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Goldman Moves To Underweight On Commodities

Tyler Durden's picture




 

Nobody could have seen this one coming: "Mounting downside risks to current exceptionally high crude oil prices are leading us to recommend an underweight allocation to commodities on a 3 to 6-month horizon, but we maintain an overweight on a 12-month horizon on tightening fundamentals over the next year....Not only are there now nascent signs of demand destruction in the United States, but also elections in Nigeria, a potential ceasefire in Libya and record market length on contagion fears. Further, softening near-term base metals balances suggest that a stock-out in copper inventories and associated price spikes has now been deferred beyond 2011, and recent gold price strength has pushed us close to our near-term price targets. As a result, we now recommend an underweight allocation to commodities on a 3 to 6-month horizon." Translation: please line up and convert your hard assets for dilutable fiat courtesy of the good folks doing god's work.

GS Commodity watch

 

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Fri, 04/15/2011 - 00:00 | 1171374 slow_roast
slow_roast's picture

Vampire squid investing in soul harvesting equipment.

Fri, 04/15/2011 - 05:39 | 1171644 spiral_eyes
spiral_eyes's picture

goldman analysts' phone numbers, eh? prank calls galore.

Fri, 04/15/2011 - 07:25 | 1171720 writingsonthewall
writingsonthewall's picture

...maybe later tonight some of those Goldman servants will be signing up for "daily sexy ladies .com" and "SPAM ME PLEASE .org" etc.

 

You never know what could happen.

Fri, 04/15/2011 - 07:36 | 1171731 slaughterer
slaughterer's picture

Two ways to trade silver.

1) Do not fight the Squid.

Every needy PD with its hands out to the Fed will want to crush commodities before June.  This will lower inflation expectations and give the Fed reason to inflate some more through QE3.  KaChing: more liquidity for the PDs.

Strategy: short silver for the time being

2)  Fight the Squid.

GS will want to squeeze all early shorters of sillver to "demoralizing levels" of pain as they have done with short sellers of nearly every absurd high-flying high-PE high-momo stock for the last few months (for which they even often had a very low price target far below the current trading price).

Strategy: ride the GS-induced short squeeze upwards, as GS fades its own analysis and trading recommendation.

 

Fri, 04/15/2011 - 00:03 | 1171381 slow_roast
slow_roast's picture

However, with the current roundof QE set to end in June 2011, and our US economics team now forecasting strong USeconomic growth in 2011 and 2012, we expect US real interest rates to begin to rise into2012, likely causing gold prices to peak in 2012.

 

Ermmm...didn't they just reduce their GDP forecast?

Fri, 04/15/2011 - 00:05 | 1171382 Missiondweller
Missiondweller's picture

Meanwhile, Goldman traders will be happy to buy BTFD as the sheeple sell.

Fri, 04/15/2011 - 00:07 | 1171384 Obummer
Obummer's picture

Ladies and gentlemen, fellow Americans, good people of the world. I find again that I must discuss with you a new threat. Remember, I said it before, winning the future will not be easy. Out on the horizon of the future we see obstacles in our path, and now one obstacle rears its ugly head. We have very little time. We must meet this threat before it becomes too powerful.

What is this threat, you ask? Ladies, gentlemen, fellow Americans, the threat is silver. Even worse than a threat, this is a menace.  This silver menace threatens all that we hold dear in America. It threatens our way of life, it threatens our economy, it threatens our livelihoods. The silver menace raises its ugly head in our path and threatens to block our path to the future.  We cannot allow this menace to keep us from winning the future.

Some say that commodities such as silver and gold offer stability in a time of dollar value deflation. This is only partially true.  Folks, the silver menace is much worse; silver only offers value inflation. And as you know, my administration has made it our mandate and the mandate of the Federal Reserve to stamp out inflation.  We will stamp out the silver menace before it grows, before it destroys us with inflation. We will not let the menace stand in the way of us winning the future.

