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Silver Shorts Bloodbath

Tyler Durden's picture


In what can be only described as a total gutting of all silver shorts everywhere, including those with infinite Fed funded balance sheets (wink wink Blythe), all one can do is commiserate. With silver hitting $35.55 intraday, not even a last ditch attempt to spread the ridiculous Chavez rumor once more (this time the two dictators will really get peace ironed out, we promise) will prevent a battery of margin calls from forcing all the silver market timers to liquidate assets to keep their primer brokers happy. That's ok: all those market timer will sooner, or much, much later, get the top right.



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Fri, 03/04/2011 - 16:58 | 1020195 Harmonious_Diss...
Harmonious_Dissonance's picture


Fri, 03/04/2011 - 17:14 | 1020292 Hugh G Rection
Fri, 03/04/2011 - 17:22 | 1020354 High Plains Drifter
High Plains Drifter's picture

I told ya. Its the metaphorical "train" being pulled on Blythe, the JPM metals whore. Baby, bend over and take it like a man.........

Fri, 03/04/2011 - 17:27 | 1020386 Harmonious_Diss...
Harmonious_Dissonance's picture


Fri, 03/04/2011 - 17:40 | 1020462 Michael
Michael's picture

Duh, Winning!

Fri, 03/04/2011 - 18:00 | 1020556 Careless Whisper
Careless Whisper's picture

Blythe, Get To The Chopper !!!

Fri, 03/04/2011 - 18:10 | 1020588 Hugh G Rection
Hugh G Rection's picture

shoulders, head, outstretched arm with extended middle finger

Sat, 03/05/2011 - 00:36 | 1021449 A Nanny Moose
A Nanny Moose's picture

+1. Just can't go wrong with a good FMJ reference.

"Just don't lead em so much"

Fri, 03/04/2011 - 18:33 | 1020672 redpill
redpill's picture

Damn it feels good to be a owner.




Fri, 03/04/2011 - 17:00 | 1020199 Debtless
Debtless's picture

Vertigo bitches.

Sat, 03/05/2011 - 07:00 | 1021696 Frankie Carbone
Frankie Carbone's picture

Got silver, bitches? 

Fri, 03/04/2011 - 17:00 | 1020201 camoes
camoes's picture


Fri, 03/04/2011 - 16:59 | 1020205 Roy Bush
Roy Bush's picture

who exactly are these silver shorts?  who the hell would short silver in this environment?  clearly shorts aren't being forced out yet as the big banks would exit en masse and cause a truly parabolic move....thoughts?

Fri, 03/04/2011 - 17:02 | 1020218 tmosley
tmosley's picture

JP Morgan is the big dog.  They have access to free money, so they literally CAN'T be forced out, no matter how high the move.

Of course, they will have to deliver the silver sooner or later, as longs continue to stand for delivery, though perhaps not in the volumes hoped for by silver bulls.

Fri, 03/04/2011 - 17:03 | 1020238 Sudden Debt
Sudden Debt's picture

and Don't forget BAC and C!

They are in the same mess!


Fri, 03/04/2011 - 17:06 | 1020251 Careless Whisper
Careless Whisper's picture

crash jpmorgan buy silver



Fri, 03/04/2011 - 17:15 | 1020284 Pladizow
Pladizow's picture

I recently read an interesting thesis that it is in fact China and not JPM that is the big silver short.

The purpose is because the PM's tend to move in tandum and by surpressing silver they can supress gold.

Why not directly short gold? - silver is a much smaller market and more easily manipulated.

Why supress gold? - So you can continue to accumulate as mush as possible at lower prices to one day back your currency with it, replace the dollar and become the world reserve currency.

China plans in centuries and is willing to accept short term silver losses to accomplish their goal of global domination.

See:      This person has written for the DOD.

Fri, 03/04/2011 - 17:19 | 1020333 tmosley
tmosley's picture

That is Ted Butler's theory.

If they are doing it, they are doing it through JPMorgan.

Fri, 03/04/2011 - 17:51 | 1020516 wintermute
wintermute's picture

Reasonable theory. But the problem is that the cost of holding silver short is far more than the benefit gained by buying gold slightly cheaper...

Fri, 03/04/2011 - 18:34 | 1020680 Andy_Jackson_Jihad
Andy_Jackson_Jihad's picture

The cost in toilett paper USTs and FRNs.  What are they going to trade them for?  New seasons of reality shows or transformers 3?

Fri, 03/04/2011 - 19:01 | 1020743 AR15AU
AR15AU's picture

I disagree...  they could sacrifice one of their tier 2 investment banks (a Chinese Bear Stearns) - Lard it up with more and more derivatives, billions of ounces synthetically shorted, until the thing explodes. Then simply walk away.

Fri, 03/04/2011 - 19:37 | 1020867 IQ 145
IQ 145's picture

 That's diabolical. You're a dangerous man.

Fri, 03/04/2011 - 19:52 | 1020907 tmosley
tmosley's picture

That was part of Ted Butler's theory.  They are long SLV and short silver futures.  They are redeeming SLV for physical metal, and intend to simply default on the silver shorts.

Not terribly far fetched.  I had thought of a similar scheme myself, but I don't have sovereign power to back up such a nefarious plot.

Fri, 03/04/2011 - 23:04 | 1021287 Fred Hayek
Fred Hayek's picture

But, why would Gensler et al be under pressure to let the Chicoms keep making a joke of their commodities exchange by holding absurdly sized positions?  That doesn't make any sense.  Their being ordered to let JP Morgan abuse the market, that makes sense, at least as far as having understandable motivation.

