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Things That Make You Go Hmmm: "My Name Is Grant Williams And I’m a Precious Metals Bug"
From Things That Make You Go Hmmm, April 30
My name is Grant Williams and I’m a precious metals bug.
There. I’ve said it.
It feels good to get that off my chest.
Of course, those amongst you who have been riding alongside me these past few years probably already had a sneaking suspicion that was the case and, I imagine, several more of you are now tutting, rolling your eyes and muttering “I KNEW it. Where’s that ‘Unsubscribe’ button?” (bottom of the last page – no offence taken). Well today, we’re going to talk about precious metals again I’m afraid, but in a broader sense if that helps at all. For readers who are over the whole precious metals thing, there’s a nice cartoon on the last page and you’ll find several stories about alternate subjects scattered throughout pages 7 to 15). For those of you still reading at this point, join me inside the recesses of my mind. Please keep your hands and arms inside the carriage at all times.
Whenever I look at an idea as either a potential trade or a possible thematic shift, the very first question I ask myself is ‘does this idea make sense?’. Plain old common sense. Nothing to do with the numbers or the likely quantum of any associated move, but would the idea seem reasonable if presented to someone with either zero, or at best a very limited background in finance?
Whilst stories around individual stocks can fulfill this criterion reasonably regularly, they often operate in confined parameters (a particular geography or a particular market segment for example) and so an idea is easier to explain and simple to quantify. It is much harder to find bigger picture, macro ideas that make secular sense because, for the most part, these ideas– but it is these big picture shifts that contain the possibility to make real money.
To illustrate this point, one of my favourite charts of all time demonstrates how, by making a single trade in each decade, it was possible to take $35 in 1970 and turn it into $159,591 in 2008. Of course, had you then made a 5th decision and completed the circle by reinvesting that $159,591 back into precious metals - this time silver - in 2008 (and, to ensure nobody accuses me of picking the low price we’ll take the year high of $21, recorded the day Bear Stearns disappeared), you would, this week, have turned your $35 into a staggering $372,379.
Five simple, considered decisions over a forty year period for a gain of a little over 1,000,000%.
Easy..... Kind of.
The pressure to chase things, to follow momentum or to be ‘involved’ is a considerable influence on the decision-making process of most investors. It’s easy to get caught up in trying to pick interim ‘tops’ in a rising market with the intention of buying back on pullbacks to add a little vig to any gains being made. Get it right and you feel as though you’re a seer - possessed with vision many hope for but few achieve; get it wrong however and the consequences are potentially far, far worse. The chances are you’ll find yourself sitting on the sidelines watching your great idea make other people very rich because you just can’t pull the trigger to buy something 5% higher than you sold it - or 10%, or 20% - and for what? Because you tried to game a quick 5% extra by proving you could time the market?
I have lost count of how many calls I have had from friends of mine who have bought either gold or silver at some point in the bull run (sadly, most were late to the party because they just didn’t believe the story - but we’ll get to that later) and wanted to know whether it was time to take some profit. I’ve lost count of the number of calls, but the questions, in essence, were the same:
“Silver’s run really hard here. Should I sell some? What if it pulls back?”
“Gold’s over $1,500 now and I bought it at $1,200 - should I sell it and look to buy it back when it corrects. It’s gotta correct, right?”
My answer to both questions was the same. “What if it doesn’t?”
Yes, silver is extended. Yes, gold has performed incredibly well. But the point here is to understand WHY you bought them.
If you bought silver for a trade then go ahead and sell it - depending on your entry point it has been a hell of a trade. If you bought gold as a trade then the same thing applies. If it DOES pull back and you want to play again you can. If it doesn’t, then you still made some money. But if you bought either of the precious metals as an INVESTMENT, then you need to ask yourself a whole lot more questions before you call your broker, visit your bullion dealer or place an order to sell electronically.
The reasons for buying precious metals are myriad, and their intrinsic worth will continue to be debated - probably for centuries - but, like it or not, based upon 5,000 years of history, gold IS money. Silver IS money. You can argue it. You can flat out denounce it, but there will always be somebody happy to take your gold and silver off you at whatever market price you may deem ridiculous. You can’t win. Nobody can unilaterally declare the idea of gold and silver as stores of value err..... well, valueless.
Last year Mark Dice went to the beach in California and tried to sell a one-ounce solid gold Canadian Maple Leaf coin (worth, at the time, $1,100) to passers-by for $50 cash.
No takers.
This was one of my favourite exchanges:
Dice: “Wanna buy it?”
Dude: “No thank you”
Dice: “Twenty bucks?”
Dude: “Not for me.”
Dice: “It’s Canadian.”
Dude: “Oh, definitely not”
But the best part of the video is when Dice tries to sell the coin to a passer-by who has a live parrot casually sitting on his shoulder. When you see a man in the street wearing a tropical bird as a fashion accessory look at someone trying to sell him a 1-oz gold coin worth $1,100 as though HE’S crazy - you’ve pretty much hit rock bottom. (If you want to watch the video, it’s HERE but PLEASE... no emails about Dice’s views on anything else - to me it’s just an interesting video)
But enough about parrots and passers-by - they are mere distractions from the point I am trying to make here.
In a big picture sense, as you can clearly see from the chart, left, owning precious metals (in this case gold) has been the right trade for the last ten years - it has been one of those once-in-a-decade decisions that, if you had made and stuck with, would have made you real returns. However, the volatility that has been evident during periods of those ten years is such that many people were, to use Richard Russell’s analogy, ‘shaken from the bull’. Many people saw 10% corrections or even the big shakeout after 2008 and, with very few believing gold was anything but the next bubble, they dumped their holdings - convinced either a ‘major correction’ was under way or just around the corner or that the bull run in gold had ended and the bubble had burst. Many were selling with a view to buying back and many were selling fearing a return to $300 gold was not only possible, but probable. The ‘big trade’ was all-but forgotten in the panic of deleveraging.
Many who sold have yet to buy their gold back and have missed out as gold has more than doubled from its late-2008 lows.
In Bud Conrad’s chart, he shows how a switch from one asset class to another once every ten years would have been all that was required and it just so happened that, at each crucial juncture, another asset presented itself as the next ‘big trade’. The danger is that, in following Bud’s example to the letter, especially now precious metals have run for ten years, it would be easy to switch out of them and into the next ‘big trade’. But what is the next big trade?
It could be a short trade in US Treasuries, as many believe (certainly when something is at zero and can’t, in absolute terms at least, go below that level - in this case the discount rate - it is a pretty safe assumption which way it will ultimately be headed). It could be a long position in crude oil or a basket of commodities if you believe in all or part of the ‘Peak Everything’ theory laid out beautifully in the great Jeremy Grantham’s latest letter - which you will find HERE. (As an aside, if you HAVEN’T read it yet - I recommend you take the time to do so as it is a truly marvellous piece of work - even by Jeremy’s lofty standards - and one you will doubtless want to read again at some point.)
But here’s the thing. What if the big trade is buying precious metals - again?
At no point does Bud Conrad say you can’t have your money in the same asset class for consecutive decades - in fact, Bud doesn’t lay out the rules at all because there aren’t any. It’s about finding the ‘big trade’, making sure the logic of it is sound to you and then sitting with it until it has either run its course, or you feel that a better opportunity for long-term gain has presented itself.