For those who insist on feeding this beast, we will have no mercy. For we know that you are the terrorists we have been fighting for so long. We know that even now you have infiltrated the very heart of America, and are in our living rooms and bedrooms even as I speak.  This is not the America I love.  Rest assured that I will do everything in my power as President of this great nation stop you. With the help of our friends and allies in business we will stop you. Over the next few weeks we will lay out a four step plan to destroy the silver menace.  We shall take decisive action against this new threat to our financial stability and to our Constitution.  Thank you, good night, and God bless America.

Fri, 04/15/2011 - 01:26 | 1171505 akak
akak's picture

"Yes we can!" stamp out domestic financial terrorists!

Chains we can believe in!

Fri, 04/15/2011 - 06:58 | 1171680 4horse
4horse's picture

Chains we can believe in!

brilliant

. . . as the equally brilliant levin is in naming the 4butt4s of causative collapse because of just such GoldmanChains, now to believe in just who should soon be first wearing them inside a fed pen:

1. ButtFor Blankfein

2. ButtFor Paulson

3. ButtFor Bernanke

4. ButtFor Barney

 

. . . levin said to be next taking nominations butt4 DeutscheBank __as we further wait to believe in that concatenation whose chainreaction might lead to the-missing-links behind the ultimate ButtFor of Causation itself:

1. ButtFor Bauer

2. ButtFor Warburg

3. _ _ _ _ _ _ _ _

4. ButtFor Rubin

Fri, 04/15/2011 - 01:40 | 1171520 I_Am_
I_Am_'s picture

Good one. For some strange reason, instead my eyes, my head started swiveling left to right as I was reading :-)

Fri, 04/15/2011 - 05:46 | 1171648 PrDtR
PrDtR's picture

Can't stop LAUGHING.. soooo good!

Fri, 04/15/2011 - 10:57 | 1172437 Ident 7777 economy
Ident 7777 economy's picture

I wonder if the sentences are split - on the real prompters that is - to keep the rhythm 'timed' ...

    "So simple, a caveman could do it"

Fri, 04/15/2011 - 01:58 | 1171540 traderjoe
traderjoe's picture

Enjoy your stuff. Keep it up. Add in a "let me be clear" every now and then. IMHO one of his most condescending catch phrases.

Fri, 04/15/2011 - 02:10 | 1171549 akak
akak's picture

Not nearly as condescending as his constant habit of speaking with his chin held high while looking down his nose at us, as if he is some medieval king disdainfully addressing an assorted rabble of peasants.  In fact, though, probably in his mind, .......

Fri, 04/15/2011 - 10:58 | 1172449 Ident 7777 economy
Ident 7777 economy's picture

+1

Fri, 04/15/2011 - 05:46 | 1171647 PrDtR
PrDtR's picture

GREAT Speech.. one for the ages!

Dying from Laughter!

Fri, 04/15/2011 - 00:06 | 1171385 President Palin
President Palin's picture

Yeah.  When GS clients sell their positions, who do you think will take the other side of the trade?  (hint:  they are evil, scum sucking vampire squid, oh, I mean goldman sucks...)

Fri, 04/15/2011 - 00:07 | 1171390 chump666
chump666's picture

i mentioned a while back the correlation trade on WTI and Brent would narrow.  Now the sell, it's all China now.  Copper is shaky, oil should sell on the China inflation bust.  Goldman should make cash on selling short re: commods.  hedge funds are dying to sell commods and related FX

Fri, 04/15/2011 - 00:15 | 1171401 knukles
knukles's picture

"please line up and convert your hard assets for dilutable fiat courtesy of the good folks doing god's work."

And remember kids, we did tell you that we remained bullish on the longer term, so when we goose the shit out of it after we've sorted out the weak hands, assumed their positions, don't blame us when we change our forecast again and jam the piss out of everybody, including you.
Pssst, wanna piece of candy, dumbass?

Fri, 04/15/2011 - 02:00 | 1171543 traderjoe
traderjoe's picture

Nicely done.

Fri, 04/15/2011 - 02:46 | 1171575 NewThor
NewThor's picture

What kind of candy is it?

