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The Great Comex Paper Gold Dump: Online Real-Time Physical Gold Price Datasource

Gordon_Gekko's picture





 

For previous articles by the author go to: Gordon Gekko's Blog - http://www.gekkosblog.com

 

So, Gold is apparently “falling” again? But is it? Really?

Before we can answer that question, first we must ask - What is “Gold Price”? Even more significantly, why the hell is Gold and its price so important anyways?

So lets’ begin.

 

An Empire of Fraud and Deception

The US Government – operating today under the control of an international banking cartel – is running a global empire whose sole aim is to exploit the many for the benefit of the few. But because the people won’t be exploited willingly, you have to control them. Now, sure, you can use chains and whips like the good ol’ days, but then the slaves won’t be as productive and may even revolt if exploited too much. Indeed:

“None are more hopelessly enslaved than those who falsely believe they are free”

 

--Johann Wolfgang von Goethe

So massive lies and deception such as – it’s a “free society” governed by rule of law, it’s a democracy, the government is there to serve and protect you, you have a right to privacy, you can be a Bill Gates or a Warren Buffet too if you just.work.hard.enough., etc. – are used to first sedate the people and then they are raped and pillaged using the biggest deception of them all – the currency. Whether it is secret surveillance on a global scale, wars based on false pretenses, luxurious summits, Bilderberg conferences, massive transfer of wealth from poor to the rich – all of that is enabled by paper money – the US Dollar. Ever since its Gold backing was removed (first internally, then externally) the dollar is nothing but a worthless piece of paper which can be printed (or created digitally) in unlimited amounts by the Central Bank, therefore enabling the government and people who control the banks to appropriate unlimited resources from the global economy (since the dollar is the world reserve currency) for their benefit. Due to mass ignorance on monetary matters (deliberately fostered since the education system and media is also under the government’s - and by implication the cartel’s - control), people normally don’t pay any attention to it and continue to work and provide valuable output in exchange for worthless pieces of paper (for a detailed explanation of the paper money/debt fraud and the role of Gold, please refer to other articles my blog).

So for an empire based on lies and deception, the biggest threat is if the lies start falling apart. If you’re wondering why a “superpower” like the United States is so threatened and infuriated by the disclosures of an allegedly low level employee, wonder no more for more than the technical details, it is the fact that they expose the LIES, and thus threaten their control over the slaves.

Imagine how they would feel if the biggest of their lies underpinning EVERYTHING was exposed?  Gold is the only standard against which the dollar’s value can be truly measured since all other currencies are unbacked pieces of paper as well (well, they are “backed” by the dollar, if that makes any sense). If the Gold price rises too much too fast, it would expose the worthlessness of their fiat franchise, the slaves will no longer work in exchange for it and which is why they need to keep it under control NO MATTER WHAT. This is why they have designed elaborate mechanisms in order to help hide the true Gold price. But, in the words of a true American Hero, Edward Snowden:

Truth is coming, and it cannot be stopped.

 

What is “Gold Price”?

What you – and the world at large – refers to as the “Gold Price” today is actually the price of "futures" contracts traded on electronic "futures exchanges" operating in various countries, primary among them being the COMEX in the US operated by the CME Group and "regulated" by the CFTC.

So what are "futures" and what is "spot price"? As per goldprice.org:

Futures contracts, or just Futures, are standardized contracts for delivery (the seller delivers) or receipt (the buyer receives) some fixed quantity and quality of a commodity. Futures contracts are available for each month of the year. For example, a contract for delivery of December wheat can be purchased in May the year before.

 

The "Spot Price" (price of Gold for immediate settlement/delivery) - the price used as reference Gold price throughout the world today - is simply the price of the futures contract of the "most active month" (most number of transactions) trading on the exchange, with the month referred to as "spot month".

(For those of you familiar with the futures market fraud, you can skip the next 2 sections).

How Its Supposed to Work

Now, in theory, the futures price should accurately reflect the price at which one can obtain the actual physical metal since the futures contract is a legally binding contract to deliver the actual commodity. The exchanges have registered warehouses where the commodities with the requisite specs stated in the contract are stored to be delivered, should the buyer (remember this for later) choose to stand for delivery. A point to be noted here is that the futures exchanges allow trading on margin, i.e., you have to put up only a fraction of the actual contract value to trade, whether buying or selling (the amount of margin is decided by the exchange). If you're selling you can go "naked short" (sell a contract without possessing any Gold, only putting up a cash margin). So this type of contract trading on cash margin has a loophole in that a player with sufficiently deep pockets could overwhelm the market by introducing a large supply of contracts (buy or sell) causing panic selling or buying and unduly influencing the price to their benefit. Trading on margin facilitates this because for a big player putting up 5-20% cash margin is easy (even if it's in the billions), but procuring a large quantity of raw material, especially something like Gold, is rather difficult and subject to rules of nature. But the price manipulation can't last forever because at some point either you have to come up with the Gold (if you're selling) or front the full amount and take delivery (if you're buying) unless you choose to roll your position to another month. Now rolling over isn't without costs so if a player manipulates the price, it's usually for a short duration to profit from the price move and then they cover their position, at a profit of course. But the exchanges have safeguards against this in the form of position limits (no. of contracts bought/ sold at any given time) and also there are numerous regulations which obligate the exchange and its regulator to monitor trading activities and look for signs of fraud and manipulation. Hence normally such manipulation shouldn't be possible, and if it happens, is detectable and can be stopped.

