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WSJ Reports Soros, Burbank Selling Gold, Silver, While Paulson Sees Gold Hitting $4,000 In Three Years

Tyler Durden's picture


The rumormill around who is buying and selling precious metals is getting more ridiculous than daily Radioshack LBO speculation. The latest comes from the WSJ which informs that based on "people close to the matter" Soros and Burbank are now dumping their gold and silver: "George Soros's big hedge fund, a firm operated by high-profile investor John Burbank and some other leading firms have been selling gold and silver, according to people close to the matter, after furiously accumulating precious metals for much of the past two years." Greg Zuckerman's conclusion, assuming a multi billion hedge fund will actually let its competitors know what it is doing concurrently as it is doing it, is merited: "Their selling suggested the sharp, nine-month run-up for precious metals could be entering more dangerous territory." Of course, something tells us that just like Goldman, whose prop desk has a nagging tendency to buy as its sellside "analysts" say sell, we would rather hold off until we see respective 13Fs on the matter. In the meantime, we fail to see where over the past week the central (pardon the pun) thesis has changed: namely that central banks will not print more linen/cotton when the time comes. And if the market is indeed starting to price in QEasing's end, then the deflationary scare will certainly see the RUT plunge and undo months of carefully executed (by NYU interns) POMO operations. For a Fed which equates the economy with the RUT, this is simply unacceptable.

More from the WSJ:

Yet silver, which has had a huge run, remains up nearly 38% in 2011. It rose 84% last year.

And some prominent investment pros continue to favor precious metals, among them hedge-fund manager John Paulson.

Last week an exchange-traded fund, or ETF, that owns silver bullion—the iShares Silver Trust—was the most active ETF on the U.S. market on some days, a sign of the rabid recent interest in silver.

"We haven't seen this much volatility in decades," said Robin Rodriguez, a metals trader in Charlottesville, Va. "We have such large profits built in," so some investors are taking their winnings, said Mr. Rodriguez, who remains bullish on the metal.

Interest in holding the silver ETF grew so intense it became hard to borrow shares to sell, as bearish traders need to do if they want to sell the metal short and bet on a decline.

All this helped set up the tumble, which started late Sunday, catching many by surprise. As sell orders flooded the market in Asia, brokers sought more collateral from investors who had bought on margin, even as they fielded calls from anxious investors who wanted to sell.

"Everybody wanted to get out," said Richard Digenan, an executive at R.J. O'Brien, a brokerage firm in Chicago.

The other side of the story, that of repeated margin hikes, is well known to ZH readers:

For those who invest in silver via the futures market rather than an ETF, exchanges and brokers have been raising margin requirements, the amount of collateral investors must leave with their broker to back a position.

CME Group, a commodity-exchange operator, has raised margin requirements three times in a week. It announced the latest increase Tuesday.

Many investors in silver futures make heavy use of borrowed money and were faced with either sending more collateral to their brokers or selling some contracts.

But back to the original story:

For nearly two years, Mr. Soros's hedge-fund firm bought gold and silver, becoming the seventh-largest holder of the biggest gold ETF, the SPDR Gold Shares. Some others with stellar records—including Mr. Burbank, of Passport Capital, and Alan Fournier, of Pennant Capital—also have been passionate about precious metals, giving encouragement to individual investors to follow.

Now they are selling, in each case for distinct reasons.

While many who buy gold do so to protect against future inflation, Soros Fund Management bought gold to protect against the possibility of the opposite—debilitating deflation, or a sustained drop in consumer prices.

But now the $28 billion Soros firm, which is run by Keith Anderson, believes chances of deflation are reduced, eliminating the need to hold as much gold, according to people close to the matter.

People familiar with Mr. Anderson's thinking said he believes the Federal Reserve's continuing to pump money into the system has reduced the likelihood of deflation.

The Soros team, meanwhile, isn't especially worried about a surge in inflation. Mr. Anderson has argued that by the end of this year the Fed will signal that interest-rate increases are in the offing, possibly early in 2012, according to someone close to the firm. Higher interest rates would tend to suppress inflation.

The Soros fund has sold much of its gold and silver investments over the past month or so, according to this person.

Mr. Burbank, a longtime gold supporter who predicts growing worries about the creditworthiness of the U.S. and some other nations, has trimmed some of his investments to lock in profits, according to someone close to the firm. This person added that Mr. Burbank remains a long-term gold bull and expects to buy more gold-mining shares after a decline.

Yes, this is the same Soros who bastardized Hayek a week ago, even as he admitted that the current monetary system is on the precipice.

As for the only guy who matters, and whose every move is studied under a microscope, he is not budging. In fact, he see gold at $4,000 in 3 years.

A number of high-profile investors remain huge holders of gold and silver, amid continuing concern about inflation and the dollar. Mr. Paulson, known for his lucrative bet against mortgages a few years ago, told investors he still has most of his personal money in gold-denominated funds operated by Paulson & Co.

Mr. Paulson told investors Tuesday morning that gold prices could go as high as $4,000 an ounce over the next three to five years, as the U.S. and U.K. flood the money supply. Gold settled in New York at $1,540.10 a troy ounce Tuesday.

Also, Wexford, run by Robert Rubin's right hand man from the Goldman arb desk days, and Mike Steinhardt protege, Chuck Davidson, doesn't appear to be going anywhere in a hurry either.

Wexford Capital, a $6.5 billion fund that has been a large buyer of silver over the past year, retains much of its metal positions, according to someone close to the matter.

Either way, a two day 20% correction, and everyone crawls out of the woodwork screaming bloody murder, even as silver has retraced to a price... from two weeks ago.

And once again we ask: will the Chairsatan stop printing? And what happens when the economy tumbles in Q2, as it will once the full hit from the Japanese economic collapse is felt, and Bernanke has no choice but to do in 2011 what he did in 2010? So yes, let silver drop to $30. Let it plunge to $20. The lower the better. Day traders on margin are advised to stay out. Everyone else, who has a personal vendetta with Bernanke however will find each incremental drop an even better opportunity to slam the stake in the heart of a failed monetary regime which is now in its last days.

Everything else is minute charts and irrelevant candles.


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Tue, 05/03/2011 - 23:19 | 1236869 What does it al...
What does it all mean's picture

I thought everyone bought Silver...

Tue, 05/03/2011 - 23:49 | 1236967 flacon
flacon's picture

I thought George Soros just finished his Bretton Woods (III) meeting with the notion that GOLD would play an important part in the New World Order (II) global currency. 