Fri, 04/15/2011 - 02:55 | 1171585 akak
akak's picture

A T-shirt I saw recently: "Strangers always have the best candy"

Fri, 04/15/2011 - 00:18 | 1171403 vast-dom
vast-dom's picture

china inflation means nothing given all other variables. goldman are turning out to be a joke with clearly duplicitous contradictory info meant to disinform. 

Goldman needs to be reformed, as does the Fed. But who can/will do this?

 

Fri, 04/15/2011 - 02:43 | 1171574 NewThor
NewThor's picture

Jesus Christ. Wolverine or Neo.

Fri, 04/15/2011 - 00:18 | 1171405 Josh Randall
Josh Randall's picture

SQUID ALERT - It's a false flag -- they are going to bet against their clients that take their advice like always

Fri, 04/15/2011 - 00:21 | 1171409 LongBallsShortBrains
LongBallsShortBrains's picture

"Mounting downside risks to current exceptionally high crude oil prices"

He must have missed the call from the other squid this week on crude.

Fri, 04/15/2011 - 07:59 | 1171772 Urban Redneck
Urban Redneck's picture

"Mounting downside risks to current  exceptionally high crude oil prices"

from

"We expect the oil market will experience a substantial pullback"

That would be like the imperialist explorer suckering the natives into his deification by demonstrating his awesome command of the universe by hiding the sun with an eclipse forecasted on April 11. 

I thought it was called a calender, but then again I am not doing God's work.  We'll soon see if they are as good at predicting the weather as they are the eclipses. 

Fri, 04/15/2011 - 00:22 | 1171415 CrashisOptimistic
CrashisOptimistic's picture

Those nascent signs of demand destruction are just how visible in China?

Fri, 04/15/2011 - 00:29 | 1171425 Big Mac
Big Mac's picture

 The government's extend and pretend gang does not like the way their poll numbers are  dropping so the call has gone out to Wall Street.

 "Shit on commodities or go to jail, but it's ok to buy the dip!"

 "It's a shitty job, but somebody has to do it!"

 

 

 

 

 

 

Fri, 04/15/2011 - 00:34 | 1171430 lsbumblebee
lsbumblebee's picture

Things that are up but in reverse order make us believe that it should bring pressure underneath the variable outlook that is arising with overall investments in assets, I say assests being weighted in anticipation of the economic recovery as portfolios now become geared towards items not listed but available now with a triple a rated tha tha tha thing wit da bing and a capital p and that rhymes with t and that means trouble, I say trouble if you don't follow our nice advice i'm remindin you twice but no more than thrice get with the goldman.  

Fri, 04/15/2011 - 00:45 | 1171444 mt paul
mt paul's picture

demand destruction... 

the little wifeys

madden name...

Fri, 04/15/2011 - 00:44 | 1171445 FaithEqualsZero
FaithEqualsZero's picture

Bullshit! Translation....Gold and Silver are going up big time....after a minor BTFD takedown.

Fri, 04/15/2011 - 00:44 | 1171448 AldousHuxley
AldousHuxley's picture

There is a reason why religious relics are usually made with GOLD. Throughout history, churches, kings, governments, have been burned by banksters.

Fri, 04/15/2011 - 01:12 | 1171485 sumo
sumo's picture

The Vampire Squid's 12 mo. target for silver is $28.20.

Just when I thought I couldn't feel any more contempt, GS pushes me to an all-time high.

Fri, 04/15/2011 - 01:09 | 1171486 ebworthen
ebworthen's picture

 

I don't know if the FED will keep up the QE and liquidity but I know they want rate inflation and to crush Precious Metals and alternative stores of value to the Dollar.

How to accomplish this?

 

Fri, 04/15/2011 - 01:16 | 1171495 Ransom
Ransom's picture

Thank you TD and commenters of ZH for opening my eyes.

To think, a week and a half ago I thought the congressional circus was the most important economic thing happening in our country.  FML

Fri, 04/15/2011 - 01:44 | 1171528 AldousHuxley
AldousHuxley's picture

Yes ZH will unhook you from the massmedia matrix. It sucks because it is the reality but at least you now know the truth.

 

I'm starting to think that ZH is either operated by Russia Today or by US government itself to figure out who to jail after when martial law is called for.

