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China Successfully Hunts Where There is Gold

ilene's picture


Courtesy of Russ Winter of Winter Actionables 

(Originally published on Dec. 20)

JP Morgan is procuring gold on behalf of China. That’s according to TFMetalsReport’s “Turd Ferguson,” who wrote an article on this topic on Wednesday. I think it’s basically true, keeping in mind that other offshore agents are working for China through JP Morgan. It’s logical when one considers that JPM is the largest bullion bankster and, as the report indicates, it has a huge long position [see "One for the Ages"]. China and its agents hunt where there is treasure.

Here’s how I think it works: The Peoples Bank of China and sovereign wealth funds don’t operate directly with JP Morgan but through offshore funds and representatives. Many are just hired guns, or even American or British firms. They procure gold for China’s huge appetite.

Ferguson writes that the forensics point to kilobars showing up in JPM’s customer warehouses, which don’t conform to normal Comex standards. But who is looking anyway. I believe it is quite logical that recently refined kilobars could show up in JPM’s customer warehouses. After all, a Chinese firm now owns Chase Manhattan Plaza, which contains a big gold vault. The point is that this is a logical transit point on the way to China, meaning it probably won’t stay there long. At the moment, there are nearly 1.14 million ounces being held in JPM’s customer accounts.

Let’s dispense with the absurd notion that these are bars recycled back out of China. Absolutely not. Once it goes into China’s vault, it’s like going into a black hole. Remember the interview Koos Jansen conducted with the chief market strategist of Anglo Far-East for insights into the gold refinery business. He said:

“In China, there are six LBMA refineries, but he has never seen a Chinese gold bar. They’re keeping it all. Gold that goes into China is like going into a black-hole.”

The bottom line on this theory it that is logical and likely that a portion of the huge JPM long position demonstrated by the banker participation report could represent gold destined for China on behalf of these agents. As Ferguson asserts: By extension, China is a party to the bullion bankster net long position. But for the Chinese, this is not just a paper long. It’s a mechanism to take physical gold.

Meanwhile, gold is finally being settled out of the puny deliverable or registered stash on the Comex, which dropped to 490,000 ounces today. Here, JPM holds only 87,071 ounces.

There has been some speculation as to who keeps indiscriminately selling gold in the paper market. Central banks are mentioned a lot. However, at these prices, I don’t think it serves the interests of the U.S. to create conditions whereby China grabs thousands of tonnes of cheap gold in lieu of U.S. Treasuries. Nor is it in U.S. interest to encourage China to make an announcement that the PBoC holds more gold than Fort Knox. It is a little thing called prestige and waving a big stick.

That’s why I keep coming back to a rogue or a whale or series of whales within the fund or speculative community. These function as foils and allow the bullion banksters and Chinese to get cheap gold. During the housing bubble, Bear Stearns, Lehman Brothers and AIG were the aggressive players at the margin that allowed the extreme risk and froth in that market. Something similar is going on in the short gold trade. New commitment of trader data released Friday by the CFTC will show the extent through last Tuesday (before the FOMC announcement).

Incidentally, I think these short attacks as occurring in the middle of the night. More accurately, a slinger shows up in the access market after London opens or in the Globex session. Since I am up and awake in Europe during that period, I can see the plunges and the rapid quick-hit volume on the Globex during the speculative attacks. Afterward, when the Comex opens, volume tends to shrivel. Late in the session yesterday, the Comex exhibited signs that some remaining spec longs were being margin liquidated. Those are 2,000- to 3,000-contract sell offs, that are then reversed and have a completely different hallmark from a spec short attack.

Thursday in the comments section on my site, I remarked that GLD showed signs of a high-volume final capitulation. Volume was 90% higher than average. I said that we could see a large extraction. But only 125,400 ounces came out of GLD SPDR. There could still be a delayed release from GLD today, but that seems like chump change for such intense post Mini Me taper market action. More and more, the forensics point to extremely offside slingers driving this action through off-the-deep-end short sales, much more so than western gold liquidations, margin calls and central banks.