Fri, 03/04/2011 - 23:14 | 1021307 just_looking
just_looking's picture

Trade off on the beating china is taking on their treasury holdings.

Fri, 03/04/2011 - 20:05 | 1020949 nmewn
nmewn's picture

+1 AR.

They'll crash & burn...I stopped by my dealer yesterday, he's out of 2010's...he had to root around in the back of the safe for 04's at the same premium over spot.

He always asks if I'm sellin or buyin when I walk in...I just give him a wink and smile.

G/S ratio is at 40.16 now and falling like a rock...lookin good Billy Ray ;-)

Sat, 03/05/2011 - 07:07 | 1021699 Mach1513
Mach1513's picture

"Free and unlimited coining of silver at a ratio of 16:1."

Maybe we'll get there.

Some day.

Some how.

Fri, 03/04/2011 - 20:52 | 1021069 Reptil
Reptil's picture

that's what I'd do. hahaha good one! but IMHO too crude for the chinese politburo. they like balance not kaboom.


Sat, 03/05/2011 - 02:19 | 1021566 StychoKiller
StychoKiller's picture

40Million+ starved, dead, Chinese peasants would beg to differ with that statement...

Fri, 03/04/2011 - 21:43 | 1021153 Amish Hacker
Amish Hacker's picture

Sorry, I can't seem to find the exact link right now, but FOFOA makes a pretty good case that the gold price is suppressed to hold down the price of oil. The idea is that the Saudis have a grams-to-barrel ratio that they try to maintain. If this is the case, then the benefit of lower oil prices might well be worth the cost of holding silver short. And it probably was, until the whole thing blew up in their face.

Fri, 03/04/2011 - 22:25 | 1021221 tmosley
tmosley's picture

The article is called "Flow" IIRC.

Fri, 03/04/2011 - 18:23 | 1020636 Drachma
Drachma's picture

The international priesthoods plan in millenia.

Fri, 03/04/2011 - 19:05 | 1020762 DosZap
DosZap's picture

Dont kid yourself, China is SCARFING up all the silver they can get.

Rumor has it they took 2 million Silver Eagles off the market here, last month.

Just like Japan, prior to WWII, they bought everything they needed to engage in War.

China is likewise, for a different kind of war.

Fri, 03/04/2011 - 22:45 | 1021254 Al Gorerhythm
Al Gorerhythm's picture

Now, where are those three wascally wabbits who have been dissing us for the last month. Oh, there you are! Hiding in amongst the comments as junk. Come out, come out, where ever you are!

Sat, 03/05/2011 - 02:58 | 1021589 trav7777
trav7777's picture

so, the ubiquitous addiction of chinamen to opium 100 years ago was all part of a centuries-long plot to trick us into letting them counterfeit Louis Vuitton handbags?  WTF?!?

Sat, 03/05/2011 - 14:02 | 1022026 Phaethon
Phaethon's picture

Those weasels think waaay ahead!

Sat, 03/05/2011 - 09:08 | 1021755 Hephasteus
Hephasteus's picture

Even Nixon can't go to Goldman's china.

Sat, 03/05/2011 - 23:35 | 1022872 Kegfreak
Kegfreak's picture

With all do respect to Ted Butler and all else who hold this theory, have you noticed the ratio?  We were 60:1 three months ago, today we are 40:1.  I realize that silver is a much smaller market but wouldn't the fact the silver is increasing faster negate this theory.

The Chinese are advising their people to invest in silver so wouldn't it be better to all buy in at once and be on the correct side of the trade?


Cheers, I got white trash mimosa(box wine and orange juice) and Beastie boys are on the radio!

Fri, 03/04/2011 - 17:42 | 1020467 Temporalist
Temporalist's picture


Sat, 03/05/2011 - 05:22 | 1021653 CH1
CH1's picture

HSBC is a very small actor, compared to JPM.

Sat, 03/05/2011 - 08:36 | 1021736 slewie the pi-rat
slewie the pi-rat's picture



HSBC?  yes, quite a nimble playa, in spite if it's diminutive "size".

Fri, 03/04/2011 - 17:07 | 1020254 Roy Bush
Roy Bush's picture

March 29th is the big day I guess....when physical delivery will be demanded.  

Fri, 03/04/2011 - 17:53 | 1020534 dumpster
dumpster's picture

even the end of feb  deliverys

cash was used by morgan to buy positions

as much as $50 bucks was paid to settle in cash/

either take the cash or we make an offer you will not refuse



Fri, 03/04/2011 - 18:06 | 1020586 Citxmech
Citxmech's picture

If that's really the premium to put off delivery - the precident will only delay the inevitable.  The COMEX is all but blown. 

This is f'n beautiful.

Fri, 03/04/2011 - 19:08 | 1020765 DosZap
DosZap's picture

This is what you get for fking&$&#^^# with Paper ETF's.

Fri, 03/04/2011 - 17:10 | 1020272 TheGreatPonzi
TheGreatPonzi's picture

This 'free money' can only be freshly printed (the FED has no personal value-assets). 

So it can only push inflation -- and the price of silver -- higher. 

Fri, 03/04/2011 - 17:44 | 1020482 Temporalist
Temporalist's picture

I believe the Fed now has a lot of CDO and MBS garbage they own depreciating RE if that's something.

Fri, 03/04/2011 - 17:16 | 1020310 earnyermoney
Fri, 03/04/2011 - 17:23 | 1020361 High Plains Drifter
High Plains Drifter's picture

Chinese government to JPM. Where is my fucking silver?