Wed, 05/04/2011 - 02:31 | 1237174 dlmaniac
dlmaniac's picture

Whatever amount Soros wanna sell will fall right into the wide open dragon mouth known as "Beijing Put" rumored to be 3 Trillion Dollars deep.


Seriously it smells like the similar FT disinformation in January about mining companies hedging their products during that correction to throw weak hands off.

Wed, 05/04/2011 - 04:02 | 1237222 Michael
Michael's picture


I just can believe how stupid our government thinks we are.

You can buy a 1080P video camcorder for under $1000.

The government has the best recording equipment money can buy.

Nothing will satisfy me on OBL's death except a 1080P video of the dead body of Osama Bin Laden.

Sony Handycam HDR-CX560V Camcorder - 1080p - 6.65 MP,or.r_gc.r_pw.&biw=1570&bih=671&wrapid=tlif130449598659110&um=1&ie=UTF-8&cid=15326852350998949199&sa=X&ei=fwfBTcSSJuSQ0QHK-cC3Cg&ved=0CFwQ8wIwBA#


Wed, 05/04/2011 - 05:41 | 1237261 BigJim
BigJim's picture

Yup, that is OT.

They can't release the video yet.. they're still scrubbing the bits that show OBL welcoming them in and offering them tea, and saying "But Obama told me you'd be dropping my meds off tomorrow"

Wed, 05/04/2011 - 06:25 | 1237280 Old. No. 7
Old. No. 7's picture

Not really off topic. It's all one giant bullshit factory. They need a bullshit ETF.

Wed, 05/04/2011 - 09:14 | 1237631 oddjob
oddjob's picture

Its called XLF.

Wed, 05/04/2011 - 10:42 | 1238019 sun tzu
sun tzu's picture

This whole scam is like a bad comedy. Now the story is that they killed him, flew his body to Afghanistan by chopper, then flew his body by chopper to the aircraft carrier. Somehow they were able to get a DNA sample to Washington DC within the same day from half way around the world and have it tested and confirmed. A flight from Afghanistan is 15 hours.

Then of course they had to follow Muslim tradition by giving him a burial within 24 hours, so they dumped his body in the ocean. Now all the Muslim scholars are saying it is against Muslim tradition to dump a body in the ocean unless the person died at sea. So they change their story to say that they didn't want to give him a proper burial because the site might become a shrine for terrorists. So they have to give him a proper Muslim burial to avoid offending Muslims, but they offended Muslims by dumping him in the ocean?They could have easily put him in an unmarked grave in the Afghan desert. 

To top it off, we are told that 4 choppers full of SEALs landed near the compound. A police station is down the street. An Pakistani military academy is nearby. No one responds to the vicous firefight happening nearby. Then we're told that the Pakistanis were not informed of the raid. The US government is now demanding that Pakistan explain why OBL was allowed to go undetected for 6 year in the compound. 

This ignores all the other inconsistencies in the OBL myth. He was supposedly deathly ill will kidney failure back in 1998. There were newspaper stories from the late 90's and soon after 9-11 about how he needed regular hospital visits for dialysis. 

Wed, 05/04/2011 - 04:55 | 1237241 LudwigVon
LudwigVon's picture

disinformation ... Seriously it smells ... throw weak hands off.


something tells us ... tendency to buy as its sellside say sell ... we would rather hold off 


Tue, 05/03/2011 - 23:52 | 1236978 JPDG
JPDG's picture

Is Soros selling physical?  

Hell, I'll buy as much as I can at these prices!  I'll even give him $1.50 over spot!

Wed, 05/04/2011 - 00:41 | 1237053 Spitzer
Spitzer's picture

He never purchased any physical. He is selling paper silver. This is bullish for real silver because he is probably dumping paper, which drives the price of phsical down so that he can get physical at lower prices.

One of these days, the SLV will be crashing while premiums on physical go insane.

Wed, 05/04/2011 - 01:05 | 1237098 RichyRoo
RichyRoo's picture

Is it possible that insiders know COMEX is about to default, and so are getting rid of soon to be worthless paper silver? Is anyone aware of anyone selling large amounts of actual metal?

Wed, 05/04/2011 - 01:19 | 1237108 tmosley
tmosley's picture

Good hypothesis.

This is what I am thinking now as well.  The paper pushers are changing the rules as fast as their little pens can cross paper, so everyone is abandoning the paper ship and pouring into physical.

As such, spot price is unlikely to recover.  Rather, the recovery will come in the form of constantly increasing premiums on real, physical silver, or the metal will simply disappear.

Wed, 05/04/2011 - 01:48 | 1237145 strannick
strannick's picture

Whats the most unreliable?

A) Soros


C) US$

D) Gold/Silver

Wed, 05/04/2011 - 02:30 | 1237175 cossack55
cossack55's picture

May we choose more than one?

Wed, 05/04/2011 - 07:26 | 1237317 Harlequin001
Harlequin001's picture

Has anything changed that might cause gold and silver to sell off?

I think not...

Wed, 05/04/2011 - 07:39 | 1237347 falak pema
falak pema's picture

we are in mini-deflation fed roller coaster as QE end is now being priced into assets/commodity future price trends. The MENA uncertainty factor also now heading down as OBL's demise and q-daffy problem are now pointing to stabilising summer heat there...apart from Syria and Iran...So the roller will move...

Wed, 05/04/2011 - 06:13 | 1237265 mogul rider
mogul rider's picture

richyroo my friend you win the crackerjack prize for the best comment this week. The weiners yap about silver up etc.

But why is it going up or going down?

It can't go up to the big numbers till the big boys say so. This rise was chump change. To the little guy it's mesmerizing, to the big boys it's a rounding error.

The parabolic caught them offguard so now they are simply re-adjusting and flipping over. After draining AAPL and NTFLX for eveyr last nickel they will scare you out of your positons. 


Very close to your idea with an added twist or two.

You folks really didn't think you'd get all the cash did you. Think like  banker my dad used to say. Now you know why

Well done.


Note that the hedgies were wiped out in 2008 selling into the fall to get liquidity for the margin calls. We are almost there again. The margin calls will be in play again.

Just watch over the next few months as the banksters bring hte house down again.

