This page has been archived and commenting is disabled.

FMX Connect Debunks The Reverse Psychology In Goldman's "Buy Gold" Recommendation

Tyler Durden's picture




 

Late last week, Zero Hedge pointed out that Goldman Sachs had come out with yet another flip flop piece on gold, having recommended that clients should go long, then short, then long again, pretty much depending on which way the wind blows. We have long been skeptical of Goldman calls on anything, let alone gold, as the firm, just like JPMorgan is very much fundamentally conflicted any time it has a bullish "recommendation" on any precious metal due to the very intimate influence gold and other commodities have on Fed presidents' perception of inflation (and the last thing one would want is for Bernanke's deflation scare tactics to be doubted by more than just Dallas Fed's Fisher, who despite lofty rhetoric has yet to back his words with even one abstaining vote). That said, our skepticism about Goldman's sudden shift in bias has been validated by FMX Connect, which has conducted a forensic analysis of just what Goldman is seeking to achieve with its most recent recommendation. We continue to be far more bullish on any price appreciation prospects for gold, when Goldman (not to mention that other clown on TV), are bearish on gold, than the inverse.

From FMX Connect:

Gold Prices to Hit $1,480: Goldman Advises to buy a Deferred Expiration

We read an interesting sales pitch on the Street.com Friday. Here is an excerpt:

The investment bank said in a research report Thursday that it expects gold to rally "towards our 3-month price target of $1,480" an ounce. Goldman is recommending investors get long on gold by buying the December 2011 futures contract currently trading at $1,426.10 an ounce.”

To restate:

“Buy Gold. Buy it in a less liquid, wider bid/ask market contract than April GC or GLD and buy it through and/or from us. Buy a contract whose liquidity will also most likely not be there when you need it most whether you are profitable or losing money.”

Forget the bank’s opinion. We ourselves are bullish. But it is commonly agreed among paranoid yet savvy traders that if Goldman is recommending you to buy, it is because they are already long and are maybe looking for an exit strategy for themselves or a client they favor.

No doubt, sometimes you make money getting long when GS says “Buy”. And that is because GS has uncovered a soft spot and the market will overshoot even their inventory overhang being liquidated. Or because their own client told them to buy. Or perhaps you were an early entrant in their “find the bigger fool” race. But sometimes you don’t make money.

Here is what we want to focus on: The recommendation of buying a deferred expiration future when so many more logical choices are available. Warning: lots of derivative talk ahead. We were on a caffeinated roll when we wrote this and didn’t make the time to translate to normal English.

Why the recommendation is Bad or at least not optimal for most people.

The real poker-tell here for us is how the bank is recommending you to get long.
“…get long on gold by buying the December 2011 futures contract…”

Right off the bat the math is wrong. Using the warped logic that recommends buying deferred expiration futures: A three month target of $1480 translates to an August future at the latest. Why would you tell someone to pay more carry cost than necessary? But let’s look at the implications of any deferred future recommendation as a market taker (i.e. lifting offer/ hitting bid client)

Let us now count the ways that this December purchase is both ridiculous, negligent, and possibly the most obvious tell on earth as to what their position actually is.

1.    December futures are less continuously liquid than their front month counterpart, currently the April contract. Which means the implicit fee from the bid/ask spread will be bigger on entry into the long position. Is this added premium worth it? NO. Gold is Gold, and the difference in price between April futures and December futures is the opportunity cost of money. Gold today is gold tomorrow plus the cost of how much interest it would be to borrow money to buy the contract. Note we said continuously liquid. There are times when December will be almost as liquid as April (with a wider bid/ask no doubt), but the real hidden hazard is continuity. Translation: “When you NEED to get out, because of the gold market washing out, the stock market washing out, you kids college tuition due, war, peace, pestilence, or whatever…..that exit liquidity will be AWOL relative to the front month’s liquidity.

2.    If there ever were a short squeeze event like in Silver and spreads went backwardated, guess which contract would benefit? April. So as unlikely as it is to happen, buying December takes the whole homerun from physical delivery issues right off the table. You are actually short optionality on a short squeeze. Guess who is long it? Speaking of Silver: how is it that GS didn’t tell their clients Silver would go backwardated? It was the trade of the year and much easier to see than if the market itself would go up or down. Do you think they missed it?  We doubt that. We also doubt they would let you in on it until the trade was exhausted. We know of two hedge funds that didn’t miss it, and they told no one anything on their bet. We found out after the fact. When JPM crushed silver spreads and carried out a prominent futures local out on a $10MM stretcher, were their clients in on that one as well? We wonder if GS was caught on the other side of that disaster. Probably not. They probably benefitted.  But by all means buy gold because they think it’s going up. Enjoy the crumbs from a TBTF bank’s best trades. It will also come with one of those neat oval stickers you can put on your Land Rover

3.    Try getting out when you have to, upon exit especially in a market washout scenario, Murphy’s law applies. The marketmaker of last resort will be Goldman. And guess what he has on his book as your position being, LONG and WRONG. The exit vig will kill you much more than those low-low commissions promised by your benevolent banker.