Fri, 03/04/2011 - 17:38 | 1020454 Careless Whisper
Careless Whisper's picture

JPM to Chinese government. To quote Mister Cee-Lo Green (love the outfit).

Fuck you! Oo, oo, oo,



Fri, 03/04/2011 - 21:29 | 1021136 cranky-old-geezer
cranky-old-geezer's picture

I rather doubt that when China holds the detonator for that huge bomb under the American financial system.

Sat, 03/05/2011 - 09:57 | 1021783 Long-John-Silver
Long-John-Silver's picture

Here; take this copper, sugar, cotton, and oil instead.....

Fri, 03/04/2011 - 17:28 | 1020393 High Plains Drifter
High Plains Drifter's picture

I believe silver was one of the main control valves they used to control the whole market. It was always was. Imagine that. Poor man's gold. Geez, what could it be that scrares them so much about that evil "industrial" metal, that they call junk...????

Fri, 03/04/2011 - 18:53 | 1020725 johnnynaps
johnnynaps's picture

And, what happens when delivery turns impossible? Not only will there be a total lack of faith in our currency, there will be a lack of faith in silver too! I'm going long on alcohol and canned goods.

Fri, 03/04/2011 - 19:04 | 1020759 Dr. Porkchop
Dr. Porkchop's picture

When that happens, the paper price will probably crash, but it won't matter because you won't be able to get physical anywhere for any price until the smoke clears. Then price discovery will happen by physical markets.

Sat, 03/05/2011 - 11:19 | 1021837 FatFingered
FatFingered's picture market.  The only truly free market.  The black silver market.  I like it. 

Fri, 03/04/2011 - 19:11 | 1020775 DosZap
DosZap's picture

My hopes is that it wont JUST dissapear here...........

The Asian Mkts,and Indians, are worse than we are on hogging it up.

Fri, 03/04/2011 - 21:31 | 1021141 cranky-old-geezer
cranky-old-geezer's picture

Comex is his-to-ry.

Fri, 03/04/2011 - 17:08 | 1020260 sandvikpanther
sandvikpanther's picture

China is demanding delivery of 100s of tons not just tossing chits around so the short squeeze is on.  You would short PMs if you wanted to maintain your ability to sell paper.  Fiat everything will be unmarketable if the price keeps rising for Silver.  A really huge headline on Silver like 100. will awaken everyone + Blythe will be broken.

Fri, 03/04/2011 - 17:26 | 1020373 High Plains Drifter
High Plains Drifter's picture

Jesse (Americain Cafe) was talking about this one time a few months ago, about how he thought one day, some big boy would come out of the shadows and swamp the JPM shorts. Ha ha ha .  I love it.....

Fri, 03/04/2011 - 17:54 | 1020529 Temporalist
Temporalist's picture

The $50 cold shower will wake people up way before $100.

Fri, 03/04/2011 - 17:34 | 1020429 skohiu
skohiu's picture

You're really asking the question?  Where have you been Roy?

Fri, 03/04/2011 - 17:53 | 1020523 Citxmech
Citxmech's picture

Ask MathMan.

Poor bastard was warned...

Fri, 03/04/2011 - 20:30 | 1021009 JuicyTheAnimal
JuicyTheAnimal's picture

My dumb ass bought SLV puts right before close last night in hopes of a turning a quick dip in prices into some physical silver.  I lost.  But technically I wasn't short since I was never going to exercise.    

Fri, 03/04/2011 - 20:38 | 1021029 tmosley
tmosley's picture

You play Russian Roulette, sometimes you go home in a box.

Sat, 03/05/2011 - 06:59 | 1021697 doggings
doggings's picture

I might start thinking about going tentatively short for a bit at around $60 silver but even that might be only half-way

if you havent seen this $138 (?) silver video, you need to.


Fri, 03/04/2011 - 17:00 | 1020216 hungrydweller
hungrydweller's picture

Let's just see if the market stays irrational longer than they can stay solvent.  Silver Buyers vs. Bernankestein!  It's Go Time , Skippy!

Fri, 03/04/2011 - 17:03 | 1020228 whatsinaname
whatsinaname's picture

does she need lunesta or ambien?

Fri, 03/04/2011 - 17:29 | 1020400 High Plains Drifter
High Plains Drifter's picture

She will be in the office most of the weekend. Does her blow supplier make house calls?

Fri, 03/04/2011 - 20:28 | 1021006 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Administrative Assistant...blow supplier --

is there a meaningful difference between the titles for an individual who is 'helping out' someone at Blythe's level?

IOW -- always available at a moment's notice.

Sat, 03/05/2011 - 02:26 | 1021571 StychoKiller
StychoKiller's picture

Will a dose of Feariflu counteract the side-effects of Greedquil?  Only your Doctor knows fer surez! :>D

Fri, 03/04/2011 - 17:01 | 1020217 slow_roast
slow_roast's picture


Fri, 03/04/2011 - 17:01 | 1020219 Pants McPants
Pants McPants's picture


I'm envisioning that silly internet icon - the dancing banana!

Fri, 03/04/2011 - 17:10 | 1020270 faustian bargain
faustian bargain's picture


Sat, 03/05/2011 - 13:53 | 1021997 FatFingered
FatFingered's picture

Beachballs Bitchez!!