So everything looks good, people are trading, real price discovery is happening, price manipulators are at bay, people are playing fair, Obama is bringing hope and change, there is freedom in the US of A, and everybody can live happily ever after.

How It Actually Works

Unfortunately, reality is a b**ch.

Now, what if there was a sufficiently large entity - so powerful as to be able to control the exchange and its regulators - having access to unlimited money with vested interest in manipulating the price - not for a short term cash profit but for other motives and a longer duration. Would that be possible?

Think about it. But even if it's possible, why would somebody want to manipulate the Gold price? That too, for a long duration and not for a cash profit (because it already has unlimited cash). Who would want such a thing and what would they gain from it if not cash profits? Cui Bono? Does anyone/anything come to mind? Who has "unlimited cash"?

Yes, that's right - the Federal Reserve. Now the Fed is just a front - collectively it can be referred to as the banking cartel or banking mafia which includes entities such as JP Morgan, et. al.

These guys are sufficiently powerful and have a fairly strong motive in controlling the Gold price because Gold competes with the worthless paper currency issued by them. A rising Gold price signifies declining value and confidence in their paper money franchise. They have to protect it at any cost. If this sounds too conspiratorial, well, I only have one word for you: PRISM. For a detailed explanation of why this is the case, please refer to these articles here, here and here.

They exploit the following loopholes to achieve their objectives:

1. Most people trading futures end up NOT taking delivery. A majority are simply speculators interested only in profiting by betting on the price movements (and some hedgers who do not wish to go through the hassle of taking delivery) trading on margin. The bankers know this. 

Hence there are a lot more paper contracts floating around than there is real Gold. They are betting most won't bother and so far they seem to be right. Take a look at this extract below (via maxkeiser.com):

... COMEX continues to hold its place as the largest and most sophisticated meeting place for buyers and sellers to express their gold price opinions, in the form of bids and offers, on what the price should be. COMEX remains the beating heart of gold price discovery.

 

Gold futures contracts are referred to as "paper-gold" because the size of this market is said to be over 100 times larger than physical gold available...open interest on the COMEX, at the time of writing, accounted for over 85% of demand on the gold futures market, so COMEX receives the most examination here. In theory investors are able to take delivery of the futures contract on expiry, although few do, instead choosing to roll the contract...the fact remains that all the long positions on COMEX cannot be settled in gold.

2. As explained above (I suggest you read the whole article), Comex operated by the CME Group in the US is the primary futures exchange for Gold and is the trendsetter for Gold prices worldwide. They control the price on Comex and the rest of the world follows.

3. Since they (indirectly) control the exchange and its regulators (Crimex Comex and the CFTC), position limits don't apply to these guys. They're above the law. They can issue an unlimited supply of paper contracts whenever they wish to suppress the price and if required, can indefinitely roll over till the longs bleed dry. If you don't believe this, please explain how this happened.

Yes the longs can stand for delivery but most are heavily leveraged so few do. In a panic, even if it's manufactured, everyone bolts for the door.

4. If you have never taken delivery from the Comex, I suggest you give it a try. It's not easy. Even though the Comex is the primary price setting venue for Gold, the people in charge there have done their utmost to make it a huge hassle to take delivery. This is intentional. The promoters of Comex DO NOT want you to take delivery, but only gamble in their casino. If they win, great; if not, they can always pay you off in freshly printed casino chips (dollars) - just don't ask them for the Gold. If you did, the whole enchilada would come falling apart.

Disconnect Between Physical Gold and Gold Futures Price

But this manipulation is not without consequence and cannot go on forever, no matter how powerful they are. The bigger the manipulation, the greater the blowback. To explain things better, read the following (from one of my previous articles):

Anyone who has actually traded the Gold futures market for any length of time knows that this [manipulation] happens on a regular basis. So basically the government/Central Banks use the paper gold futures market as a price control mechanism for Gold (of course, they can't impose price controls on Gold overtly as it would reveal the lie - if Gold is a barbarous, meaningless relic why would you need to impose price controls on it?). But what happens when price controls are imposed on something? Shortages start to occur resulting in an even greater moonshot in price than would have otherwise occurred. A "black" market (which is actually the free market at play and depicts the true price of the commodity) eventually emerges where it sells at a premium to the official price. There are two reasons for this:

 

1. Buyers - aware that the commodity/good is available at a discounted price - beat a path to the door of whoever is foolish enough to sell it at the government mandated price. Availability at that price soon runs out.