IMHO of course

Wed, 05/04/2011 - 09:40 | 1237724 Citxmech
Citxmech's picture

Already happening - Maples at my normal dealer are still $49ea. for some reason - hmmmm....

Time to visit the local shops and btfd.

Wed, 05/04/2011 - 05:34 | 1237260 GetZeeGold
GetZeeGold's picture


Gold is the ultimate bubble said spooky dude.....right before he bought it.


If George is selling....I'm buying.


We're not in the first grade anymore George. Your Jedi mind tricks won't even fool a Cub Scout.





Wed, 05/04/2011 - 09:49 | 1237761 TruthInSunshine
TruthInSunshine's picture

Everyone assumes the U.S. is printing fiat like mad via the Federal Reserve borrowing 'lending' programs known as QE1 & QE2, and in at least one metric, they are correct: Bernanke buys treasury bonds in the secondary market from primary dealers, as Bernanke is forbidden from buying them directly from the Treasury by law.

This is essentially a loan of money to the U.S. Treasury from the Federal Reserve, which Congress delegated (essentially) its money printing/coinage function to.

However, not everyone equates this with 'money printing,' as much of what the Fed is buying is longer duration maturity treasuries, which are going to be more than a little difficult to sell with interest rates on most treasuries having risen since the bulk of this buying was done by Bernanke.

Regardless, I will leave that debate for another day (I have opined that ZIRP is far more responsible for soaring commodity prices and inflationary expectations in the future than QE ever was, and that ZIRP is the elephant in the room that no one seems to acknowledge).

But why did Paulson state (paraphrasing the Wall Street Criminal-Journal) that the UK is flooding their system with currency? That's basically and essentially the opposite of my understanding, and the reason why Paul Krugman, economist/Keynesian/Sock Puppet extraordinaire has been mocking the U.K.'s "austerity measures."

Something in this article is so out of place that is damns the credibility of the reporter, if not the WSJ (foregone conclusion when you have Federal Reserve moles and weasels like Hilsenrath on Fed Payola).

Wed, 05/04/2011 - 10:22 | 1237919 Math Man
Math Man's picture

The Sept 130 puts on GLD are REALLY cheap.


20 implied vol.


Wed, 05/04/2011 - 05:58 | 1237266 Twindrives
Twindrives's picture

Soros, like Buffett and Munger, can shit and fall back into it.   Just die already you greedy old dinosaurs.   The world will do fine without your  hypocrisy and egos.  

Tue, 05/03/2011 - 23:18 | 1236872 DK Delta
DK Delta's picture

Soros is notorious for talking his book. I wouldn't trust any of these rumors either way.

Tue, 05/03/2011 - 23:47 | 1236961 Id fight Gandhi
Id fight Gandhi's picture

Never trust him. Trade the opposite,

Wed, 05/04/2011 - 00:43 | 1237059 Phillips Capital
Phillips Capital's picture

exactly. negative psychology (or whatever the term is.)


he already sold and sees no need to sell more at this low of a price. buying time. 

Wed, 05/04/2011 - 01:44 | 1237144 CrazyCooter
CrazyCooter's picture

You mean, like this ... ?



Tue, 05/03/2011 - 23:18 | 1236873 CitizenPete
CitizenPete's picture

Something very very big is going down.

Tue, 05/03/2011 - 23:32 | 1236915 DoChenRollingBearing
DoChenRollingBearing's picture

I feel the same way...

I sure am glad I am up to 12% of my assets in PMs, mostly gold.  And I am not selling.  I will quietly give it away to my kid (or grandkids in the future?).

Something wicked this way comes.


Res pubblica mortuus est.  Vivat imperium.

Wed, 05/04/2011 - 00:20 | 1237014 topcallingtroll
topcallingtroll's picture

It is an easy way to avoid probate and creditors.

Wed, 05/04/2011 - 00:44 | 1237062 DoChenRollingBearing
DoChenRollingBearing's picture

top, thank God I have no creditors...

Credit is dangerous...

You should know that YOU are one of my favorite ZH friends here...

Wed, 05/04/2011 - 03:23 | 1237206 The Navigator
The Navigator's picture

"Credit is dangerous"

Agreed - unless one could time it to buy physical on credit, have hyper-inflation go to 2,000%, and then pay the banksters back with Zimbabwe dollars after some months use of their monopoly money. Thus real estate seems appealing at this time.

Problem is timing, which I never seem to get the timing right. But with silver, I got lucky - started in 2007 and still buying every other week.

With Soros, I don't believe a word he says - Jim Rogers, Marc Faber, I listen to.

Wed, 05/04/2011 - 04:28 | 1237229 Popo
Popo's picture

Credit is dangerous?   You don't sound much like an inflationist.

Wed, 05/04/2011 - 07:45 | 1237353 falak pema
falak pema's picture

If credit is dangerous then the USA will name White house address as ...downing street!

And appoint Ben as head lawns-man!

Wed, 05/04/2011 - 06:46 | 1237292 rufusbird
rufusbird's picture

Soros tells you to listen to him. Jim and Marc asks you to listen to what they are saying.

Wed, 05/04/2011 - 03:13 | 1237203 Transformer
Transformer's picture

I too, feel the cold wind of an approaching evil.  Something is about to happen.  Everything is on the verge.  Bonds, the dollar, MENA, Piigs, you name it.  In the past, when a big event is coming that will cause some markets to explode, prices seem to run down ahead of time, I guess to get the weak hands out.

Wed, 05/04/2011 - 04:29 | 1237232 Popo
Popo's picture

IMHO, the market is about to shit the bed.   Gold and silver too.    The powers that be can't afford to see bucky get hammered any lower and they need to scare some money back into it.

Watch for liquidity to vanish overnight, and then bucky will get wood.   It's an old game.

Wed, 05/04/2011 - 10:44 | 1238051 sun tzu
sun tzu's picture

Liquidity vanishes and everything crashes. Can TPTB afford that? The problem with releasing a tidal waves is that you can't control where the water goes

Tue, 05/03/2011 - 23:49 | 1236919 JW n FL
JW n FL's picture

No matter what the shake down is.. being physical and mobile, able to get the fuck outa dodge.. is FUCING PRICELESS!!


Who said you cant take it with you?


back to your point, sorry! having real tangibles.. gold / silver will always spend no matter what fast one they try to pull on "We the People" this time around! I am expecting a doosie! of a show!