Fri, 03/04/2011 - 17:01 | 1020220 Atomizer
Atomizer's picture


Fri, 03/04/2011 - 17:03 | 1020226 AboutAverage
AboutAverage's picture

Don't trust those silver/gold ETFs.   If the banksters get a solid position of suckers, they just might tank the ETF when the street price is higher.   Last time i checked you can't deliver silver from ETFs either.  even if you could deliver, i still would be skeptical of exactly what the banksters were delivering...   probably tin foil balls with a stamp "Made in China".

Fri, 03/04/2011 - 17:14 | 1020301 Eternal Student
Eternal Student's picture

It depends on the ETF. SLV is mostly paper. PSLV actually has the silver, or so they claim.

And you can indeed get the silver out of both ETF's, or so it is claimed, if you have enough shares. Supposedly China has figured this out, and has been taking their silver out of SLV, since it's faster than getting it from the Comex.

One should be careful of, or avoid completely, most commodity ETFs, if you're not aware of the games which get played on the ETF. USO comes to mind. Such ETF's are played as suckers, and the stupid money gets liberated from them quite handily.

Fri, 03/04/2011 - 17:02 | 1020227 Sudden Debt
Sudden Debt's picture

You all should check the 1 year silver chart and ask yourself:





Fri, 03/04/2011 - 17:02 | 1020230 Village Smithy
Village Smithy's picture

And here I thought that this afternoon's green spike in the ES was bernake's money.

Fri, 03/04/2011 - 17:04 | 1020234 SilverRhino
SilverRhino's picture

Not quite 36.  Looks like I missed my call.   Oh well. :-)


Where's Littleus dickless?  RobotTrader? InnumerateBoy?

Fri, 03/04/2011 - 17:05 | 1020245 Sudden Debt
Sudden Debt's picture

I'm sorry to say you'll need to wait untill monday...


Fri, 03/04/2011 - 18:15 | 1020609 SilverRhino
SilverRhino's picture

$35.71 in the close (APMEX ask).   Missed by a whisker!

Fri, 03/04/2011 - 19:19 | 1020805 Infinite QE
Infinite QE's picture

Robot's still crying that his then guru Tom O'Brien got him to sell his gold and go short at 1200. That's what you get for being a talentless follower.

Fri, 03/04/2011 - 17:04 | 1020240 tekhneek
tekhneek's picture

Massive shorting = True price discovery manipulation. They're just going to get murdered which is what Tyler's getting at.

They're going to continue shorting and shorting all the availble liquidity and people who are long this rare-ass metal are going to keep taking their money. It won't stop this time around and once the liquidity drys up the longs will laugh all the way to the bank.

Meanwhile, Blythe gets shitfaced with the Bernank while they laugh about how little the silver market is and how much money they've gotten in their own bonus structures.

Fri, 03/04/2011 - 17:12 | 1020283 pgarner
pgarner's picture

+10, tek

Fri, 03/04/2011 - 17:16 | 1020311 Eternal Student
Eternal Student's picture

And a nice avatar. :)

Fri, 03/04/2011 - 18:26 | 1020648 naughtius maximus
naughtius maximus's picture

Screw the bank I'm putting my hard cash under my mattress. psst don't tell anyone

Fri, 03/04/2011 - 19:16 | 1020794 BallsDeepGold
BallsDeepGold's picture

  You under estimate blythe & her craftiness. The short position is on paper only. They also have large physical position. While you might think they just cancel each other out - they don't. The short position was built to push down the price so that physical can be accumulated for below what would otherwise be a higher market price. Their intention was to make money by the selling the paper as the price falls (which they did). Gresham's law dictates that if the current market price is below the true price - it will disappear. Backwardation anyone?

  Once no more physical can be had  and since the entire reason to build the paper short position was to accumulate cheap silver - and they have accomplished that - the next step is to default on the paper short position. This has the effect of driving the physical price skyward while also sticking the paper longs with the bill for the morgue's accumulated physical long. Then when the price gets high enough they will dole out their physical hoard with an eye dropper. Pure genius.

  They make money on both sides of the trade. Notwithstanding the lack of a moral compass she is a typical bankster.

   This is the part of the equation the Ted Butler's of the world are missing. The morgue is a silver BULL in BEAR clothing.



Fri, 03/04/2011 - 22:50 | 1021264 Al Gorerhythm
Al Gorerhythm's picture

Yup! Deficits don't matter.

Fri, 03/04/2011 - 17:06 | 1020244 THE DORK OF CORK
THE DORK OF CORK's picture

Bought a Gold maple leaf recently thinking silver was looking Topsy - maybe a couple tubes of silver maples was a better choice !

Silver is a fucking animal now.

Fri, 03/04/2011 - 17:08 | 1020259 tekhneek
tekhneek's picture

Stop buying gold. Buy silver man. Hold it for a few years (or til an obvious top forms, which I don't think it will anytime soon)

How much do you think your gold will be worth compared to silver when there's no mineable Ag left in the ground (circa 2020) to mine? I don't know, but it will sure as shit be worth more than gold.

Fri, 03/04/2011 - 17:14 | 1020297 THE DORK OF CORK
THE DORK OF CORK's picture

Perhaps Its the freegold / Bankster meme - I have done some heavy lifting in silver and ain't selling but I am of a conservative bent and prefer to increase Gold holdings during times of geopolitical tension.

Fri, 03/04/2011 - 17:42 | 1020470 JP McManus
JP McManus's picture

I've been doing the same thing.  I might not get the upside in gold as I would in silver, but I think I have enough Ag and I thought I should diversify more into Au.

Fri, 03/04/2011 - 18:53 | 1020727 impending doom
impending doom's picture

Love the handle. "Give me the keys you MUTHAFUCKKINNN COCKSUCKKAAAAA!!!"