Has the precious metals trade run its course? Well, I guess it’s possible - but let’s look at the factors that are affecting the price of what, for the specific purposes of this part of our program, we will refer to as ‘monetary metals’.
Until 1971, gold backed every dollar in circulation. Period.
Behind every $35 in paper money, in a vault in the United States, sat an ounce of gold. Quiet, immutable, stoic. The gold couldn’t be printed at will or created out of thin air. The idea of dropping gold from helicopters would have seemed downright dangerous or overtly stupid. Of course, as it turns out, dropping paper money from helicopters has proven equally dangerous - particularly to the value of the dollar itself which broke through 73 this week and has now lost roughly 90% of its purchasing power since the decision was taken by Nixon to shut the gold window.
Never were the words of Nixon’s Treasury Secretary, John Connally, more apropos than today:
“...[the dollar] is our currency, but your problem”
Since that day, with the restraint of a gold-backed dollar removed, the amount of dollars in cirulation has steadily increased until, as the waves of 2008 crashed upon the world’s shores, it absolutely exploded. The graph below shows the adjusted monetary base, with the near-vertical updrafts representing QE1 and QE2.
My friends Paul Brodsky and Lee Quaintance of QBAMCO recently published parts II & III of their paper entitled ‘Apropos of Everything’ and I would recommend everyone who reads this to email Paul and ask him to send you a copy of all three parts as, together, they comprise one of the single best reads I have seen in years. In fact, if you only have time in your busy day to either finish reading this or dig into Paul and Lee’s exceptional writing then let me help you out: STOP READING THIS AND EMAIL PAUL. NOW.
In ‘Apropos of Everything’, Paul and Lee revisit their ‘Shadow Gold Price’ which is a measure of what returning to a gold-backed dollar would mean to the price of gold:
In a report distributed to our investors in December 2008 we divided Federal Reserve Bank Liabilities by US official gold holdings and dubbed it “The Shadow Gold Price”. A few months later we began using the more conservative denominator, the Monetary Base, in our calculation. As it turned out, dividing the US Monetary Base by US official gold holdings happened to be the very formula used in the Bretton Woods system to establish the global fixed monetary exchange rate. Our logic was confirmed by long convention...
The “Flat” column in the table above shows our current SGP, which implies the substantial devaluation of purchasing power of the US dollar that has already occurred. Are we nuts? Are we asserting gold should be valued at $10,000/ounce when it is trading around $1,500/ounce in London and New York?
The SGP’s purpose is to provide a sense of magnitude as to how much the US dollar has already been devalued and how much further it may be devalued. (Obviously there can be no guarantees about future pricing.) We believe the Shadow Gold Price provides the intellectual framework for the magnitude of necessary future global currency devaluation. We feel most comfortable with this metric for two practical reasons: 1) there is recent precedent for its use and 2) it actually produces a lower figure than othervaluation metrics that include systemic credit in their calculations...
To put this table in perspective, the Fed already increased the US Monetary Base over 200% since 2008, from about $850 billion ($3,251 implied SGP) to an estimated $2.6 trillion (following the completion of QE2). It is important to note that the Monetary Base only constitutes systemic bank reserves held at the Fed and currency in circulation. It does not include upwards of $70 trillion in US dollar-denominated claims, a significant portion of which conceivably must be ultimately be repaid in money from the Monetary Base that does not yet exist.
And there, in a nutshell, is the ‘big trade’ in gold.
How do the world’s central banks find a way out of the dire straits in which they find themselves? Faltering economic growth (look at this week’s US GDP number), insolvent banking systems in multiple insolvent sovereign countries (you know who you are), plummeting consumer confidence (Japan and Germany the latest examples of this phenomenon), crippling debt levels at both the national and individual levels (higher US deficit ceiling anybody?), spiralling inflation (no matter WHAT ‘core’ numbers may tell you) and their favourite (and some would say ‘only’) tool to fight it, namely interest rates at or close enough to zero to make them almost ineffective.
Fear of all these issues amongst investors has driven them to what they consider ‘safe’ money. Money that can’t be manufactured at will (though it CAN be confiscated - but more of that another day) and that will protect their purchasing power.
Yes, there is definitely some speculative froth in the monetary metal prices (nowhere more obvious than silver at the moment) but, structurally, there are more reasons why monetary metals could well be the next, next ‘big trade’ and that resides in the difference between the futures price and that of the metals themselves.
Historically, the monetary metals futures contracts were used primarily by gold producers to hedge their exposure to fluctuations in the gold price and/or to lock in prices against their forward production. Simple. There have been all sorts of conspiracy theories about central banks leasing their gold holdings in order to keep the price of gold down, thus validating their fiat currencies, and of bullion banks manipulating the futures prices to make profits from the technical funds, but, again, we will leave those aside today.
In August 1999, John Hathaway of Tocqueville Gold Fund wrote an essay called The Golden Pyramid (I have linked to it in a previous edition of Things That Make You Go Hmmm..... but in case you didn’t see it, or didn’t have the time to read it, I would urge you, if you have any interest in the monetary metals, to do so. You will find it here)
In his essay, John lays out quite clearly how what he calls the ‘Golden Pyramid’ works:
The old currency gold/pyramid has been replaced by a little understood labyrinth of paper claims against gold. Responsible senior officials of mining companies, central banks, and bullion banks cannot begin to understand the internal mechanics in order to make appropriate judgements of risk. There are few published figures, no reserve requirements, no supervision or regulation, and no accountability. It is the private domain of bullion dealers, central banks, and mining companies. The credit worthiness of the old currency/gold pyramid was quantifiable. The credit worthiness of the new pyramid can only be an educated guess. Our guess is that it is bankrupt.
The gold derivatives pyramid is a vigorous free market creature. It cannot be put down with a simple declaration that the paper is no longer redeemable in gold, as governments did with currency. It is a short selling scheme that has become a trap from which few short sellers will escape. Paper claims in the form of derivatives far exceed the underlying physical metal on which they are based. The trust, which balances this new pyramid, is based on false assumptions and lack of information. Paper gold claims have proliferated at a pace rivaling any government printing press. A surfeit of paper gold has driven down the price of the physical on which it is based.
The structure can survive as long as bullion dealers, the mining community and the financial media subscribe to the bearish case. But the position of short sellers is precarious. This is true whether gold stays at current levels, or drops below $200/oz. The point is, they will be unable to realize their paper profits, and stand to lose money on their positions in the aggregate. The compound miscalculations on which the gold market is based rank with the blowup of the yen carry trade in 1998. The yen carry disaster illustrates how over-investment and near unanimity of market opinion can lead to a vicious squeeze. Compared to the yen, gold’s liquidity is microscopic. The coming squeeze will lead to a several hundred dollar rally and a permanent change in attitudes towards gold.
Read that last sentence again.
The coming squeeze will lead to a several hundred dollar rally and a permanent change in attitudes towards gold.
