testing. No concept of his can be challenged w/out his instaneous lurch into name calling. Hardly Socrates's empirical method. For him to your doom. He'll be around to keep your warm throughout the nuke winter.
Remember bubbles DO NOT reflate (well ok but only at 31 year intervals)
Ah, I see that you aren't on crack yet this morning. Able to put together not only a single complete sentence, but a whole PARAGRAPH! Congratulations.
As the paper price goes to zero on infinite volatility in this second stage of the COMEX collapse, more and more people will stand for delivery as it a) becomes cheaper, and b) the COMEX is unable to source bullion at these prices, and c) more and more people see the fraud.
It's looking like the endgame wants to play out next month. Let's see if it does. In the meantime, I will enjoy the sale, and the continued existence of my 240% paper profits on my silver that I have been buying for almost three years.
You're losing your ass. You need to post harder today to forget the pain.
I'll bet you recommend others buy more but you wont because you're chicken.
All trolls should be careful messing with the tmosley!
I believe his cost basis is very low on silver.
It seems (maybe?) that he likes silver more than gold, I'll take the gold thanks.
Silver has ALWAYS been very volatile, I have seen this kind of thing all the time.
He is right, absolutely right, about his biggest point: buy physical! Physical will win.
Start buying silver when it drops to $28. It could fall all the way to $22. Start buying gold mining stocks now (50% GDX + 50% GDXJ). In the next phase mining stocks will outperform bullion.
When gold is around $5000/oz in 2015 or 2016 sell mining stocks and buy treasury bonds. By that time the US $ will be linked to something real like gold. When gold becomes a part of the monetary system the US $ will again become a good investment.
bonds? LOL. They depend upon growth.
The USD has moved 35% against silver in the last 2 weeks. Does that classify as parabolic or is there more to go?
Wait until USD doubles in value against silver.
schizophrenia ...bitc..
The global economies have just entered the twilight zone. Lock your doors.
.
Another horrific gap down in silver stocks pre-market.
As of this morning, some like GPL are down over 40% from the highs.
Silver bugs have been outright decimated in record time.
Bugs born to lose. And so it goes.
Just bought a ton of paper below $33. Thank you PBOC.
And yet you still can't buy back the same number of eagles you sold at the peak.
lol
You could if you sold. You didn't sell you BOUGHT MORE!!! brawhahah .You suck.
Hey butt face, news alert: BUBBLES DON"T REFLATE.
No, you couldn't. Because of a little thing called "taxes". Those mean that long term holders who sell are immediately 40% in the hole.
But I see you are sparking up the crack already this morning, so you probably won't understand it by the time you read this--but spot will have to fall to at least $20-25 for RobotTrader to be able to buy back the SAME NUMBER of eagles he sold for $47. And that's with the current premium. Which won't last.
Enjoy your crack cocaine!
Yesterday it was 400%. What gives?
Who pays taxes on physical? You? LOL Loser!! You suck. You don't know fuck about taxes or anything else you jerkoff.
Agree on the whole "taxes" thing. Who in the fuck actually pays the tax? It's seriously like a waitress claiming 100% of her tips and paying the full tax. L. Oh. Fucking. L. Seriously, get a grip, no one pays taxes on physical. If you do you're a fucking moron.
No one should pay any taxes, and people do avoid them when it's highly likely they will get away with it. Who cares if you "break the law" if the chances of getting caught are about .00001% and the law itself is highly immoral?
You didn't let that man with the gun steal your moneys? Oh noes!!!!!!!1
Not sure if I follow your logic here.
You could have very easily bought silver at $20 from coin dealer A in the not so distant past. When the price was up near $50 you could have sold for $45 or so. Hell, APMEX was offering I think $48 or $49. Now, a few weeks after selling, you can walk into dealers A-Z or logon to APMEX and buy for $40 or slightly less.
Unless I'm missing something, you're completely wrong about this. There are no fucking taxes to pay if it's you and the coin dealer or you and APMEX or you and the guy at the flea market. That's like saying waitresses claim all their tips and pay taxes on them, it would get you laughed out of the room instantly.
You're still a very solid poster, but I don't understand why you keep saying there's a silver shortage or bringing up taxes regarding physical silver. Both of those are pretty wrong right now. Yeah, supplies are a bit tight in some areas, but you can have all the silver you want if you aren't a snob and can accept 90%, 40%, war nickels, generic bars/rounds, etc. Come back in 3 years and you're probably right, there won't be much silver to be had.
There is no shortage. This is just a clever lie fabricated by those interested in selling you silver.
What? You have to pay taxes on dollar gains, and at the confiscory "collectables" tax rate. Plus he has to pay state taxes.
If he doesn't pay them, that is tax evasion, and he risks prison. Sure, you can break the law if you like, but basing investment decisions on your ability to get away with tax evasion is a recipe for disaster.
And I am not saying there is a silver shortage, I'm saying there is a choice between silver shortage or rising premiums. And premiums ARE rising. Not long ago you could get a single ASE for $2-3 over spot, now it's more like $8, IF they have them. Monster box inventories are pretty much gone. Even the premiums on 100oz bars have doubled over the last few weeks. COMEX deliverable bars are up to a dollar per oz over spot in places--used to be half that, or even a third.
The point is that the price has fallen without a significant increase in physical supply, and while demand is growing. This simply does not make sense from an economics 101 perspective. But it does make sense when you realize the market has been flooded with paper. That fraud will likely be found out over the next two months as the paper longs standing for delivery get nothing but a payoff for their trouble.