Meanwhile on the Shanghai Exchange, it was a very busy night as a stunning 21,392 kg (754,585 oz) was physically delivered. Gold procurement in China appears to be a well oiled machine at this point and gold extraction out of GLD looks exhausted. For its part, the Chinese must be sending the slinger speculators a last minute Christmas card as we speak.

During the session, Pretium released its reserves and resources numbers for Valley of the Kings. This does not include the other previous zones in PVG’s district. It uses a very conservative 5-gram cutoff. Notice that the inferred — which I think is the more recent step-out holes that hit new veins — is 25.6 grams. And here is what’s especially bullish about this report: They only used 0.06 tonnes from the Cleopatra vein,which will be evaluated separately. This is very conservative, making it all the harder to believe they were subjected to such caca a few month ago.


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Wed, 12/25/2013 - 21:10 | Link to Comment Kina
Kina's picture

There is plently of gold in the world....just break it into smaller and smaller units.

And ...for a start if gold is fractionally sold at 92:1 then if all were required to have the gold they had sold....its value would exceed by many degrees $110,000/oz


An executive order from POTUS making it a criminial offence to not physically posses gold sold on any market. And a criminal offence for any individual that assists in the sale of gold they know isn't physically owned by them or their company or the company they work for.  Would never happen of course..unless you had Ron Paul as President (and then they would JFK him).

Wed, 12/25/2013 - 16:27 | Link to Comment Quaderratic Probing
Quaderratic Probing's picture

At 96 claims to 1 Oz they would be idiots not to lease it all out

Wed, 12/25/2013 - 11:25 | Link to Comment suicidalpsychologist
suicidalpsychologist's picture

Life is about killing or getting killed. Killing makes you feel good. Being dominated or killed makes you feel bad.

We re just animals. 95% of our suboncious is made of preprogrammed inherited, acquired strategies of survival we constantly use to adapt.

There, that's all you need to know.

Mon, 01/06/2014 - 19:45 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

many of those strategies are parametric, however, meaning it's not purely action or inaction, it's reaction & prediction.
Requires intelligence & perception & outcomes are not predictable any more than inputs to the living being will be. Genetics are just the beginning of what forms the basis.
To kill is a last resort, messy & hard work.
To push away a threat or reduce that threat requires much less physical work & much more intellect. Overall it is frequently a beneficial strategy.

Wed, 12/25/2013 - 12:50 | Link to Comment HeavydutyMexica...
HeavydutyMexicanOfTheNorthernKingdom's picture

Settle down son.  Your resentment is showing.

Wed, 12/25/2013 - 03:02 | Link to Comment The Heart
The Heart's picture







Wed, 12/25/2013 - 00:48 | Link to Comment Atticus Finch
Atticus Finch's picture

OK, I'm dense but I thought JPM was stone-walling slinger speculators by forcing cash settlements. So why would they provide these slinger speculators with physical?

Isn't it really a case that China has JPM by the balls and we simply don't understand how they accomplished that and the specifics on how that works. Otherwise, JPM would tell the slinger speculators to take a hike.

Tue, 12/24/2013 - 16:13 | Link to Comment ebear
ebear's picture

Seems to me it would make more sense for China to stockpile oil than gold.  Of course you could do both, but I haven't heard of them stockpiling oil.  Anyone?

Tue, 12/24/2013 - 14:47 | Link to Comment steveo77
steveo77's picture

Hey if you are a Christian, intentionally say Merry Christmas!   to people.

Fuck this "Happy Holidays: apologist bullshit.

You don't have to fucking apologize for being Christian and expressing your beliefs!


Merry Fucking Christmas!

Wed, 12/25/2013 - 16:09 | Link to Comment techperson
techperson's picture

Uh, "holidays" comes from "holy days." So if I say Happy Holy Days I am apologizing for being a Christian?

Tue, 12/24/2013 - 18:54 | Link to Comment gdpetti
gdpetti's picture

You mean Happy Caesarmas? Or did you  not get the memo on that ancient con job? That's why we're told to 'turn the other cheek' or 'give unto Caesar that which is Caesars'... wink, wink... governments have been doing this forever, same BS with every civilization, when disgrunted people turn your idols against you, flip it over and make them believe in total BS, they fall for it everytime. You just have to keep the truth 'in the closet', but then the Church is good at that... wink, wink, the usual 'hide the pedophile' game.

