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USD Short Covering, EUR Capitulation Ending, Silver Spec Longs At Two Year Lows

Tyler Durden's picture




 

As we expected, the recent rout in the EUR and the spike in the USD have largely kicked out all marginal speculative elements. As the first chart below indicates, as of May 17 net non-commercial spec EUR contracts dropped by 19.8k from 61.4k to 41.6k, nearly a third of the current bullish bet. And as that was happening, USD shorts were covering rapidly, confirmed by the weekly change from 4,563 contracts short to just 1,270, the most bullish position in the USD since January 2011, and roughly where it was back in October 2010.

And probably more important, now that speculative fervor is all the talk, the silver net long positioning by non-commercials, contrary to conventional wisdom, is not only at an all time high, nor was it recently, but instead in the last week plunged to a level last seen back in April 2009. Net silver exposure has dropped by almost 60% since its recent peak in February (40,937 contracts), and at this point it seems all speculators have left the party. The new base is now being rebuilt based on much firmer hands.

 

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Fri, 05/20/2011 - 16:33 | 1296681 Hugh G Rection
Hugh G Rection's picture

physical bitchez!

Fri, 05/20/2011 - 17:17 | 1296789 trampstamp
trampstamp's picture

Who you call in bitch? lol

Sat, 05/21/2011 - 01:46 | 1297714 jeff montanye
jeff montanye's picture

the article needs to delete an "only" when talking about net silver longs as it reverses the correct meaning.

Fri, 05/20/2011 - 16:32 | 1296683 Spalding_Smailes
Spalding_Smailes's picture

 

.... the smart money is on the sidelines 

 

Silver miners start hedging on price falls

February 14 2011

 

Not so fast. Hedging has made a comeback.

In the past two months, at least five miners have executed silver hedges to protect against a fall in prices, bankers say.

Deutsche Bank estimates that in excess of 100m ounces may have been hedged. That is several times the size of total outstanding hedges in late 2010, estimated at about 20m ounces, and 15 per cent of annual silver production.

http://www.ft.com/intl/cms/s/0/af6a0ca8-386c-11e0-959c-00144feabdc0.html...

Fri, 05/20/2011 - 16:35 | 1296689 Hugh G Rection
Hugh G Rection's picture

$20 says the Smailes kid eats it.

 

I have a message from turd spalding....

 

Go fuck yourself.

Fri, 05/20/2011 - 16:44 | 1296712 tmosley
tmosley's picture

You have to sell something to be a salesman.

But you wouldn't know anything about that, being a jealous unemployed gigolo.

Fri, 05/20/2011 - 16:48 | 1296730 Spalding_Smailes
Spalding_Smailes's picture

Got Ice Cream .... ? Turd does

So, so many contradictions ... Lol'

The end of the great Keynesian Experiment is upon us ( really ? ) Prepare accordingly. ( why all the new fiat driven businesses then ??? )

 

Turd in his own words. Let the sheeple keep feeding the turd in fiat deep down he loves it. Viva snake oil ...

 

Ultimately disgruntled by the fraud known as "financial planning", he retired to a career as a serial entrepreneur in 2008.

Fri, 05/20/2011 - 20:40 | 1297132 SilverIsKing
SilverIsKing's picture

Which word of Hugh's struck a nerve? Was it 'go', 'fuck', or 'yourself'? How dare he offend you like that Mr. Smallpecker!

Fri, 05/20/2011 - 21:16 | 1297213 Texas Gunslinger
Texas Gunslinger's picture

Turd is the only chartist I've seen who claims the entire PM market is manipulated and rigged...

.....yet charts it every night anyway.   

LOL.

More hilarious than that, though, is the indignation and exasperation in his tone when his charts fail.  LOL

 

 

Fri, 05/20/2011 - 21:53 | 1297292 SilverIsKing
SilverIsKing's picture

I read Turd's blog and missed the part where he claimed the entire PM market is manipulated and rigged. Do you mind forwarding a link? Also, for someone so critical of Turd, you spend a great deal time posting there. Let me know how to find your blog. I'm sure many would be interested in your thoughts.

Fri, 05/20/2011 - 22:24 | 1297338 Hugh G Rection
Hugh G Rection's picture

Here is Smailes blog King Ag-

 

nordicboy.blogspot.com/

Fri, 05/20/2011 - 22:14 | 1297323 Hugh G Rection
Hugh G Rection's picture

Logged out as Smailes, Dungslinger?

 

If the rapture is tomorrow, does that mean your TX dungslinger sock account goes away?

Sat, 05/21/2011 - 11:36 | 1298159 Fiat2Zero
Fiat2Zero's picture

So Tex,

Exactly how much do you get paid per hour to post your opinions?

Because there isn't much meat in them, if you know what I mean.

Since you are, without a doubt, being tracked by social analytical software, by those who pay your salary, how would they feel if they knew that your desperate efforts at swaying opinion were backfiring?

Then you'd suffer the fate of the RoboTrader replicant and the Zing replicant.

You see, I can't believe that anyone would waste their time posting the same content-free drivel over and over and over, unless of course he was getting paid to do so.

So you'd better wise the fuck up and start being more persuasive or your replicant ass is getting terminated.

Start posting things that have something of value in them or the checks are going to stop showing up in your paypal account.

Tell Robo-Ning hello.

Fri, 05/20/2011 - 23:43 | 1297510 longorshort
longorshort's picture

40 dollars says you bought the top and are crying on the inside.

Fri, 05/20/2011 - 16:34 | 1296693 Tyler Durden
Tyler Durden's picture

The Dumbest Trade Ever? from Ted Butler

My
award for the dumbest trade of all time goes to Barrick Gold and its
ill-fated gold hedge. This is a trade that was doomed from the start.

The occasion for the award is Barrick’s latest attempt to close out and rid itself of this rotten trade. Here’s a pretty good review of the story.  Or, if you prefer, here’s the actual press release from Barrick directly. What’s not in the review or the actual press release is the suggestion  that this is about the dumbest trade of all time. Let me explain why I think it is.