Wed, 05/04/2011 - 00:10 | 1236995 JW n FL
JW n FL's picture FBI Don’t Need No Stinking Warrants! Personal / Civil Rights are a thing of the past!


"Unfortunately, the PATRIOT Act did Not! Include Checks to PROTECT! Americans” Senator R. Durbin (IL)  

U.S. Army Pys Ops Verse U.S. Congressmen & Senators Senator Al Franken asks Apple why the IPhone Tracks its Users EVERY MOVE! Even while the Phone is OFF!


Senate trying to hide Campaign Contribution Monies from Government (Military) Contractors with the Argument “Free Speech” LMFAO!!


Home Land Security & the F.B.I. are concentrating on PlayStation Hackers! Wonder why? Lobby $'s!!



********************************************************************************* Miami Metro Dade Police Predator Drone on Patrol & coming to a City near YOU! NEXT! (YouTube Video) Why does the military train to rescue bankers?

Wed, 05/04/2011 - 07:47 | 1237359 falak pema
falak pema's picture

JW everything you say is valid provided : you can hold on to physical for 4-5 years all through the paradigm change shit storm coming with USD demise as SOLE reserve currency. This will be awesome as the US Oligarchy will fight tooth and nail to maintain a lion's share of the net worth in the new currency mix, which will be a real bummer to negotiate with King Yuan!

Wed, 05/04/2011 - 00:33 | 1237042 legal eagle
legal eagle's picture

Yes, it is called our Centralized Planned Economy.

Tue, 05/03/2011 - 23:18 | 1236875 sterman7
sterman7's picture

Here Here.  Just took delivery of some Tears of the moon.  Sooo pretty!

Tue, 05/03/2011 - 23:18 | 1236876 AmazingLarry
AmazingLarry's picture

I'm long fine Italian suits. It's the only thing real anymore. 

Wed, 05/04/2011 - 00:08 | 1236993 e_goldstein
e_goldstein's picture

Beware of moths.

Wed, 05/04/2011 - 04:31 | 1237234 Popo
Popo's picture

..and in 10 years you'll have a fascinating collection of funny, retro-looking costumes.

Wed, 05/04/2011 - 06:34 | 1237285 Moe Howard
Moe Howard's picture

I'm long Members Only jackets. Do you have any idea how many colors were produced?

Wed, 05/04/2011 - 06:56 | 1237299 Big Corked Boots
Big Corked Boots's picture

At least they looked good. I'm long J. Peterman dusters. Cowboy up.

Wed, 05/04/2011 - 08:11 | 1237404 tarsubil
tarsubil's picture

Thanks, now I have coffee all over myself. I'm going to reak like coffee all day.

Wed, 05/04/2011 - 09:57 | 1237781 TruthInSunshine
TruthInSunshine's picture
by Moe Howard
on Wed, 05/04/2011 - 06:34

I'm long Members Only jackets. Do you have any idea how many colors were produced?

by Big Corked Boots
on Wed, 05/04/2011 - 06:56


At least they looked good. I'm long J. Peterman dusters. Cowboy up.




Wed, 05/04/2011 - 07:51 | 1237363 falak pema
falak pema's picture

Mozzarella and italian charcuterie too

Tue, 05/03/2011 - 23:20 | 1236882 CPL
CPL's picture

Let them sell their PAPER assets.  ZH readers probably have more physical gold and silver than the worlds richest men.  Doesn't matter, unless they are Methuselah, they won't be around much longer.  Funny thing about old men and games, they forget they drop dead eventually and their is no uhaul behind that hearse.


Or maybe it's a grave play.  Go liquid to divy their estates.  Again, they are old, hard assets are difficult to cut up

Tue, 05/03/2011 - 23:26 | 1236895 Freddie
Freddie's picture


Paulson said he was hedged in a lot of his portfolio with gold using physicla and some synthetic instrument based on gold???   There is an article out there.  I forget where I saw it.  Soros always lies and is a POS.

Tue, 05/03/2011 - 23:28 | 1236909 CPL
CPL's picture

Alternatively, the two richest men are looking to get physical assets like land.  Greeks and Brits on boats with castles can't live in a world where there is no food.

Tue, 05/03/2011 - 23:36 | 1236930 DoChenRollingBearing
DoChenRollingBearing's picture

I read somewhere that the eastern Chaco of Paraguay has the cheapest useable (farming, ranching) biomass of any land in the world.  There was a rumor, what, 2 - 3 years ago that "W" had bought a ranch down there...

Wed, 05/04/2011 - 01:24 | 1237115 seek
seek's picture

I'd heard the same rumor with the detail that it was 100,000 acres. It didn't hurt the rumor's credibility that Paraguay didn't have an extradition treaty with the U.S. at that time (2006.) I'm sure that may have been a factor.

The ruling party that backed the no-extradition rule lost the elections in 2008, if I recall correctly. Maybe they ranch is for sale (cheap!) now...

Wed, 05/04/2011 - 02:29 | 1237173 Cathartes Aura
Cathartes Aura's picture

Although official sources have not confirmed the information that is already public, the land is reportedly located in Paso de Patria, near Bolivian gas reserves and the Guarani indigenous water region, within the Triple Border.

just the usual uber-rich sociopath resource grab for whenever the "need" arises. . .

Wed, 05/04/2011 - 08:15 | 1237425 tarsubil
tarsubil's picture

For those wondering. 100,000 acres roughly equals 160 miles squared or a 40 mile by 40 mile box. Most major metro areas would fit into that.

Wed, 05/04/2011 - 08:33 | 1237495 falak pema
falak pema's picture

40x40 is 1600 sq miles. For 160 sq miles its app. 12.7 x 12.7 miles.

Wed, 05/04/2011 - 09:33 | 1237714 tarsubil
tarsubil's picture

Yeap. I always screw up the decimal points.

Wed, 05/04/2011 - 10:50 | 1238108 Milestones
Milestones's picture

It takes 640 Acres to make a section of land (sq. mile) Do the math based on that.    Milestones

Wed, 05/04/2011 - 06:54 | 1237297 mogul rider
mogul rider's picture

So true

The rich combine gold an silver with land.

Land is essential in any portfolio. No - not the pimp my house 90210 kind.