Fri, 03/04/2011 - 21:52 | 1021175 DoChenRollingBearing
DoChenRollingBearing's picture

I'm right there with you JP.  I have enough silver so that should it have the humongous spike, well that's great.  

But for me, new money goes into Pt or Au

Fri, 03/04/2011 - 17:17 | 1020316 Dr. Porkchop
Dr. Porkchop's picture

I'm just starting to acquire some gold. Sold some silver the other day when it was up to get some. I'll still be getting both as I can. I think this paper game has to end at some point, and I want to be holding physical in both when that happens.

Fri, 03/04/2011 - 18:11 | 1020595 Citxmech
Citxmech's picture


That's the trade:  Ag today - trade into Au once the ratio is closer to the historical ratio.

Fri, 03/04/2011 - 21:56 | 1021179 DoChenRollingBearing
DoChenRollingBearing's picture


+ $35

+ $1425

Hold my silver, buy more gold.

Fri, 03/04/2011 - 18:13 | 1020603 OldTrooper
OldTrooper's picture

I had to start buying some gold.  Job keeps me moving around and the silver is almost too heavy to lug around...almost too heavy.

Fri, 03/04/2011 - 22:31 | 1021235 destraht
destraht's picture

I just bought two 1 gram gold (uhm) stamps. I figure that it is small enough that it is undetectable for embedding in clothing and stuff like that. I figure that if things suddenly go to shit when I am traveling that it will be nice to be able to get a very long bus ride anywhere. Its much harder to get that kind of insurance out of silver. I figure that if I get robbed down to my underwear that it will be possible to pull a bit of gold out of my ass. I suppose that I could do the same with diamonds but I hear that they have rough edges.

Fri, 03/04/2011 - 19:24 | 1020818 nscholten
nscholten's picture

It's so heavy though....

Fri, 03/04/2011 - 18:51 | 1020721 JPMorgan
JPMorgan's picture

Yup gold's upward momentum is an shallow affair compared to silver's sharp rise.

Blythe and friends are flighting an losing battle against an historic equilibrium ratio of 16:1 as well as an tight supply and demand squeeze brought on by their own under hand activities.

Meaning silver should be around $89 an ounce today, so it has some catching up to do yet (imo of coarse).

Fri, 03/04/2011 - 17:05 | 1020246 Dr. Porkchop
Dr. Porkchop's picture

whatever happened to goldmiddlefinger and the rest of the PM trolls?

Fri, 03/04/2011 - 17:31 | 1020412 BobPaulson
BobPaulson's picture

They're getting the shit beaten out them by their loansharks today after getting their asses handed to them in the short squeeze.


Fri, 03/04/2011 - 17:41 | 1020458 in-Credible Banker
in-Credible Banker's picture

I want MathMan's head on a stick!  "It only costs 5 bucks to dig the shit out of the ground"!!!!



Fri, 03/04/2011 - 18:22 | 1020634 jimijon
jimijon's picture

That phrase makes me laugh every time... love it

Fri, 03/04/2011 - 18:01 | 1020561 Bay of Pigs
Bay of Pigs's picture

He changed his name to Billy the Bastard and continues to spam on ZH gold/silver threads.  

Ladies and Gentlemen, we are witnessing history (the end of the cartel's controlled suppression). I've been on this PM wagon since the late 90's, and I never dreamed it would take this long to see this happen.

Long and Strong Bitchez!



Fri, 03/04/2011 - 18:19 | 1020623 The Disappointed
The Disappointed's picture

I've been on this PM wagon since the late 90's, and I never dreamed it would take this long to see this happen.

Really! I 'converted' in 2006 and never thought it would go on this long. But I'm in no hurry. In the meantime, I've bought a lot more.

My only regret is that I didn't sell gold for silver in late 2008, like Ted Butler advised, when the ratio was above 80 vs. ~40 today.

Fri, 03/04/2011 - 19:00 | 1020745 Bay of Pigs
Bay of Pigs's picture

Yeah, I rememeber the gold shows when you could throw a bowling ball down the aisle and never hit anyone. I was there In Vancouver, BC when GATA was formed in 1999. I new the JPM crap way back then. Everyone thought we were completely nuts. Kudo's to Chris and Bill. They are good people.

Mai Tai's tonight here in Maui. Cheers and Aloha to TD and Co. and my ZH gold/silver crew.

You guys rock...

Bay of Pigs

Fri, 03/04/2011 - 23:04 | 1021252 destraht
destraht's picture

Well I was pretty young then but someone handed me a few New Americans (John Birch Society). It was all Federal Reserve bad, UN bad, NAFTA bad over and over again. I loved it. I wish that I knew how to make money then though off of all of this shit (like GATA). Basically my dad thinks that gold is a barbarous relic, etc, while meanwhile every person that is elder in my family is going to be wiped out through housing value collapse, devaluation, reevaluation and maybe even outright seized money. Meanwhile I try to accumulate a few coins which is kind of a joke really when compared against wealth that my family could be preserving and growing right now. Its a total shame. We'll see if I am a jut job though or if my family loses over 50% of their current alleged wealth. When it happens though they will not recognize and will be offering up some further talking points. It seems that everybody that I know that knows what is going on here (dollar collapse) is poor and under employed and can't take advantage of it while those who are grinding away making new notes are too busy and illusioned to care. Its the perfect theft really.

Fri, 03/04/2011 - 17:05 | 1020247 Buckaroo Banzai
Buckaroo Banzai's picture

Stick your nose out the window and take a big whiff. Because there are so many poopy diapers at JPM right now you can probably smell 'em from here.

