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Gold Commercial Short Positions Hit All Time High, As Gold Spike Protection Team Keeps Very Busy
In addition to the EUR data in today's CFTC Commitment of Traders report, another data point that caught our eye is the record exposure in outright commercial shorts in gold: this week they hit an all time high of 450,950. It appears that last week the desire to suppress any gold breakouts was at historic highs, even as net commercial exposure hit a 2010 low of -282.6, just slightly higher than that seen in the second week of January. If even with this massive onslaught to keep gold low by the LBMA, the precious metal managed to nearly hit $1,250 today, what will happen to gold when the 450k commercial positions are forced to cover?
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This isn't even a theory of mine, but maybe they're not withholding? Maybe that's why we've yet to see the big squeeze?
I'm just saying, why not distrust their official accounting any less than ours?
China is the main reason I'm unsure of my own goldbugginess, measured in months, because they have 2 banks larger than our largest bank, are the biggest gold miners in the world, and produce all of my favorite high tech gadgets. Oh, and isn't my country in tremendous debt with them, too? Not too not mention that we rate countries based largely on GDP, which is like saying your boss is more productive than you just because they're valued higher in dollars.
Overall, I'm just wondering aloud what the biggest player is or isn't doing.
It's like when we talk about global warming without mention of the sun (or geothermal).
It's in their latest quarterly
US Mint sold 900 tons of gold coins last year only.
its 3-4 times more than 2008. last year they announced few times they are stopping to take orders due to short supplies.
why would the commercials have to cover...
vast majority of that is producers who will be physically delivering on those short posistions..
Like ABX did when it bought back its hedgebook last year? This is why you can't own mining stocks and need to stay with the metal. Half of them are run by idiots. Half of them are frauds. And a mix of both types assist the government in suppression. ABX admitted in court that it was assisting the gov in a suppression scheme to avoid liability once already.
But that's true everywhere. And traders who just go picking stocks based on public information tend to get their due because of this. However, good old fashioned partnerships can be formed, in a sense, via stocks when shareholders actually get to know companies and pick them based on their relationships.
Look, we should probably be thinking about doing more mining, not less. And right now, their are juniors out there looking to build bigger teams to help get this part of the world a little less dependent on China.
Many within the mining industry haven't been calling Barrick "The Evil Empire" for nothing.
And why ever did people buy stock in a company that was actively shorting its own real stock? They called it "hedging."
Not only are there tons of juniors out there, there are also tons of great VCs/small ibankers hunting for good, honest companies that won't be nationalized by... some Australian fuck or Hugo Chavez type.
You have to watch out for hucksters and counterfeiter types. There have been some truly brazen mining frauds. Need more than just accounting - have to do maximum due dilligence, hire proper monitors, and otherwise cover your ass.
You can't get into gold or silver mining without diving into the belly of the beast. That much is certain.
Any heroes out there?
In metal mining. No. Volcanos regularly spit out a couple hundred pounds of precious gems and blast the all over various areas. So if someone asks to borrow a couple hundred bucks to go dig snow around eyajackawhatever volcano. You might consider loaning it to them.
Source for ABX admission?
Politicians like Cuomo are trying to get Super politician status by going after JPM etc. It's only a matter of time before there is a perfect storm of jackasses looking to get elected and will be willing to hang everyone out to dry to do it. When that happens then you will see some fun at the Comex.
But in the meantime I need some more cheap gold. Thx in advance.
My bullion is hedged with shorts. There are alot of people buying gold I'm guessing they are hedging too, or maybe not.
If I started buying gold at this price way up here I would be scared shitless.
That is smarter than you may think. Likely, paper gold will go to zero while physical gold goes to infinity. Those shorts will act as a hedge until the correlation between physical and paper breaks in a real and permanent way.
More specifically, the face value of bullion leases will decline, while the interest rates increase, much like you would see in a failed auction in the bond market. If you're looking for a type of 'sovereign bond failure' then look no further than the bullion leasing market.
We saw a little bit of that during the 5-min. 'take out' correction, and with the decline in the discount rate, and a rise in the face value of treasuries and bonds across the board, it just becomes cheaper to take readily available fed funds and buy gold futures rather than lease the gold and short into the market.
Note that the leasing rate has declined for the short term recently as the commercial short position has increased. This also comes on the heels of more and more treasuries being sold with no impact whatsoever on the interest rate.
Very possibly there will be more casually announced IMF gold sales, but with less and less effect. Even should they re-liquify the bullion banks with central bank gold, this merely acts to increase the liquidity of the gold market, much like selling more treasuries liquifies and expands the sovereign bond markets.
This last episode of IMF sales accomplished very little, as the demand for short term money is greater than the ability of any central bank to stave off a decline in interest rates.