A Graphic Interlude: What Determines a future contract’s value

These charts are on different scales and not perfect renditions. But you see the point. The difference (for now) in gold future expirations is a function of interest rates, be it treasuries, LIBOR or some other correlated instrument that measures opportunity cost of carry. Futures are just synthetic forwards and vice versa. There is no benefit to buying less liquid instrument unless you are the marketmaker and can make more money in bid/offer fees than you lose in cost of carry arbitrage. There is a reason these curves are similar. Any variation is arbitrage, though not without risks. A future contract in Gold’s value is a mathematical equation.

Spot price x days to expiration divided by 365 x the risk free rate of money for that time period + some storage cost factor= the future price.
 
There are 2 scenarios that will change that math. When a shortage of physical gold reflects a need to roll futures to spot (unlikely but we can pray!) or when aliens land that eat Dec gold and crap April gold (Moonshot contango)
Also, buying a December future contract does not limit your downside risk NOW as many people think. “It’s Gold in December, not now right?”  There is another word for that. It is called a DECEMBER CALL OPTION.

 
Why the Banks may be legitimately recommending this tactic and why that recommendation assumes you are too stupid to understand the risks of getting long another way:

“You may be holding it for a long time and we are trying to save you the rollover cost execution.”

a.    Math is math. Rolling over your long every expiration will cost approximately as much money as the complete contango from April to December right now. Add in the “We know you’re a buyer so we’re gonna back off and raise our Dec. ask price because you are a captive client” and you will most likely get crushed. They can’t fade you in April. They have more competitors there.

b.    Even if a. is wrong and they are not fading you, and the monthly rollover carry is a tick or 2 more than just buying and holding the December future, we’d rather pay that liquidity premium any day instead of being kept on hold while our broker, banker, AND counterparty susses out our position before making a market in a back month future. Even if you execute the Dec contract for yourself on a screen, who do you think is bidding up the December contract with no fear of anyone selling it to them? They borrow at 0.00% interest. Their staying power is bigger than you and your 18% visa card. And they know you are coming to buy. Its Bayesian probability and asymmetric risk for them. You are toast. Their whole commodity model has de-evolved into a Martingale trade, And Double Zero is the Fed going under.

c.    If it were more efficient to buy December futures than to buy April and roll them over, there would be no back month independent marketmakers or arbitrageurs, because there wouldn’t be sufficient edge to support their trading. But yet there are plenty of back month futures marketmakers willing to make a market in something you know infinitely less about than they do. Back month marketmaking is not a public service. Meanwhile, there are hardly any spot month independent marketmakers anymore, because the market is just too tight to make a living unless you are arbing another venue.  Natural flow as a result of transparency and technology makes the market now. December, not so much.

Why they may be recommending this tactic with less than your best interests at heart:

1.    They could already be long December contracts given to them from producers who hedged production last year.  The Bank’s own hedges could be in April and they seek exit liquidity on their December long leg while they unwind their shorter dated leg, which is infinitely more liquid for them.
2.    They are long April and are perfectly happy putting on the April/ Dec spread at higher than interest rate differentials. Specifically, 8 month rates will be less than what you pay buying December at a price while April is trading at a lower price. Example: they sell Dec, buy April and collect a cost of carry spread of say, .25% and then trade a bond spread that charges them .15%. Tadaaa, inefficient markets make them money.
3.    Because their market share in commodities has shrunk since ETF’s have trumped their own GSCI for retail flow, and they have to make up some “special” reason to buy a December contract in Gold.
4.    Maybe they are helping to create exit liquidity for a client they give a shit about, someone like Paulson? Free Abacus with every Dec future?
5.    Some other reason our paranoid minds haven’t thought of.

In the one size fits all category, they should be telling you to buy an ETF. No rollover risk, less entry and exit vig and no cost of carry.   But they can’t control that transaction can they? Unless of course they expect a paper versus physical delivery issue. In which case you should be long April, not December.

Even if their idea is legitimate and we’re wrong. They should at least describe the risks of buying a deferred expiration contract and not in some fluff piece by shill Jim Cramer’s site.

