Explaining Gold's Sudden Move

Tyler Durden's picture

From Credit Suisse (names redacted):

Few things on GOLD’s move – My colleague [] hearing Egypt's banned Muslim Brotherhood movement has unveiled its plans to scrap a peace treaty with Israel if it comes to power (per a deputy leader in an interview with NHK TV)

And my other colleague [] pointed to the $2.5~3b notional that was bought in gold futures through the intra-day high of $1,338 - was bought over ~5min.......

VOLs haven’t budged, so NOT seeing much protection being bought, but Gold telling something else.. Will keep u posted if I hear anything else.

Is gold once again the geopolitical canarie in the coalmine?

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Bananamerican's picture

here kitty kitty kitty.....

The Rock's picture

The canary died a long time ago.

tmosley's picture

Nah, he's just pining for the fjords!

Fred Hayek's picture

He's an EX canary!  He's gone to join the choir invisible!

Muir's picture

"here kitty kitty kitty....."


Brett: [refering to Jonesy]  "It's just a cat man."




today's trivia question


Pool Shark's picture

It's not the cat... it's the alien behind it...

Turd Ferguson's picture

All these sell-side douchebags try to make it sound so complicated simply so they can continue to extract huge fees from the sheeple.

I give you everything you need to know...for free:


philgramm's picture

fear the Turd, Bitchezzzzzzz.............or is that love the Turd bitchezzzzzz?  Keep up the good work my friend

snowball777's picture

Love the Turd.

Fuck Phil Gramm in the ass until his eyes bleed to his shoes.

RockyRacoon's picture

For those in the market to buy there is a great piece on the PM retail market:

Patrick Heller provides a pretty comprehensive summary on the availability and pricing for gold and silver bullion products.

Math Man's picture

The Nasdaq more than doubled in 2 years and peaked at 5048 on March 10, 2000, and quickly fell to 4798 by March 17th.

It then rallied back up to 4963 on March 24th -- and people thought it was safe to get back in water.

But they were wrong.  By April 14th, it was at 3321. 

It rallied to 3860 on April 28th, and  people thought it was once again safe to get back in the water.  They were wrong again.

The Nasdaq was back around 2000 by March of 2001.

The same thing will happen with Gold.  The downtrend has already started.

Those of you buying this rally need to be really careful.

We're going to have ups and downs before we go back to $750 (or lower).

It seems that 1.4mm ounces (45 tons) of Gold have come out of the trigger happy exchange traded funds since 1/24/10 (rioting started on 1/25/10). 

This rally is being sold big time.

Sell The Fucking Rally!



tmosley's picture

Sorry, when did gold double in two years?

When did the Fed stop printing money?

Did I fall into a coma for a year or something?

Math Man's picture

Gold went from $713.50 on November 8th, 2008 to $1432.50 on December 6th 2010.

The fed is also not printing money - QE increases bank reserves.  The banks print money, not the fed.  Loan growth is still anemic, and thus so is money printing.

You've all been had.

You need to wake up from your comas and sell.

tmosley's picture

Hey, this guy thinks the Fed isn't printing money!

Hey everyone, check this guy out!


But seriously, you act as if gold had been rising before that.  It only hit that level after a 30% correction that lasted almost a year.  Pretty sure the Nasdaq didn't do that.

Go sell you piss lemonade somewhere else.  No-one here is buying.

Math Man's picture

I hope none of you are buying PMs.  You're going to get destroyed.

You're buying something that has gone up 5x in 10 years on the premise that massive money printing is occuring.  It's not.  We're still deleveraging. 

QE is designed to negate the deflationary pressures of a collapsing credit bubble.

It's been used before and it works - WELL - look at the Sweden and Finland in the early 1990s.

tmosley's picture

All is fine.  Nothing to see here.  Buy stocks.  No bubble there.

Math Man's picture

Stocks are cheap.  Corporate earnings are hitting records, and we might do $100 bucks in earnings on the S&P 500.

Even at 1300 on the S&P, we're still at 13x.

Historical is more like 15x...  which means we could hit 1500 soon.

Also look at the P/E of debt - large corporates can borrow at (or below) 4% after tax...

The P/E on debt is 25x ---- that means any of these companies sitting on large cash balances can theoretically pay 2x where any company is trading and it is still accretive!

Sell The Fucking Rally.  Gold will get crushed.


jeff montanye's picture

how are you wrong?  let me count the ways.  no just let me elaborate one:  your example of the nordic banks is in actuality a counter example to current u.s. and european (and prior japanese) policy.  the nordics put the banks in receivership, wiped out the shareholders, replaced management, haircut the bondholders and took public the stub banks stripped of toxic assets with the resulting moneys used to replace the public's expense for the operation.  and yes it did work well.  did the u.s. do anything like this?  (howling laughter, sounds of chairs and tables being knocked over by individuals tumbling to the floor and rolling upon it).

Math Man's picture

I'm not wrong.  Sweden and Finland expanded their monetary base, just as we are doing.

Sweden doubled their monetary base from SEK 83.73 Bn in August '93 to SEK 208.26 Bn in June 1994. They decreased the monetary base to SEK 81.11 bn in Feb 1997.

Finland expanded their monetary base from 34.5 bn to 68.7 bn and brought it back down to 36.2 Bn.

Expanding monetary base does not doom a country, as much as all of you would like to think it does.

Expanding the monetary base actually does exactly the opposite.  It saves countries.


GoinFawr's picture

Mathman ducks, he weaves, awwwwwwwww he still gets one right in the kisser!

Evasion isn't an argument boyo.


66Sexy's picture

perfect organism... void of concience... remorse...

Michael Victory's picture

I've got Speedy on my tail, and I know it's either him or me.

Josh Randall's picture

A litmus test of global stability it is

SRV - ES339's picture

Great point... but I would replace 'stability' with 'stupidity.'

Sam Clemons's picture

Speaking of stupidity, any other gold bug worried about Cramer recommending gold and mining stocks here?

Flakmeister's picture

 No, but based on his analysis of the NEM FRG takeover, he doesn't have a fucking clue about the business...

Attitude_Check's picture

Obviously a BIG takedown planned in the next week.

StychoKiller's picture

Headline from AlJazeera:

Algeria to lift emergency powers

President says country's 19-year state of emergency will be lifted in near future in apparent bid to stave off unrest.

Looks like they picked the wrong week to give up emergency powers!

Matt's picture

19 years!? that must have been one hell of an emergency. Glad to hear it is over though.

jeff montanye's picture

yes 19 years is quite long.  our national emergency, at a decade, seems much shorter.  

sodbuster's picture

Somehow got double posted.

dwdollar's picture

Let me know when you find a religion that's truly peaceful.  I might join it.

drink or die's picture

Quakers?  They also make good oatmeal.

Withdrawn Sanction's picture

Really?  Ive always found they scream a bit too much when you boil them.

jeff montanye's picture

how about buddhists?  i remember some monks burning themselves up in vietnam to protest the war with nary a peep.  now my granddaughter's tinkerbell notebook says made in vietnam.  damn glad we fought that one.  maybe someday she'll have one made in afghanistan.  then it'll all be worth it.

colddirt's picture

the church of monday night football has never started any wars.

Commander Cody's picture

And two sides fighting for land is...sport.

mmlevine's picture

Buddhism - preferably the Zen school.

BigJim's picture

I'm afraid the pre-war zen buddhists were very keen on the Japanese imperial expansion:




Sorry :-(

colddirt's picture

the church of monday night football has never started any wars.

fragrantdingleberry's picture

Many sacrifices have been made on the Altar of Love.