Very interesting post.
If the price disconnect between paper and physical gets too large, that is when a good part of the world will look towards price discovery on other exchanges and do away with USD spot.
Expect spot then to be in Yuan or HKD.
Hey Bob, two weeks ago I bought some gold when it was $1,161.00. My wife said good, my mom said it was to high. I said no it's not. Now at $1232.00 my wife says buy more. Me, I think my wife is more aware of what's about to happen then my mom and has a clearer understanding then you. Gold is not an investment. In the not so distant future those that have alot will have a nice standard of living and those of us that have a little will not go hungry. As long as gold remains available thru the mail I'll continue to add. And if you would be so kind to continue shorting it for me to keep the price down I would be very grateful.
So buy silver and sleep well.
http://www.trilulilu.ro/SHANA04/712029e4c78c31?video_google_com=
rick santelli said it today at 11 am on cnbc its up on there site if somebody can link it please..It was at the 11:20 mark..cnbc videos please
http://www.cnbc.com/id/15840232?play=1&video=1494145732
Just watched that video. F***ing awesome.
Looks like CNBC is whistling a different tune. A little dissension in the ranks. Always late to the party .
RockyRacoon , Thanks for the cooperation, posting the link. I am still learning these things in computerland.
I have noticed two distinct traits when a post about gold hits here. One is, the majority of those against gold only post between 9-5 in their time zone meaning they do not have a computer at home and are using the computer at work, and, those that post here against gold from 9-5 in their time zone are living hand to mouth paycheck to paycheck.
Please, a link to your chart for this analysis?
you mean, other than the fact that you state that there are two groups of people and reference both of them as being against gold...
your my kinda critter. Watch where you put that nose will ya! LOL
More likely, their 9-5 job is to bash gold. Everyone has a computer at home.
Almost everyone here is Pro-Gold!
Some, like myself are NOT! Pro-Gold thru the use of fear tactics... or the anti-gold salesman who leave out the fact that Gold is high right now (price wise)...
So, I disagree with your statement that most are against Gold. Most are for Gold ownership (physical)!
As for the posting times of people, I don't know? I come here when I can. I am an addict for the info, the vibe and the realness. I have learned a LOT! from people here. I try to give back in the spirit of that learning.
I will say I have noticed when people first come here, they are angry... Rightly so, as well the anger is mis-placed... I did it when I first got here. The info pisses people off and since they are here it gets spouted off here... Once again, I am a PERFECT example of that pattern of behavior. I think the more you learn or the more I learned or got to know people here the more I came to understand we are all fighting the same Demons and / or we are all paddeling in the same boat going the same fucked up direction... without wanting to go in said fucked up direction.
Thusly, give the place and the people a chance... I think you will be in fact pleasantly surprised by what happens.
My best to you and yours, JW
To date, your argument is you don't want to see the whole shithouse go up in flames! The power to change the tide of the transfer of wealth from the masses to the elite cannot be stemmed. You exhibit nothing more than misplaced idealism. Oh, and buy something of value, PMs or otherwise. The shitstorm *is* coming, wether you choose to be aware of it or not. Don't say you weren't warned. And for the record, I am as far from a gold salesman as it possibly gets.
Where does one store physical gold? Any suggestions? Safe deposit box?
In your home.
Well, alternatively, you can stored it around mine. I promise my "storage fees" wont be excessive.
Or your grill.
My house :)
Get out of that safe deposit box. Bank holiday is coming soon and you won't be able to get in there without someone looking over your shoulder. Bury it! And get some lead and brass (bullets) to guard it. Nobody is going to save you except yourself! Get over it!
A fire safe bolted to my concrete slab.
Knew I would get a spirited response!!!
Watch this first, before purchasing a safe
http://www.youtube.com/watch?v=nBhOjWHbD6M
You can store it in my home.
I have been passing them out to unsuspecting strangers in the vain hope lust will stir their curiousity. Funny thing is , My goal was a thousand ounces. Now my goal is to keep 200. Hope i succeed, know it sounds crazy to all of you. Half my life hoboing, the other half in business and barely make wages. Its in me to give, keep little but what i need. I eat 3 times a day , have no worries or stress other than my gal and country. I am more rich than most. I have myself, i am more spirit than human , wish to remain at that balance and saw the greed creep in as i owned gold and saw the potential of it owning me.
I would rather be shit poor and have my heart than be well off and lost in my act.
Wow, that's quite an amazing outlook!