Seems the PMs have been following the same script, but then everything does here in the Matrix, ie Purgatory, where we repeat our lessons until they are learnt. With the colossal crap coming next year, none of this will matter... most likely, but it should be very entertaining to watch. The Chinese seem to be enjoying the show, and they should, it is designed to keep them and all of us sheeple distracted.

Wed, 12/25/2013 - 06:18 | Link to Comment geewhiz
geewhiz's picture

Its not about Caesar or the "Church". Its about Christ giving you some elevated insights into handling difficult stuff. So much has been lost in the translation and politicization of the message who knows the reality of what it really was. Probably something along the lines of the Fatherhood of God and the Brotherhood of man. As for turning the other cheek, maybe once in my case, just in case it was a misunderstanding, but if your intent is my demise for your reward, you won't so easily get to the other cheek. Christ said you have a direct conduit to God, no brokers neccessary, use it. He may have come as a subtle Teacher the first time, leaving your free will intact to figure things out, but he's coming back as a General the second time. I find it a common meme that people misunderstand kindness and gentleness for weakness. Just fuck with a good fathers children and have a look at his other side.

Wed, 12/25/2013 - 11:18 | Link to Comment suicidalpsychologist
suicidalpsychologist's picture

jesus christ was a dude who took over the poor with his nice little depressed words and endangered the riches which in return killed him. His goal was to lead the poors., get at the top ..just lile every animal is suposed to do cause there s nothing else to do. He wanted power, too. Cause he s just an animal like the rest of us.

Wed, 12/25/2013 - 16:07 | Link to Comment MSO
MSO's picture

Think it over. We (human beings) didn't learn everything worth know in a single day. In fact, most things worth knowing were learned before we leaned to write, but even then, we knew it was good to teach our fellow beings and our children the thing we learned and the things we were taught by our ancestors.

The solution to this 'teaching before writing' was to create pithy little stories that conveyed the message and could be easily remembered. By the time we learned to write, all these little stories had been enhanced by the wise ones amongst us, but the original authors (those who learned the hard way) were long forgotten. These long lost authors might have been forgotten, but their lessons were not. The lessons were attributed to those prehistoric (before writing) beings who were lumped together into one super-wise creature who knew what was important and whose lessons should be given great authority.

We moderns tend to look down our noses at anything learned by others before we graced the world with out magnificent presence and call out this mythical wise one as a phoney and a farce. Worse, we even tend to think of our history as a plot to keep us ignorant and oppressed.

Tue, 12/24/2013 - 15:53 | Link to Comment ebear
ebear's picture

I was in the Salvation Army Thrift Shop (Canada) the other day and the woman behind the counter said "Happy Holidays" to the customer ahead of me at the checkout.  I was floored.  I said you don't seriously have to say that here, of all places, do you?  "Oh, that's what our manager wants us to say", she replied.

Well, I said Merry Christmas to her when I left, and so did she, and I got the sense she was glad to say that at least once that day, but seriously....  Political Correctness at The Sally Ann?  That really is too much.

Where I work there are many Sikhs, and they all say Merry Christmas, just as I say Happy Vaisakhi on their day.  Many of them turn up at our Christmas party just as we do at their Vaisakhi Parade.  This is NORMAL where I live.

In India, if you greet a Muslim a Hindu or a Sikh, you use their greeting, and they use yours as a sign of respect.  Likewise, an Engish speaker will get an English greeting, and although it's not expected, if you reply with theirs you will be most appreciated for it.

I'm not even a religious guy, but frankly, this Happy Holidays crap pisses me right off.  I refuse to say it and will continue to use Merry Christmas, Happy Hanukkah, Happy Diwali, etc. at the appropriate times.  It's a sign of respect, nothing more.

You know what?  If you don't want to hear Merry Christmas, go spend your Happy Holidays in Saudi Arabia.

Wed, 12/25/2013 - 16:30 | Link to Comment IrritableBowels
IrritableBowels's picture

Happy winter solstice.