 

Fri, 04/15/2011 - 02:40 | 1171570 ebworthen
ebworthen's picture

 

Cool.

 

Fri, 04/15/2011 - 01:21 | 1171498 Mike Cowan
Mike Cowan's picture

My mother has a ton of silver hoarded away, and she ain't selling.

Fri, 04/15/2011 - 01:44 | 1171529 chet
chet's picture

Thanks for the impartial advice, Goldman Sachs!  You're always looking out for my best interest!

Fri, 04/15/2011 - 02:00 | 1171539 Bay of Pigs
Bay of Pigs's picture

Less than 1 or 2% of Americans has any idea what the fuck is going on anymore. Nothing but clueless stooges and a bunch of deer in headlights.

Place your bets accordingly.

Fri, 04/15/2011 - 02:10 | 1171553 jmc8888
jmc8888's picture

I guess this is where the pastor (Billy Blank[s]enfein) motivates you to tithe for the cause.

Fri, 04/15/2011 - 02:13 | 1171558 surfersd
surfersd's picture

Goldman Internal Email

To: Research

From: Commodity Prop Trading Desk

Positions set

-short front to back in crude spreads

-long copper put spreads 

-short dollar

Wait to announce your bullish call on Pan American, until after you deliver the suitcase to Evo next week. Need to see JP try jam it down and scare sheep out of their physical.

CC: Deliveries - come pick up the sheets for this months silver delivery

It is going to be a tough summer for Blythe.

 

Fri, 04/15/2011 - 02:25 | 1171564 TheGoodDoctor
TheGoodDoctor's picture

How about an AM margin hike? Maybe some Fed Head speak about how QEII is ending? Bernank comes out and says there is low inflation? Perhaps some strong dollar talk too? Hmmmm. BTFD!

Fri, 04/15/2011 - 02:42 | 1171572 NewThor
NewThor's picture

.....but how does Goldman Sachs feel about investing in Unicorns and Dolphin poop?

Fri, 04/15/2011 - 03:03 | 1171588 ZeroPower
ZeroPower's picture

Check out their 3mo p/t on Silver. 24.70. Remember those 25 July puts, 3 months out?

Interesting. 

For any paper longs out there, PLEASE hedge your shit.

Fri, 04/15/2011 - 03:04 | 1171589 Richard Chesler
Richard Chesler's picture

Goldman: current exceptionally corrupt and inept stooges in DC are leading us to recommend an underweight allocation to pitchforks and guillotines. 

Long live the chairsatan!

 

 

 

 

Fri, 04/15/2011 - 04:03 | 1171611 AGoldhamster
AGoldhamster's picture

Suggest to not treat GS like an idiot. Suggest not to get carried away by whatever GS - or any other institution or so-called advisor says.

I have done extremely well over last 7 months, well beyond what you think is extremely well - BUT I'm strictly TA led. For me is noise what comes out of the banks, advisors, gurus and even ZH. That tells me this:

TA wise - and also cycle wise - we have still a run north - maybe for another 6 weeks. Parabolic moves. Hyperbolic moves. Maybe 6 weeks, maybe a bit more or a bit less. But I suggest to become highly alert around late May. That will build the H of an SHS.

Thereafter the banks (and GS and that SLV put buyer and ...) will be right again - as major parts of markets will start their route south. No market will be immune - no matter what the so-called gurus will tell you. That move south will last a few months, then a recovery for another few months (building the right S of an SHS - or for other markets the double top) and latest early 2012 the real disaster (deflation monster back) starts.

Keep this chart in mind: http://3.bp.blogspot.com/-wYql07K4h4c/TaOCvewX7fI/AAAAAAAAAM4/PpGojARiOo8/s1600/Dollar_20110411A.png

And keep the timing in mind. Print out this post and check whether it will become true. And don't say that you weren't warned early enough.

Mentioning my gains is not for gloating - it's just to get your attention, as I want you to be prepared - as such gains don't come from being often wrong. They come from a pretty good sense and sources for what is to come next. And no I do not have inside information. At least not in the sense you might think of. Though yes in a different way maybe. Cycles is the keyword. See how this comment will close.