I have spent a good part of the last 15 years below the poverty line as well, at least technically (have never applied for any welfare or handouts, though), but like you I have never really felt "poor", and have never lusted after all the material hoo-hah that everyone else around me seemed to. For me, riches are going fishing with a good friend, or picking wild berries with my dog, or going hiking or camping in a beautiful and isolated valley. To each their own, and I don't criticize others for chasing the materialistic life (too much), but I don't see them being much, if any, happier than I am.
akak, like you a lot. I am not jewish, but like the idea of their kibbutz .
I like the oriental way of bowing to respect the spirit in the other person and i like the muslim way of taking time 5x a day to show respect for his life.
No handouts for me either.
Working together toward a common goal for universal cause rather than the selfish desires we all have. I have crappy tennis shoes and a beatup pair of boots, but am barefoot now and like that best especially in the garden.
BTW Oregon coast is having no trouble now, but its getting spookier day by day as i watch the quake developments of shore and down south seeming to ramp up. Hope i am wrong.
Thanks for the kind words, Merehuman.
I imagine the coast of Oregon is a beautiful place to live --- not too different from southeastern Alaska in many ways.
akak, the most hunting i have done so far is rats. Got 14 of them with traps. I have never fished ,but look forward to learning this year. The deer came this morning to check out my garden. I believe our community can handle coming events better than most. Guesstimating 75% seniors here, most having well stocked pantries and in hidden gated communities. Not as many gardens yet , but next year that will change and many silvers will be traded for the suddenly expensive seeds. Think i will stock up on seed and buy more things to start my "Hard times store" after everyone else folds.
Fantastic sir!!!!!
go to the bed room store it underall the junk ; then the hall under the junk ,, in the wash room under the junk no end of junk in american homes
If you want to hide it under junk, just put it under one of MB's posts.
yes a good idea but his junk is so thin .. even the stance he has in a world gone amuck in keynesian promise ,, one would have to even his sanity ,
he of course is going to school
and we all know what a empty place to go for reality
That's funny! Truth hurts, as they say.
This has been the most informative and lively discussion on ZH that I've seen in a while as far as gold/silver topic.
Other than Jim Bob Bravo, all of the comments have been consistently civil.
Thank you all for a well-spent evening.
If you'll excuse me now, I have to go rummage a few garbage cans.
Some at home, some offshore, just not all in one place.
If someone else is storing it for you, then it's all about trust, and you should get to know the people and not necessarily the company name.
Am I allowed to suggest James Turk at GoldMoney? Read and watch everything he's said over the years and then check out what seems to be the only real bank in the world.
The majority of the comments on this post and almost all like it reflect years of brainwashing, mostly found in government drone factories (public schools), and economic transaction experience.
Gentlemen, and ladies:
1) You are mistaken to "price" gold in terms of a fiat currency as though the currency were the rational base measure for value. That approach is, frankly, insane. The "value" of the currency changes hourly, and is guaranteed by the your friend Ben and others to go down every single day from this point (and long before now) on.
2) Try the reverse. Use your mind in a different way. Try pricing everything else in your life in terms of ounces (grams, grains, take your pick) of gold. Change your mindset. Think rationally, in terms of a money which has a substantially less rapid rate-of-change in quantity.
All of a sudden, the "value" of gold becomes apparent. The "price" of gold becomes instead the "price" of a fiat currency, which instantly shows the fiat currency's worth (not much).
And how many ounces of gold should a miracle drug or an iPad be worth ?
Depends on the drug, and between 0.5 and 0.75.
.5 oz for an iPad?!?!?!?! Get real. Maybe a couple oz of silver.
That's what they are worth today.
Tomorrow, who knows?
It's a miracle drug (i.e. the difference between life and death). It required millions of man hours to develop ...etc. Is that worth 1 or 1000 ounces ? What about the IP, what should that be worth ?
How many 'dollars of ten years from now' should they be 'worth'?
How to value fiat IP in terms of a fiat currency is not what the *Doc asked.
PMs are the buoys in a sea of fiat.
In other words: think completely irrationally!
That's what it would take to remain a goldbug at these prices.
Johnny, you seem agitated.
May I give you a massage?
price in johnny bravos
ten johnny bravos =one jackass
five johnny bravos = 1/2 jackass
1 johnny bravo = last fart from the jackass
Yes, it is completely irrational to be a paperbug at these prices, particularly knowing what we know about how many more pieces of paper will be coming along.
Johnny, did you ever learn to read?
Yeah, C is where all the action is. It's a real bargain!
Are you Harry Wanker's little brother?