Again, LMAO at paying taxes when dealing strictly with coin dealers in person. It's like saying "going 60mph in a 55 is speeding, like it or not." It doesn't fucking matter. The chances of you getting caught are so low it's insane you even mention it. How the hell would anyone even know enough to charge you with tax evasion, especially if you buy and sell only in person. It's insane.
And yeah premiums have gone up, and will continue to go up. Paper and physical will decouple and eventually sever completely. I hold physical, and I'm not selling. I think you're a great poster. But come on, give these guys a little slack. They are short term, paper traders. Junk them for that, but their logic is at least a bit sound on the paper game.
If we had asked you, and most others here, if we would see $60 or $40 first in silver, 99% would have said "lol, $60 by next week" and you would have all been flat wrong. I would have also said $60 and been wrong. But at least I can admit that Math Man, Robo, etc were right, at least for this week.
If your entire strategy is simply buy physical and hold, why even bother posting when people talk about the paper game? I have about 90% in physical and I dabble with small amounts in the paper game trying to hit a nice score. It's not like I'm going to stop buying physical or sell any to gamble in AGQ, but if I hit big I can definitely add some silver and/or gold.
I can answer why mosely-claven does that...it's because he's a liar and an idiot.
When he falls on his face (again), rather than admit his error, he just goes into the lies and bullshit even deeper.
Very quickly, he loses the ability to even keep the stories straight and he falls on his face AGAIN.
And he never learns from the experience of falling on his face. He'll dust himself off, pretend it never happened, start spinning bullshit to rationalize it, then promptly march right off and fall flat on his face AGAIN.
The chart does not lie.
decimated = -10%
yep...this is more "annihilated."
Anyone who had their life savings in silver was asking to get banged out like a cheap whore.
...and there wasn't a bubble?
There is a bubble no doubt, but its not in silver.
all of you sippin' that silver hater-aide, need to humble yourselves and trail your stops. I'm amazed how people see this manipulated downward volitility and think this reflects reality.
A shouter in the pit is buying big lots. Somebody big is stepping in! I am literally watching it happen right now. Real-time report.
the price action is suggesting some gold support at 1475-1500 and silver in the low 30s.
I'm not sure there will be much in the way of renewed massive selling pressure to take it down to the 20s. Maybe a slow bleed, but the overbought conditions have totally burnt off. We'll soon see whether there were real buyers at this level or else just pumpers
The funny thing is TPTB think these things will work in their favor. Another monetary tool to use. Hey Rocky, watch me pull silver out of my ass.....federal reserve up my sleeve...
The sad part is they don't realize this sort of thing is how (or at least a major reason why) the swings of ever wider high-low gets started and GROWS over time.
Of course at some point, and not always, but every once in a while, the law of diminishing returns will hit, and now that they've already used it, people will know what it looks like. Sometimes this will mean they'll be ready, and maybe more willing to sit through a drop[ (knowing a big swing the other way will occur), or be quicker to get out at the beginning.
It works until it doesn't, in the mean time here some wider peaks to trough to deal with.
And at no time, will these huge swings endanger any investor or firms foundation. If it does to a TBTF, the discount fed window will be there.
Surely vastly manipulating the markets into a playground seesaw is good for the recovery, and is in no way indicative of a sick and dying market (as well as monetarism as a whole).
Margin hikes, it's the new federal funds rate decision.
Glass-Steagall
Anyone know what the ‘mining’ cost of $1,000 bill is?
Look, PM are commodity just like paper and ink. While the market price/production cost ratio of PM is lower than fiat both trade at a significant premium over their respective manufacturing cost. The only reason any paper based currency has a spot value orders of magnitude above its printing cost is because it can ‘currently’ be exchange for things that do have value (food, energy, land, cars, guns, labor etc). That’s it. So the debate between mining costs vs. spot price is missing the whole point of what gives any currency however manufactured an exchange value ‘above’ its manufacturing cost, PM included.
The bet that all long term PM holders are placing is that ‘if’ or ‘when’ the worldwide fiat system collapses some ‘other’ mechanism of global and local trade will need to be re-established ‘quickly’ as very few individuals or nations are 100% self-sufficient ‘without’ trade. USA needs Oil, SA needs food etc. I could also see a barter system arising for must have commodities between nations completely by passing any medium of exchange (ie barrels of Oil per tons of Wheat). Imagine an extremely large commodities exchange system in which all major commodities are traded for each other with PM being used to help grease the gears for more thinly trade stuff and a store of value within the exchange.
Now post current fiat collapse the world could establish a new global fiat ponzi scheme for all I know without PM. But given the fiat games ‘all’ nations are playing with their respective fiat currencies my guess is that the world will attempt to establish a neutral territory in which to exchange good and services between each other. PM fit that bill.
If you divide the yearly global trade volume by the total amount of above ground Gold I get price somewhere around $2,500/oz. So it’s not hard to imagine especially such a system especially if its just used to augment full on commodity exchange system that doesn’t revolve around any nation’s internal local currency. Even local fiat currencies would be a commodity within the exchange for those wishing to purchase services within the country.
The PM holders/BTFD buyers are betting this future medium of global and even local exchange will be based at least partly upon Gold and/or Gold/Silver. I wouldn’t count out Silver over the long term either. At the current rate of Silver consumption it will likely stabilize at an above ground abundance only 4x more than Gold. The Gold consumption rate just went down sooner due to its native scarcity in the Earth’s crust placing its price well above the substitution cost for other materials/approaches sooner than Silver. Bottom-line, through waste we are on path of scattering Silver to the four winds which will drive up its recoverable scarcity just below Gold in the next decade or two.