First,
even if everything goes as planned, the short gold hedge that Barrick
is trying to rid itself of, still won’t be closed out completely. What’s
more, Barrick has made previous announcements, over the years, that it
plans to close out its short gold position and has never completely
succeeded. A trade is really bad when you can’t close it out even after
you decide and publicly announce your intention to do so. Who allows
themselves to get into a trade that you can’t close out, even if you
want to?

Nowhere
in the article or the press release is stated the total cost of
Barrick’s venture into short gold hedging. Let me rectify that. My
estimate is that Barrick has lost, in total, more than $10 billion
overall since it started the nutty idea of over-hedging its gold
production. That’s larger than any single derivatives loss on history.
That’s more than Barrick has earned in its existence. That’s $10 billion
that could have gone to shareholders in the form of dividends, or to be
used for acquisitions or legitimate corporate purposes, like
eliminating debt or buying back shares. Instead, it was $10 billion
completely squandered. Now, shares must be issued to pay for the gold
short loss, diluting shareholder value. To add insult to injury, the
management responsible for such a debacle rewarded itself lavishly.

But
the magnitude of the loss and the ineptitude of entering into a
transaction in which there is no ease of exit are but two components of
what makes this the dumbest trade of all. The deciding factor that
crowns this the worst trade of all-time is how long the trade has
existed and how much Barrick was warned all along about how the trade
made no sense. The level of arrogance displayed by Barrick management
over the years to anyone, including shareholders, who tried to point out
the folly of the short gold trade, boggles the mind. Please remember,
the gold shorts being closed out now by Barrick were established at near
$300 an ounce, meaning losses of $600 to $700 per ounce are now being
taken on millions of ounces. I would submit that would be hard to
accomplish, even for whoever might be the world’s worst trader.

I
was one who warned Barrick about the folly of this trade before anyone
else, to my knowledge. In fact, my very first writings on the Internet,
going back to 1997, concerned leasing and forward sales and Barrick.
Incredibly, after my warnings, Barrick dramatically increased the size
of its short position. Here’s an
article from 2006, about Barrick (and a silver hedger, Apex Silver,
that eventually went bankrupt due to that hedging), that contains links
to some earlier articles.  I didn’t just warn
Barrick, I warned their accountants and auditors, the CFTC, and even
complained to the SEC about Barrick’s fraudulent hedging and
non-disclosure to shareholders. The great irony is that the lack of
action by all involved, who supposedly exist for shareholder and public
protection, played heavily in the subsequent $10 billion loss.

Fri, 05/20/2011 - 16:42 | 1296705 Internet Tough Guy
Internet Tough Guy's picture

Barrick is the TBTF miner.

Fri, 05/20/2011 - 16:58 | 1296748 Bay of Pigs
Bay of Pigs's picture

So what. Barrick was/is the poster child for corruption in the gold sector. Peter Munk is no better than Dimon or Blankfein. He is a lying sack of shit and belongs behind bars.

Fri, 05/20/2011 - 17:06 | 1296762 Hephasteus
Hephasteus's picture

Barrik is getting one of it's mines massively attacked by gangs as big as 800 people trying to break in and "steal" gold.  They are using huge amounts of security and successfully stopping it but it'll eventually become trying to mine in a war zone.

Fri, 05/20/2011 - 18:46 | 1296931 Transformer
Transformer's picture

To understand this trade, we need to know who was on the other side, who was making a killing on the other side.  I would bet anything it was a large bullion bank with undo influence on Barrik management.  Instead of Barrik making a lot of money, the other side of the trade made the money.  And perhaps that was the point, the very reason for the trade.  Or maybe it was a good hedge for the bullion bank to cover a lot of naked shorting over the years.

Just as Gordon Brown made the worst physical sale of gold in history, all we need to know, to have it make sense, is to know who bought it.  With Brown, was it the royal family, the Rothschilds, some other royal family?  These things don't happen because of some bumbling executive trading decision, these things happen for a reason.  When a huge gold mining company or a sovereign lose big time in the gold market, who is winning?  Find that out and it will all become clear.

 

 

Fri, 05/20/2011 - 19:09 | 1296967 Bay of Pigs
Bay of Pigs's picture

All the evidence I've ever seen point right to JPM, the FED's chief agent in the markets. 

Sat, 05/21/2011 - 07:55 | 1297900 bigdumbnugly
bigdumbnugly's picture

 i once had peter munk and needed a shot at the clinic to get rid of it.  Nasty.

Fri, 05/20/2011 - 16:42 | 1296708 LowProfile
LowProfile's picture

Mmm...  From a fundemental perspective, that seems to indicate resources Barrick could put into mining instead go into covering the short, which means less supply. 

In the grand scheme, probably not terribly significant, but it's yet another straw on a straining camel...

Fri, 05/20/2011 - 16:40 | 1296711 Spalding_Smailes
Spalding_Smailes's picture

Yes, but those miners ( silver ) will have avoided a 50-70% drop .... 

Fri, 05/20/2011 - 16:44 | 1296714 tmosley
tmosley's picture

You're going to be held to that statement.

Fri, 05/20/2011 - 17:25 | 1296738 Spalding_Smailes
Spalding_Smailes's picture

And what about your moronic statement ( silver never ever drops below $35 again ) as it sliced past $49.00 on its way toward $70.00 ..... ????

 

In your words, get the fuck out you goofball .... 

 

PIN (fucking) DROP .... Again after T-bag gets his ass handed to him he goes silent, I love it

 

You sure do get slapped around on ZH ..... You should get help at a halfway house .... Lol

Fri, 05/20/2011 - 17:36 | 1296826 tmosley
tmosley's picture

Physical silver, numbnuts.  In fact, I specifically said in February at the latest, that paper would, in fact, enter a period of high volatility, trending toward zero.

But then, you wouldn't know the difference between paper and physical.  

Because you are a retard.

Fri, 05/20/2011 - 17:45 | 1296854 scratch_and_sniff
scratch_and_sniff's picture

You're obsessed with retards. Each to his own i suppose.