Fri, 03/04/2011 - 17:06 | 1020250 TheGreatPonzi
TheGreatPonzi's picture

But but, the deflationists, Math Man, William and the lady on CNBC told me this was impossible.

Fri, 03/04/2011 - 17:15 | 1020299 outamyeffinway
outamyeffinway's picture

Where IS that Math(less) Man.....such a tool.

Fri, 03/04/2011 - 17:30 | 1020402 A_MacLaren
A_MacLaren's picture

....such a tool.

....such a toad.  there, fixed it for ya.

Fri, 03/04/2011 - 17:41 | 1020471 in-Credible Banker
in-Credible Banker's picture

If only costs 5 bucks to dig the shit out of the ground!

Fri, 03/04/2011 - 20:08 | 1020965 akak
akak's picture

And crashing to $10 by June!

Fri, 03/04/2011 - 21:57 | 1021182 DoChenRollingBearing
DoChenRollingBearing's picture

Au to $0.02 by August!

Ag to $0.01 by August!

Fri, 03/04/2011 - 23:08 | 1021290 destraht
destraht's picture

You mean; his $0.02 on Ag which would put Au at $0.32.

Sat, 03/05/2011 - 14:17 | 1022057 FatFingered
FatFingered's picture

He forgot to remind us that it takes another 5 bucks to bury it and dig it out of the ground later.

Fri, 03/04/2011 - 18:12 | 1020600 Citxmech
Citxmech's picture

I'm guessing he's throwing up somewhere.

Fri, 03/04/2011 - 17:24 | 1020369 Zero Govt
Zero Govt's picture

can I call for a little respect for deflationists (and reality) please and inflationists to take their blinkers off if you'd be so kind.

Inflation in Gold, Silver, Oil, Copper (Commods' etc), stocks and Benny the Beans money supply

Deflation in US property/mortgages, consumer credit and US State budgets

All i ask is inflationists stop ignoring the crushing deflation (imploding debt) in the economy by taking their eyes off the inflationary forces for more than a second. I'm in Gold (wish it was Silver, ho hum!) so i can see inflation as well as the other side of the coin. Balance please

Fri, 03/04/2011 - 17:31 | 1020414 tmosley
tmosley's picture

Inflationists never said that property would rise in value.  They hyperinflation theory is that anything that is traded internationally will rise in price, along with anything containing those components (ie bread).  Things that can not be exported, like real estate, natural gas, large appliances, etc will go down in price.

Hyperinflation comes when people are starving in the streets and on the verge of rioting in a government-destroying manner.  Then the government will print money to try to make the problem go away.  It won't work for long.  Especially not when everyone holding dollars sees what is happening.

Fri, 03/04/2011 - 17:38 | 1020441 Zero Govt
Zero Govt's picture


In a true inflationary economy everything should go up. That's because everything is floating on a sea of over-printed Benbabwe Beans.

That's NOT what we have in either the US or Europe. We have a mighty confusing mixture of inflation in some sectors but deflation in many others.

I'm asking inflationists to at least deal with that reality just as I as a deflationist can see the inflationary forces still very much at work. Let's be fair not blinkered  

Fri, 03/04/2011 - 17:44 | 1020484 Thisson
Thisson's picture

Not so.  Even in a true inflationary economy, some prices can decrease due to changing preferences.

Fri, 03/04/2011 - 17:59 | 1020558 THE DORK OF CORK
THE DORK OF CORK's picture

There was a huge deflation in the 30s yet Gold was forced to rise to cover the excess credit creation of the 20s - we have pretty much the same thing going on now even though we do not have a official gold standard.

Wages are deflating through unemployment pressures and globalisation of the workforce creating excess humans at least in a economic sense.

This is infact a real form of inflation although it is inverted and somehow a paradox for some (I don't see why )

The credit produced during the boom created huge deposits and liabilties for the banks - there is little yield in risk free deposits so there is a opportunity cost in leaving it on deposit - people are in a great prisoner's dilemma game engine and sooner or later people will learn that under these parameters it is best to defect rather then remain in  yield less risk free stuff or equities which have a huge risk factor.

Better to just follow the real money.

Fri, 03/04/2011 - 18:47 | 1020707 Zero Govt
Zero Govt's picture

Thisson  -  i think you're simply saying prices go up and down in inflationary and deflationary economies. Yes alright. But there's no mistaking an inflationary economy as across the board most things go up (see Weimar or Zimbabwe). In a deflationary everything across the board should go down, from stock markets, housing, consumer and retail markets to precious metals.  

What we have now is a mix of both. One force, inflationary or deflationary, will win the battle shortly and i'm betting it's deflation simply because our problem is debt. When debt implodes it's deflationary on everything that was 'floated' by debt (credit) previously. It just implodes in price

Fri, 03/04/2011 - 19:56 | 1020913 IQ 145
IQ 145's picture

 I'm glad you specified what you're betting on; deflation. This makes it very simple to reply to you. You're wrong. "But there's no mistaking an inflationary economy as across the board most things go up---" Apparently this is not true, since you live in an inflationary economy and you are managing to mistake it for something else.

Fri, 03/04/2011 - 22:52 | 1021267 Zero Govt
Zero Govt's picture


You say, " live in an inflationary economy and you are managing to mistake it for something else." 