Many casual readers of John’s work would have found that statement difficult to accept in 1999. They would have, in fact, dismissed his words simply because the outcome he was proposing - a rise in price of several hundred dollars - would have seemed extremely unlikely with Gold trading around $300. And yet, the beauty of reading this essay now, 12 years later, is that you can clearly see a simple idea that, with the benefit of hindsight, makes complete sense.
The trick comes in trying to find these simple, clear ideas WITHOUT the benefit of hindsight.
So, to recap:
Sovereign governments are awash with debt; several are on the verge of inevitable default (you STILL know who you are), Central Banks around the world have printed trillions of units of their respective paper currencies in the past three years in an attempt to stimulate their moribund economies (which are either slowing in the case of the US and the UK, or are tipping back into recession like Japan), politicians are starting to finally understand that Austerity ISN’T Calvin Klein’s new cologne and are about to find out just how hard it will be to apply in the real sense, consumers are pulling in their heads and are more concerned about the future than at any point since the depths of the crisis in 2008, the housing market in the United States - Ground Zero for the debt-driven disasters that tipped the world on its head - has turned down once more and is about to make new lows just as a slew of Option ARM resets are due, inflation is starting to bite in a real way, not only in Asia, but in the West as well and all the REAL money that has ever been mined could STILL only fill a cube 67 feet in each direction (thanks for that, Warren).
Simple? Clear?
Full report:
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You can make it difficult to get there to begin with: chainsaws etc.. Humping cross country in armor or even humping it sucks and increases water needs. There will be no blackhawks dropping mre's to these five guys. Ferfal while valuable has a perspective that is nto always useful everyhing is basic third world conditions. When everyone in five miles has a cb. 4-5 FRS's, even rudimentary night vision and battle rifles and the desire to work together the five in armor have a bad day/night.. Not that many shadow warrior types out there and they probably have better things to do than raid farms for eggs and sides of beef.. OPSEC is key, point taken / internalized.
“I tell you that the great cities rest upon these broad and fertile prairies. Burn down your cities and leave our farms, and your cities will spring up again as if by magic. But destroy our farms and the grass will grow in the streets of every city in this country”. - William Jennings Bryant
So, you're saying that the BMG is an attraction but cities are not?
Nice try. D.C. and Wall Street have more criminals than all the countryside combined.
A better argument would be against the stereotypical survivalist who sits on a pile of gold and C-rations. But... the person that you're trying to argue with has stated that he's PRODUCING, so, although he is flashing around talk about a BMG (kind of silly, but dogs do tend to bark), he's more on the correct path. For several years I'd been involved in very intense discussions about how this was all going to play out. What I found was that there are several components, and no stereotype is going to hold up; not all places will be impacted the same, nor at the same time; and, in most cases swarms of people result in slow death marches. All I know is that I am pointing my ship at what I believe to be the most sane target, and that I'll look to make land more productive and to feed as many people as I can. Clearly I could be killed, but I'm going to die anyway, and I'd rather feel as good about things as possible, and sleep well, up until that point: if peace holds on my land then hopefully it'll be able to continue to provide for the next generation.
i was in gun shop in 2005 and he had a slightly used barret semi auto in there. he wanted 6000.
i knew i should have bought that with my citibank card.........
They are great cannons. Unless suppressed, the noise alone could dissuade approaching adversaries to leave the vicinity of your dream Thunderdome. They’re good for stopping light armor and critical personnel at distance if you’ve got the chops to send 700 grains of something accurately up to a mile or so away (no mean feat). Keep in mind that if you dismount personnel you are going to have to deal with them, they will likely not just run away. Not really practical for most personal defense where you cannot plant yourself, use the bipod and have some standoff distance between you and the adversary. If you don’t believe me then just try picking one up and moving it around like the little AR or AK pea shooters. Only Rambo can use one like an assault rifle, but big guns are fun guns.
How far is a 680 grain API going subsonic?
Dry air, sea level, I believe the standard ball round is supersonic close to a mile (1500 yards or so)... still traveling at over 1000 fps - big honker stray round could be lethal for miles.
Doesn't matter,650gr+ are not that accurate(unless you have special ammo, and a special .50.
Definitely a use for anti personnel tgt though.(esp w/ correct rounds).82A1, is almost useless for people sized tgts,past 1000yds.(unless a lot of training has been done, and proper ammo is used).
Bolt action .50, far more accurate and portable,and easier on the user.
Esp on human sized targets.
Far smaller, more accurate calibers are best.
.300's/7mm/408's+,etc
Most(95%+) people are nowhere near proficient enough to hit a human size target at ranges past 1500yds any way.(esp if on the move).
The roving bands are not going to be (IMHO) anywhere close to being armed and trained enough,armed properly, to hit past 600-800yds.(and that's a stretch for a non rifleman.)
You can do nothing with it "At The End". My plan is excess wealth in PM's all the rest to tangible goods, which you mention. As barter investment at an end I would think ammo, toliet paper and such would be be the things to trade with. Beans, Bullets,and Bandaids is the motto.
Edit, As Clint says those who have everything they need will take it. Got any ciprofloxacin Clint ?. Bravo the BMG, I just can't afford one, or the ammo. Good job Sir.
All you need do is look at what happened in Wiemar, Argentina, and Zimbabwe after their hyperinflation and currency crash. The exact same scenario will play put here. Google is your friend, my friend.
"i have heard all this before. can someone please explain what the ultimate end game for gold is. no one ever explains what they are going to do with their heap of gold at the end."
Here's a letter I sent to my friends. It is the complete explanation of your question, at least the FOFOA article is.
Without a doubt, understanding the current financial situation that we live in, and the possible effects of it upon our future lives might be the most important intellectual challenge we ever undertake.
If you think that the next 20 years is going to be quite different than the past 20 years, then it might be an extremely good idea to have a good understanding of what is going on. To me, the pinnacle of this intellectual exercise is the ongoing debate about whether our system is headed for a deflationary collapse or a hyperinflationary collapse. Both arguments are very esoteric and seem equally remote to someone living in these United States today. There are several commentators out there in the blogosphere, who go back and forth with their arguments. It has become a theme at Zero Hedge, where they post both sides of the argument.
Whether your care about the ins and outs of this debate or not, understanding the debate will lead to a complete understanding of the current situation we find ourselves in. Frankly, til now, I have not completely understood any of the arguments I have read. One practically needs a degree in economics and another degree in political science to really get it. None the less, I just spent about 4 hours reading and working hard at understanding what I consider the definitive treatise on this subject. I urge you to read it also.
Now, I must say that this is not easy to understand (at least for me). I would suggest you approach it not as an easy read, but something you are going to spend some time studying, as if you had to know it for a college level course. There are links within the article that lead to other articles, and likewise, links within those articles. Go back as deep and as far as you need to. Make your goal understanding, and not just getting through it. Maybe leave the window open on your desktop and go back to it when you feel like more.
http://fofoa.blogspot.com/2011/04/deflation-or-hyperinflation.html
Whatever considerable intellectual merits the arguments of this FOFOA might have, brevity and clarity are certainly not to be counted among his strengths.
Whenever I try to read him, I feel like I am being force-fed a 12 course cordon bleu meal, with a poetry reading between each course, when a simple salad and sandwich would have sufficed.
Nuance is king. I love his articles! You may fare better on a high-protein snack but I go for the 8 course dinner served slowly so it may be savored.