2. The good becomes even scarcer as the costs of producing and selling it are no longer covered by the government mandated price. Aware of this, sellers withdraw from the market and demand ever higher prices for the good.

 

And remember: for marketable goods, the "out" is money, but the only "out" for money is a superior form of money. When the paper currencies become unstable, the only "out" is Gold so you can be sure there will be no lack of buyers, only sellers - and there is no upper limit to high it can go. Theoretically, the price will be infinity when no seller is willing to sell Gold in exchange for paper. You want to be "out" of paper before we reach that event horizon.

 

If the rigging in the futures market keeps continuing, the futures price at some point will decouple from the physical and become meaningless. This is exactly why you should use this opportunity to buy as much physical as possible at discounted prices while there are foolish sellers still willing to sell at the stated official (futures) price.

What’s happening in Gold futures market right now (and has been forecasted before) appears to be the beginning of “the disconnect” between “Paper Gold” a.k.a. futures and “Real Physical Gold”. Entities who:

  • Were/are solely in the game for cash profits and don’t understand the fundamental basis for buying Gold but ride the price trends in the futures casino
  • Have realized that the paper gold is nearing its end game and want to be solely be holding the physical
  • Have been holding futures but are unable obtain physical Gold from the Comex
  • Need to liquidate futures positions to obtain dollars (for whatever reasons, e.g. funds which need to return money to their investors in dollars, morons going to dollar as a “safe-haven”, etc.)

are in the process of dumping paper Gold (including the fraudulent GLD ETF) en masse along with the bullion banks (ala JP Morgan) who have a vested interest in keeping the price low. This is what Andrew Maguire had to say recently regarding the physical market:

Just off wholesaler calls.  Most are too busy to talk at this time, but today (Thursday) will be the largest volume day this year and possibly 2 years.  Central bank purchases are almost certainly far in excess of paper sales.  We are so close to the marginal cost of production that my contacts are saying the gates are wide open here to purchase all physical that is available....

 

Continued paper market supply saw another + 45 tons sold into the rise ahead of Thursday’s fix and then in size directly post the fix.  These were immense amounts of paper gold hitting the market, yet there is absolutely zero physical gold for sale and nothing but buy orders in the wholesale market. 

 

We are below the true costs of production for both gold and silver and it makes a good deal of sense for the central banks to be taking all that is offered.  Fundamentally this will have a significant catch-up impact.

 

Needless to say we are getting reports of extremely large allocations of gold, but also far larger direct producer deals being struck outside the paper markets.  The one question is, just how long this paper market selling can continue to drive price when such a massive transfer of physical is underway?

 

(All emphasis mine)

There are strong hands and intelligent minds out there who know the truth and do not sell at every hint of a falling price. They care only about accumulating the physical metal – as insurance in case of system failure - not about short term paper profits. In fact, many of them will NEVER sell; only buy whatever the price as long as this fiat money regime lasts. That is why the price has been rising for the past decade even with heavy manipulation happening on the Comex. Moreover, the Comex doesn't operate in a vacuum. If the price is suppressed there, the buyers - aware that it is available at a discount - will flock there and demand delivery. If it can’t deliver, a break will occur in the prices being quoted on the Comex and the prices being quoted in the real world for the real metal as people dump the future contracts and try to find the physical elsewhere. This will render the futures prices worthless. By some accounts, the Comex is already under increasing pressure for delivery of the metal. So much so, that if you look at the Gold stocks inventory report published by Comex, they have recently put this disclaimer ON THEIR OWN warehouse stock report:

The information in this report is taken from sources believed to be reliable; however, the Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness. This report is produced for information purposes only.

 

For questions regarding this report please email Registrar@cmegroup.com or call (312) 341-3370.

I suggest you call that number right away because if they don't know what's in their own inventory, then who does?

Of course they do realize the seriousness of the Gold situation. If they keep printing to infinity, the currency will eventually collapse against Gold. They are scared and desperate enough that they are thinking of using Volcker’s playbook of letting the interest rates rise figuring maybe that will keep the Gold price in check and the scam may continue. They just floated a trial balloon in the form of fed taper talk just to see how it might work. And boy, it doesn’t look good. Either way - interest rate increase or not - the economy is fried (which tells you why they are so interested in having laws and tools at their disposal which will help them control the populace – so they can perpetuate their power through an economic collapse which is sure to occur). And no, rising interest rates won’t save them because the amount of rise needed to stave off Gold is so high that it will probably kill everyone on the planet – either that or people dump the worthless dollars and move to a Gold based system. Bottomline is, whether they like it or not, the world is going to have a debt jubilee with all the fiat currencies rendered worthless. He who has the Gold will make the rules.