Fri, 05/20/2011 - 18:01 | 1296875 Captain Planet
Captain Planet's picture

its just something in the blood.

some have urges to set other feeble minds straight.

great if you have restraint. it is often a sign of strength.

but don't come down too hard on those trying to pursuade others to wake the fuck up, this isn't disneyland anymore

Fri, 05/20/2011 - 18:14 | 1296895 scratch_and_sniff
scratch_and_sniff's picture

Nah, tmosley is totally anti-spastic, he's a spastic nazi.

Fri, 05/20/2011 - 18:18 | 1296899 fuu
fuu's picture

At least he didn't call him a faggot.

Fri, 05/20/2011 - 23:47 | 1297517 longorshort
longorshort's picture

       * 

   *     *

*           *   Even bigger numnut who likely bought a top because extranormal talking bears said this time was different in silver.

Sat, 05/21/2011 - 00:22 | 1297565 tmosley
tmosley's picture

Retard trolls should learn their place.

My dollar cost average is about $16, idiot.

Also, fail ad hominem is fail.  "Hurr, da bears said it it must be wrong, nevermind that da bears was made by da industri prufesinal, an da format is just a easy way tuh make a video wit audio, HURP."

Sat, 05/21/2011 - 00:58 | 1297646 Troll Magnet
Troll Magnet's picture

hey spalding smailes,

a few years ago my mother handed me a big bag of coins (her loose change over the decades) because she just wanted to get rid of them.  at first i was annoyed because i didn't want the trouble of going through and sorting them.  but my wife did.  and in it she found hundreds of pennies, nickles, dimes...along with dozens of junk silver coins, ASEs and morgan dollars.  and when i looked at those silver coins i was startled and felt like my mother had just given me a bag full of treasure.  i've been buying physicals since. 

i bought a monster box of silver when spot + premium = $50 and change last month, so yeah, i'm one of those top buyers you seem to enjoy picking on.

i also bought at $38, 32, 28, 26 and 21.  and i'm about to buy more gold and another monster box of silver this week or next.

by no means am i happy that i purchased a monster box of silver at the top.  but along with my gold stash, i'm pretty psyched at the thought of handing them down to my children when i grow old.  just last year, i tracked down and bought a 2oz gold lunar coin that was minted in 1999, the year of my beloved niece's birth, and gave it to her for her birthday.  should've seen the look in her eyes when she held it in her palm in wonder.  her first words in amazement: "this is GOLD!"

i'm not sure if doomsday scenarios will play out as many here on ZH predict.  but i do know that gold and silver are treasures.  and i prefer them to unlimited federal notes being printed by bernanke and other central banksters. 

my point is that a contrarian's point of view is necessary but when you start bashing PM holders relentlessly for the sake of bashing them, your credibility diminishes and become annoying.  buy some physicals and try giving them as gifts to your loved ones.  they may go down or up in $ terms but your loved ones will NEVER, EVER ask for a gift receipt so that they can return them.  can't put a price tag on that IMO.   

 

Sat, 05/21/2011 - 01:16 | 1297675 RockyRacoon
RockyRacoon's picture

Good story.   I like anecdotes that point out the tactile response to gold and silver.  I can remember my first Morgan dollar.   Completely hooked after that.   I'm old enough to remember using silver coinage as real money but just as a kid.   Here is an article with some interesting charts, especially the silver price in nominal terms and the CPI and Shadowstats CPI:

Silver Price Collapse Reminds of Risks in Paper Market
Sat, 05/21/2011 - 02:00 | 1297723 jeff montanye
jeff montanye's picture

patience.  from the perspective of 2015 it may be hard to distinguish $50 silver from $34 silver.

Fri, 05/20/2011 - 19:18 | 1296976 hack3434
hack3434's picture

WRONG! Minera Frisco (Biggest hedger out there) has been taking a beating YTD. One can safely assume that they had something to do with the massacre of May. After all, Carlos Slim is known as a ruthless WELL CONNECTED businessmen. 

From Reuters:

Frisco, which reported earnings of $4.3 million in the quarter ended March 31, was short just under 95.759 million ounces of silver as of April 30 compared with a short position of 70.120 million ounces at the end of 2010, according to filings with the Mexican stock market. The company said the short positions were assumed to support the company's investment program.

In its most recent filing, Frisco reported a short position of a notional 34.478 million ounces in silver swaps at an average price of $25.06 per ounce as of April 30, according to filings with the Mexican stock market.

The company was short 24.840 million ounces at an average price of $18.82 an ounce as of Dec 31.

Frisco also held a notional 61.28 million ounces in options collars on silver with a long put positions at an average of $23.82 an ounce as of April 30, along with offsetting short call positions at an average of $39.97 an ounce.

As of the end of Dec 31, Frisco's silver options collars amounted to 45.280 million notional ounces with an average put price of $21.79 per ounce and an average call price of $39.70 per ounce.

The positions mature between 2011 and 2013.

Frisco's hedging positions are heavily out of the money even after silver's recent correction. Spot silver was bid at $39.36 an ounce in late trading on Wednesday.

 

http://www.reuters.com/article/2011/05/04/slim-silver-idUSN0410776920110504

 

 

 

Fri, 05/20/2011 - 16:41 | 1296713 swissaustrian
swissaustrian's picture

Maybe Barrick had a gold carry-trade going to finance it´s operations? Just an idea of mine...

Fri, 05/20/2011 - 16:52 | 1296720 Yen Cross
Yen Cross's picture

 Another keeper for weekend research. Thanks. The Squandered,Legitimate dilution of the post is trading perfection. I don't own Barrick. Ineptitude and over bought are synonymous! NO?   P.S. I don't junk the hand that feeds me. Your crew is fantastic!

Fri, 05/20/2011 - 16:52 | 1296741 JW n FL
JW n FL's picture

You might not like what Tyler has to say.. but he is factual and honest.. not just honest in one faucet of thought but in multiple.. he tries to help, he tries to make the World a Better Place with his Honesty and mostly gets pissed on for his effort.. I dont mean us here.. we Luv Our Bro! but outside of here, he is shunned by the money changers in the Temple..

 

Please never stop Tyler! Please, Pretty Please ALWAYS spread the Truth!

Fri, 05/20/2011 - 18:54 | 1296940 rocker
rocker's picture

+1   Always good stuff.  ZH Rocks.