You ask what you should do with your gold when the time comes. No one knows what the hell the future holds so how could they knwo what you should do with your gold. . If they tell you they know they full of shit.Only you will know
All we have is the past history and behaviours our forefathers had. We inevitably believe we are different, IMHO we are not.
We make the same stupid mistakes. All you can do is hedge your bets. When fruit loops around here yap about hyper this and deflate that what they are doing is grasping at a notional concept is the hopes that it will save them. I adapt to the situations on a daily basis becuase the Long Emergency is just that - Long. The markets will bob and weave and gyrate from year to year. Simply adapt
It is my belief that the history of our past is our future. We must understand how our forefathers reacted to siutations and what the massesof their time did in panics and bull markets.
No one has convinced me otherwise that my idea is wrong. My fortefathers wrote diaries regarding their financial investments and those notes are eerily similar to discussions and tactics people are doing today.
Is this belief of mine correct, who knows. It is irrelevant becuase it is my existential belief only. You will have your own.
Most importantly - assume people are pumping and you'll be half right for sure.Assume the other half are dumping and you have the other half.
Just try to be somewhere in the middle
What is the endgame for gold? Profit and wealth security. Sell it whent he time is right, buy when the time is right.
good luck to you
Excellent point.
No one knows the endgame.
Just try to gather enough wealth for family security and keep your head above water. Be nimble. Keep a short to intermediate horizon with your speculative money.
Excellent post. That's what I've been doing. Buy low, sell high. Don't worry too much about analysis and reasons. Just watch the pretty numbers dance. If the stock of a strong company takes a dive for no good reason, I get in and ride it back up. If an Indian internet stock starts moving upward, I jump in and ride it. If I think the market is going to tank, I get out. It's working well for me. The days of "buy and hold" are over.
Amen, brother. "Those that ignore history are condemed to repeat it."
We all know the $US has cancer.
We all know G&S are money.
Everyone is swimming in the same ocean. Know how to swim when the tidal wave hits shore or get the hell out of the way. Trying to time it is suicide.
First have food, water and shelter. Then retain a proper lead to silver ratio if you get my drift. Buy some lead and containers to put said lead in. Then look to accumulate silver in small denominations. I recommend 90% silver (pre-65 dimes, quarters and halves) as well as "Cull" low quality silver dollars (.7734 actual silver weight) as well. Fractional (1/10,1/4 & 1/2 oz) Gold Eagles or Gold Maple Leafs would also be good for those who can afford them. If you plan on buying houses or buildings at the bottom of the depression and have the means ten ounce and kilo gold bars might be good. Never buy precious metals as an "investment". Buy them as "insurance" against the infinite stupidity of governments but more importantly to protect yourself from the corporate fascists who currently run this planet.
--Tuco Benedicto Pacifico Juan Maria Ramirez
I answer that question with a question. Why do so many folks think it inconceivable that one won't be able to trade gold and silver for goods when and if the dollar collapses? Is it naive of me think that precious metals could play the same role as the dollar does now? I so often hear, "you can't eat gold!" Well, you can't eat dollars either! You TRADE them for things to eat. Direct barter of goods would definately be in play in times of crisis if a seller had a need of a specific thing, but generally, rather than haul my 5 gallons of gasoline over to your yurt to pay for 500 rounds of .45 ACP, wouldn't it seem more efficient to hand over say, 10 Silver Eagles for said ammo? At that point, you could use those 10 oz. to pay for anything you wanted. When and if the Powers that Be came up with an alternate scam for currency, then you could trade in a portion of your PM's for said new currency and use that to acquire goods. Why can this concept not be grasped by most people?
Maybe I'm oversimplifying things, but I think people cannot think beyond the boundaries of the fiat currency system that we have been stuck in for at least the last 40 years or so.
You're very close to understanding. There's only one trade...ever.
It's the one you're negotiating.
You place your bets and your hedges beforehand, but when the real conversation takes place, all other bets are off.
@evercentometal
You have a limited view of the role that gold/silver plays in the economic landscape. Some reading is in order for a better understanding. I just hope I'm not playing into a potential troll position. If you sucker me into this I'll be pissed.
Read: http://fofoa.blogspot.com/
Technically, gold cannot be considered an "investment", if one considers gold to be money. Investments, after all, are by definition some thing other than money with the hope or expectation that they will provide a return as in dividends from stocks, or profits from a going concern whether a farm or business. To those who claim gold is only a "commodity", why do central banks hold thousands of tons in their vaults, and trade it throufh their currency desks?
I understand that after the war, it was common to see signs in German factories that said "Export or Die". The US has for too long depended on the kindness of strangers, borrowing money from overseas to purchase items made overseas. What is especially egregious is that virtually every precept learned over thousands of years has been turned on its head and jettisonned, mostly through skillful advertising and collectivized groupthink training in the "education" system. I don't count myself out of this, it took a
long time to understand what (and how effected) was going on and has been fairly disturbing. That is the wickedness we all face.
Silver For The People:
http://www.youtube.com/user/BrotherJohnF?feature=mhum
edit
The idea that gold and the dollar are related are axiomatically atypical in my opinion. I find that if one compares the level of US debt to that of the price of gold it is a far more compelling relationship.
Furthermore, I think with the level of Obamas approval rating souring, and the rhetoric for a massive cut in government spending (which spits in the face of Obama supporters) that an agreement on raising the debt ceiling will not happen. I think this will be dollar positive as this is not a US default. What this means is that whether Obama likes it or not, the cuts are going to happen. What a failure to raise the debt ceiling simply means is that creditors will be paid with US tax revenues (at the expense of government spending) So principal payments, and interest payments will be paid with US tax revenue...
What does this mean? It means that there will be less dollars as money = debt. The less debt the US government issues the less Ben Bernanke can monetize it through Primary dealers. This is what has the likes of Bernanke/Geithner so worried and assuring the rape of your first born child and satan to rise from Fukushima to destroy us all if the ceiling is not raised. However, it is not implicit of a US default. It also means there will be a massive credit event in which the largest beneficiaries of the money printing scheme will get hit hardest (stocks, PM's, Planned Parenthood, food stamps, unemployment checks, etc, etc)
All in all, dollar positive as long as Tea Party and Rupublican reps. hold out.
That is all, carry on.
+1 and Bernanke Sends the Signal
http://thesheepletimes.com/2011/04/30/bernanke-sends-signal-to-carry-trade-speculators/
Bash the Fed all you wan't but also listen carefully to what Bernanke says.
I don't listen to Bernanke, nor do I care how he says it.
"Like I'm supposed to beleive he's not going to cum in my mouth."
-LT
If Tim Geithner has a strong dollar policy he would not be advocating raising the debt ceiling. So he is just as full of shit, but it's not like he was appointed to Chief Tax Collector on his ability to actually pay his own taxes.
Just sayin I was supporting your stronger dollar supposition.
That's enough for about one more dead cat dollar bounce, maybe. And it will probably be supported by all the CB's with GS alumnis governing them too... speaking of which, all US hubris aside, to my knowledge there are a myriad of fiat currencies all being 'printed' at an unprecedented pace worldwide, no?