The tail is wagging the dog right now. Nobody – NOBODY – in their right minds is selling the physical. This is all futures movement, which as pointed out above, maybe 100 times larger than the physical market. We have to go through this phase to get to the other side. Think of this as a cleansing process. The fake futures market needs to die before true price discovery can begin. But this process offers a great opportunity to those who recognize it (for a limited time only though). We don’t know how low the futures will go, but there will be a futures price below which the physical won’t be available. Even though gold is already below its average cash cost, we don’t know that level since paper speculators outnumber physical holders by a large margin, so the accumulators of the physical can keep getting the stuff for cheap as long as there is metal available. There is no single one defined moment of the beginning or the end of the disconnect. It’s already started happening on some scale in most countries. With so-called "premiums" hovering around 20-25% for a long time now, silver futures are already worthless for physical buyers in many countries such as India. Premiums on Gold have also soared in India, one of largest physical buyers, while imports and gold coin sales to the public have been practically halted:

India's biggest jewellers' association has asked members to stop selling gold bars and coins, about 35 per cent of their business, adding its weight to government efforts to cut gold imports and stem a swelling current account deficit.

By the way, any guesses why that current account deficit is exploding out of control? That's right - in their greed, the Indian government printed too much local currency, and now they want to the people to be obedient little slaves and stop buying Gold! Bending over must be easier. Of course the "jewelers association" doesn't have a clue.

So, we have tumbling prices (yes, the Indian currency has fallen, but Gold has fallen more, so its gotten “cheaper”), yet no physical available, at least in India. Go figure. Soon this phenomenon will be seen in every country around the world.

Online Physical Gold Price Datasource – Real Gold Price

I’d like to first define what is “Real Gold Price”:

Real Gold Price is the price at which the Real PHYSICAL Metal is available for delivery to the buyer's own PERSONAL possession and is the ONLY ONE that matters. It is NOT the Comex Futures price.

Currently the difference between the two prices (futures vs. physical) is referred to as "premium" that you have to pay over "spot" (Gold futures price). But whatever the nomenclature, the fact remains that the paper Gold price no longer accurately reflects what you have to pay in the market to buy the metal. It’s becoming meaningless for people who want the real stuff. Hence, yours truly has created a reference database/datasource that will accurately track and record in real time the price of real physical Gold. The data is sourced from what the major Precious Metal dealers are charging buyers to deliver real physical Gold to their own possession. It is important to note here that this does not include dealers/suppliers who are running some kind of allocated/unallocated scheme because until and unless the buyers have the metal in their hands, there is no guarantee that the metal has not been sold multiple times over or if indeed it even exists. The supplier may be able to provide a lower price for "the physical" if they are running such a scheme (and given today's rampant fraud in ALL markets, it is more likely than not that most are).

Now anytime the price falls, there is available in real time what price the real metal is going for (I try to get the cheapest price for a given denomination, with the only condition that the dealer is currently shipping the item. Readers will have to help in this endeavor i.e. finding the lowest real price for different denominations). People will be fooled no more by prices of worthless paper contracts.  

For now, the prices are in USD and dealers are also mostly US based, but any dealer can be included as long as they are delivering on time and have price updates online. You can check out the website here:

Real Price of Gold  - http://www.realpriceofgold.com/

More details such as how the data is collected and displayed etc. are available on the site, but just to give a preview, this is how the charts look like:

 

The site tracks prices for a variety of gold product denominations. Here are what the current real world prices for those denominations look like:

*Comex price for denominations other than 1 Oz were obtained by multiplying by the appropriate factor (pls see website for more details).

As you can see, everything is on a “premium”!

If you look at the charts data, you will see that the real price right now closely tracks the comex price with almost a fixed difference (represented by the rolling average). It is my opinion that as the futures market breaks apart, two things will happen:

1. The fixed difference will increase

2.  The patterns might diverge as well

Indeed, if you look at the screenshot below for the 5 oz product, the premium jumped from the day before even as the Comex price remained almost the same:

Of course, the data collection has only started since 13-Jun-2013, so I will be learning alongwith you. I’m sure there will be many things to see for the raw data doesn’t lie.

The site is a version 1.0, so I’m sure there are many improvements/features that may be needed. Please feel free to email me whatever feedback or questions you have about the site and I will respond as fast as I can. If I get many questions, I will put up a FAQ. Contact info is there on the site.

I remember some technical analysts looking at the Gold price chart and declaring that Gold is now in a bear market. I fully agree. Because the chart they are looking at is, in fact, the Gold futures price chart, which will continue to be decimated. There is no chart out there for the REAL physical Gold price which will continue to be bought as insurance against the stupidity of man and as protection from the depredations of paper money producing Central “Banks”.

This empire of tyranny and violence can only be defeated by elimination of ignorance and deception and bringing out the truth – in EVERY aspect - whether it is mass state-sponsored surveillance or fake futures exchange prices. Hopefully this website will help in exposing the biggest fraud of our times.