"Try pricing everything else in your life in terms of ounces (grams, grains, take your pick) of gold."
just set a price for a piece i made in ounces of silver.
for every short commercial position there is equal and matching long speculator position. So the mere fact that commercials are short and will be forced to cover has no meaning. And unless the speculators are planning to take delivery (which most dont and cannot), they will be forced to close longs OR rollover to next paper. Either way, it is the longs who are asked to show their hand first, shorts can keep their positions until the last trading day.
vs-trader.blogspot.com
Is this why they confiscated the gold during the depression - to stop the buying and selling of it and protect the currency? I have to imagine they will do it again if the pricing becomes 'real.' If demand is anything close to what is being suggested here, the value in dollars really should be double what it is. This is insane.
Stay long slv and gld but start to diversify into the physical stuff at these prices and higher. No need to worry about delivery until 3-4000 an once (by then be all physical) but if we go to 10,000 say good bye - confiscation/war.
Here is your Rick and Gold Video
http://www.youtube.com/watch?v=b6d3Oy6YMCI
tyvm..I appreciate it cam..
I seriously thought you rickroll'd him.
http://www.youtube.com/watch?v=dQw4w9WgXcQ
*a real rickroll.
These paper shorts will NEVER be covered. If the paper longs are lucky they will get Ameros [Dollooesos] for their positions. TAKE DELIVERY NOW
You show me a piece of money with a picture of John Pierpoint Morgan or Rockefeller on it and I'll show you 8 inch knife up through chin into your skull. It's just that simple.
For those of you who missed it....
Interview with NNT... Speaking of Black Swans....
http://www.youtube.com/watch?v=OVxcDgfTzuk
Thanks for that. I really believe in Taleb's judgement of the situation
World governments, how moronic. They give gold away at half price and then want to ban it to get it back (al a 1933). Idiots. The end of the world is possibly pre 2012. Gold and silver have not even made mainstream consciousness. When that happens the physical market will be overwhelmed and the banking system will collapse as it is exposed as fraudulent. In the meantime stock up on half price gold now. Everything will deflate in terms of wheat.
perfectly said..
This just in from Trends Research (Celente)
http://inflation.us/videos.html
This is a must watch , current video. Goes over our debt, silver naked shorts and much more
Some of it was inaccurate, but on the whole,,"Hulk" Great link!!!!
What was inaccurate??? the amounts,,under!!!
Thank You Hulk!!!
My pleasure. They were very conservative in their debt estimates.
And Celente is correct, the Olive Garden IS NOT italian food!
Also, Rogers didn't look all that comfortable being long the Euro. He was squirming and looked a bit constipated....
Thank you for this. Perfect primer for uninitiated friends and family. I just feel like I'm coming across as Sarah Connor when I open my mouth.
Sarah Connor was right.
Sarah is awesome. Remember that. Linda Hamilton had to work out 6 hours a day for 13 weeks with Arnold helping to coach her to be worthy of the role.
Awesome.
You are Tyler Durden. You are Sarah Connor. You get it. Hold your head up. You are awesome.
(It is kind of sad that getting what is happening puts you easily in the upper quartile of the population, probably more like the top 2% but I can't back that up).
Hold your fucking head up, don't be arrogant, have compassion for the trap they are in, and don't let them bring you down.
Agreed, this is a video well worth watching... put aside some time people. Makes a strong case for silver.
Melt up is an excellent wrap up primer. Good of you to post it, thanks much and i passed it on to 8 more and they will pass it on also.
Looking for the hundred monkey solution
Great video Hulk. It seems like it is too late to stop hyperinflation.
The only way this changes is if people have to face reality.
Haven't yet watched the vid-- but check out what a ZH poster wrote last month about the organization/people behind the video:
by Alethiometeron Tue, 04/06/2010 - 06:45
#288272
To anyone ignorant of what the "National Inflation Association" (NIA) truly is, just go to youtube:
http://www.youtube.com/watch?v=sDxUjMOKROU&playnext_from=TL&videos=uwhiL...
and follow the saga.
Basically, John Lebed, whom was convicted by the SEC in the late 90s for pumping and dumping small cap stocks/penny stocks, made a foray into the youtube community in an attempt to aquire front men to run a new "scheme." The new "project" (NIA) was to assert itself as a bastion of truth in the economic turmoil from 2009 onward. Lebed aquired a few youtube assets: George4title, visionvictory, manoftruth, etc. and set about bringing legitimacy to his movement. The true purpose of the NIA is to essentially mirror the website lebed.biz's history of compensated penny stock recomendations, which are really pump and dumps. It gets people onto the newsletter roster, and sends out hot tips for stocks (which are presumably already heavily bought into) for <$1 (hey, even the little guy can make a killing here, right?). The site mixes videos/articles with banal economic analysis (meant for the ignorant masses) with the get-rich-quick stock picks overlayed with a honeyed "just trying to get my slice of the pie" mentality.
As you can see in the video series, many of the same "recommendations" from lebed.biz found their way onto NIA. Strange. I couldn't see any of the savvy members of zerohedge taking this seriously anyhow, but it sure is fun to investigate and expose liars and scam artists.