As you say farmland and I would add Timber. We have lots. It is an effective depression hedge actually. Although, it's not good in Hyperinflation though cause our firewood sales drop cause people are burning stacks of paper USD

Tue, 05/03/2011 - 23:23 | 1236884 JW n FL
JW n FL's picture

****** "Mr. Paulson told investors Tuesday morning that gold prices could go as high as $4,000 an ounce over the next three to five years, as the U.S. and U.K. flood the money supply. Gold settled in New York at $1,540.10 a troy ounce Tuesday." *****




Base money has tripled in 3 years.

2. M1 has continued to increase to its highest level in history.

3. Same goes for M2

note: all credit for the facts above is to another poster here of the facts, I stole them from him / her! kudos and thanks for the easy cut and paste!

Wed, 05/04/2011 - 02:41 | 1237181 jomama
jomama's picture

i think that was me, and i lifted it from this article:

 whereaminow 's comment was insightful to say the least.

Wed, 05/04/2011 - 08:22 | 1237451 Miss Expectations
Miss Expectations's picture


Just want to say that I appreciate your putting it out there.


Tue, 05/03/2011 - 23:21 | 1236886 DeadFred
DeadFred's picture

Took a gamble on TNA yesterday.  Osama plus big POMOs seemed favorable.  Thank God for stops.

Tue, 05/03/2011 - 23:24 | 1236887 I am Jobe
I am Jobe's picture

I am long on caskets and Undertakers. Recession proof and corpses don't need IPADS or Portfolios.

Tue, 05/03/2011 - 23:40 | 1236938 Freddie
Freddie's picture

The dead need Travelzoo, Chipolte, Amazon and Priceline.


"Hey Mel - here is your first class ticket to the resurrection."

Antonio Montana 

Tue, 05/03/2011 - 23:27 | 1236897 Yen Cross
Yen Cross's picture

RICH. Excuse me, (arrrblaww). Some bad ex-fed pres. (shellfish)

Tue, 05/03/2011 - 23:30 | 1236907 firstdivision
firstdivision's picture

Paulson is new to the game, and will get burned.

Wed, 05/04/2011 - 09:13 | 1237624 Papasmurf
Papasmurf's picture

Exactly.  His success last time was based on fraud.

Tue, 05/03/2011 - 23:30 | 1236908 Kina
Kina's picture

ASX Perth Mint Gold looking tempting at $1,414 AUD - might wait to tomorrow to load up some more along with silver.




Tue, 05/03/2011 - 23:44 | 1236955 Yen Cross
Yen Cross's picture

Your thoughts on that RBA hold last night/day Kina? That NZ building number was a reminder! I'll give an opinion if you ask. Thank you.

Wed, 05/04/2011 - 00:24 | 1237025 Kina
Kina's picture

Housing prices recetnly reported as softening - however CPI food 2.9% education 5.7% Transport 2.7% health 3.9% and 1.6% overall for the March Quarter

And March YoY 3.3%

How much has the strong AUD helped them here?

Also things to ponder is how much have the floods added to food costs. I think the RBA would have liked have to raised rates and if high dollar does soften we will get increased energy costs and imports. I think the RBA takes its role of containing inflation pretty seriously so I can see them raising them at maybe the next opportunity.

Also if the housing market is softening raising rates will I think actually have a noticeable impact on housing also.


Wed, 05/04/2011 - 00:58 | 1237089 Yen Cross
Yen Cross's picture

Thank you. So the strong aussie and low unemployment is not really helping people?

The banks are ass raping home owners, and clothing and, food costs are being passed on?

The housing market is in the tank and home owners are scared of rate rises? Raising rates on a 45 billion dollar deficite (what a joke, is sooooooooooooo bad!!!!!!!) Tourism is dead, and export costs are rising!

Wed, 05/04/2011 - 01:35 | 1237111 Kina
Kina's picture

Yes good for inflation bad for business. The RBA's remit is the inflation outlook and it has been fairly dogmatic in the past. I recall them raising rates one or two times during an election year and campaign in 2007 that was damaging to the then Govt when in previous occassions they may have waited.


One major newspaper ran a front page with a very large picture of Glen Stevens RBA govenor with the large caption 'Does this man care' - with respect to housing. Pretty nasty stuff - but they remained unphased.


Wonder what inflation would have been with a softer dollar and lower rates. And very low unemployment is a concern for the inflation outlook as well.


The old dilema is in raising rates that people will be hurt and helped - but at what rate do you jump on the inflation genie if it appears. There is never a time when it wont hurt somebody. Better I guess while things are not too bad and with full employment. There decision.

Wed, 05/04/2011 - 01:51 | 1237143 Yen Cross
Yen Cross's picture

You kick ARSE! I have been to NSW, QLD 6 times in the last 4 months. Just stay quiet.


  Rates need to stay where they are. Your housing market is sooo depressed. Your textile ecomomy is great for feeding. You need to diversify.

Wed, 05/04/2011 - 00:38 | 1237048 Keri at Bankste...
Keri at Bankster Report's picture

Yeah, and gold on the year in AUD is nearly flat.

Wed, 05/04/2011 - 01:02 | 1237092 Kina
Kina's picture

A bit disspointed it didn't correct the way silver has. Missed a better opportunity earlier in April. Has been flat due to an elevated dollar. But see how it goes the next few days. Have some spare cash just come due from another investment - placing into PMs gets my % in PMs up closer to where I want it.

Wed, 05/04/2011 - 02:15 | 1237164 Yen Cross
Yen Cross's picture

Thank you for your thoughts. You will laugh.   

It's winter, and QueensLanders (R) Bored!

Tue, 05/03/2011 - 23:31 | 1236911 wawawa
wawawa's picture

Short SLV till $35.

Tue, 05/03/2011 - 23:54 | 1236984 Lost Marbles
Lost Marbles's picture

It IS looking heavy, but think we bottomed after hrs today.

Tue, 05/03/2011 - 23:31 | 1236912 slow_roast
slow_roast's picture

And the award for the most idiotic reasoning of why someone would be selling their gold and silver goes to.....


People familiar with Mr. Anderson's thinking said he believes the Federal Reserve's continuing to pump money into the system has reduced the likelihood of deflation.



Wed, 05/04/2011 - 00:43 | 1237070 Global Hunter
Global Hunter's picture

Well I'm glad I'm not the only one wondering about that.  I noticed in the next sentence it says he's not worried about inflation either. Guy is talking crap

Wed, 05/04/2011 - 01:42 | 1237135 Urban Redneck
Urban Redneck's picture

It is not that crazy a thesis- given the historical relative performance of gold in a highly deflationary vs highly inflationary environment, ceteris paribus.  However, hyperinflation is not simply high inflation, and the possibility of inflation due to rising aggregate wages and purchasing power isn't even on the horizon at this point, the existing inflation is due to monetary debasement, a somewhat different beast.