___________________________________________________________________________________________________

Some parts of this article have been included from “What is Real Gold Price?” section of the website, also authored by yours truly.

Note: I realize some of the "premium" part is due to fabricating costs for the item, but how much  fabricating cost can there be for a simple bar or coin? And what is Comex selling? An unadulterated sea of Gold?

Also, some people are suggesting that these premiums are merely dealer profit margins. Sure, the profit margin is part of the premium, but is not the whole premium IMHO. Otherwise how do you explain a 20-25% premium in case of Silver (in many countries)? Surely it is not entirely the dealer's margin. Anyways, as I said, we only care about what price we can GET the real stuff, not some idealistic notion of a price.

 


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Sat, 06/29/2013 - 12:09 | Link to Comment Lord Koos
Lord Koos's picture

Why read this when all you have to do is look at the prices on ebay?

Sat, 06/29/2013 - 11:33 | Link to Comment lasvegaspersona
lasvegaspersona's picture

Nothing speaks the importance of gold more than the fact that gold is the number one asset of the worlds only survivable (yes yes I know you disagree, humor me for the moment) and relatively un-manipulated currency, the Euro. If other currencies tank, the Euro will have only gold on its balance sheet. All they have to do to prove the value is put out bids for physical gold in large amounts. Presto, gold way up.

Fofoa deals with the way the ECB marks its gold to market 4 times a year in his most recent blog offering. It is a good summary of why we may be at the end of the paper gold market.

http://fofoa.blogspot.com/

Sat, 06/29/2013 - 10:43 | Link to Comment Alternative
Alternative's picture

Great article. I am just a bit disappointed that the great physical versus paper disconnect amounts to 2 Samuel Adams beers per 1 Oz.

Sat, 06/29/2013 - 10:43 | Link to Comment mogul rider
mogul rider's picture

$50,000,000 an ounce I say!!!

Can I have my blog spot now iwth 30,000 followers are whatever the fking saying is?

You gold tools are like zombies we can't kill you off

Sat, 06/29/2013 - 10:41 | Link to Comment mogul rider
mogul rider's picture

gold bug - retards with leverage

 

could it simply be that the trade died and herd left?

Jesus christ - you got caught on the other side of the trade

 

admit it.

Fri, 06/28/2013 - 23:43 | Link to Comment TheReplacement
TheReplacement's picture

Why are all of you pessimists so afraid to die?  Everyone dies.  You... are... going... to... die.  At least have the balls to live first.

EDIT:  WTH man, this was supposed to be a reply...

Fri, 06/28/2013 - 23:10 | Link to Comment sasebo
sasebo's picture

China can shut that mf down in a ny second   ---- just buy a bunch of futures

& force delivery ----- btfd

Fri, 06/28/2013 - 23:08 | Link to Comment sleestak
sleestak's picture

Something went wrong with my post so I hope this isn't a dupe...

I was just marvelling at  how people in the US - on average - have absolutely no understanding of the money in which they entrust their wellbeing and how the mainstream media is a bizarrely willing agent in deceiving them. I recall a 60mins piece a few years back and at higher gold prices that was interviewing some Indian nationals about their affinity for gold.  It was so condescending it was embarrassing - and this from a libtard outlet that's supposed to celebrate multiculturalism.  But no, not when it regards gold.  That's just too stupid!  No wonder sentiment here is so negative - not only has it never been understood by more than a minute minority, but it is widely denigrated by the smarties on TV - and now it also doesn't go up everyday like stocks!  With such disinterest reinforced over decades now, the only way gold regains highs and finds its economic level against all the debt we've created, is for somebody in the west to be called to deliver to the east, and cannot.  That may come soon, or perhaps later, but it is the only way.

Fri, 06/28/2013 - 18:15 | Link to Comment whoknoz
whoknoz's picture

went to an antiques auction last night...could not touch either gold or silver...everything bid just above "spot", then buyers pay 15% to the house....

Sat, 06/29/2013 - 12:11 | Link to Comment lasvegaspersona
lasvegaspersona's picture

Jim Sinclair has developed a surprisingly freegold attitude and price estimate, he also speaks of 'Free Gold', wonder where he got those (unattributed) ideas.

Fri, 06/28/2013 - 14:25 | Link to Comment Rudini
Rudini's picture

Nice job. On price action alone, just about all pundits had it wrong: I've never heard a bunch of grown men pound their fist on the table and yell "buy!" all the way down from $1900 to $1200. If a stock market pundid did the same he's be verbally crucified. Yet the gold pundit's advice on price action alone resulted in a 36% loss for those who purchased at $1900. Eventually you pundits may be right. But since the Fall of 2011 you pundits got it 100% wrong. Face it. You don't know, do you.