What I find truly funny is the shear hypocrisy of the site. It supposedly stresses strong moral character, and a return to the "good old days" when things weren't sullied with malfeasance and tomfoolery. Of course, then it goes into how going big into their stock picks is helping everyone, and eventually (when the stone age returns) we'll return to a bimetallic gilded age where everyone is happy. Poppy cock. Who controls "money" is key, not what it is made of.
I will investigate further, thanks for the insight.
I'll make an inquiry into this and see what trends research has to say about it. thanks
This is unbelievable. Gerald Celente just got back to me, and here is his response to your post, which I sent him in full
"Thank you for contacting me.
I did not know any of this. However, I see nothing in the video, nor what I said that can help this guy pump and dump stocks. As for his legitimacy ... who on Wall Street has any? I believe NIA did a solid job on this video and stand by every word I said. How anyone could suggest my words or Farber's, Schiff's and others that appeared in the video translates into stock recommendations is without merit. And, a person does need to sign up for a free newsletter to get spammed to buy stocks or other scams. Thanks again for the heads up ... much appreciated. Regards, Gerald Celente"
Nice!!!
That's 10 gold stars for your progress chart!
Nice of you to care about the rest of us Hulk!
Be well as always, JW
wow, just finished. Well made. Will pass it on. Thanks
feels like this video is going to go viral. Most excellent
That is 2/3 the yearly global production of gold all being promised by miners to the US gold market. Not gonna happen. The miner hedgebooks will be blown out yet again.
Meanwhile, there's an inverse H&S on the USDX and a flag, with a P/O of 87.10, and Volcker talking trash jawboning the Euro down, like it needs help to go to par with the USD, along with some sorid rumors! Just in time, for the planned smash down. The target was broadcast the other day -- $1150. Let's see if they get their target.
SILVER BITCHES!!
I am Chumbawamba.
what he said...
I like silver too.It is more affordable, and even more grossly undervalued than gold.I am also stockpiling copper and aluminum.Aluminum is really energy intensive to extract from ore.Long term, it is a no brainer.It just occupies a lot of space!
This is the most idiotic post I've read on ZH, ever. Commercial shorts = noncommercial (speculative) longs. Commercial shorts DON'T ever have to cover, because they have the gold to back it up. Its non-commercial which is always evaluated as the weak hand, which is forced to reverse.
I've read about thirty posts on ZH over the past year which indicate that non-commercial will reverse, and here they claim exactly the opposite. Hypocritical, and meant to stir up the beehive of gold bugginess.
No shit, huh?
I guess we should all believe some tin foil hatters instead of the professional traders that were right 61/61 days last quarter.
"professional traders"? How about "cheaters".
Try and guess what number I'm thinking of... It's either 1 or 2. The odds are that you will get it right 50% of the time.
I bet you $1,000 that you will get it wrong 100 times in a row. Wanna take that bet?
Cheaters?You are too kind.You must mean scumbag operators of the theiveo-matic capital extraction system.
They are treasonous scumbags, who richly deserve the visitation of justice as proscribed for treason.
They are a clear and present danger to the security of the United States...and those who would emulate them are at best idiots, or evil....and should be treated as such!
Cistercian, Bravo. Supine and tied, hand and foot, by our own ignorance! Its more like rape, rape of the planet and its people .
Must be aliens, who else would be so unkind to our grandchildren?
ever wonder why the elite call themselves 'blue bloods'?
http://en.wikipedia.org/wiki/Blue_blood
those crazy Castillians...
moved
OBEY.
WATCH TELEVISION.
DO NOT QUESTION YOUR BETTERS.
GOLD BITCH!!
I am Chumbawamba.
I'm as big a gold bug as anybody else, but I'd agree - commercials increasing their shorts (i.e hedges) shouldn't surprise anybody. Surely after such a big move many dealers/producers may be more inclined to lock in profits or protect their inventory from a decline from here. Spinning it as a conspiracy is not helpful to the cause.
The very notion that the people that "rig the markets" are short gold should tell you something.
They didn't make money on 61/61 days by accident. Of COURSE they make the market. And now they're short PMs.
Do you people really think that they would be short if gold was going to 6000?
Keeping challenging the Gold Zombie Cult, JB. When every 2nd commercial on Fox and ESPN for the last 6 months is hawking gold to couch potatos... we are talking Slap Chop and Marie Osmond diet territory. Hardly investment genius purveyed to the Chosen on ZH.
Yes, the Paper Zombie Cult is the group you want to be in!