Regardless, there is a difference between advancing a thesis and realizing a profit- and no one managing money is going to advance a thesis which diminishes the profit they are seeking to realize. 

Wed, 05/04/2011 - 01:59 | 1237150 Global Hunter
Global Hunter's picture

Urban Redneck, agree with your last point.  As for deflation I have always looked at it as my dollar bill will give me more purchasing power next year so why not hold cash or better yet bonds and earn income on my note and get even more "stuff" in the future.  Why bother with gold in that scenario?

If I take it a step further and all assets are decreasing in value (houses, stocks, bonds etc.) gold might hold its value. Either I just had to take my thinking a step further or I'm still not getting it, either way everything that is going on is causing me to think.  My senses are on full alert.

Wed, 05/04/2011 - 03:59 | 1237220 Urban Redneck
Urban Redneck's picture

I don't have a good article handy, but there were a number that came out a couple years ago around the last significant correction and the ramping up of the inflation vs. deflation debate.  They looked at the relative performance of PMs vs PM miners, against periods of anticipated inflation vs anticipated deflation, and then against actual inflation vs actual deflation.  In a deflationary environment cash rises, but investors seek to boost alpha over the baseline cash return and there was cyclical timing correlation that actually implied better physical gold price performance in a deflationary than an inflationary environment (whether the anticipated or actual escapes me at the moment).

Wed, 05/04/2011 - 09:22 | 1237669 Papasmurf
Papasmurf's picture

You also get increasing prices when productivity is lower.  Continued high unemployment meand continued lower productivity.

Tue, 05/03/2011 - 23:31 | 1236917 DoChenRollingBearing
DoChenRollingBearing's picture

I'll take FOFOA over Soros et al.

Wed, 05/04/2011 - 02:03 | 1237151 Reven
Reven's picture


Tue, 05/03/2011 - 23:35 | 1236935 slvrizgold
slvrizgold's picture

That little Nazi NWO prick's best talent is deception.  His best use would be as a lampshade or candle. 

Tue, 05/03/2011 - 23:37 | 1236944 AgShaman
AgShaman's picture i'm gonna believe that Soros would be dumping his precious halfway into this bull market. The Social Planners and NWO engineers can't trust him to keep his yapper shut either. i don't think any of these crusty old cretinous creatures will be divesting themselves of the precious....with fiat black swan implosions looming around every corner.

Wed, 05/04/2011 - 09:59 | 1237801 TruthInSunshine
TruthInSunshine's picture

As ZH succinctly states, Paulson, Soros & other BSDs always let markets know what they're doing in real time, and even let reporters in on their trades in real time, and even before they make them.




Tue, 05/03/2011 - 23:45 | 1236957 FischerBlack
FischerBlack's picture

The dollar is going to rally very soon. It'll be curtains for high beta PMs and the smallcaps. Summer swoon soon to come. And maybe a May liquidity event? Hmmm. I remember that happening not too long ago.

Wed, 05/04/2011 - 01:42 | 1237136 strannick
strannick's picture

The turd on the bottom of my shoe will rally first.

Wed, 05/04/2011 - 02:29 | 1237170 jomama
jomama's picture

are jobs being created domestically en masse? is there a new AAPL or GOOG we don't know about? did we hit the motherlode of new oil fields?

wtf are you talking about...?  please enlighten us.

Wed, 05/04/2011 - 06:51 | 1237296 SilverDOG
SilverDOG's picture

A Fear generated run to the dollar is possible.

Suggestive parameters are being displayed for psychological effect.

The street will be far different.

Holding PM's and transaction fee collectors will be the gain receivers.



Wed, 05/04/2011 - 08:31 | 1237489 linrom
linrom's picture

LOL. The more (junks) you get, the more right you are.

Wed, 05/04/2011 - 09:32 | 1237698 Papasmurf
Papasmurf's picture

I junked you to prove you're right.

Tue, 05/03/2011 - 23:46 | 1236958 monopoly
monopoly's picture

I will be buying on every dip. You think I am going to hold dollars as they continue to lose value each and every month. Not for me. We are all on the same page here. Next.

Wed, 05/04/2011 - 00:56 | 1237085 Keri at Bankste...
Keri at Bankster Report's picture

That's the thing: so you sell PM's, and buy what? Dollars? I was talking to a JM Chase broker just this afternoon. I asked him if he was getting any concerned groans from clients. He said, "No, not really." He focused on 70/30 equities/fixed income. We talked for quite a while; he noted that commodities were "straight up" and that they couldn't sustain the moves. Then he showed me a chart from 2009 of the DOW, and apparently thought that those moves were a-okay. I asked him what he was doing for his clients who are concerned and want to hedge against the dollar. What did he say?


Of course.


Tue, 05/03/2011 - 23:48 | 1236964 cxl9
cxl9's picture

Soros Fund Management bought gold to protect against the possibility of the opposite—debilitating deflation, or a sustained drop in consumer prices.

Um. Does this statement make any sense?



Wed, 05/04/2011 - 00:25 | 1237024 A_MacLaren
A_MacLaren's picture

It does if you've studied John Exter's Inverted Pyramid:

(Someone with graphics privileges please re-post the graphic, thanks)

Wed, 05/04/2011 - 05:55 | 1237267 BigJim
BigJim's picture

I don't think you've got that right.

Exter's pyramid (in this context) predicts relative value in a collapsing currency situation (ie, hyperinflation)... the higher layers lose value relative to the lower layers.

FOFOA had a nice posting mentioning this:

Tue, 05/03/2011 - 23:53 | 1236980 Ben Fleeced
Ben Fleeced's picture

we're fighting with the eyes of the blind.

taking it hard

Taking it hard.

we feel we are paper

choking on you nightly.

Tue, 05/03/2011 - 23:53 | 1236981 False Capital
False Capital's picture

Either Soros has offered up some more physical to keep the ponzi going for a while longer or he is lying. Either way it wont change the outcome.

Tue, 05/03/2011 - 23:53 | 1236982 sasebo
sasebo's picture

Better think twice before you swap your phys. silver for paper dollars. The DXY ain't going nowhere but down ----------------

Saying "Who wants that crap?" What you gonna buy from the TBTF's to retain purchasing power? Stocks? Houses? CDO's?