The forum is full of followers who practice parallel reasoning: what's good for the goose is good for the gander. Many are vehement complainers about unequal scales of justice and thereby seemingly uncover the banality of justice. For example, some complain that no heads rolled in the givernment after 911. Well, which gold pundits' heads gonna roll now? Go ahead and apply the same parallel reasoning to your prophets. Go ahead! The gold pundits' performance has been dismal and none are calling for their heads. You are no different than those you criticize. Kind of tribal at best, something like this: "Ha ha! Those stuuupid holders of AAPL! They are down 40%! Those Idiots!"; and yet no such characterization of holders of Au who've lost 36%. Get real.

Fri, 06/28/2013 - 19:13 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

it's very difficult to predict or find a really flat period for metals.
The 2 choices are: buy on the way up or,
buy on the way down.
Buying on the way down is the smart way.

Fri, 06/28/2013 - 16:44 | Link to Comment cro_maat
cro_maat's picture

I know I shouldn't respond to such blatant Troll vomit but....

If you stack physical you lose nothing when the rigged paper market craters. The only ones here who have lost anything are those foolish enough to go boating after returning from their local coin dealer.

Fri, 06/28/2013 - 18:15 | Link to Comment Praetorian Guard
Praetorian Guard's picture

Really, you lose NOTHING? When the paper market craters, everything is coming down. PM holders will be wiped out like everyone else. You won't have some magical bean that make you any more ahead of the game than FRN holders, or paper holders. Gold will be used at the CB level as SDR's, decoupled from mainstream, and every PM swinging dick, will be holding his dick as it flops in the wind. You cannot game a system wherein you are not a PLAYER...

Fri, 06/28/2013 - 19:13 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

lost nothing. What I have is in OUNCES. They aren't vaporizing. The coins aren't lighter.

Fri, 06/28/2013 - 19:03 | Link to Comment akak
akak's picture

History (and most if not all of your previous posts in this forum) prove you to be a fool.

Fri, 06/28/2013 - 19:20 | Link to Comment Praetorian Guard
Praetorian Guard's picture

History? You mean the history of how a global market with JiT was non existant? Or perhaps the history that the main "currency" in many of the ancient empires was in fact FOOD. You mean that history? Or perhaps how this is an economy of energy and resources, so that in the event of a currency collapse, which if it happens will drag the ENTIRE GLOBAL house of cards down, will mean limited commods. PM's won't mean DICK during said scenario. The ONLY time you gain to profer from PM's is in a stable economic environment wherein you can still exchange your PM's for FRN's or whatever currency of the area. That I agree. Baring this, it will not make a difference. EVEN in a hyperinflationary scenario, PM's won't save your ass - examples of Zimbabwe or Weimer Republic are all fantastic examples, but they fail in that the global markets were still operational and allowing imports of foreign goods. If that stops, it becomes a contagion worldwide...

So pick one for Gods sake!!! You either believe that things will continue to hum along, albeit shitty, or everything comes to a crashing finale. Which is it?

Sat, 06/29/2013 - 22:14 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

You are completely in error.
Food can't be currency because it rots too quickly. It rots NOW and we have such wonderful things as freeze-drying and freezers. We have freezer trucks. The ancients were in no way able to do this.
They were able to sun-dry fruits & veggies and able to salt meats. They were not as able as we are to SEAL CONTAINERS to keep out moisture, bacteria or insects. That means food can not be currency and never was. You are in deep contradiction to known history.
SPICES were a currency: for the ancient peoples they were RARE and were used to cover the smell & taste of spoiled food, and there was a lot of spoiled food, yet a lot of hungry people willing to eat it anyhow.
You shot yourself in the foot with a weapons-grade Failtonium tipped shell.

Special exception for honey. Honey was so sugary it killed off any microbes that would othewise eat it. It was also so near to solid that if put in a good container, perhaps sealed with wax, it would be easily portable.

Sat, 06/29/2013 - 12:14 | Link to Comment lasvegaspersona
lasvegaspersona's picture

PG

????? PM's won't save your ass - examples of Zimbabwe or Weimer Republic are all fantastic examples????

 

What???

gold did very well in those examples???

Fri, 06/28/2013 - 19:34 | Link to Comment akak
akak's picture

You are a blinkered fool.

Like most disingenuous anti-gold paper bugs, you simply cannot resist positing the simplistic, patently absurd and outright false dichotomy that either things remain EXACTLY as they are today, or else civilization collapses in a smoldering ruin. 

Setting aside the fact that the world has witnessed an almost uncounted number of financial, economic and monetary collapses without simultaneously experiencing the death of the associated society, your idiotic argument boils down to the same false dichotomy that, not coincidentally, perfectly feeds the bankster's pro-status-quo propaganda and explicit threats that the current financial house of cards remains standing, at ALL costs, or else "the kid gets its".  However, you utterly ignore human resourcefulness, ingenuity, and the will to survive.  It is flat-out ridiculous to assert that a mere financial or monetary collapse will spell the end of civilization --- that is simply historically clueless defeatism at its most ignorant and laughable.  Yes, such developments would certainly spell hardship and possibly disaster for many if not almost all involved, but to equate a financial and/or monetary implosion to a disaster far exceeding a world war or a cometary impact is to give FAR too much credence and weight to the importance of a relatively small band of sociopaths and banksters whose corrupt current paradigms are unsustainable and doomed in any case.