I wrote we live in BOTH an inflationary and deflationary economy right now. It's a mix, and a messy and confusing one at that! You may have an IQ of 145 but like most inflationists you don't see any deflation. Unlike you I understand the deflationary argument but I also understand the inflationary argument inside out. You'd be better prepared to judge who is "wrong" if you took off the blinkers and did some deflationary reading. It might surprise you how much stronger the numbers stack up and point in favour of a deflationary depression ahead


Sat, 03/05/2011 - 17:10 | 1022365 GoinFawr
GoinFawr's picture

Until 'Mark to Model' changes back to 'Mark to Market', there can be no 'deflation'. And even in that instance, there won't be any deflation either as long as the big banks hold the lion's share of toxic assets, because every central bank controlled by GS alumnis has a 'printing press' at its disposal that goes from zero to infinity in less than 10s.

Keep in mind: 'Infinity' is an infinitely larger number than even 'four billion trillion to the quadrillionth power'.

Now, should those banks manage to offload enough of these toxic assets onto sovereign nations' balance sheets; well then you can expect a massive deflationary 'event', but until that happens...problem 'they' are having with this anti-matter transfer is that real assets (ie those with little or no counter party risk) are being denominated less and less often in USD these days; I'd guess because the world is becoming very wary of the USD, and any 'quintuple A rated', financial 'products' based on it.

RE:Real estate; just a slowly collapsing bubble being unsuccessfully propped up with toothpicks, instead of being allowed to burst like the commodity market did in late 2008.

But who knows? Anything could happen, right?


Fri, 03/04/2011 - 17:47 | 1020496 tmosley
tmosley's picture

Then Weimar didn't experience inflation.

Expenditure on housing fell from some 38% to 0.2% within a couple of months, though it eventually started rising--at a MUCH lower pace than everything else.

Don't get too hung up on definitions.  If you acknowledge that most prices are rising, and if you believe that trend will continue and accelerate, then you are an inflationist/hyperinflationist.

Fri, 03/04/2011 - 18:34 | 1020684 Zero Govt
Zero Govt's picture


Just to repeat quite simply there is inflation and deflation about right now. All i'm asking is the inflationists stop a while, take the blinkers off and at least acknowledge deflation is out there. Which force wins and overwhelms the other only time will tell.

Regards inflation "accelerating" if you look at the Govts' CPI and indeed John Williams more accurate CPI figures inflation was accelerating up to 2008. But Credit Crunch 2007 took time to work through and hit the CPI in 2009, according to JW's figures halving the CPi from some 14% to 8% in under 9 months.

Namely there was a colossal trend change from ever higher inflation to halving it. If you believe in the double-dip then Credit Crunch II will hit even faster and harder. Credit Crunch is deflation in a nutshell and it will do the same to the CPI again, but wreak even more deflationary havoc  

Fri, 03/04/2011 - 21:17 | 1021117 Fred Hayek
Fred Hayek's picture

I think you're pretty much right to ask that the deflationary force of the deleveraging as a result of the the credit bubble explosion be acknowledged. 

I think honest believers in inflation see it as the Fed response to deflationary pressures. 

Sat, 03/05/2011 - 02:47 | 1021581 StychoKiller
StychoKiller's picture

Although the dates described in this video are bogus, the ideas are not:

When is the Great Implosion (controlled descent into terrain!) gonna occur?  I think we'll all recognize it when it happens!

Fri, 03/04/2011 - 17:50 | 1020510 tsx500
tsx500's picture

hey,Bob Prechter, don't u have something better to do ?

Fri, 03/04/2011 - 18:27 | 1020642 Zero Govt
Zero Govt's picture

Bob Prechter has two sides... the Elliot Wave theory service which is a sack of absolute shit ...and the economist side where he has stood almost alone for the past 10 years predicting a deflationary 1929-stylee meltdown.

I've listened intently and respect both inflationists (Jim Sinclair, Jim Rogers, Peter Schiff, Marc Faber etc) and the few deflationists about like Prechter and to me it's 'no contest' whose arguments stack up: deflationists will win the economic debate unequivicably.... time will tell...


Fri, 03/04/2011 - 20:00 | 1020923 IQ 145
IQ 145's picture

 you are unequivicably wrong.  Complete nonsense.

Fri, 03/04/2011 - 23:00 | 1021282 KevinB
KevinB's picture

By God.. someone who seems rational..

I (perhaps vaguely) grasp your thesis, and would appreciate your comments on the following:

To me, it seems certain items (mostly manufactures, including FRNs) are going down in value because of increasing know-how and global integration. (Deflation) Things that CANNOT be easily scaled up (e.g. food, oil, energy of any kind, personal services like - and especially - health care) are going way up in price. (Inflation)

While I work in the PM industry and hence have a vested in the latter, I'd appreciate your thoughts on which side of the pendulum will win out in the end.

Sat, 03/05/2011 - 02:49 | 1021584 StychoKiller
StychoKiller's picture

The pendulum is gonna snap off completely and millions, possibly billions of people are gonna get hit by the shrapnel! :>(

Sat, 03/05/2011 - 12:24 | 1021882 feeb
feeb's picture

I'm sorry, but LaRouche is an effing crackpot and should not be used as any form of authoritative source whatsoever. I remember vividly this past summer, running into some of his nutjob acolytes in downtown Boston (at 100 Federal St), replete with Obama-Hitler posters and ill-informed rants. I spoke with a couple of them briefly, but once the crazy eyes manifested themselves I realized that this was not my preferred way to spend my time. Life is too short ;)  

Fri, 03/04/2011 - 23:35 | 1021343 Al Gorerhythm
Al Gorerhythm's picture

You misjudge by not taking into account that the US$ is now a reserve currency, which all commodities are priced in. Further, you fail to recognise that the German Mark and the Zimbabwean $ both printed outside the parameters of the global indexing valuation mechanism. The US $ is the cornerstone of that mechanism. Outside of US borders, prices for all goods are affected by US printing. 