Wed, 05/04/2011 - 00:12 | 1237000 fellatio is not...
fellatio is not fattening's picture

Its pretty moronic reading here how "I will sell my physical"  OK  Spot is ~ $42, to sell take off 10% = $37.80 than take another 10% fee that a store or smelter takes and you have $33.02 best case, if you want to sell at $33.02 fine but you NOT getting $42 or even $38, and a coin store takes ~ another 5-10% get you a NET of ~$30, so don't sound so stupid

Wed, 05/04/2011 - 00:14 | 1237003 topcallingtroll
topcallingtroll's picture

Sell to aka california numismatic investments.

Thats where i sold my last box. You get pretty good prices on all sorts of bullion products. They pay well over spot for most items.

Wed, 05/04/2011 - 00:21 | 1237016 Creed
Creed's picture

Its pretty moronic...




this is the only part of your statement that was correct


call Apmex or Tulving, get spot or a little less, little more for premium coins, ship it off and get a check



Wed, 05/04/2011 - 06:43 | 1237288 donpaulo
donpaulo's picture

I sell mine over at

www spotmex com

Wed, 05/04/2011 - 07:24 | 1237316 fellatio is not...
fellatio is not fattening's picture

I appreciate the info, I was not aware they paid spot, I stand corrected

Wed, 05/04/2011 - 10:16 | 1237885 DosZap
DosZap's picture

With an "F" BBB rating, I will steer clear of the Big "T".

Companies also that do not issue, confirmation numbers, and provide immediate sales/purchase/paperwork, I do not trust.

Big "A" may may have shit prems, bit at least you know you stand a real great chance of getting your shite.

Wed, 05/04/2011 - 00:17 | 1237006 AgShaman
AgShaman's picture

Getting "Out" of physical at this stage of the game is folly...and trusting the witch with a tinderbox. If one looks to get "cute" with their stacks to build wealth...they should be trading the GSR ratio or jumping into depressed miners that are already producing without burdensome hedges....then cashing in on leverage and getting back your physical. Unless the Gubmint taxman or bank is looking to confiscate your domicile and property....or you're using the fiats to beat back a serious health'll be most likely missing out on the more exciting chapter of the PM bull market.

Wed, 05/04/2011 - 07:52 | 1237364 Moe Howard
Moe Howard's picture

Exactly. Huge demand chasing limited supply. If you have physical hold on tight.

Personally, I am not selling at any price right now. I have no debts of any kind, bills I have FRNs for.

I would like to buy a dip but the premiums and delayed delivery are stopping me.


Wed, 05/04/2011 - 10:08 | 1237846 goldfish1
goldfish1's picture

Getting "Out" of physical at this stage of the game is folly

That's my take as well.

Wed, 05/04/2011 - 00:22 | 1237022 traderjoe
traderjoe's picture

"Everything else is minute charts and irrelevant candles."


Wed, 05/04/2011 - 00:31 | 1237034 Ricky Roma
Ricky Roma's picture

Ha Ha, that's hilarious! Candlesticks haven't worked forever!

Wed, 05/04/2011 - 09:33 | 1237717 Papasmurf
Papasmurf's picture

Candlesticks are great.  You can look at the chart and create an explanation for what happend last month.  "See that spinning top and death star? 

Wed, 05/04/2011 - 00:35 | 1237040 strannick
strannick's picture

Maybe Soros sold GLD cause it was becoming unravelled as the bankster-created gold-demand sucking vampire it is.

Wed, 05/04/2011 - 00:38 | 1237047 Phillips Capital
Phillips Capital's picture

"Soros and Burbank are now dumping their gold and silver" should definitely be read as "Soros and Burbank have dumped their gold and silver". Please people. Big money never talks until they want you to play into their hand. They already sold. They'd never shoot themselves in the foot by releasing stuff like this if they are IN THE PROCESS of selling. Just like when [i forget what news network] released that Soros "Owned Petrobras". that was around a month ago or so. Then miraculously, PBR just straight up tumbled like a little bitch for a week or two. He wanted you to buy his PBR from him. Genius. Bla bla. 


Also, it's a new moon. time to buy silver. */sarcastic reference to lunar cycles, but not really. 


Wed, 05/04/2011 - 01:42 | 1237134 bid the soldier...
bid the soldiers shoot's picture

Didn't you leave out the fact that they opened a large short position somewhere before they started selling their holdings?

Wed, 05/04/2011 - 07:07 | 1237305 rufusbird
rufusbird's picture

I guess we could call that a "Goldman Hedge"...

Wed, 05/04/2011 - 00:37 | 1237049 Augustus
Augustus's picture

Everyone else, who has a personal vendetta with Bernanke however will find each incremental drop an even better opportunity to slam the stake in the heart of a failed monetary regime which is now in its last days.

The only problem is that the hammer they are using is getting quite a bit lighter.  The headache will be gone with the funds.

Wed, 05/04/2011 - 00:41 | 1237054 ebworthen
ebworthen's picture


In other news:

"Warren Buffet buying Lubrisol and telling Obama to go after 'speculators' on Wall Street".


Wed, 05/04/2011 - 00:39 | 1237055 RobotTrader
RobotTrader's picture

Doesn't surprise me to see the big money leaving GLD and SLV.  Huge selling volume substantiates this selling.  They will probably use the money to pile into bank stocks, which have been very strong the last few days.

JPM in particular, is very strong.  Large institutions have been supporting that stock, none of this "cut and run" attitude you see in the PM sector.

Wed, 05/04/2011 - 10:19 | 1237898 goldfish1
goldfish1's picture


Why It's Time to Sell Silver Stocks and Buy Bank of America

"Disclosure: I am long BAC." (Imagine that.)

Wed, 05/04/2011 - 00:40 | 1237058 Kina
Kina's picture

Tend to agree no way will you hear Soros is selling until after he has or, he wants to buy.

Wed, 05/04/2011 - 00:50 | 1237080 AldoHux_IV
AldoHux_IV's picture

Soros is part of the system and profits both ways-- he wants the system to continue. Thus, if you disagree with him fundamentally about the monetary system then his insight is as meaningful as nipple hair is to Bernanke having a full head of hair.