Hocus Pocus!
If the debt ceiling doesn't get raised (which I hypothesis it wont) it will be the only dead cat bounce the dollar will need.
It will be MASSIVE.
Dollars will be in VERY short supply in very short order. Not only will we be paying our national debt/interest with tax revenue but every single government agency will be clamoring for them to maintain operations. It would be an absolute hysterical frenzy to get dollars.
oh, i thought you were being serious there for a second.
oh, cool.
thanks for the thought.
any other contributions from the peanut gallery?
And the lion shall lie down with the lamb, and swords shall be beaten into plowshares.
Unicorns shall shit skittles, and beneath every rainbow will lie a pot of gold.
(Funny how the old legend didn't have pots o' paper under those rainbows.)
Dollars will be in VERY short supply in very short order...
The term "dollar" is not the ontic referent you suppose. Zimbabwe, Canada, Australia, etc..all call their currencies "dollars".
If you are referring to the current "legal tender" of the US, it's more accurately termed a federal reserve note. They are conjured up from nothing and issued as ciphers, credits and physical paper in exchange for the promise to pay tribute to the issuing agency.
The thrust of the article is only to point out once again that PM coinage remains the ontic referent that even the purveyors of fiat rely on to gauge profit and loss.
Gold's value to the ship of state is that of a ballast. A sovereign entity does not need an entire ship constructed of gold. That is ludicrous. It does need the weight in the keel however to prevent it from losing control when strong winds hit. imo.
Thanks, I know that a dollar is a FRN.
Find some better vessel for your gold based allegory. The boats didn't cut the mustard, as I am left clueless as to where you were going with that comment.
Sailboats have large fins underwater that are weighted which help keep the boat upright. As the sails fill with air, the boat can be directed even into the wind by virtue of this knife blade slicing the water from below.
It may be a stupid allegory, but to me it fits pretty well as to gold's value in a macro economy. It can sit there like a lump of lead in the keel looking like it's not doing a thing, but without it, the boat would spin around and around like it was in a giant toilet.
And with that flush, the allegory is gone.
I appreciated your allegory, thought it quite apt.
You mean that gold is like ballast. I get it, and like it.
I suggest you read the article and the link to Dr. Hussman's work. The Fed is at the end of the monetization rope. Any further monetization will cause inflation to exceed their target and they know it.
All of this is a math game - base your decisions on the math of economics - if you don't you will be sorry.
Emotioon and speculation only goes so far in the game of money before the empirical nature of economics rules.
Well then you're in luck, your path is as clear as an azure sky in deepest summer! (sarc)
You're right about the 'math' thing though, just wrong about the variables and the function.
The world cares less and less about your FED and its reserve notes everyday. All currencies are completely fungible 24/7 so denominate a debt in what you will, creditors wear the pants in the lender/borrower relationship, and they don't like counterparty liability. Guess which currencies that puts in 'deflation'. (Hint: they don't appear to be your favourite(s), but in the long run they sure as fuck will be your masters'.)
Bonne Chance!
Very very interesting and well stated. It is always good to "expect the unexpected"! My only argument is that you place any power at all in the hands of our beloved government. The world is run by corporate fascists comprised of huge corporations and international banksters. It doesn't matter if Daffy Duck is the president and Mickey Mouse the house republican leader. They are all puppets. Thank you for your post.
--Tuco Benedicto Pacifico Juan Maria Ramirez
Bien dicho Tico
"My only argument is that you place any power at all in the hands of our beloved government."
To that I reply, with the degree in which politics as polarized as it is in this moment in history, the fodder is sufficient to create an unstoppable force meeting an unmovable object. Hence, my views on the ceiling not being raised.
Obama releasing his birth certificate (to Trump of all people) was the watershed moment in which all this came together for me. It's getting desperate.
I am of the view that not raising the debt ceiling is imperative to the long-term viability of the United States of America. I hold that truth to be self-evident (on behalf of all Americans)
Well in my opinion you may have placed an inordinate amount of faith in that conviction considering the litany of self evident truths wholly ignored by Americans on a daily basis; I guess "this time it's different"?
Yes, this time....it's different.
I thought I explained that....maybe re-read my above comments (start at the top)
Appy polly logies: I admit I've completely failed to grasp the syllogism connecting the birther debate and the demise of fiat currencies. Give me a hint.
I'll start believing in your debt ceiling revelation the day the US 'defense' budget gets cut in half (hallelujah! Can I get a witness!?)
Ok...well I guess to each his own. If you can't figure out what I was saying than continue on your merry way.
This conversation....is....over.
Oh it`s not too hard to figure out that what you`re saying is a pipe dream, or a dream induced by a pipe, but keep on truckin`.
"It also means there will be a massive credit event in which the largest beneficiaries of the money printing scheme will get hit hardest (stocks, PM's, Planned Parenthood, food stamps, unemployment checks, etc, etc)"
But Bobby, isnt this the defacto definition of a collapse. The stock market is the "only" thing supporting the world economy being helped with injections of paper. Remember those pesky little things called derivatives ?
http://en.wikipedia.org/wiki/Financial_derivatives
You write as if this will be a controlled descent, and then stopped in midflight once the exiled price discovery mechanism magically reappears. I have to disagree with you, as this will be a self feeding nosedive and once it starts you cannot pull out of it. As the value of "everything" evaporates the derivatives will kick into overdrive. This will not be a paper vs scissors event but paper vs paper. What payment do the underwriters of these derivatives get because they were on the right side of the trade ?.................................Paper. !
Is this not also inflationary, as mearly the paper is transfered to the winner but the debt stays with the loser ?
1.6 Quadrillion and counting..................!
Catch 22 or checkmate which ever one you prefer.
Whatever.
I'm not arguing here.
I said what I said, that's what I believe.
I see you changed your response twice !
Checkmate !
update: Now 3 times
Wow....you follow my every edit....coool.
You're right. I'm wrong.
happy?
Price is the final arbiter. We'll see how it works out.
Like I said.
"You write as if this will be a controlled descent, and then stopped in midflight once the exiled price discovery mechanism magically reappears"
Like I said:
Price is the final arbiter.
Thanks Bob, you've always been a fantastic contrarian indicator for me.
Like when you told everyone that you sold your silver two days ago:
I bought some. After your latest piece, I'm bailing on my remaining T-Bills.
Do you have a donate button?
The silver was sold longer than two days ago. I don't buy things after parabolic moves up, if you do, that's great. I also said, that I was waiting for it to correct, and if it did enough to my liking I would consider re-establishing a position.
I've done my analysis which isn't even posted on here, and have come to my conclusions. Here is actual verbiage coming from the the people about to vote on the debt ceiling.
Bachmann Dismisses Debt Ceiling Warningshttp://www.foxnews.com/politics/2011/05/01/bachmann-dismisses-debt-ceiling-warnings/
Sen. Paul dismisses debt default warningshttp://www.upi.com/Top_News/US/2011/04/17/Sen-Paul-dismisses-debt-default-warnings/UPI-89791303063701/
Boehner not promising House vote to raise debt ceilinghttp://www.cbsnews.com/8301-503544_162-20057437-503544.html
etc, etc, etc, etc, etc
Thanks Bob, you've always been a fantastic contrarian indicator for me.