And yes - GS will be right - if you have a look at the mentioned time frames! 3-6 months. That is no coincidence. 1.5 more months north (that's where they will sell their stuff) - and then south. And then in around 3-6 months they start buying back. Different markets at different times. For that right S of SHS. Or the double top. Before they again sell into year end. Thereafter the true repeat of the 30s to come. And worse.

Put all the noise makers on ignore - respect the charts instead. The pattern to look for was mentioned above. And study cycles and what happend from 1921 thru 1930. Multiply by 3.

And of course always do your own decisions - as Hammy could well be wrong.  But not often.

April 1930. And no - this is not a misprint. This is around midst of April 1930. That should tell you everything you need to know.

Fri, 04/15/2011 - 04:51 | 1171620 TheGreatPonzi
TheGreatPonzi's picture

For what I've observed since 2008, technical analysis is mostly a sect, a Church. There is not any rationality in it (you can't predict the near-term future by looking at the near-term past, whatever the level of complexity of this "looking back" is, as evidenced by nearly all the academic studies made on TA) ; it is neither provable nor refutable, as if you deny TA, TA-adepts will say you're not smart/experienced enough to understand ; and prophets/gurus rotate frequently, each with a totally new technique/version of the story. 

If charts were the secret to riches 

(1) All hedge funds would employ "sucessful" TAists like you and make a killing every year, instead of 10 miserable percents of profits, which are already considered as "beating the Street"

(2) Everybody would be doing TA, as learning geometrical figures and identifying them is a job a 5-year old child can do (and a robot even better). 

I applaud the prediction you made with this message, but if it doesn't come true (like the hundreds I've seen in the past years), I hope you'll have the honesty to admit you're a complete loser. If it does come true, then yes, my consideration for you will sligthly improve, and I'll fully respect you if you're able to have a >70% success rate in a sufficiently long time rate (around 30 years). 

Fri, 04/15/2011 - 06:43 | 1171643 AGoldhamster
AGoldhamster's picture

...

Fri, 04/15/2011 - 08:20 | 1171805 web bot
web bot's picture

There is a huge misunderstanding out there of TA. TA measures investor psychology and perceptions. They reflect a point in time and herd sentiment.

You can go back in history and look at TA in a "normal" ungoosed market under both bullish and bearish sentiments and see how the herd behaves. The candles do provide patterns and do signal a change in herd mentality.

The problem today with TA in this environment is that market volume = 89% robot trading... which means you are looking at the investment psychology of robots... which doesn't work.

TA is a data point to consider, like looking at an insect with a magnifying glass. You still need to consider the broader economic picture (FED, economy, trade, currency, etc...) to see what the overall hive is doing.

Fri, 04/15/2011 - 05:18 | 1171638 Bicycle Repairman
Bicycle Repairman's picture

GS aren't stupid.  They are duplicitous.

TA is for fools.

Fri, 04/15/2011 - 05:48 | 1171650 AGoldhamster
AGoldhamster's picture

Funny to see my post being junked. But I'm used to that. That's another experience: only a few are able to see beyond what lies infront of their eyes.

That's the reason why it is so easy for the politicans and oligarchs to manipulate the masses. They are brainwashed for what is ok and for what is not. And they are brainwashed for what works and what doesn't work. Throw 'em some bones and they will run. Thinking out of the box and selfsufficient thinking - I know exactly 2.5 such individuals.

Almost nobody believed those predicting the great depression - almost nobody believed those warning of the 2007 peak, almost nobody believes that we are close to another even bigger financial crises.

Almost nobody believes in cycles. Astrologers i.e. are treated like trolls. Despite zillions of examples proving that there is a high correlation inbetween cycles and planets and the universe.

That's why sheep and lemmings continue to be sheep and lemmings. And why they deserve to be enslaved and robbed and treated like animals.

But that again - is just a matter of cycles.

Down we go into 2035 - before bigger change comes for the better. For those interested - UCT cycle S. Puetz the author. The rest - junk me.

All my posts will be deleted again - within next few hours.