The success or failure of the current monetary system is dependent upon a majority realizing whether or not it works i.e. if the masses wake up to the genocide and fraud that's currently taking place. So in addition to accumulating gold/silver as protection (along with all the other goodies that are needed for survival) it would be just as important to spread the knowledge to other people who are still 'stuck in the matrix' and actually listen to these asshole policymakers and their MSM minions.

We need to take more than just profits or physical delivery of precious metals, we need to take our economy and livelihood back from the centrally planned authoritarian regime that is so hell bent on dividing and robbing the rest of the world of the most basic rights and needs.

Wed, 05/04/2011 - 10:54 | 1238113 goldfish1
goldfish1's picture

we need to take our economy and livelihood back from the centrally planned authoritarian regime that is so hell bent on dividing and robbing the rest of the world of the most basic rights and needs.

Well, we have a little catching up to do.
Senate Sneaks RFID Drivers License, Internet ID into Transportation Bill (FLA)

Soon they'll know exactly who is buying and selling physical.

Wed, 05/04/2011 - 00:53 | 1237084 tony bonn
tony bonn's picture

what a gift....keep selling george

Wed, 05/04/2011 - 01:05 | 1237093 longorshort
longorshort's picture

Two trailer park silver bulls go round the outside round the outside.  With the two comex brinks trucks parked on the outside.    You too can have your own trailer if you keep playing with big bubbles in little markets.  If you compare how much Fiat has gone down % over the same period % silver went up its still a big bubble.  Also if you count the total value of silver at market highs compared to fiat.  Silver is a very small market.  Also with the poor rules in commodities, this leaves lots of room to burn all the silver bugs before they know what hit them.  Best of luck.

Wed, 05/04/2011 - 01:10 | 1237103 AgShaman
AgShaman's picture

Huh?  The Real Silver Shady has spoken I guess

Wed, 05/04/2011 - 02:06 | 1237157 Global Hunter
Global Hunter's picture

I might not know whether silver is trading at 35 or 45 at the end of the week but I can guarantee you it will have some value to my children, their children and to their children.  I cannot guarantee you that the USD or the S&P will have any value in 100 years.   

Wed, 05/04/2011 - 10:59 | 1238143 goldfish1
goldfish1's picture

No doubt tbtb can play havoc with the markets. Still, I like physical's chances.

Wed, 05/04/2011 - 01:15 | 1237107 Ham Wallet
Ham Wallet's picture

Remember when Gold went from low 1400's to low 1300's? 

Lol, don't retreat...reload.

Wed, 05/04/2011 - 01:20 | 1237112 blindman
blindman's picture

obviously not advice from the blind.....
buy the fucking dip!
hold physical. period. rest.
when you awaken. btfd.
rest. rinse and repeat.
let them drive themselves absolutely,
without precedent or context, crazy.

Wed, 05/04/2011 - 01:21 | 1237113 Plata con Carne
Plata con Carne's picture


It would be so awesome of this was true, maybe we'd have a change to stop all this madness...

Wed, 05/04/2011 - 01:25 | 1237117 Cdad
Cdad's picture

George Soros's big hedge fund, a firm operated by high-profile investor John Burbank and some other leading firms have been selling gold and silver,

This is EXACTLY what put the bottom in the last time gold corrected.  I know, because I was not in the trade and I BTFD.  This is good news for the PM crowd.

I suspect the miners have one more low morning open in them, and then the compression trade should start to get traction.

Wed, 05/04/2011 - 01:27 | 1237120 TexDenim
TexDenim's picture

Soros versus Paulson: ---

There is a wonderful African saying: "When elephants choose to dance, it is the wise man who gets out of the way."

Wed, 05/04/2011 - 01:29 | 1237124 hudson
hudson's picture

In Soros' spare time looks to capture the Sci-fi market buy placing Puts on extra-terretrial planets. Anne Macfferty and David Weber hardest hit.

Sorry feeling silly

Wed, 05/04/2011 - 01:31 | 1237125 Dapper Dan
Dapper Dan's picture


Feb 14, 2008 ... Fall 2007 - Universities with the Largest Jewish Population in North ... 6 University of Texas, Austin 7 Pennsylvania State University. Taken delivery of 1$ billion physical gold.  And late in the game no less.
Wed, 05/04/2011 - 01:37 | 1237131 Segestan
Segestan's picture

It's certainly an all out effort to save their ass... Liars.

Wed, 05/04/2011 - 01:45 | 1237139 TraderTimm
TraderTimm's picture

But guys, 4,700 students need a million in a week!,0,2584...

Yeah, I don't care either. Between that and other fictional concerns, (dancing with the stars, etc..) nobody on the street knows what we care about, much less is planning to do anything about it.

I'm glad Zerohedge is here, but sometimes I feel I'm drowning in a sea of ignorance "out there".


Wed, 05/04/2011 - 11:04 | 1238210 goldfish1
goldfish1's picture

I feel I'm drowning in a sea of ignorance "out there".

As my ole pappy used to say:

"There's only 1 in 10,000 who understands this situation."

Wed, 05/04/2011 - 01:45 | 1237141 bid the soldier...
bid the soldiers shoot's picture

The good news is that someone as savvy as Paulson thinks there will be 3 to 5 years more of this.

Wed, 05/04/2011 - 01:53 | 1237149 jomama
jomama's picture

dude... we WANT the price of physical to go down... that way not only can we load up, and because we all know when the price really does go through the roof, the endgame is upon us.

Wed, 05/04/2011 - 02:04 | 1237155 hudson
hudson's picture

Let's see I had a GED and went into the military. Like all the Dumb poor folk do. I saw the housing collapse coming and I had skin in the game and manage to hit the top of the bubble because of a title issue. Cause if that leagal issue I hit the top of the market. But in real terms I'd have been happy to grab a percentage and walk away. But Hell I knew the housing market would collapse and the PTBs didn't see it coming? WTF? and I'm not that smart and don't hold an Ivy league calibre education. I  understand basic physics and history. God help us all If I'm smarter than the folks that set policy.

Wed, 05/04/2011 - 02:20 | 1237167 Global Hunter
Global Hunter's picture

I saw an old friend tonight that I haven't seen for 2 years he knows very little about economics or the markets.  He asked me about the markets (he probably has a small pension accumulating) that he was worried about them and I said "why"?  And he replied, "things go up things go down and they've been going up for a long time".  I told him that in my experience in the financial industry for 10 years I was surrounded by people (MBAs, economics phds, business school grads) who were convinced things could always go up.  

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