Tue, 12/24/2013 - 14:08 | Link to Comment GrinandBearit
GrinandBearit's picture

Just wait until the Chinese back their currency with all the gold they've bought.

It's going to make the US dollar look like a kiddie scissor class cut it up for a paper doll.

Mon, 12/23/2013 - 14:08 | Link to Comment smartstrike
smartstrike's picture

I like Russ Winter, he is one of the first guys who was writing about 'crack up boom' and fictitious assets in 2006-2007. He also advised to go tits up on all the retail stocks in 2009.

But I wouldn't trust any Chinaman with Renmibi backed by gold or Peking Duck. There is not enough gold in the world to back the mountain of Chinese fiat ever. Like Nixon in 1971, if China ever ever went the gold-back route, it would last like maybe one day before 2 billion Chinese rushed to convert their paper assets.

Money backed by gold is a scam; they get gold for free, but you would have to work your ass off to earn it--nothing new here. Google FOFOA to get an idea how this scam would work and Bill Still's 'Follow the Yellow Brick Road."

Wed, 12/25/2013 - 06:33 | Link to Comment geewhiz
geewhiz's picture

Chinamans promise that his Renmibi is backed by gold, worthless, a really good Peking duck, priceless.

Now if the embed a measured weight of gold metal into the fabric of the Renmibi note I would accept that backing, just no empty notes with empty redemption promises please. I would even accept a US note backed that way, even if nice Jewish gentlemen issued it. Is Peking duck kosher?

Tue, 12/24/2013 - 16:00 | Link to Comment e2thex
e2thex's picture

"There is not enough gold in the world to back the mountain of Chinese fiat ever."


Correct, although it would be nice to have a six cubic meter cube in the backyard, to pray to, while we hunt for ducks.

The Chinese modelled their model after the model from the people who modelled their model from the original model they modelled. 

Mon, 12/23/2013 - 12:57 | Link to Comment PR Guy
PR Guy's picture



Here's one of my cartoons to watch (The Fallen) while we are waiting for the gold price to go back up.

Mon, 12/23/2013 - 11:16 | Link to Comment Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Gold is to silver as paper is to opium. The more things change. We know what happened next when the addicts tried to get clean..... The only question tea is to ????? this time around.

Whose gold vaults are taking the biggest hit by the Chinese in the physical gold shell game?

Tue, 12/24/2013 - 15:40 | Link to Comment Dewey Cheatum Howe
Dewey Cheatum Howe's picture

You people give these assholes too much credit. They run the same scams over and over with a different veneer each time around to fool the masses. The only difference is this time around everyone's hitting the paper crack pipe. You see the results all over the place. cracked up zombies roaming the streets and dealers hooked on their own drugs making one bad drug induced decision after the other.

It is no mistake the world went off a gold standard right when they opened to doors to trade with China again under Nixon. They just subsitituted fiat funny money for opium this time around and thought they'd be cute about it by demonetizing gold and silver to not get burnt like the last time around in the 1800s.

Mon, 12/23/2013 - 11:06 | Link to Comment 999.9
999.9's picture

Hey guys, I bought gold online from Heubach Edelmetalle (Germany) and there was one ounce of gold less in the package. What can I do? The invoice is correct but one ounce is missing

Mon, 12/23/2013 - 11:07 | Link to Comment gold_pa3ot
gold_pa3ot's picture

Had the same problem last week with Heubach. Just send them an email and they will clarify the problem

Mon, 12/23/2013 - 11:21 | Link to Comment 999.9
999.9's picture

Clarify what? The invoice is 9999,06 euros and one ounce is missing, so they stole 926 euros

Mon, 12/23/2013 - 10:07 | Link to Comment el Gallinazo
el Gallinazo's picture

The USSA hoard of gold is like Schrödinger's cat.  It is only alive as long as the box (Ft. Knox) is sealed.  I think it far more likely that the US Treasury is a lot longer in tungsten than gold.  But then again, tungsten has many uses.  There are several firms in China that specialize in gold plating tungsten for example.

And then we have the Fed's hoard of gold under Liberty Street.  But when Germany politely asked for ther 2000+ MT to be sent back, they were offered 20% over 7 years.  The sovereign republic of Germany is not even permitted to send qualified inspectors to Liberty Street to look at their gold.