The irony of a good marketmaker is that his success attracts competitors and his service is then no longer needed. As these banks make less money on tighter bid/ask spreads they seek legislative protection of their franchises, less transparency, restrictions on competition and such. Call it white-collar welfare.  Failing that, they seek more and more arcane ways of convincing you to put on a position which could be executed much less expensively. They seek to migrate your positions into the desert of liquidity. Where transparent light rarely shines. This way the bodies are harder to find if it blows up. They are in a war with exchanges as well. Exchange products are trumping bank intellectual capital and salesmanship. And so the banks are trying and succeeding in buying pieces of them now.  There is a new wall going up, and it is being constructed by the government around the Exchanges. The banks want to be on the right side of that wall. Even while they rail against the exchange clearing monopolies, they want in. But we digress.

We are Bullish on Gold

Here is what we are telling you at the most basic level: if you are bullish, and haven’t fallen asleep yet reading this; buy the front month contract and use some reliable methodology to generate a stop loss. Be it technical analysis, bank roll management, voodoo, interest rates or whatever. Just have a level to get out if you are wrong.

If you insist on buying a December futures contract, the screen market will be 2 to 3x as wide as the April, and we’re sure higher than the cost of carry. Whatever gets you through the night we guess.  Vaya con dios.

If you wish to express your position in options, consider a tight December call spread or a ratio if you are not afraid of margin calls. But learn what we are saying here first. Google it or email us. We’ll respond.

If you want to get fancy, do what the pros do, a covered write. Buy April Gold. Then ask yourself at what price do you want to get out? Goldman says $1480.00. If you agree, sell a December 2011 $1500 call and create a dividend for yourself if the market doesn’t get there. If it does, laugh to the bank.  Just make sure you have the capital to handle a margin call, even as you are making profits. Keep your powder dry and don’t put too much in any one idea.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 03/22/2011 - 21:50 | 1088256 Michael
Michael's picture

Anyone who takes Goldman Sachs masters of deception word for anything needs their head examined.

Tue, 03/22/2011 - 22:00 | 1088295 monopoly
monopoly's picture

Right on Michael, +1

Tue, 03/22/2011 - 22:18 | 1088343 Herd Redirectio...
Herd Redirection Committee's picture

They are trying to get people to TRADE gold.  'Nuff said.  What you need to do is HOLD gold.  For when, I'm not sure any one can say with any certainty, but we will wake up one day to gold prices atleast double what they were the night before.  The 1933 dollar devaluation will be a fond memory, at that point.

Check out the Capital Research Institute "The Day The Standards Died":

http://www.capitalresearchinstitute.org

We have spent a lot of time discussing the Gold standard and what it means to have the world reserve currency here at the Capital Research Institute. But today we want to look at something a little different, but just as crucial: the importance of accounting standards. OK, OK, I am hearing the yawns already, just bear with me! When the Financial Crisis hit in late 2008 not only did Capitalism die, when the Government decided bankrupt firms (of their choosing) should no longer be exposed to the risk of failure! The history books are going to be speechless on that one, and will simple relate: “It seemed like a good idea at the time!?!?” But what may have slipped under a lot of (non-accounting) people’s noses was that accounting standards were also effectively removed at that time. The most important of which were mark-to-market accounting rules.

Wed, 03/23/2011 - 02:07 | 1088942 sherryw
sherryw's picture

Er.... yes we know this. and????

Wed, 03/23/2011 - 05:25 | 1089057 Debtman And Robbin
Debtman And Robbin's picture

You think they are trying to get people to trade gold?

Where do you read that?

It appears to me they are trying to get people to trade CLAIMS on gold.

 

 

Tue, 03/22/2011 - 23:03 | 1088538 Michael
Michael's picture

Goldman Sachs is the mirror image of Gollum.

http://www.youtube.com/watch?v=DLvIFRNbqOs

Wed, 03/23/2011 - 08:04 | 1089240 Cash_is_Trash
Cash_is_Trash's picture

Hehehe, it's been noted here before that Gollum looks like Herman Van Rompuy.

http://en.wikipedia.org/wiki/Herman_Van_Rompuy

 

Tue, 03/22/2011 - 22:10 | 1088316 Thomas
Thomas's picture

It will always be a three card monty.

Tue, 03/22/2011 - 22:21 | 1088353 Careless Whisper
Careless Whisper's picture

Any analysis of a Goldman recommendation is PATHETIC. Seriously, do you think they will publish a paper that is intended to help the general public? Pathetic. Pathetic. Pathetic.

Tue, 03/22/2011 - 22:19 | 1088350 penisouraus erecti
penisouraus erecti's picture

+

Tue, 03/22/2011 - 21:53 | 1088261 DoChenRollingBearing
DoChenRollingBearing's picture

I pay zero attention to what Goldman Sux and JP Morgue have to say.  They recommend then unrecommend PAPER.  They are basically acting like carnival barkers and con men.

Drive a stake in their hearts, buy physical gold!