Fri, 06/28/2013 - 19:55 | Link to Comment espirit
espirit's picture

akak, don't bother.

We all know Au is worth more than Pb, especially entertaining when dug out with a rusty bayonet.

Fri, 06/28/2013 - 19:41 | Link to Comment Praetorian Guard
Praetorian Guard's picture

Ahahahahaha... like the simple fact that population rises with energy output and said energy output is declining? You mean that ingenuity? Absurd and false dichotomy? Is that really the best you can do? Yes, the world has encountered financial collapses before, but never at this leveraged level, nor GLOBALLY. Idiotic argument? WTF? So detail to us, oh wise one, how you perceive the future. What EXACLTY do you foresee from NOW until, oh, lets say 2035?

Fri, 06/28/2013 - 19:58 | Link to Comment akak
akak's picture

Oh, I forgot .... your argument also rests on the assumption that "This time is different!".

Thanks for the laughs.

Fri, 06/28/2013 - 20:07 | Link to Comment Praetorian Guard
Praetorian Guard's picture

Oh, what a shocker... so you are saying "this time is NOT different"? Whatever, you make me laugh...

Fri, 06/28/2013 - 19:58 | Link to Comment espirit
espirit's picture

Whatcha doin' here man?  Like, what's your purpose - educating the newbies?

Fri, 06/28/2013 - 13:47 | Link to Comment Orwell was right
Orwell was right's picture

Well written article!!    Well done factual research to support the basic premise.

This sort of writing is what I come to ZH read.    

Agree or disagree with the author, but if the article is well done, then the discussion tends to stay on topic and focus on ideas instead of jumping off into the weeds discussing obvious problems with the way the article is written.

Fri, 06/28/2013 - 19:17 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

gordon gekko, unlike certain birds of legendary blogs, is always a quality read. Same with G Washington.

Fri, 06/28/2013 - 13:38 | Link to Comment NoTTD
NoTTD's picture

Also, I'm all in in PMs and ahve been for years - but this action can cause severe sphincter tightening.

Fri, 06/28/2013 - 19:18 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

all it says to me is time to start back to stacking gold. My biggest worry is that prices will go up before I can get enough ounces.

Fri, 06/28/2013 - 13:37 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

Legacy coins in Lutz florida is charging $5 over spot for ASE. Art and Mark are genuine dudes, and right down the street from the snobs at gainesville.
FWIW im writing from upstate ny. Cant find shit here.

Fri, 06/28/2013 - 15:45 | Link to Comment linniepar
linniepar's picture

Snobs at Gainesville?  Care to elaborate?  They seem to always turn my orders over fairly quickly and never give me a hard time.  I am just curious as to why you call them snobs.

Fri, 06/28/2013 - 20:00 | Link to Comment espirit
espirit's picture

Curious also.  Always got my share from Gainesville.

Fri, 06/28/2013 - 13:36 | Link to Comment NoTTD
NoTTD's picture

So...can anyone tell me where I can buy retail for a premium of $14 over spot?

 

Seems unlikely.

Fri, 06/28/2013 - 12:58 | Link to Comment 0b1knob
0b1knob's picture

So the paired trade would be:  short GLD (the ETF) and go long gold (physical)?

 

Its interesting to me that another gold ETF I follow (GTU) is up while GLD is down sharply.   Interesting divergences going on.

Fri, 06/28/2013 - 17:54 | Link to Comment Panafrican Funk...
Panafrican Funktron Robot's picture

I would suggest that the faith in GTU over GLD is misplaced, but yes, that does help show the divergences.  

Regarding short paper/long phys, that's basically been the central bank play since the 2011 top.  I've been playing along since February (short GLD, long phys) and have been doing well in that trade.

Fri, 06/28/2013 - 18:48 | Link to Comment Bastiat
Bastiat's picture

GTU is subject to audit whereas GLD makes clear, if you study the custodian/subcustodian bullshit in their disclosures that no amount of gold is gauranteed to be held.  You can't even call GLD a fraud because they lay it out.  So, yeah, GTU should trade at a premium to GLD.  I take this spread opening as a good sign.

Sat, 06/29/2013 - 12:20 | Link to Comment lasvegaspersona
lasvegaspersona's picture

Bastiat

Here is the GLD inventory

http://www.spdrgoldshares.com/assets/dynamic/GLD/GLD_US_archive_EN.csv

 

Screwtapes Warren keeps a bar list. I have confidence (sort of) that GLD has gold. It is loosing it fast however as inventory has fallen over 30% since January after being stable for a couple of years.