Mon, 12/23/2013 - 09:18 | Link to Comment Quinvarius
Quinvarius's picture

It is going to be the opium wars all over again once the West realizes China buys nothing and only wants payment in PMs.

PM's go hand in hand with global trade because they are the only money that lasts and that everyone excepts.  They are not local tokens like fiat.

Mon, 12/23/2013 - 12:37 | Link to Comment optimator
optimator's picture

Or payment in a gold back currency, theirs being the only one.  Goodbye Bretten Woods Agreement.

Wed, 12/25/2013 - 06:43 | Link to Comment geewhiz
geewhiz's picture

What good is a gold backed currency when everybody in government is a liar. Only the gold itself can't lie. It isn't settled till you have the gold (or silver, or bitcoin, no downvotes please)

Mon, 12/23/2013 - 10:26 | Link to Comment new game
new game's picture

although you are fundamentally right, you by you own device ignore who is in charge of the money system and that they are not going to a gold backed system anytime soon.  just won't happen because they are in charge and have a police/military system to back it up. ignorance is bliss.

hey i got 40 oz of gold- meet you are the local real estate office for exchange for your 100k property-not fucking happening dude. 99.9 percent of sheeple have no clue of value much less want it.

I means tested 20 oz of fine silver american eagles for compareable gun value-NO ONE INTERESTED, I REPEAT, NO ONE INTERESTED-THE GUN TYPES - NOT INTERESTED-HELLO, ANYONE HOME - NO INTEREST IN SILVIER FOR A GLOCK, NEED I REPEAT. no monetary trading value, just fees for exchange to make the brokers money- yea you russ.

not only that, but the very majority are fucking broke and the last fucking thing they would even consider is your shiney piece of gold. not only that it attracts theives, hmmm.

sugestion to you; brass, lead and riffled steel...way, way better utility and very easy to find a buyer in a crisses.  even trade for food water booze cigs and pussie.  gold, well maybe...

Tue, 12/24/2013 - 14:13 | Link to Comment Whalley World
Whalley World's picture

If you are talking about the American populace, you are correct.  They have been brainwashed to the point of not understanding anything of Value.  Thank you Carnegie Foundation for dummying down the US school system since 1918.  One only needs to look at a Mark Dice Youtube video to watch Americans turn down a 1 ounce gold coin for $20, $10 bucks and even a stick of gum.


Internationally you are very wrong, the rest of the world knows the value of "real money" and are snapping it up at these low prices.  Once the house sells after the divorce in Feb, I will be using the proceeds to buy gold and silver and maybe a little bitcoin for international travel.

Mon, 12/23/2013 - 15:55 | Link to Comment silverserfer
silverserfer's picture

whats the over/under on this miserable troll capping himself on xmass?  

$20 says he DOES.


Mon, 12/23/2013 - 11:06 | Link to Comment Quinvarius
Quinvarius's picture

We are talking about global trade and global money.  Not how much dick unprepared morons will suck for food.  Gold is the money of global trade and always will be.  That is why we are losing all of ours.  

Mon, 12/23/2013 - 10:08 | Link to Comment el Gallinazo
el Gallinazo's picture

The Opium Wars only could occur due to the huge technological advantage of Britain over the Chinese empire.  China was unable to defend itself.  That is not the case today.

Mon, 12/23/2013 - 11:05 | Link to Comment Quinvarius
Quinvarius's picture

The opium wars started because China demanded payment in silver for everything, but never bought anything from anyone else.  They were a PM black hole.  So the British forced them to accept opium in trade in order to not lose all of their silver.  Then the war progressed from there.

Mon, 12/23/2013 - 08:22 | Link to Comment Laughing Stock
Laughing Stock's picture



Instead of,

Russ Winter of Winter Actionables 

A better title might be,

Russ Winter of Winter Useless Observations

There wasn't one "Actionable" in the entire post...just the usual assorted Mr. Hair On Fire idiocy.

Mon, 12/23/2013 - 08:39 | Link to Comment russwinter
russwinter's picture

Why don't you post by your real name, cowardly heckler? 