Tue, 03/22/2011 - 22:02 | 1088298 Doña K
Doña K's picture

Assuming that all the people who can afford to buy and hold physical Gold, buy it all and take it out of circulation and price goes to $10,000 or higher, who would want it and why?

Tue, 03/22/2011 - 22:11 | 1088322 bankrupt JPM bu...
bankrupt JPM buy silver's picture

why would anyone sell Gold for fiat if its hits $10,000?  At that point the $US will be worth as much as Blythe's derivatives.

Tue, 03/22/2011 - 22:15 | 1088340 savagegoose
savagegoose's picture

they might want to become a slum lord, and there is a great deal on a whole block of houses for $10k

Tue, 03/22/2011 - 23:02 | 1088542 tmosley
tmosley's picture

At that point, you can be assured that the current owner of those slums would prefer to have the gold, not the dollars.

Tue, 03/22/2011 - 21:52 | 1088265 Moe Howard
Moe Howard's picture

Purchase physical from Worm Lip KaddafyDuck. I understand he is short FIAT and long physical.

Tue, 03/22/2011 - 22:03 | 1088301 Doña K
Doña K's picture

I had a Fiat once and it was factory pre-rusted. Any connection?

Tue, 03/22/2011 - 22:12 | 1088326 Moe Howard
Moe Howard's picture

Yes, Chrysler.

Tue, 03/22/2011 - 22:17 | 1088328 GoinFawr
GoinFawr's picture

 Only if you want to be seen as admiring brutal dictators and their gold, because short fiat long gold=QDaffy. Or so I keep hearing...

Wed, 03/23/2011 - 00:45 | 1088840 Diogenes
Diogenes's picture

They call it Fiat money because it depreciates like a rusty Italian car.

Tue, 03/22/2011 - 21:59 | 1088286 monopoly
monopoly's picture

It is really so simple for me. I buy more on the dips, and take 1/3 off on rips. Always keep my core holdings, always. 3 months forward on options, no more, from time to time. That is my speculative side. Limited losses there if I am wrong. And add physical whenever I can. I never try and be cute and short gold. Sure there are some super shorts for a few days, but for me it is too much to time, I just lighten up and hope to get the turn up soon after it starts.

Does anyone feel comfortable around a squid? Especially a Giant one? And cramer, not even worth typing about.

Tue, 03/22/2011 - 22:10 | 1088321 Doña K
Doña K's picture

Assuming you had $20k holdings and it went up to $27k. then you took 1/3 off ($9k) and now your holding is $18k. What level down do you consider a dip? Would you buy once, twice or thrice if price drifted down three days in a row? And how much each time.

Help me understand the concept.   

Tue, 03/22/2011 - 22:01 | 1088294 Ray1968
Ray1968's picture

Just today I exited my Dec 11 Gold 1200 call. Nice profit. Didn't need the squid to tell me to do that.

Tue, 03/22/2011 - 22:02 | 1088297 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

Goldman knows Gold! Really they do..

If they said buy today and came out in a week and said sell, well. You must have missed the fact that they trade the micro trend.

Dummies!

Tue, 03/22/2011 - 22:03 | 1088300 oldmanagain
oldmanagain's picture

My experience in this situation is that Goldman is wanting to buy the nearby and sell the deferred contracts in hopes of backwardation. Since Dec is thin they need some buyers for their short side.

Tue, 03/22/2011 - 22:05 | 1088306 Mineshaft
Mineshaft's picture

When does someone get the nice pair of Silver handcuffs?  I am getting tired of waiting.

Tue, 03/22/2011 - 22:10 | 1088317 Oh regional Indian
Oh regional Indian's picture

Gold's day in the Sun is dun. You have to see through the smoke and mirrors. 

No technical or other analysis needed to tell you that. Don't do as they say, do as they do. All the talk, disparagiing or otherwise, is about gold. Meanwhile, over a 1,500 Kilos of Silver shot on the plains of Libya in one hour of missile-barraging.

War is the future and silver is real in that scenario. They did the same in WWII, study soem history. Silver has been destroyed, physically, over and over. What is it they fear about it so much?

Think.

ORI

http://aadivaahan.wordpress.com/2011/03/22/interesting-times-sweet-validations/

Tue, 03/22/2011 - 22:44 | 1088429 Cdad
Cdad's picture

Ummm...I'm long silver...so don't get me wrong...but this IS NOT AN INVESTABLE THESIS.  Good grief, ORI.  Seriously...1500 kilos blown in the dessert the last couple days...and what... it is going to flow through to the spot? 

Listen, I try to give you the benefit of the doubt...and then you go and say something like this.

Good grief...definitely buy silver but for other reasons.