Inside the USs borders, discretionary money flows to staples and insurance against monetary policies (such as PMs) and is pulled out of fixed assets.

Taking into account the oversupply of US$s, a simple conclusion is advanced: Get out of Dodge, fast. Dump dollars and other depreciating fixed assets (who gives a fuck about the semantics of it) and buy PM's and other mobile investments, regarded as safe havens.  

The deflationists are half right but their investing strategies neglected an important part of the equation and by being blinkered, have missed out on a prime move in inflation protection assets, by ignoring the historic (1944 Bretton Woods) change in economic drivers.  

Sat, 03/05/2011 - 17:20 | 1022391 PhattyBuoy
PhattyBuoy's picture


Acute Bi-flation ...

Fri, 03/04/2011 - 18:03 | 1020568 Temporalist
Temporalist's picture

You don't hear the deflationist crying about HDTVs, cellphones, computers and other mass produced goods dropping in price.  Then it's okay I guess?  The Central Banksters don't like PMs because everything deflates against them.

Fri, 03/04/2011 - 18:17 | 1020617 Zero Govt
Zero Govt's picture

Temporalist - yes deflationists should be "crying about" deflating prices in HDTV's, computers etc. Because its proof of deflation in consumer credit. There is a bottleneck in TV's as you mention because consumers aren't buying on the never-never as before. This is deflation in action, both consumers de-leveraging and changing their buying habits.

I'd say the reason central bwankers don't like PM's is because it is a store of value, a major embarasment to their Fiat paper money. The increase in price and 'popularity' of Gold and Silver purchases is a growing crowd sneering at their funny money system. They don;t like to admit it but social pressures get to them, even under their skin... let's keep it up

Sat, 03/05/2011 - 03:24 | 1021606 KevinB
KevinB's picture

Please understand I'm not disagreeing with you, but trying to seek nuance.

Of course the price of physical goods is going down - why shouldn't it? As we progress farther and farther down the learning curve, the price of any mechanical, replicated good should fall. ECO 101 tells us that.

The question now is: which will way will the battle go? There are goods which are constrained by the physical reality - lettuce, for example - and goods which are restrained by political reality - teachers in Wisconsin, for example. Will the battle over replicated goods vs. scarce goods boil over into the streets, or will we seek some middle ground which recognizes the dual nature at work here?

Fri, 03/04/2011 - 18:08 | 1020591 mynhair
mynhair's picture

What about stagflation?  Wages don't go up then.

Ok, 'true' inflation.

Fri, 03/04/2011 - 18:17 | 1020614 Big Ben
Big Ben's picture

In a true inflationary economy everything should go up.

It has been said that the difference between theory and practice is that, in theory there is no difference between them, but in practice there usually is.

Gonzalo Lira published a blog recently describing how property prices tanked when there was hyperinflation in Argentina. It appears that interest rates went so high that no one could afford to borrow money to buy anything, including property.

In the 70's inflation in the US, property prices went up somewhat and stocks were roughly flat in nominal terms.

Fri, 03/04/2011 - 19:03 | 1020754 Zero Govt
Zero Govt's picture

Big Ben

Most inflationists are predicting a Weimar/Zimbabwe/Argentina hyper-inflationary type scorched Earth. I fully understand where everybody is coming from on this issue with benny the Bean up all night winding the printing press having tripled his balance sheet.

But what inflationists just aren't getting is it's the retail bwankers that have been printing for 25 years that's the real problem with their 30-40/1 leverage. They have created inflation for the past 25 years through credit (debt) creation which has worked into everything from housing to car markets to consumer loans for every imaginable product.

The retail bwankers debt mountain out-guns Benny the Bean 40/1. Probably 400/1 if you include the insane (£600 Trillion) paper mountain of derivatives. It is this house of credit (debt) cards that poses the biggest most overwhelming threat from implosion of that unserviceable debt which will be deflation, hyper-deflation in fact.

Benny the Bean doesn't stand a snowball in hells chance of creating inflation with his printing. He's already been PROVED useless with his utterly failed attempt to reflate house prices and the mortgage bubble. Benny with his pea shooter is massively out-gunned, simple as

Fri, 03/04/2011 - 20:02 | 1020935 IQ 145
IQ 145's picture

 "hyper-deflation" Oy Vey.

Fri, 03/04/2011 - 20:01 | 1020941 Big Ben
Big Ben's picture

I personally am not expecting hyperinflation in the US. Ordinary inflation eliminates government debts well enough, so there isn't really any need to hyperinflate. I think hyperinflation is usually caused by monetary authorities who have no clue about what they are doing. It often occurs in new or revolutionary governments that take over after an existing government collapses.

I think that Ben B. is perfectly capable of creating any amount of inflation that he desires. But he needs some way to avoid being blamed for it if he wants to keep his job. This is why these possible oil supply disruptions are so worrisome. In the 70's Nixon/Ford/Carter blamed inflation on the OPEC oil price increases, and lots of people (including me) accepted that explanation. So when oil prices collapsed in the early 80's, I expected the price of everything else to drop as well. But only gasoline prices dropped and everything else just kept rising (but at a much slower rate than in the 70's). Actually the inflation in the 70's was caused by money printing by the Fed. When the Fed reduced its money printing, there was a nasty recession and afterwards inflation was much lower.

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