There's no up-front costs (they are happy to have you pay with credit), they never ask you to worry about tomorrow, all lapses in judgement and responsibility are overlooked or excused, they have SO many more members, and they're always so happy and optimistic!
that's right - all those fools watching Pet Olympics at 3 AM ...
being told to "end their own personal recession by SELLING their nasty, dirty, stinky, broken and unwanted gold - while prices are at record levels."
One issue with the gold cult is that there's a lot of counterfeiting out there. When you're unable to verify the claims made by the advertisers, you could be suckered in.
But like all speculative investments, do what you need to. I believe in human capital above all. No one can take my mind from me. No one can take my dignity. They can't steal my relationships.
Does that make sense? Buy gold if you like, but don't expect it to cure all your problems or provide for your family.
With the same open-ended philosophizing I would say a bullet to the head would "steal" one of your relationships - and nothing will cure all problems. There is nothing that is certain - always far too many variables.
Enron made money every quarter too, except they didn't.
Some people never learn. Enjoy your digital toilet paper.
LOL. Storm took out internet for 2 days. Glad to finally get it back so I can laugh.
Kudrow and Gold right now....
It is dangerous to make too much of this one day chart; and volume and tax are definitely factors, but there is a distinct premium between these two:
http://finance.yahoo.com/echarts?s=gld#chart3:symbol=gld;range=1d;compare=phys;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined
The record Commercial Short in gold exists to counter the record short in the Euro. The old sell Gold if USD up program seems to have run amok. Another 'fat finger' trade from the 'machines' as the MIT rocket scientists spend the weekend trying to figure out WTF is happening. Can't wait to get my first delivery of tungsten laced bars.
I think central Banks will be what drives the price up and squeezes the shorts-
Who knows when that happens-but all it will take is for the current contaigion in the junior currency's to spread into any "one" of the majors-GBP-JPY-CAD-EUR??
How will they stop a panic sell off-how will they strengthen that currency enough-to restore faith-which will begin to deterorate-in all majors?
They will buy Gold--
They weakened currency's by selling out the Gold weighting-
They will strengthen them-by buying Gold and weighting their currency's up with it--jmo
I wish TD would investigate this. http://www.huffingtonpost.com/dean-baker/will-they-get-fooled-agai_b_575...
I always suspected when they told us the money markets were in peril, everyone I knew changed their opinion to support TARP.
It was the fulcrum in the debate. People freaked out, even people just in cash or money markets were ready to do anything.
I always suspected it was a lie, linking the two. I'm sure it would make a good detailed story
Dean Baker: "Shit, shit, shit. I need a job. I am a total fucking bearded loser."
No, uh, offense intended, of course, but where the fuck were these guys back in the day?
That's the one thing I like about nihilists - they flip to follow the strongest ones in the room every time, without fail. Makes them dangerous, too.
Battle lines are drawn once again. Gold bulls are on the barricades. The front lines in an underground war.
TPTB, worn out from years of over indulgence, obese, gout-ridden and soft will not be able to resist forever. Already the first signs: dissent in the ranks. After the 1 Trillion dollar weekend in Euro land, replete with multi billion dollar swap lines and IMF slush, there's discord in full flower. The squabbling has officially begun. So much so that armed with the 1 Trillion dollars, none could agree what to do with it! Who's bond markets should get bailed first? How much is each country going to get at the trough? And which banks should benefit the most?
Prediction 1: Europe with Spain as its debutante, will kick off round 1 of the deflationary vortex with imposed draconian austerity measures into an already deflating economy with massive unemployment. The interconnectedness will pull down all of EUro land. And the Brits with their avid taste for condos on the Costa Del Sol will go down too. All other global dominos will soon follow.
Prediction 2: Timmay and Ben will triumphantly claim we've decoupled all the way to oblivion. They'll see it as a "European problem". But China, the lynchpin, will be drawn in just as their own deflation is getting underway, hoisted on the shoulders of a deflating equities bubble and a deflating real estate bubble. Bubblicious!
Prediction 3: (And don't they always seem to come in threes?) US deflation will pick up further steam this summer as state and local austerity measures (I'm looking at you, California!) join the diminishing Federal stimulus to start a self-reinforcing cycle of deflation centered around large cities. Cuts to services, security and upward pressure on taxes combined with a weakening labor market will make our cities sultry this summer. Perfect for an election year.
I did not see any unicorns, rainbows, changium or hopium in your predictions. If you are correct what will Barry Obama talk about?
CE, 3 very interesting predictions.
I wonder if there will be a 3rd disaster, to follow Iceland's volcano and the horrific Gulf oilwell blowout.
I'll be watching from my bunker, armed to the teeth and protecting my gold!
.....
J Bravo! I will take this opportunity to wish you luck in your studies and speculations. Find some time to read some History.