Sat, 05/21/2011 - 01:06 | 1297663 Troll Magnet
Troll Magnet's picture

i have to say...i've been reading ZH for about a year now learned more about economics than i ever have including 4 years of little ivy education.  i still don't get a lot of things because i'm not and have never been a trader - i have a REAL job.  Ha!  but i am picking them up one by one and it's been an eye-popping experience.  

Fri, 05/20/2011 - 19:20 | 1296990 Pegasus Muse
Pegasus Muse's picture

To hell with the money changers.  If there is a just God this will be their end: http://www.youtube.com/watch?v=X3KV4fLSNoU&feature=related

Sat, 05/21/2011 - 01:17 | 1297673 Troll Magnet
Troll Magnet's picture

speaking of which, it's already saturday (past 2pm) here in asia.  where's jesus? 

wait...does this mean...oh, NOOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!!

Fri, 05/20/2011 - 16:52 | 1296742 buzzsaw99
buzzsaw99's picture

over-hedging is a fool's gambit.

Fri, 05/20/2011 - 17:10 | 1296774 ebworthen
ebworthen's picture

Thanks Tyler,

That may explain why the fund that has Barrick as a component took a dive around January (?).

How stupid of Barrick.

Fri, 05/20/2011 - 17:47 | 1296853 AldoHux_IV
AldoHux_IV's picture

Points to the fact that even hedging for commercial purposes needs to be reviewed closely-- when companies that are supposed to make money from the production/refining of a commodity can make or lose more money 'hedging' then it becomes a whole different game then what the futures were initially designed for.

In a world where the regulators are in cahoots with the market manipulators of course this makes no real difference on how the markets should be governed.  Just another note in a long list of observations on how our markets are truly no better than 3 card monty.

Sat, 05/21/2011 - 00:21 | 1297576 SYantiss
SYantiss's picture

Tyler,

I'm really new to the whole trading mantra and have made some astoundingly bad stock trades.

I don't read some of the acronyms very well, and have a hard time descifering some of them...

I have bought a small amount of silver at $19, $24, $36, $42... I do not "need" to sell any of this at this time, but I'm pretty close to "full in".

Based on this article, I get the impression that I should sell and buy back at $26 or so...

I'm not looking for specific advise, just clarity in what this means...

I really don't know who is a "troll" or Govt agent, or whatever, here... I'm just looking for an explanation to my wife of why I'm doing ___.

Sat, 05/21/2011 - 01:17 | 1297676 tickhound
tickhound's picture

SYantiss,

I'd run for the hills, dude.  I'd sell all of your "full in", yet "small amount" of silver and get out while you still can.

Tell your wife you've been advised that all weak hands should dump cuz $9 is to be re-tested and its green shoots and asparagus for everybody.

Tickhound, Tyler's other handle.

Sat, 05/21/2011 - 01:29 | 1297696 StychoKiller
StychoKiller's picture

Silver & Gold (along with the other PMs) are wealth INSURANCE -- can you have too much insurance on your wealth?

Sat, 05/21/2011 - 11:47 | 1298171 Fiat2Zero
Fiat2Zero's picture

Close, PMs are wealth itself. Money used to be a claim on future wealth, redeemable in precious metals. Now it is a claim on nothing because the concept of "Future Exchange" was eliminated by LBJ.

Fri, 05/20/2011 - 17:02 | 1296754 homersimpson
homersimpson's picture

Dumbass Spalding still doesn't realize Silver is still way up since last year, when most ZHers realized a deal.

Only the Robotraders and Cramer lovers of the world got shot during the 49 to $35 downfall.. everyone else is up.

Fri, 05/20/2011 - 17:07 | 1296773 Spalding_Smailes
Spalding_Smailes's picture

Really ? So everyone loaded up at $17.00 and have just sat back and avoided the etf's, futures, miners .... Really

 

Nigga' please ..... Many goofs got whacked over the last 5 weeks .... 35% gone .... Miners blowtorched

Fri, 05/20/2011 - 17:19 | 1296802 Yen Cross
Yen Cross's picture

 Spalding please. You seem to have some sort of financial prowness. These people are light years ahead of you. Use your new found wisdom, and be-friend these ZH posters.

 

  You will thank me in the not so distant future. Trade well.

Fri, 05/20/2011 - 17:28 | 1296815 Spalding_Smailes
Spalding_Smailes's picture

Naw' .... I've tried.

 

The doomer™ crowd is fuuuuuuucked up .....

 

Maybe after the dow hits 14,500 a few more traders will show up and we can chop it up ...

Fri, 05/20/2011 - 17:40 | 1296834 Yen Cross
Yen Cross's picture

 Alright. Be your own man and do your business. You remind me of my self. By the way can you send me a closing Treasury chart 2-5-7-10-30( overlay) I'm trying to figure the FED out.

  Thank you. P.S. ignore CNBS

Fri, 05/20/2011 - 18:20 | 1296905 fuu
fuu's picture

You can always just go back to yahoo is you want to talk to traders.

Fri, 05/20/2011 - 18:27 | 1296910 Yen Cross
Yen Cross's picture

 You sweetheart are wecome in my home any day! I'll bet you are sweet and hungry.

Fri, 05/20/2011 - 20:01 | 1297039 longorshort
longorshort's picture

I should trademark piss on silver to make money on the pissed off hoarders.

Fri, 05/20/2011 - 18:12 | 1296890 vocational tainee
vocational tainee's picture

No problem when the gamblers leave..

Fri, 05/20/2011 - 19:05 | 1296954 DeadFred
DeadFred's picture

Speaking of which any thoughts on where the miners bottom. When they pulled this $#@$! back in January I was able to buy some calls in Coeur D'alene Silver that ended up paying 13X. So sweet but I guessed they would go lower than they did and missed the bottom. I'll entain and guesses but troll guesses get discounted.

Fri, 05/20/2011 - 19:10 | 1296972 mynhair
mynhair's picture

GPL already bottomed.  Bounced off 2.52, almost at its 200dma.