Like when you told everyone that you sold your silver two days ago:
I bought some. After your latest piece, I'm bailing on my remaining T-Bills.
Do you have a donate button?
I believe the Republicans will huff&puff but in the end they will either capitulate or just won't have the ability to halt the debt ceiling increase.
As much as I'd like to see it halted and "real" debate and deep spending cuts agreed to and occur...I just don't see enough willing to grit their teeth and do what needs to be done.
Maybe I'm wrong...
Humm. "The xau- eur/usd correlation"? Hummm the xag overlay on CNBS @ 5 P.M. NY time (t)esterday! Coming from a trader speaking about 17 large moves (quote CNBS), and on the same page calling a 1.5225 stop on eur/usd! ? I'm suspect!
?! Speed can kill, I hear. But noted.
So you are fading the trade? Gas Pump?
Bite yor tongue sir! Wayne Dresser and Marconi forever!
I'll put that comment in my Armuier. Thanks, and smiles.
Not sure how old you are, but remember Paul Van EEEEEEEden? Old School
Bonne Chance!
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion.
http://www.bloomberg.com/news/2011-04-29/gold-buying-central-banks-may-signal-bullion-extending-record-price-rally.html
This has been the trolls thesis consistently. I am not seeing evidence i am wrong.yet.
No qe3 until the public and congress are begging for it.
A swing between inflationary and deflationary scares until we hit some sort of new equilibrium where all of us are a little bit poorer or the wheels come off the track and all of us are a lot poorer.
Reposition your trades to take the other side at the height of the inflationary or deflationary hysteria.
Try to avoid taking the schlong or crapping in your pants.
+1 Pump it up, let it deflate, pump it a little bit higher, let it deflate, pump it more let it deflate.
Historically the cycle of pump and deflate (or the economic cycle if you wish) had a lower amplitude and a longer frequency in the waveform. Now the amplitude is increased (pump and deflate) and the frequency of the events (length of the wave is shorter).
As the world population continues to expand the amplitude will increase and the wavelength will decrease until well like in surfing the wave collapses which will most likely be caused by an event external to the financial markets.
So you must be willing to be on bothsides of the trade. The collapse cannot be traded because it will devstate everyone if those with glocks and gold.
Why is the yen not worth nothing? They are a dead man walking.
Because the japanese are like an ant colony, or a beehive.
Nice to speak with you R.F. The Yen is backed by an export therie(sP) Research Kampo, and The BoJ bond structure. Best wishes. If you have any q/a I will help you.
Can the japanese go to a 300% debt to gdp ratio?
What are your longterm thoughts?
BoJ has 1T in (U.S.) denominated debt.
Can you elaborate?
More than happy. 800B in treasuries, and the remaining AMT. in short term equities and cash. Any questions?
Yeah i guess i am stupid. How does that relate to yen/usd and the ability or likelihood of japan going north of 200% debt to gdp and where the limit is in jap debt to gdp.
Trade well T.C.T. Think micro and regional. You are not stupid. You are stubborn though. GDP is a baked figure from MOF.
tct far be it from me to offer you any beneficial advice, (apart from telling you to fornicate your own person, of course) but when conversing with YC be aware that you must be prepared to glean as he only speaks in tongues. Unfortunately I don`t think English is usually one of them. Though I concede he does much better than this guy (start@1:09)
Thanks for clearing that up.
pas de probleme
yup, the US will become their partner in crime
Remember the other day when I said be careful for what you wish for. 2000 gold and 100 buck silver implies social chaos and disaster?
Judging by some the freakshow comments here tonight I'd say we are well on our way to Armegeddon.
Holy Christ the fruit loops plant just exploded.
I am beginning to think that the guns, gold, grub, and bitchez moment is almost here
They know gold and silver correction is coming and they are not happy.
Hope you are right.
Buying extra food and ammo in a low interest rate environment is smart since it will get used up anyway, but i am now long ZSL and was lonely and scared until some of you others spoke up. I always make the most money when i am scared though.
I still think we need a society reset though. tIts too bad those rarely come about peacefully.
You know it's close to the top when ZH trademarks Weimar rally.
Add horses to your list.
Tyler,
Where the F is the searhc feaure you had before? I had to much too much Wild Turkey after reading how fucked up USA is and thinking about moving to Palestine for a worthy cause.
Tyler,
Where the F is the search feaure you had before? I had to much too much Wild Turkey after reading how fucked up USA is and thinking about moving to Palestine for a worthy cause.
Ghadafy family just got blown up
Wishfull Thinking, Or finally? North Africa is Vast!
Let us hope the crazy man and all his children are finally dead. We need a dollar rally right now plus i have not forgotten the pan am bombing he personally ordered. His inner circle that turned against him recently are now giving british intelligence all the details.
Hah, that is funny.
Try this: http://aadivaahan.wordpress.com/2011/03/28/for-dis-believers/
ORI
Thanks
Do you have the names of the people pulled off that flight and is it possible to prove it?
Unfortunately all this is hearsay and extremely circumstantial at best but kadaffy or however you spell it was causing trouble for oil companies.
Thanks for the info. i just never know which kool-aid to drink anymore!
TCT, you are welcome and how about a zero-koo-aid diet?
As for proof, this is far more proof than Gaddafi's "ordering the hit" is it not? Eh?
ORI
One of my elderly clients kept calling me Matthew (Gannon) by mistake, and then told me part of the story you relate. Thanks for the refresher.
Until Gold is priced in, oh I don't know, say......GOLD, then all else is relative and consequently, somewhat irrelevent. How do you really know you are making any money?
You're not. Gold doesn't make you money.
It stops them from stealing yours.
Good reading. I wound up the silver position on Wednesday. Can't get too greedy. And I will be placing a major copper short on Monday.
"How do the world’s central banks find a way out of the dire straits in which they find themselves?"
This question is repeated over and over. The answer is always the same. Print more, steal more, and prepare escape plans.
Thanks Grant...
Rickards said last year that the real value of gold is north of $5000 (and more likely $10K) based on the Central Bankers use of gold and minus the suppression schemes. You point out that this valuation was also duly noted by others at least from 2008, so bless you for that. It's no doubt much higher.
Gold isn't a trade. It's a store of real value and the Central Bankers know it. That's why they're keeping every ounce they have these days. The Chinese, Russians, ditto. If it's good enough for them, it's plenty good enough for me, too.
I don't consider myself a gold bug, just a prudent person who 3 years ago saw the Keynesian, fiat, and social-welfare experiment bubbles bursting everywhere.
The CBs could have prevented the Great Depression if they had chosen to revalue gold, but they chose to have it confiscated and banned first, then revalued it afterwards -- for the CBs. The criminal CBs insist on controlling governments and peoples with their fiat currency at all costs. Without it, they have nothing.
That's why CBs hate gold. That's why we must love it and acquire it. They've seriously overreached with their greed and are weak right now, waiting to roll out a new reiteration of a WRC fiat in the form of an IMF global currency. I suspect the IMF will demand confiscation of gold for their own ends and to eliminate competition. We'll see about that.