Mon, 12/23/2013 - 10:00 | Link to Comment Toolshed
Toolshed's picture

It seems his screen name is quite appropriate.

Mon, 12/23/2013 - 08:18 | Link to Comment Sufiy
Sufiy's picture

Jesse: COMEX Gold Claims Per Deliverable Ounce of Gold at 92 to 1 

Jesse reports that we have another All-Time-High leverage at COMEX with 92 Owners per one once of Gold. Jesse: Record COMEX Gold Claims Per Deliverable Ounce at 79 to 1 GLD, MUX, TNR.v, GDX

  "Jesse reports that the Game Of Musial Chairs in the Western Fractional Gold Reserve System is getting into the new stage with the record level of leverage. Now report from Bloomberg can be put into another perspective."    Bloomberg: London Gold Vaults Are Virtually Empty GLD, MUX, TNR.v, GDX

Bloomberg quite suddenly provides some really interesting information about the state of the gold market and ongoing manipulations around it these days. Could the reports about JPMorgan being Net Long Gold now be correct in the end?

Mon, 12/23/2013 - 08:53 | Link to Comment kenezen
kenezen's picture

There are several countries that are involved in Gold retention. Two have dreams of being the new Reserve Currency. One of those is probable perhaps in 2014.  

Mon, 12/23/2013 - 08:26 | Link to Comment Kina
Kina's picture

TPTB as revealed in Kissengers meetings... want gold gone from the system...they wanted the IMF to own it all. But too bad it didn't work out for them. Gold has been a big pain in the arse for them for is a problem for them...they know its utility, its worth, its power against and outside the fiat system...and its affect on rates.


The Chairman of the LBMA was out and about trying to get gold producers to push the gold price down $400 in 2014. NOW that is fucking super desperate....tryin to get gold miners to totally and absolutely bankrupt themselves.  Basically he was encouraging management of companies to defraud their shareholders.

Now the story is out..the management of these companies will find themselves the subject of massive law suits if they in fact did what the LBMA was trying to corrupt them into doing.


As far as money and wealth ... in the eyes of central banks... gold is IT. And thats their problem. They are to print fiat into oblivion...but there is gold sitting on top of them

All they can do is play the paper gold, because they have nothing themselves. They playing make believe to higher and higher degrees to high and higher risks....paper gold is out there at 97:1    It is hanging on...until it ceases to price gold bullion.


  • OK Who feels safe hanging onto USD in their accounts, holding shares, housing? WTF to put your money on where it wont be raped one way or other. Sure you can have a  little market garden in your back yard, buy a couple of years food...but that solves nothing.

    There is only one insurance regardless of how the paper gold price is being manipulated. ASK South America, ask older Europeans.

Wed, 12/25/2013 - 06:52 | Link to Comment geewhiz
geewhiz's picture

Poor banksters, in addition to PM's they now have crytocurrencies crawling up their ass. They need to print more money to fund sheeple education so we can get to appreciate the finer points of fiat slavepaper.

Mon, 12/23/2013 - 07:52 | Link to Comment new game
new game's picture

i would think russ and all you gold bugs would get sick and tired of the market of gold that has turned into a den of theives.

so, by association what does that make you.


as you well know there is no honor amoung theives...

so fuck you and gold

useless relic for power trippers

go rub your fucking gold you idiots...

folow the trail of gold to find the theives

plain and simple

china/ pegged yuan/gamed system for cheap goods/gold flows west east from ill gotten gains as we created fiat debt in exchange for what? cheap good/huge deficiets now the fallout of biggest flow of capital ever...

like i say follow the gold to get to the biggest criminal...

Mon, 12/23/2013 - 15:43 | Link to Comment silverserfer
silverserfer's picture

hey new game I think you nominated yourself for "biggest ignorant bitch on ZH of 2013" award. Cheers!  