FWIW, our daughter was able to claw onto a decent job, she graduated with a BA in English and French a year ago. If you are as smart as you think you are, you may want to work instead of fooling around in school.
Are some of you people that dense? I mean every TV commercial about gold I ever saw is trying to get you to give away your gold for next to nothing.
Buying/selling the dips in the last two days was fun. It was like clockwork.
Was it Martin Armstrong who described the petro dollars, gold futures/miners connection?
I wasn't around the 1970 crisis and was curious what the hell happened at that time. That article pretty much cleared it up for me. I do not want to butcher it... The main gist was that crisis was caused stopping $->gold exchange. The oil producers baulked and didn't want to sell oil for confetti.
It appears, the solution and the reason why we can buy oil with with our bernanke bucks is that the banks worked out a sweet deal for the Arabs where they get to funnel the bernanke bucks from oil sales into loans for miners, which are repaid through the gold futures market. The bankers get price suppression, miners get funding for exploration, and arabs get real money. The moral of the story a lot of this short position is miners repaying their debts in real money back to arabs. So thank your nearest oil producer for cheap gold. Bad part is that they grab most of what is being mined.
If this gets upset in anyway, the dollar would be toast. Now what could cause this to end? Miners running out of gold? Electric cars?
I believe it was ANOTHER and FOA in the Kitco forum, and then USAGold forums, beginning in 1997 who made that information public, rather than Martin Armstrong, but otherwise you have summed up much of the story fairly well.
Don't overlook that the Euro was created specifically take advantage of this situation. Or that the main architect of the Euro gold reserves, Christian Noyer, is now the head of the BIS. The BIS are, as you probably know, the Central Bank of the Central Banks. They also function as the clearinghouse for XL size physical gold transactions between the worlds giant economic players, at a different (much higher) price than that fixed twice daily by the LMBA.
The current excitement surrounding the Euro is nothing more than MOPE.
Up to date analysis and commentary of this situation is available at FOFOA (Friend Of Friend Of Another).
I respectfully suggest that anyone who has an interest in how the presently developing currency crisis may find it's resolution, and what the role of gold may be in that resolution, acquaint themselves with these thoughts. FOFOA's most recent post, Hair of the Dog? would make a good starting point for anyone who has not already taken these thoughts into consideration.
Those who think that gold seems a crowded trade currently would do well to recall that lifeboats on the Titanic were at one time viewed similarly, and we all know how that ended.
nuinut, +1 austrian philharmonic on the FOFOA rec., however MA does talk about this as well in one of his 'joints from the joint' (can't remember which one).
but yes, agreed, the BIS is the secret keystone to the global monetary architecture of the future, King Dollar & his court notwithstanding.
Thanks, I think it was FOFOA....
FOFOA
http://fofoa.blogspot.com/
sinclair
in the gold market for fifty years owned international brokorage units
his family started the nasdeq.
then you have zit faced youngsters , throwing shit in the air to see what stinks
any ways here is sinclair
Jim Sinclair’s Commentary
Everything will be bailed out. That includes every state and all sovereign debt as quantitative easing goes to infinity.
Gold will trade on this leg at a minimum of $1650. More than likely it will reach much higher.
Yep, just started the sovereign's and the states are warming up in the batter's cage...
Easy to spot folks with no wealth to protect...
That was a nice set observations and metaphors all put into 2 little sentences.
Bravo Hulk. Bravo to you as well dumpster.
Oh, wait. Perhaps saying "Bravo" now is an insult!!!
Way to go Hulk and dumpster! Way to go!
Thanks DCRB, dumpsters to blame. did you watch the video I posted?
The whole Gold Bug Frenzy is getting absolutely outta hand now on the pages of
Zero Hedge. You wonder why they have so many Gold Ads up on the site? I wonder
how many lemmings read an article on Zero Hedge and then click on one of those
ads to Buy Gold?
Calm down for a moment and get REAL. Gold is at around $1250 for an OUNCE of
the stuff. What this means is that if you have just ONE Gold Eagle, you can use
it today to buy enough food to last you a Year. Now, assuming you get the crash
that Gold Bugs assume is coming here, do you really think you could go into a
Supermarket and buy a whole YEAR'S worth of groceries for ONE Gold coin? That
is just preposterous.
Meanwhile, the Gold Bugs are figuring its going to skyrocket to $5000 or more
per OZ. Even more ridiculous, because then all paper money is worthless and all
commerce comes to a halt.. You can't have massive companies like Cargill
selling tons of Wheat for a few gold coins. At the point Gold shoots into the
stratosphere, regular commerce would come to a complete halt. TPTB who are in
nominal "control" of regular commerce can't have that.