Fri, 05/20/2011 - 19:37 | 1297007 DeadFred
DeadFred's picture

Argghh, missed again. The money is not the primary thing, it the thrill of the hunt. Maybe Ill get it right after the dip from $100 to $65.

Sat, 05/21/2011 - 10:19 | 1298049 Absinthe Minded
Absinthe Minded's picture

No, I loaded up at 16, but thanks for caring about us.

Fri, 05/20/2011 - 17:17 | 1296788 EscapeKey
EscapeKey's picture

will you this time answer the question over which timeline this is, or just ignore it as usual?

if the 100m oz have been hedged over the next 10 years, it means nothing.

Fri, 05/20/2011 - 17:18 | 1296797 Spalding_Smailes
Spalding_Smailes's picture

I do not work for Goldman how would I know the timeline .... But they did hedge at the top of the bubble.

 

I posted this days before the crash .... You said the same thing then.

 

Got .... props ?

Fri, 05/20/2011 - 17:24 | 1296807 EscapeKey
EscapeKey's picture

i did - because you dodged the question of timeline back then as well.

without a timeline, 100m oz could literally mean everything - or nothing.

Fri, 05/20/2011 - 17:28 | 1296823 Spalding_Smailes
Spalding_Smailes's picture

They did not report on the hedge timeline sorry .... No dodge from me ....

 

But a five year old would look at the history of silver and guess at $45 it was a top is in hedge ...

 


Silver History • 

1900 - $0.80

1910 - $0.70

1920 - $1.70

1930 - $0.50

1940 - $0.42

1950 - $0.90

1960 - $1.00

1970 - $2.00

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

1990 - $6.00

2000 - $5.00

2003 - $5.00

2006 - $8.50

2009 - $12.00

2010 - $18.00

Fri, 05/20/2011 - 18:02 | 1296881 tickhound
tickhound's picture

Lol!  C'mon Smailes... You crack me up, at times, but you runnin' out of material?

ps  A Rite Aid closed a few months ago outside of DC... now covered with weeds and insects

I have a sucker in mind, who'll pay extra for the green shoots and crocus

 

Fri, 05/20/2011 - 18:06 | 1296884 EscapeKey
EscapeKey's picture

I guess you think circumstantial evidence is supportive when you put it forward, but isn't when put forward by an opponent.

Fri, 05/20/2011 - 18:38 | 1296921 Yen Cross
Yen Cross's picture

 E/K I put the technicals and fundamentals out there. Walk away from the Froth.

 

   I'm going surfing before I hit the Jet Sunday. My house has cobwebs!

Fri, 05/20/2011 - 20:26 | 1297097 Jendrzejczyk
Jendrzejczyk's picture

My jet has CobWeBs!!!

Webbed feet are orgasmic.

Fri, 05/20/2011 - 22:01 | 1297298 Yen Cross
Yen Cross's picture

 Conjunction function!  My web/bed feet are Radioactive right now.

Fri, 05/20/2011 - 18:45 | 1296935 Bay of Pigs
Bay of Pigs's picture

The numbers he uses aren't even close to being accurate. For instance, these are yearly highs, but silver traded much higher on average than what he says. He is simply wrong, as usual.

5/5/06 $14.07, not $8.50

12/02/09 $19.18, not $12.00

12/30/10 $30.70, not $18.00

 

 

Fri, 05/20/2011 - 18:56 | 1296945 Spalding_Smailes
Spalding_Smailes's picture

What about the other 95 years you fucking fool ... You bring up the ramping of the bubble years, listen , you can hear the air pissing out of said bubble  Lol

 

Can you address the long term price being under $10.00   .... 

Fri, 05/20/2011 - 19:15 | 1296978 Bay of Pigs
Bay of Pigs's picture

Sure I can. The US dollar is only worth only 4 cents now over the last 98 years. Purchasing power is the key you fucking fool.

You're not even fun to smackdown anymore. You've got nothing left rookie.

 

Fri, 05/20/2011 - 20:30 | 1297112 Spalding_Smailes
Spalding_Smailes's picture

Hey dip shit.

US Dollar 1980 - 84

US Dollar 1990 - 80

US Dollar 2000 - 100

US Dollar 2010 - 78

Today - 75

 

What has silver traded at in most of those years ? Below $10.00 ....

 

Read a book ....

Fri, 05/20/2011 - 20:50 | 1297164 tmosley
tmosley's picture

I might suggest you read a book about competitive devaluation.

Idiot.

Fri, 05/20/2011 - 21:21 | 1297234 tickhound
tickhound's picture

I believe CNBS coined it, "competitive currency non-appreciation" - has a more positive ring to it.

Fri, 05/20/2011 - 20:57 | 1297174 Tyler Durden
Fri, 05/20/2011 - 21:13 | 1297219 OuaisBla
OuaisBla's picture

LOL. A good reason to go short silver. The American people have less purchase power than in the 1980. Joe the plumber doesn't care about the white not too shinny metal. Unless the price of electronics devices like cameras would go too much higher for then to afford.

 

And ... don't fight the fed.

 

Still not sure about that call of going long on shorts Silver position. But technically, the fall from 48$ might have a run down up to 31$. And below 30$ afterward down to 26$.

Is there any reasons to to be a silver bull right now? QE2 is ending no? Banks will have to fight to keep their balance sheet up and running... The bonds markets will suffer deeply. No time to speculate on something as insignificant as silver. That is only my HO.

 

Happy doom's day everyone.

Fri, 05/20/2011 - 21:24 | 1297235 Tyler Durden
Tyler Durden's picture

Is this the first post you have read on Zero Hedge?

Fri, 05/20/2011 - 21:27 | 1297249 CD
CD's picture

No, just the first time posting with this particular username. I'm afraid we'll get used to him/her before they are forced to change up their login...

Fri, 05/20/2011 - 22:23 | 1297343 Bay of Pigs
Bay of Pigs's picture

Unfortunately these nitwits, dimwits and PM retards are crawling out from under every single fucking rock these days. ZH is currently gold and silver troll central.

BTW Tyler, thx for the chart. It says a thousand words.

Fri, 05/20/2011 - 22:51 | 1297402 OuaisBla
OuaisBla's picture

It is because I don't go along with the crowd that I'm not a regular reader?