Everybody should read Alan Greenspans 1966 essay, Gold and Economic Freedom. The last two paragraphs eloquently spell out the entire deceit -- a rare prequel by a future Chairsatan before he turned to the dark side and became Greenspansebub.
gwar5
three years ago saw the keynesian folly,,
man your some slow study,, where you been the last 30 years. but it must be good to see .
Still to many even on zero hedge either with out a clue , or trying to change their diapers of flat earth studys .
QE3 has already started , a rose by any other name is still a rose ,
whats the end gane for gold many ask.. what the end of fiat curriencys is my reply,
and a bond now worth 3 cents of its orginal 1000 value .. talk about the keynesian experience going on 50 years for melting away the wealth of nations
and oh many just picked up on it lol
they were forced to turn up the heat on the boiled frog... perhaps it can jump out in time?
gwar5... here's the link to 'Gold and Economic Freedom', an essay by Greenspan for an Ayn Rand periodical, published in 1966... Don't miss the last two paragraphs, tcr and friends...
http://www.321gold.com/fed/greenspan/1966.html
Fight the Fed?
http://www.youtube.com/watch?v=ArkBbkaWESQ&feature=related
They have us in a full nelson. When the big hit happens yea PM survived as did what else? Equity for the letes crafted to perfection.
Things that make you go hmmmm, like a Seth Meyer's joke that no one got at the White House Correspondents Dinner.
I am sure the Fight Club can spot this one joke that defines just how stupid the Press is and how corrupt the D.C. political lobby in the crowd is. Hint ''CDO'' http://www.c-span.org/WHCD/ Truly a golden moment and more proof that the gold in Chairsatan's BTFD Cup is full killer one line-errors. http://www.c-span.org/Events/Live-Coverage-2011-White-House-Correspondents-Association-Dinner/10737421177/
No, Grant. You are not that important a guy. In fact, who, really are you. I, as well as many others, have been buying silver and gold for years. Why would I (or them) care what you think about the state of the Nation?
Your self absorption and sense of self importance is pathetic and is what has partially led to the state of affairs of this now bannana republic. You probably should be hung with the GS/JPM group, and I mean hung, as in China.
Atch Logan ... member for 15 weeks and another new troll... get lost troll, and take your pos pals with you...
and, yes I junked your dumb azz...
OT: What we are watching over at FT if new to you.
http://www.youtube.com/watch?v=GTQnarzmTOc&feature=player_embedded
Texas Gunslinger...
Fuck off and die ,you sach os troll shit.
"Nothing but quotes from such luminaries as Nitwit Nadler and poor old Ned Schmidt who have been screaming the silver bubble story since it traded at $30, and even clueless Chris Ecclestone get repeated to suggest the fair value of silver is only $30".
That's too kind of title for the Nitwit Nadler.
Nadler has Rothschilds balls resting on his chin at all times.
PMs might be expensive in the short term, but very cheap in the long term.
Are you a short or long term thinker?
The hardest purchase of PM's it the first purchase. After that, it's a lot easier. Time will validate the purchase. Look at a 30 day, 90 day, 1 quarter, 1 year, 5 year, 20 year graph of gold and silver. Patience is rewarding.
Obama is the anti-Christ - Satan incarnate. Together with Bernanke and Geithner, he destroys America. Americans do nothing to stop him and so, deserve their future as slaves.
Go away you myopic party troll.
The BUBBLE is in the currencies, USD, EUR, JPY, SDR
Richard Russell on KWN ... Here is a short portion of what Russell has to say about China and gold accumulation...
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/4/30_Richard_Russell_-_China_on_Massive_Gold_Accumulation_Program.html
"Gold Note -- China has reserves of $3 trillion, of which almost half is in dollar denominated items. China is now the world's biggest producer of gold. And the Chinese government is going all out to increase its production of gold. China also is encouraging its people to buy and accumulate gold.
Against it's huge ($3 trillion) reserves, only 1.7% of China's reserves are in gold. China is on a diversification program to increase its tiny reserves of gold. It is thought that China wants at least 10% of its reserves in gold. This means that China is on a massive gold accumulation program.
My thought is that there is a "Chinese put" under gold. When ever gold corrects a bit, China is there loading up on what ever is available. Other central banks are doing the same thing.
Gold is held in strong hands, big money buyers, central banks, large pension funds. This is not true of silver, which I believe is held in many speculators and quick-trade operators. Thus, silver is in weaker hands than is gold, and that's an important difference.
With its huge cache of reserves, China is also buying all the energy supplies that are available. If it's a natural resource, China is out there waiting to buy it.”
Also on that note: If China is `encouraging` (or even simply allowing; their frugal populace see this as one and the same) their citizens to purchase PM`s it would be very dangerous for the lives of the Chinese PTB NOT to have that `put` you mentioned. I mean, imagine advising a billion plus of your fellow countrymen to make an investment and then allowing it to drop precipitously for the sake of someone foreigners who couldn`t give a ratz ass if those you gave the advice to live or die; doesn`t sound wise to me. It`s not like the PRC would be backed into a corner, rather the opposite: they`ve got the situation by the short and curlies.
So, in my view, even in the highly unlikely event that US fiscal policy somehow gets impaled by a unicorn and magically reverses, or is simply forced into facing reality for that matter, any impetus this might give fiat FRN`s compared to their peers is highly unlikely to have a serious or lasting impact on the hard currencies because, to save themselves, the Chinese (along with many other net creditor nations) authorities will simply use any conjured strength in their vast USD denominated assets to speed up their divestment into the Precious metals, or other hard assets.
And why the fuck not, hey?
Contract margins at CME to be raised 'much higher' by MF Global according to a press release by CNBC... This is bad news for silver paper longs but not so bad for shorts that have the Fed printing money to cover their losses... Disclosure: I am long physical gold/silver and paper oil...
So here it is. Be prepared if you have positions in paper silver...
http://www.cnbc.com/id/42828370
"In what could be a precursor to much higher margins at the Chicago Mercantile Exchange, MF Global on Friday raised its margins on one contract of silver from $14,513 to $25,397, an increase of 75 percent.
Thomas Northcut | Photodisc | Getty Images
Current margins on CME Group's
[CME 295.77 -8.28 (-2.72%) ]
exchange are $14,513 for a "New Initial" position in one silver futures contract, or about 6 percent of the value of the contract. The new rates posted by MF Global reflect margins of 11 percent of the value of the contract.
Earlier Friday, market activity indicated investors were unwinding short gold versus long silver positions. Gold futures for June
[GCCV1 1556.40 25.20 (+1.65%) ]
settled up $25.20 to end at $1,556.40, a fresh record high. Silver, on the other hand, finished about where it started the session, near $48 an ounce
[XAG= 47.80 --- UNCH (0) ]
.
The margin increase is being described by some as an atypical move for MF Global
[MF 8.41 0.09 (+1.08%) ]
. Sean McGillivray, vice president at Great Pacific Wealth Management, said that normally, MF Global moves in lockstep with the CME
[CME 295.77 -8.28 (-2.72%) ]
.
"I would anticipate that the CME will be raising margins again due to the volatility of the daily trading range as well as to reflect the contract's intrinsic value," he said. McGillivray suggested markets could see some selling in silver when Comex electronic trade starts Sunday night at 6pm ET.