There are all sorts of ways TPTB can stop the trade in Gold without Confiscating
it. Simply make it illegal for Coin Dealers to buy your Gold for the Cash of
the day. If you can't exchange the coin for the Goobermint approved Cash, you
can't get $1250 to buy a year's worth of groceries with it, and neither will the
Checkout Clerk accept the Gold Coin for your train of Shopping Carts full of
Rice and Beans either.
At some point here, the Gold Bugs are going to crash their own market through
Backwardation. They are all POURING money into getting some of the stuff to
bury in the backyard. Nice way to flush money out of the system there. You once
had $1250 worth of spendable Cash, now you have a nice shiny metal coin, which
for all practical purposes is worthless. Unless you can actually USE it to
transact bizness, its just a paperweight. The paperweight has to wait for the
fiat system to calm down to establish its REAL value. Just to be a bit obvious
here, its STUPID to think that One Gold Coin is worth a YEAR of food. If Gold
were to soar to $5000/oz, one coin would buy 5 YEARS of food. Ridiculous. The
Gold Coin will deflate in value relative to the food, at which point the $5K you
spent to buy said coin might if you are lucky buy you a Twinkie.
While we are in the throes of Collapse here, "Gold Gone Wild" seems likely to
sucker in every last mega rich dude out there. Picture Bill Gates or some other
Pigman with Mega Bucks, worried his $30 Billions or so of personal wealth are
about to go worthless. Gold SOARS to $10K per oz, so Bill sells all his dollars
for 3,000,000 American Eagles? This also seems preposterous. Whatever monetary
system does emerge, if one does, it cannot value 1 oz of Gold at One YEAR's
worth of food. Nobody, and I mean NOBODY in their right mind would value one
coin of ANY metal as being equivalent to a year's worth of food. Of course right
NOW, nobody economically is in their right mind, INSANITY reigns supreme here at
the moment.
The market is in failure mode, and price and wage fixing have to be the next
step here. Real price discovery cannot happen because the market is rigged.
They are in effect doing price fixing through the rigging of the markets, but
this appears to be collapsing and once it does, all pretense to a "free market"
will have to be dropped to maintain some stability in commerce. This can be
done at the Wholesale level, but the biggest problem remains at the retail level
with J6P the Consumer of the goods, and how to distribute out money to him.
Without the guise of "work" as a means to distribute out money, Economistas are
confounded in their ability to distribute wealth. Giving money to people for
FREE without them having to work isn't very motivational for anybody to do
anything. It remains unclear how you can distribute out the plenty of a society
fueled on the thermodynamic energy of Oil without "work". Not that we will have
that problem in perpetuity, but it is the problem we have right now. Making the
money Gold won't solve that problem, moreover its just obvious there isn't
enough of the Yellow Metal to go round here and still run an economy as big as
we have now.
If you have some extra cash and can get hold of some possessible Gold, feel free
to do so. It might help you during the spin down phase. Long term though, its
NOT a solution. The Gold market will crash here, spectacularly when people
invested in paper Gold cannot redeem it for the real thing. It's an accident
waiting to happen.
My God you're dumb.
A similar weight of high quality diamonds is a million dollars. Why the fuck would you think that there is some sort of fundamental limit to the number of peices of paper that something is "worth"?
You think the value of physical gold is going to crash when people find that paper gold is a fraud? Sort of like how price goes down when supply is cut by 99%? I must have missed that day in economics class.
But yeah, enjoy your grinding poverty.
There is no fundamental limit to the number of pieces of paper that anything is worth, I never said any such thing. Read for comprehension.
What I said is that RELATIVE to food, Gold or Diamonds or any other source of wealth storage you think is meaningful is quite meaningless when what you want to buy with it is in increasingly short supply.
You can't run commerce in food with a few gold coins shuttling around the economy in one so big as this. When the paper money crashes, which it will, the commerce comes to halt, and that includes the commerce in Gold Coins. They may work for a while longer than the Fiat does, but not much longer because the collapse of the fiat means the collapse of the production. The stuff you might buy with the gold won't be available to buy. At ANY price.
RE
as the price of gold goes up if it were, and had a equivalent note of promise to pay backed by gold
the note or paper could go to any value to buy whatever a person whizzes .
all the bread , all the milk .
their is plenty of gold
also plenty of anal economists that have a hard time figuring that out ..
the gold sits ,, no need to go out and trade for stuff
you back the gold 100% with notes in circulation,
its like if you held 10 oz.. worth 12,000
have 12,000 paper pieces ,
you buy the eggs ,, the person selling the eggs then could come to me and i would give him gold or silver in exchange for his paper ,
presto ,,
at some price whatever gold their is will satisfy the complete need for gold
so the total amout of eggs can go as high as the need