Tue, 03/22/2011 - 22:47 | 1088445 Oh regional Indian
Oh regional Indian's picture

All good Cdaddy-O! We all work on our own instincts, ne? Seriously, what does a prolonged war do for silver? Will they sift the sands for it?

Good Grief..... oxymoron!

;-)

ORI

Tue, 03/22/2011 - 23:18 | 1088598 ZapBranigan
ZapBranigan's picture

What happened to your March 22nd prediction?  It's almost midnight and nothing has happened.  Please stop posting/advertising-your-website and making predictions that are based on nothing.  ZH is a financial and geopolitical website, take that fearmongering shite elsewhere. (Rense or AJ perhaps)

Tue, 03/22/2011 - 23:53 | 1088717 Oh regional Indian
Oh regional Indian's picture

Zapper, your choice of avaatar speaks volumes for who you are. It's all very subliminal.

ow I suggest you delete yourself.

And by the way, it wasn't me, it was Terrence McKenna who said that, and have you taken a look around at the world going into the shitter> Libya war launched on the 19th?

Ah, why bother.

You cesium to exist as far as I am concerned and I suggest you see me the same way, all well.

ORI

Wed, 03/23/2011 - 04:41 | 1089037 Bay of Pigs
Bay of Pigs's picture

Bullshit dude. You said otherwise. Still may happen though, but why the Sinclair type predictions? Makes no sense.

Wed, 03/23/2011 - 09:40 | 1089578 ZapBranigan
ZapBranigan's picture

Yeah, exactly what BoP said, "Bullshit".  Don't play-off your endless failed predictions on someone else.  You specifically told all ZH'ers to have ALL of their money and assets OUT of the markets before March 22nd and I bet some naive individuals actually took your advice.  Yet another one of your busted prophesies, remember, a broken clock is right at least twice a day.  You are definitely 'on-notice' now.

I'm not junking your right towards spiritual/astrological enlightenment, but this isn't the forum for your New Age rants.  If you can't post on relevant market and political issues, then don't post at all.  Take it somewhere else. 

Tue, 03/22/2011 - 22:13 | 1088325 Bansters-in-my-...
Bansters-in-my- feces's picture

Did you say "Godman Sachs.?

Tue, 03/22/2011 - 22:14 | 1088332 High Plains Drifter
High Plains Drifter's picture

There was a time when they had about 80B in type 3 assets. I suppose these now have long ago been off loaded on the FED which of course means us??

Tue, 03/22/2011 - 22:15 | 1088339 High Plains Drifter
High Plains Drifter's picture

http://www.dailymail.co.uk/news/article-1368693/Libya-war-Germans-pull-f...

the coalition of the willing is falling apart now. its ten long years since 911. perhaps the sheep are restless now and are not as willing to go for the lies anymore.

Tue, 03/22/2011 - 22:18 | 1088344 Dr. Porkchop
Dr. Porkchop's picture

I just read about this new development of JP Morgue getting a quick and dirty license from CFTC to be a silver vault.

Oh, what new and evil shenannigans are they going to get up to with this one? I think it does show that they are having to get creative.

Tue, 03/22/2011 - 22:31 | 1088394 umop episdn
umop episdn's picture

http://seekingalpha.com/article/259549-will-jp-morgan-now-make-and-take-...

The bank can now, potentially, deliver short obligations to itself. Yes, you read that correctly. The bank itself, if it still holds short silver positions, and/or the hedge funds/related financial institutions who may have taken over the positions, can now deliver the alleged metal to J.P. Morgan's own vault.

Is this the link? I can't keep track of all the writers on that site...how reliable is this guy?

 

Wed, 03/23/2011 - 00:36 | 1088832 rich_wicks
rich_wicks's picture

Well, JP Morgan would have to still purchase a futures contract in order to deliver to itself.  I don't see how this really fixes their problem, if indeed, they are naked short on the COMEX.  How is this at all different to simply closing the short position?

Maybe they hope to get clients to go long on silver, and then desposit paper silver at the vault?

Tue, 03/22/2011 - 22:17 | 1088345 Bansters-in-my-...
Bansters-in-my- feces's picture

Save a cow...Eat a FAT FUCKING BANKER.

Banksters-in-my- feces.

Tue, 03/22/2011 - 22:17 | 1088346 Blano
Blano's picture

Props to FMX for the tone and attitude of the article.

Tue, 03/22/2011 - 22:21 | 1088355 unclebigs
unclebigs's picture

The Always Long Gold Trade is going to Backfire on Goldbugs just like it did in 2008.  LOL!!!!

 

Tue, 03/22/2011 - 23:31 | 1088644 DoChenRollingBearing
DoChenRollingBearing's picture

We´ll see.

Wed, 03/23/2011 - 00:06 | 1088749 PaperWillBurn
PaperWillBurn's picture

Remind me, what was the price of gold in 2008?