Fri, 04/15/2011 - 06:06 | 1171654 TheGreatPonzi
TheGreatPonzi's picture

You're not the only technical analyst out there, so your posts won't be deleted, and I don't see why they should be.

I admit you're nicer and smarter than the average technical analyst, who is often very cocky, and whose sole argumentation is speaking about his -- often dreamed -- profits and insulting those who disagree with him. 

I do acknowledge that the history functions in cycles, and I use this for my investments based on fundamentals, but these cycles are very lengthy, and can be partly broken by technology development. You can't see what the future will exactly look like by glancing at the past, only get some clues. 

Technical analysis, according to Wikipedia, does not work (the original article was very charged against TA, described as a pseudoscience, the latter has been softened, probably under the influence of TA lobbyists). 

Why I take the TA issue very seriously is because it has gained enormous popularity in the last five years, thanks to the development of amateur trading and amateur trading forums, which themselves are due to the development of high-speed Internet (before this, nobody traded, except professionals in banks, and most futures pits did not even exist). 

And while it does not work very well on the long term (I've seen many broke TAs during the past years, believe me, and it wasn't pretty) it is endlessly pushed by the Forex account providers/Day trading dreamers/Online Banks as the best way to make money. 

It has become a question of enormous importance, because if TA really works, then nobody would need to do actual work anymore to earn money, just identify geometrical patterns every day like a robot. In a society like this, I'm not sure potatoes and wheat would still be planted in the soil to feed the population.

Fri, 04/15/2011 - 06:47 | 1171675 AGoldhamster
AGoldhamster's picture

Unfortunately after replies posts can't be removed or changed anymore. So seems they have to stay here - whether I like it or not. Another lesson learned.

I would have removed my comments - because I'm not eager to be on some gov black lists in the months and years ahead.

Bad luck ...

Fri, 04/15/2011 - 06:52 | 1171677 TheGreatPonzi
TheGreatPonzi's picture

Well, I don't think Tyler is going to hand over your IP to any curious gov official.

Many people here have disclosed way much about their personal financial holdings. 

Fri, 04/15/2011 - 07:21 | 1171705 AGoldhamster
AGoldhamster's picture

This is not about financials - this is a repeat of the 30s. It will all be about whether you, or your opinion, or what you know (or appear to know) is a threat for the system and those in power. Only little will be enough to become suspicious - and at least questioned.

And no, I do not suffer from paranoia. Just that I know very well what happened in the 30s in central parts of Europe.

Fri, 04/15/2011 - 10:02 | 1172186 r101958
r101958's picture

ham....just a wild guess....you are in paper and not physical?

Fri, 04/15/2011 - 10:55 | 1172417 AGoldhamster
AGoldhamster's picture

Until around October 75% of liquid assets in coins - rest cash and a small trading account.

January this year added considerable more silver.

In above posts I only talked about the trading account.

Fri, 04/15/2011 - 07:30 | 1171722 FunkyOldGeezer
FunkyOldGeezer's picture

This is nothing much different to the normal yearly cycle in Gold. Nothing new here?

Fri, 04/15/2011 - 08:12 | 1171795 web bot
web bot's picture

+100000000000000000000000000000

You get the picture.

Fri, 04/15/2011 - 04:04 | 1171614 Global Hunter
Global Hunter's picture

what's the opposite of never catch a falling knife?

Fri, 04/15/2011 - 08:27 | 1171820 snowball777
snowball777's picture

never get out of the boat. <fucking tiger, man!>

http://www.youtube.com/watch?v=QUcpcFz3PGI

Fri, 04/15/2011 - 04:46 | 1171628 sub Z
sub Z's picture

Did I miss the most recent entry on silver? Oh, someone inform me when it's time to short the market, thanks.