Fri, 06/28/2013 - 12:57 | Link to Comment bcecil
bcecil's picture

The way to stop all of this, and the way to move the whole thing forward, is to open an exchange like mtgox but only gold 

and silver weights, not US$,  to be exchanged/traded for btc. You need small shops 

everywhere, like a current cash shop, or pawn broker that fronts all of the small 

trading for everyone. So you give them some gold or silver and they give you btc or you 

give them btc and they give you gold silver based on current exchange rates.. all 3 

things cant be touched by megalomaniacs and are outside of "world money 

regulation/phantom creation"

This also solves the problem of no easy liquidity for easy transfer and 

payments using actual pieces of  gold and silver .....  now their value is transferable 

to btc, which is easily exchanged anywhere for EVERYTHING starting with the most important thing wages for employment

 

The numbers make sense..

 

if you look at fractional bitcoin system the numbers more then make sense... each btc can be broken down to units that equal .00000001  so There are really 2,099,999,997,690,000 (just over 2 

quadrillion) maximum possible units in the total maximum bitcoin design. The value of "1 

BTC" represents 100,000,000 of these. there is only around an actual 1 trillion in 

printed usd around and currently 60 trillion in debt http://www.usdebtclock.org/

so there is or will be by the year 2140 (end of bitcoin mining), 2000 times more exchangeable bitcoin units  then us$ in the world and then there are no more...

 

Fri, 06/28/2013 - 19:20 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

if BTC "economics" was divorced entirely from the nonsense of fiat exchanges then BTC would become viable.

Fri, 06/28/2013 - 12:55 | Link to Comment Bastiat
Bastiat's picture

Still no talk about silver today as it pushes towards up 5%?

 

I have to do this all by myself, I guess:

Silver momo shorts getting their faces ripped off!  blowtorched! monkeyhammered! donkey punched!

 

Fri, 06/28/2013 - 13:52 | Link to Comment Bastiat
Bastiat's picture

Silver still making new highs, up 5.25% and 7.6% from the overnight low.

Fri, 06/28/2013 - 14:26 | Link to Comment SAT 800
SAT 800's picture

Looks like my official reccomendation to buy Silver yesterday was okay. So Far. Up 5,000$ a contract. Very strange price chart the price took off in New York after being down in London; it's usually the other way around. god only know what's going on.

Fri, 06/28/2013 - 14:47 | Link to Comment Bastiat
Bastiat's picture

Nice call.  Congrats. 

Yeah, god, Blythe, Jamie, Lloyd, Bernanke (if anyone bothered to tell him) and a few others.

Fri, 06/28/2013 - 12:42 | Link to Comment the grateful un...
the grateful unemployed's picture

well GG what do you think about floating hard cash against investment or notional or phantom collateral? i imagine a currency exchange, (right now I am guessing that hard dollars are around 4 or 5 to 1 against investment dollars) traditional M ratings don't touch this problem, since most of socalled M1 is actually notional.

apparently anyone can convert their stock certificates to FRNs, there are of course practical limits. hard cash has limited usage, a real problem for drug lords, who eventually go straight because its easier than dealing with cash and the limits cash imposes. notional and investment dollars are pyramided higher, if all those dollars were repatrioted into cash there would be massive inflation, to a degree of probably 4 or 5 to one, is my guess.

it would be useful to count all physical dollars against non-physical assets, taking a commodity view that liabilities are just the other side of the trade.

Fri, 06/28/2013 - 12:19 | Link to Comment lasvegaspersona
lasvegaspersona's picture

fofoa comes at this from a different angle (and his insights allow a different play) but the message 'of salvation' is the same...hold physical gold...soon!

Fri, 06/28/2013 - 12:16 | Link to Comment ebworthen
ebworthen's picture

Mr. Gekko,

Nice to see you.

Great article and information.

Lot's of good verbiage too, I like this:

"Now the Fed is just a front - collectively it can be referred to as the banking cartel or banking mafia which includes entities such as JP Morgan, et. al."

Banking Mafia...yup.

GOLD bitchez!

And if you don't like GOLD - you should leave!:  http://www.youtube.com/watch?v=o97uNzbBfis

Fri, 06/28/2013 - 12:07 | Link to Comment SillySalesmanQu...
SillySalesmanQuestion's picture

Great article! Thank You Gordon for concisely explaining and clearly exposimg this farce and charade that has been going on with paper gold trading. The non-existant CFTC and their Chairman (FUCK YOU Bart Chilton) should be hung and guillotined. Keep on stackin bitchez...

Fri, 06/28/2013 - 19:57 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

but but NEFARIOUS ... he SAID SO! we can't trust The Seagulls? I mean Bart Chilton?

Fri, 06/28/2013 - 11:43 | Link to Comment Odin
Odin's picture

Easily the most comprehensive article on the subject I've read. Excellent work Mr. Gekko.

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