LOL... that's not the Tyler guy I'm used to. You are smarter then that, don't you.

Am I the first contrarian poster here?

Keep on posting good stuff. And let others think by themself.

Fri, 05/20/2011 - 23:07 | 1297441 tmosley
tmosley's picture

All these trolls think they are unique little snowflakes.

lol

Fri, 05/20/2011 - 23:29 | 1297481 Bay of Pigs
Bay of Pigs's picture

"don't fight the FED"?

Where have we heard that before? Uncle Gorilla?

LMAO.

Fri, 05/20/2011 - 22:20 | 1297246 tickhound
tickhound's picture

Joe the Plumber?  Holy shit.

Sat, 05/21/2011 - 10:31 | 1298064 scratch_and_sniff
scratch_and_sniff's picture

Shouldn't that chart be offset by average income or money supply for a saner picture of whats actually happening? It may have lost a lot of purchasing power, but you cant even begin to compare standards of living to 1933, or even 1953, 63,73... Im no economist, as you have all probably worked out, but charts like the one above are surely a little biased, maybe even a little pointless? Yes, a dollar buys 90% less than in 1933, but you are earning 80% more of them!

Have a look at this one that show average family income increasing ~80% from 1933. No, you haven’t got any richer, but you certainly aren’t 90% poorer!

 

http://i52.tinypic.com/2jb6rl.jpg

Fri, 05/20/2011 - 20:59 | 1297182 Bay of Pigs
Bay of Pigs's picture

I guess there's no way to explain loss of purchasing power via debasement and inflation to you is there?

 

Fri, 05/20/2011 - 21:25 | 1297237 TrueStrengthTur...
TrueStrengthTurnsTheCheek's picture

this usd "chart" youve made may just be the most worthless piece of information any ZH poster has ever posted. if anyone had any doubt before, they now know you are literaly a troll.  the fed has stolen 96 off the dollar and you couldnt be happier.

Sat, 05/21/2011 - 03:54 | 1297797 EscapeKey
EscapeKey's picture

The long term DJIA average is below 1,000. How would you like to address this gross current overvaluation?

Sat, 05/21/2011 - 06:53 | 1297868 css1971
css1971's picture

Are you really trying to tell everyone that you don't know what a percentage is? Or what it means when applied to growth in money supply over time?

 

Fri, 05/20/2011 - 19:14 | 1296984 rocker
rocker's picture

Selective information is often used to manipulate opinion.

Famous Quotes: More people own homes now than ever. (Having a mortage is not owning the home)

                        The deficit is only X dollars. (Not if the biggest part is on a charge card)

                         The economy is much better. (Not if Food Stamps are at new highs)

Sounds like someone is a politician.  Much better to stay out of people misinformation on ZH. Somebody will seek you out.

Sun, 05/22/2011 - 05:20 | 1299733 ffart
ffart's picture

He's a neo con what do you expect. I guess if you can't start wars to get juicy oil contracts for your corporation, the next best thing is trolling people on the internet.

Sat, 05/21/2011 - 16:49 | 1297169 OuaisBla
OuaisBla's picture

...

Fri, 05/20/2011 - 16:36 | 1296684 Yen Cross
Yen Cross's picture

 The usd is range bound . ACB's will continue to divest into euro's as long as the Federal Reserve Board is dovish. Ben (aka) Chair Satan Bernanke wants a soft dollar. He is completely out of touch. His (soft dollar) policy is hurting exporter friends of the U.S.. I won't mention any names.

Fri, 05/20/2011 - 17:01 | 1296745 agent default
agent default's picture

And a hard dollar policy would require a US that can service it's debt in real terms.  Now let's see of the top of my head (very loosely): Government debt about 90% of GDP.  GSE debt (government backed) about 30% of GDP.  Madicare/Medicaid comes under unfunded liabilities,  I don't remember how big that is but I remember it is a number a bit silly to contemplate. 

The dollar is no longer a hard currency and will not be one in the forseeable future.

 

Fri, 05/20/2011 - 17:08 | 1296777 Yen Cross
Yen Cross's picture

 I respect and agree with your argument. We are beating DEAD HORSES here.

Fri, 05/20/2011 - 16:32 | 1296685 Strider52
Strider52's picture

Silver, Bitchez

Fri, 05/20/2011 - 16:38 | 1296697 malusDiaz
malusDiaz's picture

Picked up 105 Silver Dollars Baby!

Fri, 05/20/2011 - 16:39 | 1296703 Tracerfan
Tracerfan's picture

I own more silver than ever and am adding more daily, particularly silver coins with underlying numismatic value even if silver prices did fall, which I don't expect.

Exchanging fiat paper which is being continually devalued in exchange for real money sounds good to me.

Fri, 05/20/2011 - 20:02 | 1297045 longorshort
longorshort's picture

Glad to see comex found a sucker who watched too many youtuble videos

Fri, 05/20/2011 - 16:39 | 1296709 falak pema
falak pema's picture

where will all the hot rods mice run to ...as they see the ship burn in all quarters...stern side USD, bow side euro, port side yen and starboard side Renminbi...all in flames.

Fri, 05/20/2011 - 16:47 | 1296719 AR15AU
AR15AU's picture

Initiated some sizable new longs in CDE and HL this afternoon.

Fri, 05/20/2011 - 16:48 | 1296723 XenoFrog
XenoFrog's picture

3 more 10oz bars ordered this morning with ye ol' paycheck.

Fri, 05/20/2011 - 16:58 | 1296752 Tracerfan
Tracerfan's picture

+3

Fri, 05/20/2011 - 16:52 | 1296740 ebworthen
ebworthen's picture

 

What's the relationship between USD short positions and PM Mining stocks?

My mining stocks lagged the physical quit a bit, and were higher when the USD shorts hit a long term trend bottom in October 2010.

I realize they are stocks versus the physical metals themselves, but they are behind the physical and not yet been hit the way silver has.

 

Fri, 05/20/2011 - 17:11 | 1296779 darkaeye
darkaeye's picture

I think this is historically normal.  In phase 2 of this kind of bull, it's physical first, then the senior & intermediate producers, then finally the juniors and explorers go nuts in phase 3.