The purpose of increasing margins would be to keep both long and short investors from adding to positions in what has become an increasingly volatile market.
CME has already raised margins on silver futures twice in the past week alone. CME spokesman Chris Grams said any further increase in margins depends on volatilty.
"We are monitoring all our products. These decisions are based on volatility, it will depend on the markets," Grams said.
MF Global has not yet responded to a request for comment. MF Global is both a member of the Nymex and a ring dealing member of the London Metal Exchange. The company operates as a market maker and broker in metals futures, options, and over-the-counter swap products."
Yup yup. But silver only costs 5 bucks to get out of the ground, remember? That's why this guy gave his life looking for the stuff in a nearly one mile deep hole to hell:
http://www.npr.org/2011/04/25/135693539/workers-recover-body-of-trapped-...
Silver For The People
http://www.youtube.com/user/BrotherJohnF?feature=mhum
Grant, you were fantastic in The Incredible Shrinking Man.
Now is a TERRIBLE time to buy silver. Wait until it crashes during the next few months. You will get a FAR better price.
Put your money where your mouth is and list yours for sale. There's a lot of fiat around here dudes would love for you to have. I can't trade mine fast enough; in fact, I borrow from the future to get it.
I sold most of mine last week around $46 an ounce.
You should reconsider borrowing money to buy an asset that's about to drop by 30%.
`few months` `drop by 30%` Taking `few` to mean 3, by July you`re saying?
Now, if instead it drops that much next week and then goes up past where it was on friday by the same percentage before July you realize you`re still dead wrong, right?
Which would kind of means that all told your comments are batting 1000, though only in `Costanza' plays.
Sure by July. Maybe sooner.
By your math I would be wrong. But by reality my call would still be 100% accurate. Corrections imply that the value will go back up again.
Well that would be the first call of yours that was, so it would be a new record for you.
"I sold most of mine last week around $46 an ounce."
Hahahahahahaha! (wipes tear) Hahahahahah!
(facepalms)
Damn, you are absolutely, hands down the WORST liar on ZH, and that is saying something. How many dipshits are using that account? You lot need to have a conference and get all your stories straight.
Regards
Check it:
`by Dangertime
on Fri, 04/08/2011 - 11:27
#1150008
Which part of "nothing goes straight up" do you not understand?
I am more than bullish on commodities, but you newbs need to learn that things get frothy every couple of years or so in this ten year bull market.
A correction is coming, it will begin sometime within the next four weeks....and it will bring pain.`
OOOoooo the pain: yours. Just keeping movin' the goalposts, eventually, in a few years or so, you might be on to something. I mean was silver even at 40 US bitz and bytes yet when you rote that?
TICK TOCK MF`er!
Hahahahahahahahahaha! YOu must be bleeding SKIMPED M8!
Gawd you're DUMB
Need answers? Pls.
Anyone had issues with TULVING deliveries?.
I ordered and wired them for in stock metals, and they are not performing as expected.(IMHO)
First order, trepidation always w/first time transactions,with new vendors.
Anyone pls.
Thanks
Is this your first time buying silver?
Never had a problem with Tulving.
Things that make you go hmmmmm
2004-(5) - Silver goes from $4.50 to $8.25 in 9 months for an 83% gain. Silver then crashes almost 30% to $5.50 in six weeks.
2005-(6) - Silver goes from $6.50 to $15 in 9 months for a 130% gain. Silver then collapses 35% to $9.50 over a brutal eight weeks.
2007-(8) - Silver goes from $11.50 to $21 in 7 months for an 83% gain. Silver then gets crushed by 25% to $16 over six weeks.
2010-(11) - Silver goes from $18 to $49 in 8 months for a 172% gain. Silver then crashes x% for a loss of $yy over six weeks.
I wonder how the pattern will complete this time.
You forgot Q1,Q2,Q3 etc...
Irrelevant.
Sure it is. That's why they keep doing it.
Last I knew money printing has been going on through this whole silver bull.
And yet, oddly, silver has these 30% crashes after huge run-ups. Wonder why?
http://en.wikipedia.org/wiki/File:Components_of_US_Money_supply.svg
Ah I see. Wasn't silver around the same price in 1980? Guess what? Its not 1980 anymore (though with Obozo its hard to tell) and well things are more expensive and the idiots that be are using alot more butt wipe to prop up the house of cards.
Who said anything about 1980? That was the peak of the last PM bull market.
Who said anything about 1980?
I did, since you brought up past performance.
Oh right, *this time it's different*.
I seem to recall that mentality back in the tech mania phase.
It sure is prevalent in this round of fiat currencies.
Au contraire Its not different its just worse.
And yet the pattern continues no matter how much worse it gets.....
Historically yes. Its print or crash.
I agree, the money supply MUST grow or we enter a deflationary crash and that is NOT good for incumbents.
My point is merely that even though we have always grown the money supply per the link below.....prices still flucuate wildly in the short-term, often with very fast and large downward spikes. All evidence points towards this occurring very soon in silver.
http://en.wikipedia.org/wiki/File:Components_of_US_Money_supply.svg
I'm hoping so.
Doesn't a large downward spike mean I can get stuff cheaper? i.e. ON SALE?
I sold almost all my silver last week at 48 or so, bought some platinum and I'm just waiting for a silver sale.
I understand what you are saying as well. And your points are well taken and appreciated. I'm in silver and gold for the long haul anyway. PM's fundamentals are well... too fundamental.
Stop feeding the troll, and I've only been a member for 13 weeks I think.
Does that mean you are only a recent buyer of silver? Or did you have some before you came here?
"fundamentals are well... too fundamental"
It's really as simple as that. And once you take the Red Pill things are easy to grasp.
What exactly will get ZH readers to sell their precious metals or a significant portion thereof?
A) When you can buy a house at the seashore for 20 ozs of gold?
B) When Money Magazine has a front page article on getting rich in Gold?
C) When the Government bans the ownership of gold?
D) When you can get 18 rounds at Pebble Beach for 1 oz of silver?
E) When you can purchase an original 427 AC Cobra for one oz of Au?
F) When an ounce of gold buys one tank of gas?
G) When it's that or starvation?
or
H) When Warren Buffet and Bernanke declare gold to be the investment of the century?
When you can spend them.
... and for the bozo that trademarked the "it only costs $5.00 to dig silver out of the ground". Possibly the cheapest silver is being dug out at AUD14.02 (USD15 and change) from Alcoyne's Queensland, Australia mine. I'm not considering Evo Morales & Co. mines.
Can someone please explain the difference between GOLDS:COM and GCA:COM on Bloomberg at 1563.70 and 1556.40, respectively? Yes, Google is my friend, but no luck. Ditto SILV:COM and SIA:COM. Thanks.
What I find amusing is that those shorting gold and silver, are figting 98 years of historical inflation. They are fighting the Federal Reserve. They are fighting political venality.
Really, it's a brave, idealistic, courageous but down right stupid, stupid, stupid fight. You are hoping for a depression or at the very least, deflation. Are you insane?
Take a look at what you're up against:
http://en.wikipedia.org/wiki/File:Value_of_US_dollar.gif