Wed, 03/23/2011 - 00:08 | 1088752 gosseyn
gosseyn's picture

Where did you come from troll?

We BTFD below 730 spot in 2008 and our rec was in the public domain at the time.

Before this is all over you will BTD, that's bite the dick.  You'll cry "uncle", unclebigs.

Wed, 03/23/2011 - 00:39 | 1088836 rich_wicks
rich_wicks's picture

1000 to 750 to 1400 didn't backfire on me.

"lol".

Tue, 03/22/2011 - 22:20 | 1088356 Bansters-in-my-...
Bansters-in-my- feces's picture

Does Godman Sucks get thier Very Own New shiny Precious metals Vault,like the J P Morgue & Chase do...???

Tue, 03/22/2011 - 22:24 | 1088363 gwar5
gwar5's picture

Goldman Sachs is the mothership of alien predators.

Swab their DNA if you don' believe me.

Tue, 03/22/2011 - 22:27 | 1088378 FischerBlack
FischerBlack's picture

Great write up. Love it.

Tue, 03/22/2011 - 22:33 | 1088402 3rivers
3rivers's picture

some of the shortfall is being made up for. Treasure Island yesterday reports gold prod up 34% yoy, silver 66% nickel 55%.  if more mining countries keep increasing maybe the shortage will finally be reduced.  that would be good news? making it more affordable to accumulate. but what if they keep increasing production? not everyone lives in Palawan.   

Tue, 03/22/2011 - 22:37 | 1088412 SumSUN
SumSUN's picture

You don't need to listen to any bank to learn how to make money pushing buttons.  Even if nobody cared what the federal reserve corporation and friends are doing, they would still be spewing on the tube.

Tue, 03/22/2011 - 22:42 | 1088427 floydian slip
floydian slip's picture

MSM = only mentally ill dictators and terrorists own gold.

(sarcasm)

Tue, 03/22/2011 - 22:46 | 1088439 99er
99er's picture

Russell Futures

Back test of rising channel completed within a broadening top.

http://www.zerohedge.com/forum/99er-charts-0

Tue, 03/22/2011 - 22:45 | 1088441 High Plains Drifter
High Plains Drifter's picture

http://www.latimes.com/news/science/la-sci-spent-fuel-us-20110323,0,4358...(L.A.%20Times%20-%20Science)&utm_source=feedburner

A look at American nuclear plant, uranium fuel rod storage methods and problems. I want these damn things turned off yesterday. Good grief, what a mess.

http://www.straightdope.com/columns/read/374/did-john-wayne-die-of-cance...

movie stars and film crew who died from cancer, later in life, as a result of being exposed to lingering radiation, while on film shooting location in Nevada. This radiation was caused by lunatics who performed above ground ,atomic bomb testing Nevada, during the 1950's. Absolute insanity. Radiation, the gift that keeps on giving. Its my understanding that Steve McQeen was also involved in atomic bomb testing in Nevada, hence perhaps his problems with cancer as well. I can't find any link on that but someone said he was a volunteer for the atomic bomb test while he was in the marines.

Wed, 03/23/2011 - 00:49 | 1088845 Diogenes
Diogenes's picture

It has been a while but I remember reading something about McQueen working in a factory that involved asbestos or some other carcinogenic substance, before he became an actor.

Tue, 03/22/2011 - 22:49 | 1088459 buzzsaw99
buzzsaw99's picture

Gollum loves precious. lulz

Tue, 03/22/2011 - 22:51 | 1088460 SuperRay
SuperRay's picture

with fiat raining down like volcanic ash, the demand for PM's will eventually outstrip any supply, especially the demand by China, India, and any country not as stupid at the good ole USA, which at this point is probably all of them..

Tue, 03/22/2011 - 22:52 | 1088463 Instant Karma
Instant Karma's picture

I must admit when Goldman raised their price target on EURUSD I sold.

Tue, 03/22/2011 - 22:55 | 1088473 yxhlhq
yxhlhq's picture

Without a kind not through contempt christian louboutin store, endurance and fight we can conquer the fate. A great man is great discount christian louboutin shoes sale, because he adversity coexistence with others cheap louboutins, others lost confidence, he has determined to achieve their goals louboutins cheap. There is no hopeless situation, only the man who falls into despair. When you feel sad or pain christian louboutin 80% off, you'd better learn something. Learning christian louboutin discount will make you invincible christian louboutin boots. In the world the most easy thing cheap christian louboutin pumps, delay the time the most easily discount louboutins. You think you can, you can christian louboutins for cheap. A believer develop strength, more than 99 men who christian louboutin pumps on sale are just interested. Each strenuously behind, there will be double reward. http://www.cheaplouboutinsstore.com/