Fri, 04/15/2011 - 05:08 | 1171635 Itsalie
Itsalie's picture

what if oil and Ag prices fail to comply with the orders from dudley to throttle back? what if raising margins does not work (silver seems rather stable these last 2 days), what if all the suddenly inflation-conscious MSM poison (from FT to Economist to WSJ) calling commodities prices a bubble (until now they have obediently argues it was supply vs demand) fail to bring oil or corn down? Will they engineer a mini flash crash next to scare the market? Will the market be scared since BTFP is already part of the algo's BIOS, cannot be un-wired. So a half-hearted flash (hey, the R2K must stay above 800 right? else QE will be pronounced a failure right?) will only bring more Indian silver buying, chinese oil and copper hoarding. It seems they are now firing the last or close-to-last silver bullet (no pun there) by having the squid talk down oil and corn. The sooner oil and corn tanks, the earlier QE3 comes. How long can  the banksters wait? How many more quaters can JPM/Citi/BoA write back loan loss reserves before they run out?

Fri, 04/15/2011 - 05:25 | 1171640 Spalding_Smailes
Spalding_Smailes's picture

Get ready for those margin hike requirements.

 

 

Silver History • 

1900 - $0.80

1910 - $0.70

1920 - $1.70

1930 - $0.50

1940 - $0.42

1950 - $0.90

1960 - $1.00

1970 - $2.00

1980 - $48.00 ( Two months later below $10.00 )

1990 - $6.00

2000 - $5.00

2003 - $5.00

2006 - $8.50

2009 - $12.00

2010 - $18.00

Today = Bubbleicious

Same thing will be playing out all over again ...... Get ready for round two, back then they thought COMEX was in trouble but she's still around ......

.............. " When the Hunt's had begun accumulating silver back in 1973 the price was in the $1.95 / ounce range. Early in '79, the price was about $5. Late '79 / early '80 the price was in the $50's, peaking at $54.

Once the silver market was cornered, outsiders joined the chase but a combination of changed trading rules on the New York Metals Market (COMEX) and the intervention of the Federal Reserve put an end to the game. The price began to slide, culminating in a 50% one-day decline on March 27, 1980 as the price plummeted from $21.62 to $10.80. " ......................

 

.................. " On January 7, 1980, the other major U.S. exchange, COMEX, changed its rules also. Investors were limited to 10 million ounces in futures contracts, and any amount above that had to be liquidated by Friday, February 18.6 On the very next trading day, Monday, January 21, as silver reached a record high of $50 an ounce, the Hunt silver hoard peaked at a mind-boggling $4.5 billion, (that’s $43.5 billion in Shadowstats CPI-adjusted 2011 dolars!)5  


On the same day that silver hit $50 and silver futures topped out at $52.50, gold’s price set a new record of $850 and gold futures peaked at $892. COMEX, terrified that it would be forced into default, announced—with the backing of the CFTC—that trading in silver would be limited to liquidation orders only, eliminating any buyers.

With no new buyers, the price of silver could not go up. So this rule was basically the same as saying, “Until this rule is lifted, the price of silver will only go down.” Of course, silver began to plummet, and on that same day so did gold. " .........................................

 

Fri, 04/15/2011 - 09:24 | 1172027 DoctoRx
DoctoRx's picture

Sometime trolls post stuff that merits a brief response.  Here's a response.  Silver rose about 10X from early 1979 to early 1980.  The equivalent move now, but only half as intense (ie 5X) projects more than a doubling from here.  All you have pointed out is that silver is in a bull market.  But everyone on ZH knows that.  Some of the public is even learning it.  So you added nothing.

Fri, 04/15/2011 - 09:31 | 1172058 MadeOfQuarks
MadeOfQuarks's picture

Wow I never realized the comex were such corrupt turds, imagine NYSE going out saying no one is allowed to hold more than 100,000 Apple stocks. If the system weren't corrupt comex would have gotten their asses sued to the gutter. 

Fri, 04/15/2011 - 05:36 | 1171645 PrDtR
PrDtR's picture

GREAT Speech.. one for the ages!