I canardly wait!!

Fri, 05/20/2011 - 19:38 | 1297010 ebworthen
ebworthen's picture

Thanks.

Fri, 05/20/2011 - 17:01 | 1296759 apberusdisvet
apberusdisvet's picture

In response to Tyler's post; I am surprised that he doesn't know that Barrick has been in bed with the bullion banksters (and FED owners) since Day 1, and has been a key player in the 40 year old Ponzi of PM manipulation.  Just look at the composition of the Board and Execs since 1970 (and even before).

Fri, 05/20/2011 - 18:01 | 1296872 Jendrzejczyk
Jendrzejczyk's picture

Just curious, which part of his post indicates that he lacks this knowledge?

Fri, 05/20/2011 - 19:24 | 1296992 DeadFred
DeadFred's picture

No doubt he knows still it makes you wonder how they could be so stupid. Or is there one of those backdoor ways of making it good that the TBTF seem to specialize in. The rumors are that JPM's shorts are backed by the treasury why not Barrick's, after all they have a lot more legitimacy as a short seller than a bank has. Wouldn't it be harder for Barrick to launder the payoffs though? Seems that JPM could put 10 billion in all sorts of places and fool most people. Of course 10 billion direct to the top players and let the shareholders hold the bag is more like their MO.

Fri, 05/20/2011 - 21:59 | 1297295 swissinv
swissinv's picture

PHLX XAU INDEX     SYMBOL     31-Dec     19-May     CHANGE    SHARES    MKT CAP    XAU%
Barrick Gold     ABX     53.18     45.35     -14.7%    996.0     45.2     19.2%
Agnico Eagle     AEM     76.70     62.55     -18.4%    167.7     10.5     4.5%
AngloGold Ashanti     AU     49.23     45.21     -8.2%    187.2     8.5     3.6%
Yamana Gold     AUY     12.80     12.03     -6.0%    741.1     8.9     3.8%
Buenaventura     BVN     48.96     40.40     -17.5%    140.7     5.7     2.4%
Freeport McMoRan     FCX     60.05     48.62     -19.0%    941.8     45.8     19.5%
Gold Fields     GFI     18.13     15.52     -14.4%    280.1     4.3     1.9%
Goldcorp     GG     45.98     48.65     5.8%    736.3     35.8     15.3%
Randgold Resources     GOLD     82.33     77.78     -5.5%    62.4     4.9     2.1%
Harmony Gold     HMY     12.54     13.48     7.5%    114.2     1.5     0.7%
Kinross Gold     KGC     18.96     14.84     -21.7%    1131.5     16.8     7.1%
Newmont Mining     NEM     61.43     53.80     -12.4%    486.2     26.2     11.1%
Pan American Silver    PAAS     41.21     32.77     -20.5%    107.2     3.5     1.5%
Royal Gold     RGLD     54.63     59.32     8.6%    53.7     3.2     1.4%
Silver Wheaton     SLW     39.04     34.47     -11.7%    346.6     11.9     5.1%
Silver Standard     SSRI     28.22     28.09     -0.5%    78.8     2.2     0.9%
XAU INDEX     ^XAU     226.58     198.63     -12.3%    TOTAL    234.9     100.0%

Fri, 05/20/2011 - 17:03 | 1296764 darkaeye
darkaeye's picture

The Morgue and their collaborative "buddies" have shaken out all the tech and speculative longs they could, but they STILL have not been able to get the price down anywhere near the 200 day MA.

I'm gonna need a bigger vault!

Fri, 05/20/2011 - 17:07 | 1296766 Au_Ag_CuPbCu
Au_Ag_CuPbCu's picture

Same here.  There is a local dealer selling US commemorative proofs at spot; I guess someone off loaded a ton of them.  Whatever, it's silver at spot.

Fri, 05/20/2011 - 18:33 | 1296916 Captain Planet
Captain Planet's picture

that'd a boy. soak it right back up into safe hands. got me a dealer selling below spot on outdated european fiat

Fri, 05/20/2011 - 17:08 | 1296776 johny2
johny2's picture

The place where I used to buy can not keep up with the demand. What does it mean I do not know for sure, but it seems there is plenty of people who would like to change paper IOU-s into something better. 

Fri, 05/20/2011 - 17:18 | 1296791 scratch_and_sniff
scratch_and_sniff's picture

I know that silver is a small market, but credit where it's due, it is a global one.

Fri, 05/20/2011 - 17:12 | 1296785 BeerGoggles
BeerGoggles's picture

Does this mean buy silver on paper now?

Fri, 05/20/2011 - 20:45 | 1297152 OuaisBla
OuaisBla's picture

It means do like commercials do. Short it. IMO.

 

26 bucks next support. 

 

Disclosure: I'm short at 35$, but I have very tights stops. This thing can kill you both ways, whenever you picks the wrong one.

Sat, 05/21/2011 - 04:41 | 1297824 BeerGoggles
BeerGoggles's picture

The chart above shows non-commercials. COmmercials are long./

Fri, 05/20/2011 - 17:15 | 1296786 gwar5
gwar5's picture

USD looks good because QE is "ending", stock market will correct for the same reason.

If the weak hands have been shaken out of PMs then good riddance. More reflective of the (real) physical market. Less volatility. Smoother sailing.

Fri, 05/20/2011 - 17:27 | 1296811 Yen Cross
Yen Cross's picture

 USD looks good because Japan has ultra low borrowing costs (carry) and a net export economy. Not true anymore .

 

Fri, 05/20/2011 - 17:34 | 1296835 darkaeye
darkaeye's picture

Eric Fry over at the Daily Reckoning refering to the Greek sovereign debt issue...

"The canary in the coal mine is choking"

True dat!

Fri, 05/20/2011 - 18:35 | 1296918 Captain Planet
Captain Planet's picture

thanks for the shoutout to DR.

They introduced me to PMs and debt clusterfuck when I was a wee boy

Just started going back to them recently....still a fan!