Tue, 03/22/2011 - 22:56 | 1088486 yxhlhq
yxhlhq's picture

Tomorrow is to appreciate in the world fastest a piece of land discount christian louboutins shoes, because it's full of hope cheap louboutins sales. Remember: Every day is the best day of the year. Happiness christian louboutin boots isn't because of possessing much but caring less. When disappointed not in sadness louboutins pumps sales, think about the days with laughter! To overcome the anxiety christian louboutin high heels and depression in life, you must learn to be your own master christian louboutin ankle boots. Put himself as a fool, you don't know, ask christian louboutin boots. You'll learn more. Aimless life is like christian louboutin wedges sailing without a compass. Learn to do anything to christian louboutin evening step-by-step, your may. The hope of tomorrow christian louboutin pumps, let us forget today's pain. http://www.saleslouboutin.com/

Tue, 03/22/2011 - 23:02 | 1088541 lsbumblebee
lsbumblebee's picture

Speaking of that clown on teevee, on yesterday's show Cramer said the DOW finished +180 due to "the power of positive thinking". I shit you not.

Tue, 03/22/2011 - 23:13 | 1088572 Oh regional Indian
Oh regional Indian's picture

Perhaps he just got down to reading his copy of The Secret?

ORI

Tue, 03/22/2011 - 23:23 | 1088615 lsbumblebee
lsbumblebee's picture

Yeah. Maybe this time he's really flipped out and joined Oprah's book of the month club. 

Wed, 03/23/2011 - 00:11 | 1088761 SoCalTrader
SoCalTrader's picture

Jesus Christ.

Maybe I'm a bigger dope than I thought -- although his TV show (and web newsletter service) is a f*cking joke, I thought his books were relatively coherent and insightful.

 

Either way, at this point JC (Cramer -- not Jesus) has lost 99.9% credibility.

Tue, 03/22/2011 - 23:19 | 1088597 glenlloyd
glenlloyd's picture

I love their stuff

Tue, 03/22/2011 - 23:32 | 1088645 gold mans sack
gold mans sack's picture

Go long physical gold and silver.  F the paper.

Tue, 03/22/2011 - 23:55 | 1088723 optionking
optionking's picture

there is no gold in Fort Knox

Wed, 03/23/2011 - 00:03 | 1088742 SoCalTrader
SoCalTrader's picture

Either 10% of what is claimed -- or Zero.

Their "audits" are a farce.

Wed, 03/23/2011 - 00:00 | 1088735 SoCalTrader
SoCalTrader's picture

Does anybody pay attention to Goldman Sachs at this point? They make "public" market comments to push the sheep into a desired direction. Buffett does the same thing. And JPM. And PIMCO.

My advice: Whatever they "say" their strategy is, (along with PIMCO) do the exact opposite.

 

Wed, 03/23/2011 - 04:27 | 1089027 fredquimby
fredquimby's picture

Unless they are banking on you doing the opposite of what they say.....as we all now know to always do the opposite of what they say....

 

Wed, 03/23/2011 - 00:12 | 1088758 TwoShortPlanks
TwoShortPlanks's picture

"Dallas Fed's Fisher, who despite lofty rhetoric has yet to back his words with even one abstaining vote"

That's because the NY Fed does Robo-Voting. I hear 'Robo' is all the rage these days!

Here's 'The Bernank' in full flight at a standard FOMC meeting: http://www.youtube.com/watch?v=htRHj3tyYyo

Note the shiny head...does Bernank have a cat...and where's Mini-Bernank????

Wed, 03/23/2011 - 00:22 | 1088788 Vint Slugs
Vint Slugs's picture

This may have been touched on previously, but we need to remember that Goldman Sachs had no commodities research presence prior to the abdication of the Merrill and Smith Barney commodities research departments just after the turn of the century.  When it comes to  commodities in general and commodities research in particular, GS is a bunch of pikers. 

Wed, 03/23/2011 - 00:36 | 1088830 nathan1234
nathan1234's picture

Can't for the life of me understand who would deal with Goldman Sachs in the first place.

A bigger bunch of crooks is difficult to find.

Wed, 03/23/2011 - 00:55 | 1088856 rich_wicks
rich_wicks's picture

If you make money from them, you do business with them.

Greed trumps any feelings of good or bad.

 

Wed, 03/23/2011 - 00:46 | 1088843 Bansters-in-my-...
Bansters-in-my- feces's picture

I her Blankfien does it Goddy style.

Wed, 03/23/2011 - 01:16 | 1088881 RockyRacoon
RockyRacoon's picture

Thanks!  Good stuff.  But do we need extravagant explanations as to why not to take ANY investment advice from Goldman?   How 'bout:  "Here's what Goldman says -- now go do the opposite."