Fri, 04/15/2011 - 05:55 | 1171651 kapillar
kapillar's picture

It gets better yet. Those Goldman folks are all over NJ with our worst enemy: Young ladies

Fri, 04/15/2011 - 07:00 | 1171679 savagegoose
savagegoose's picture

isnt there some sort of insurance you cfan take against  bad financial advice, ie if their advice loses you money, you get a payout equal to the loss?

professional indemnity insurace? or thats what they take incase you sue em?

still who would be dumb enough to  back it? IAG i spose

Fri, 04/15/2011 - 07:13 | 1171695 Moe Howard
Moe Howard's picture

The squid better move against silver soon - I just ran American Silver Eagle 1TOZ through Goldshark.com and the cheapest estimated ship price was $52.95 - 54.64 using CC - from some place I never heard of. The cheapest at the places I use is $55.91. That is quite a premium I must say. Seems to me there might be a lot of FRNs chasing a few ASEs. American Gold Eagles don't seem as bad - $1551.66 - 1598.21 using CC - again from some place I never heard of. From a place I use, $1564.44.  I have some in transit I paid $1507.85 shipped for, so I don't feel too bad right now. But silver? Not purchasing at that premium. Guess I will purchase junk silver from co-workers, and start flea marketing and pawn shopping for hallmarked silver.

Fri, 04/15/2011 - 07:13 | 1171700 Lone Mad Minute...
Lone Mad Minute Medic's picture

So GS is saying I should turn my paper silver profits into Physical?

Fri, 04/15/2011 - 07:32 | 1171726 writingsonthewall
writingsonthewall's picture

I don't understand how they get away with this? They're already being questioned about betting against clients and here we have a classic setup for it to happen again.

 

Don't give me that chinese walls crap either - they couldn't keep out Genghis Khan and they're not going to stop Goldman ripping off their clients.

There is an argument that any client Goldman has left are simply dumb schmucks - but how many funds are managed by others...and are taking GS bullshit advice?

It's criminal - there is no other word for it.

Fri, 04/15/2011 - 07:43 | 1171739 mogul rider
mogul rider's picture

This is god speaking Lloyd

 

Short Commodities

 

Fri, 04/15/2011 - 08:31 | 1171823 snowball777
snowball777's picture

God sounds an awful lot like Jamie the Greek with a megaphone.

Fri, 04/15/2011 - 08:14 | 1171798 MadeOfQuarks
MadeOfQuarks's picture

*Ouch*, I find myself half in agreement with GS, I think silver could take a hit this summer (particularly the miners and particularly the juniors) while the FED suspends QE until it's politic again, but I'm bullish in the longer term. Does this mean I'm about to get wiped out?

Fri, 04/15/2011 - 08:32 | 1171826 snowball777
snowball777's picture

Fuck paper. Form the physical into slugs.

Fri, 04/15/2011 - 11:37 | 1172607 Papaneuf
Papaneuf's picture

I have been dabbling in technical analysis the last few weeks, trying to discern the pattern in the tea leafs and what I am seeing today is the classic pattern "Dog taking a shit."

Gold & Silver, Bitchez!!

 

Fri, 07/15/2011 - 05:50 | 1458634 hama
hama's picture

The Yen, and Japan, raising cash to pay for the reconstruction of the country, is already on the path of Yen appreciation and will be assisted in their efforts by the other central banks. By acting in a co-ordinated fashion they will begin to reverse the worldwide race to the bottom.
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Fri, 07/15/2011 - 07:41 | 1458763 hama
hama's picture

compound annual inflation rate, the appropriate term to measure this year over year inflation measurement? This level of inflation will make it difficult for people to properly value the products they buy relative to the products value in silver.. A value buying guide might be a useful tool going forward.
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Sat, 07/16/2011 - 08:59 | 1461905 hama
hama's picture

This level of inflation will make it difficult for people to properly value the products they buy relative to the products value in silver.. A value buying guide might be a useful tool going forward.
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Sun, 07/24/2011 - 09:29 | 1486922 pama
pama's picture

The equivalent move now, but only half as intense (ie 5X) projects more than a doubling from here. All you have pointed out is that silver is in a bull market. But everyone on ZH knows that. Some of the public is even learning it. So you added nothing.
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Tue, 07/26/2011 - 07:25 | 1493816 pama
pama's picture

As stated above, my ears were bleeding. If you read it backwards your ass will bleed.
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Wed, 08/17/2011 - 08:38 | 1568398 pama
pama's picture

As stated above, my ears were bleeding. If you read it backwards your ass will bleed..
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