Fri, 05/20/2011 - 17:41 | 1296848 Yen Cross
Yen Cross's picture

 This CNBS! Dennis Gartman called for eur/usd parity a year ago. The guy disapears when he calls bogus trades. Now the the guy is calling P/M's? Dennis Gartman is a sponge. He schleps other traders that do their homework. He couldn't run a trendline if you asked him to. Gartman is a joke!!!!!!!!!!!!!!!!!!!!!!!!!!

Fri, 05/20/2011 - 18:01 | 1296877 BeerGoggles
BeerGoggles's picture

Fade Gartman and yoiu'd make a million.

Fri, 05/20/2011 - 19:27 | 1296999 rocker
rocker's picture

+1  CNBC kisses Gartman's ass.  CNBC blows the horn for JPM, GS and BAC.  They even have Kass ass tooting for GS.

Fri, 05/20/2011 - 17:44 | 1296849 Raymond Reason
Raymond Reason's picture

Good riddance. 

Fri, 05/20/2011 - 18:01 | 1296879 Yen Cross
Yen Cross's picture

 Some one write Cramer a SICK note, and fetch the marble from his throat! Jimmy you are worthless. See your kids before neumonia sets in! Idiot stay in BeD when sick!

Fri, 05/20/2011 - 18:35 | 1296920 Captain Planet
Captain Planet's picture

anybody to put a letter like that under his family's front door is winning! IMHO

Fri, 05/20/2011 - 19:05 | 1296953 belogical
belogical's picture

I am not sure how they calculate this stuff.

When I check OI at the comex before the cell off I get 132K and as of this evening I get 122K. This after a 30% drop. Someone still thinks there is profit to be made in silver

Fri, 05/20/2011 - 19:02 | 1296957 dcb
dcb's picture

As I keep pointing out on this site, there is no real price of anything when you have margin and zero cost of lending, plus the sme silver can be used in multiple places. I will still keep my long euro positions bought at the low, and am hedged with sort euro positions. based on the graph with euro's I could drop a lot further.

Fri, 05/20/2011 - 19:13 | 1296981 mynhair
mynhair's picture

Went long sand in a box.  It really does only cost $5 to dredge out of a river!

Sat, 05/21/2011 - 01:49 | 1297713 StychoKiller
StychoKiller's picture

Well, most kitties I've ever seen do have a use for kitty litter...:>D

Fri, 05/20/2011 - 19:49 | 1297021 slewie the pi-rat
slewie the pi-rat's picture
Silver Spec Longs At Two Year Lows

The new base is now being rebuilt based on much firmer hands.

yep.  the specs sold;  the banksters (commercials) bought. 

COT Gold, Silver and US Dollar Index Report - May 20, 2011

banksters, BiCheZ! 

much firmer hands?  compared to...what?

Fri, 05/20/2011 - 20:03 | 1297051 Yen Cross
Yen Cross's picture

 Well done Slewie. (BULLET PROOF) as always.

Fri, 05/20/2011 - 20:10 | 1297061 Darth Silver
Darth Silver's picture

simple math and logic combined. dont lose focus on what is staring you in the face.

1. OI for May and July represents over 332 million t oz of silver.

2. registered silver at comex is just under 10% of this amount.

3. total handle at Comex is just over 30% of this amount.

there continues to be backwardation. there is a significant chance the Comex defaults in the next 60 days if holders 20% of futures holder of May and July take delivery. Supply / Demand fundamentals are not being missed by the new entrants here.

it is going to be a very profitable summer for those that have held on to the physical during this two week shakedown. Enjoy the summer

Fri, 05/20/2011 - 20:15 | 1297068 Kina
Kina's picture

When you see a group of intelligent people being incredibly stupid over a long period of time you can safely assume it isn't stupidity but corruption that is at the heart of it.

Fri, 05/20/2011 - 20:43 | 1297085 AC_Doctor
AC_Doctor's picture

Looks like the bankster fuckwhores covered almost 4000 AG contracts this report while adding 2000 AG shorts last Fridays report...

Fri, 05/20/2011 - 20:37 | 1297130 OuaisBla
OuaisBla's picture

Don't fight the Fed.. Go long on short silver position. 

Fri, 05/20/2011 - 22:37 | 1297367 Bay of Pigs
Bay of Pigs's picture

Robo's new handle? No doubt...

Sat, 05/21/2011 - 01:52 | 1297719 StychoKiller
StychoKiller's picture

Whoever "OuaisBla" might be, (S)He does not have a good grasp on English.

Fri, 05/20/2011 - 21:27 | 1297243 CD
CD's picture

The radical (if not exponential) increase in the number of well-meaning PM experts and monetary geniuses warning the rest of the blind, hypnotized and mindless silver-followers to finally come to their senses and realize the utter folly that are PMs and just BTFD in LULU/LNKD is actually amusing and reassuring. Be afraid. Be VERY afraid.    The best thing you can do for yourself is SELL ALL YOUR PMs NOW, while there's still time. Really? Is that the best you've got? It's also amusing, because as a tool/tactic of mass manipulation, this is an idea that NONE of us have ever encountered and recognized before. See, psychology works both ways -- desensitization training applies to a fascinatingly wide range of stimuli.

 

Guys, relax. To me this is a clear indication that the short side is running out of room, options and projectiles to throw. Did anyone even NOTICE the other implication of the article, that the EUR/USD seesaw is beginning yet another round trip? No, we were instantly flooded by gold/silver "bears". 

 

 

Fri, 05/20/2011 - 21:44 | 1297276 OuaisBla
OuaisBla's picture

My thoughts are clear on silver. Once 40$ will be hit again, 50$ not an option anymore and maybe 100$. But until then, which will come first ..30$ or 40$?

 

I'm guessing on 30$ first then 26$ base on the fact that QE2 is ending, and the contraction on liquidity that will follow will put pressure on commodity prices. If that statement is true, then that is good for the long net buyer who they will be able to pack more at a more affordable price. Commercials Shorts will have their party as well, thanks to Ben and al.

Today Silver, July contract, close at 35$ exactly. 35$! Monday morning, at the open few penny up or down will set the tone for what's next. IMO.

I have to say that unless I have clear indication otherwise, my bias is for more downside. 

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