Mon, 12/23/2013 - 13:40 | Link to Comment Al Gorerhythm
Al Gorerhythm's picture

TAke a pill; a red one. Read some books; some honest ones. Follow the criminals, indeed (TARP, Rumsfeld admits: Pentagon lost $2,3 TRILLION with nothing to show for it, NSA behemoth, money provision in Constitution destroyed, Obamacare, bailouts through counterfeiting continue, $85 BILLION/month counterfeiting to buy bonds, central banks buying gold, currencies purchasing power world wide being destroyed through ZIRP and counterfeiting, unfettered government spending causing a visible US 17 Trillion debt).

That's a great store of value and rarity you're enamoured with there, Patsy and a nice bucnch of honest Joes you vote for to maintain the value of your CURRENCY. Are you 16 something or just not paying attention? Learn the definition of the words "Numeraire" and "standard" (as in a fixed length or measure).

Here is a portion of a story posted at Let me know how you feel about contributing to a savings plan after reading this. Can you concentrate long enough to make a conclusion?

From PBS:

The program, (on PBS) The Retirement Gamble, showed how if you work for 50 years and receive the typical long-term return of 7 percent on your 401(k) plan and your fees are 2 percent, almost two-thirds of your account will go to Wall Street. Under a typical 2 percent 401(k) fee structure, almost two-thirds of your working life will go toward paying obscene compensation to Wall Street; a little over one-third will benefit your family – and that’s before paying taxes on withdrawals. The dirty secret is the negative impact that Wall Street fees subtract from compounded interest over long blocks of time.

In the program, Smith pulls up a compounding calculator on his laptop. On air, he shows the viewer the results:

Smith: “Take an account with a $100,000 balance and reduce it by 2 percent a year. At the end of 50 years, that 2 percent annual charge would subtract $63,000 from your account, a loss of 63 percent, leaving you with just a little over $36,000.”

You can prove the point to yourself. Pull up a compounding calculator on line. Assume an  account with a $100,000 balance and compound it at 7 percent for 50 years. That would give you a return of $3,278,041.36. Now change the calculation to a 5 percent return (reduced by the 2 percent annual fee) for the same $100,000 over the same 50 years. That will deliver a return of $1,211,938.32. That’s a whopping difference of $2,066,103.04 – the same 63 percent reduction in value in Smith’s example.

Approximately 70 percent of Americans who have a retirement plan at their place of work have a 401(k) plan rather than a pension plan (defined benefit plan) that would deliver a fixed sum at retirement. Not everyone is paying 2 percent in 401(k) fees. Some workers are paying more and others are paying less – sometimes much less if using passively managed index mutual funds.

If you had saved gold, you would notice the skimming of your ounces by light-fingered execs but because it's currency and you don't control the production or earnibg of it, you are easily set up for disappointment. Get used to it.

Mon, 12/23/2013 - 10:18 | Link to Comment GOSPLAN HERO
GOSPLAN HERO's picture

pffffftttt fart

Mon, 12/23/2013 - 10:05 | Link to Comment Toolshed
Toolshed's picture

Gosh, what an idiot you are. Our food chain is corrupted too you know. I suggest you stick to your philosophy and stop eating immediately. You will make the world a better place in no time by doing so. Thanks in advance.

Mon, 12/23/2013 - 06:43 | Link to Comment Kina
Kina's picture

If the US repudiates debt it will cause an immediate implosion of global finance and economics... and totally fuck the USA as bad, if not worse than all else.


US military might has value in force projection...but ultimately there exists MAD... and I think the Chineses more unpredictable in a direct US China confrontation when SHTF... TPTB will not force this issue because the backers and owners of US and Europe wont risk their position on predicting China's actions.


Also if China knows it is in deep shit on the economic domestic politcal front and we reach a prisoners dilema...they will not hesitate to dump USD enmass.


China is not Europe or the USSR... if they see the best long term result is one action, and it is something that shores up immediate power that looks at risk...they will simply do it. The US cannot play the same old games they have in the past with other nations....this is a different animal with a very long history...and unique domestic problems that always requires large actions to maintain power.





Mon, 12/23/2013 - 06:30 | Link to Comment Kina
Kina's picture

And of course record demand for physical gold means a lower gold price...doesn't it CFTC.


Another day another blatant corruption of the gold those who know they are beyond the law ans will never be prosecuted or thrown in jail....yet.

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