Wed, 03/23/2011 - 01:23 | 1088887 andy55
andy55's picture

Awesome article guys -- thanks for sharing!!

It was maybe a tiny bit intense, but after a second read I think I got it all and learned a ton!  I love learning this way!

Wed, 03/23/2011 - 01:37 | 1088913 plata pura
plata pura's picture

A GSR of 39.39 be intolerable. Utility will bring parity.

Wed, 03/23/2011 - 02:23 | 1088957 mark mchugh
mark mchugh's picture

I think Goldman is trying to both be right AND crater those who listen to them.  Gold will hit $1480 and beyond within the next three months (probably in April).

then....

There will be a hiccup in QE.  Rates will rise a little,  asset prices will fall and Mish will start screaming "Deflation!!" at the top of his lungs again.  CNBS will take the opportunity to remind everyone that "Gold's not a safe haven" everyday the paper price of gold drops.  You should know this play by now.

then....

At the slightest sign of discomfort, America will beg for more heroin and the Bernank will gladly oblige. 

so......

Goldman is right, but all you got out of it was a crummy margin call you couldn't meet.

 

Wed, 03/23/2011 - 03:20 | 1089003 Flore
Flore's picture

if you are bullish... buy fysical gold instead of all this paper rubbish.. it's as simple as that... why do you always have to let others game with your money ? If you hold gold.. nobody can mess around, pay big bonuses etc etc with it.. that's an act of rebellion..; not playing along in the paper crimex pit

Wed, 03/23/2011 - 03:22 | 1089004 Coldfire
Coldfire's picture

Goldman's business model is a study in conflicts of interest, as are those of the other riverboat gamblers investment banks. But I don't think it's fair to say that Goldman fortune telling research is always wrong. They make mistakes. Broken clock, etc. So sadly, fading their recos is not a money machine.

Wed, 03/23/2011 - 05:25 | 1089058 hz
hz's picture

Goldman had also gold forecast at $1690 for end of 2011:
 http://www.cnbc.com/id/40530212/Goldman_Sachs_2011_Forecast_Stocks_Gold_... (Dec 6 2010)

Wed, 03/23/2011 - 07:05 | 1089122 Rikki-Tikki-Tavi
Rikki-Tikki-Tavi's picture

As $1480 sounds very conservative perhaps they are trying to contain people's inflation expectations by putting a ceiling on the price in people's mind. Clearly BEnron has been extremely successful in creating inflation expectations and now it seems like they need to reverse that a bit - preferably without actually doing anything.

Wed, 03/23/2011 - 09:28 | 1089567 Hephasteus
Hephasteus's picture

1480 is the line in the sand. When gold stops dropping for any length of time the game is over for the dollar. It best happen soon. Somebody better cash out some 401k's or go on a robbing spree.

Wed, 03/23/2011 - 09:51 | 1089669 trendybull459
trendybull459's picture

Ha ha ha,where Goldman Sachi was in 2001 on gold running up,those morons are coming usually on top,when you have to think about  food for today-no gold position will help you untill you are very wealthy guy,gold is irrilevant for now because every one talking on it,why not one was buying PAAS and NEM when they was 6 and 10$ respectively guys?Where all those traders was when ADRs of Gazprom and Surgutneftegas was trading at 6 and 4$ respectively?I did it and people who was my clients was shaking their knees from angst,Media was portrain Russia as dead place to invest,gold as barbarian relic,NEM full hedged and PAAS all life loosing company.Where all those guys who was talking down?They here now talking all things up.May be its good to have some gold,no more that 25% of total money and most you need is cash,gold is not doing good in rising interest rates invironment usually,some times good,but risks of you unable to exit gold on top is huge.Look at exploration gold and silver,most of it did not cover their high of 2007,but gold almost doubled from margin prospectives-think twice before to listen all media morons whatever they are,think how you will buy food on gold you so much talking about?Who gonna take it from you?What exchange rate the baker will apply to you when you will be starved to death from hunger-think again,Government through the Monopolistic control of exchanges try to put you into the "home jail",so you can not move and get food,fly away because simple thing-you are scruwed by rocketing prices,when prices will crash-believe me,exatly at this moment you will be very sorry that you listened to Sachi Goldi bullshit-hang them on the tree and prosper from it with all world around

Wed, 03/23/2011 - 10:49 | 1090045 Fascist Dictator
Fascist Dictator's picture

(not to mention that other clown on TV)

 

GO SCREW YOURSELF! I HAPPEN TO LIKE GLENN BECK! AT LEAST HE TELLS THE TRUTH!

 

Fondly yours,

The Fascist Dictator

Do NOT follow this link or you will be banned from the site!