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Two Gold Charts

Tyler Durden's picture




 

We have one simple question - does the following small drop (which we happen to have seen before) in Gold ETFs, which at least according to the mainstream media, has been responsible for the recent slide in the price of gold, appear to justify the absolute surge in gold futures and options short exposure as per the Commitment of Traders report, which for yet another week, saw the biggest net short positioning since 1999. And no, we are not really confused - as we said "according to the mainstream media"...

 

 

 

and the Bonus third chart - what happened the last time futures were so 'short'...

 

Charts: Bloomberg

 

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Fri, 03/15/2013 - 16:03 | 3333365 nope-1004
nope-1004's picture

ETF's are the bankster management tool for the real thing.  100% fake.  COT is probably fudged too, like LIBOR.

 

Fri, 03/15/2013 - 16:04 | 3333376 SafelyGraze
SafelyGraze's picture

you can tell that it's *real* gold if it has the rfid chip embedded in it

http://www.youtube.com/watch?v=dpSKVk9iobc

 

Fri, 03/15/2013 - 16:09 | 3333388 cifo
cifo's picture

They don't call them "instruments" for nothing.

Fri, 03/15/2013 - 20:13 | 3333964 FranSix
FranSix's picture

Whenever I read 'instruments' I think bassoons and French horns.

Fri, 03/15/2013 - 16:12 | 3333394 flacon
flacon's picture

One could microwave one's gold or heat it up to the point where microchips melt....I suppose..

Fri, 03/15/2013 - 16:26 | 3333433 AllThatGlitters
AllThatGlitters's picture

There's a huge GLD ad on this page, LOL.  How's that for targeting?

I'll take the real thing.  OPM 1 oz bars are just $25 over spot:

http://www.pmbull.com/gold-price/ 

Fri, 03/15/2013 - 16:37 | 3333457 negative rates
negative rates's picture

Is that with or with out a heart of tungstun?

Fri, 03/15/2013 - 18:48 | 3333737 Buckaroo Banzai
Buckaroo Banzai's picture

If you check the fine print of the bylaws of GLD, you'll see that a GLD holder with a position size over a particular threshold (IIRC over 10 million dollars) can liquidate their position in physical gold. This is a great way for buyers in size to get physical. Keep that in mind when you see a sudden big drop in physical gold holdings at GLD. Some rich guy just cashed out in physical.

Fri, 03/15/2013 - 20:14 | 3333971 Harbanger
Harbanger's picture

There's no getting around the need for physical Gold.  Countries are stocking up on it because they already know the role it will play in the new global currency.  That's good news for gold bugs.  There's a currency summit in China this september with the purpose of establishing an international mechanism to create this new global currency.

Currency Summit:

http://www.bitcongress.com/gscs2013/welcomemessage.asp

Sat, 03/16/2013 - 01:15 | 3334579 fockewulf190
fockewulf190's picture

China will make the move to ursurp the dollar as the new world reserve currency, but only after the Great Reset. That is why they are buying as much phyzz as possible...and are keeping their trap shut as too how much they own. Once the dollar has imploded, they will re-introduce the renminbi as gold backed, and THEY will fix the price of gold to it. The US will be powerless to defend the dollar once it is forced to admit that it's claim of owning over 8000+ tons of gold has been a monsterous lie.

Fri, 03/15/2013 - 19:33 | 3333854 San Diego Gold Bug
San Diego Gold Bug's picture

OPM 1oz gold bars are only $19.99/oz over spot with no minimums at Libertycpm.com.

Junk silver is still tight and the premiums are still way above normal.

Sat, 03/16/2013 - 17:08 | 3336105 DaveyJones
DaveyJones's picture

is fudge the new crime flavor?

Fri, 03/15/2013 - 16:05 | 3333371 SWCroaker
SWCroaker's picture

But but but, they happened at the same time!   That *must* be the cause!   Causation/correlation <-- same word that old farts spell differently; pretty sure.

Edited to add: That bonus chart reminds me of the "decay" you get in the leveraged ETFs vs the index they track.  The shorts came off and the price of gold went up, but it stuck for the shorts and really didn't hold for gold.

Fri, 03/15/2013 - 16:03 | 3333374 Praetorian Guard
Praetorian Guard's picture

Interesting, I believe metals will go higher. On a side note, its funny that my friends sig other got a job at the local PD after they went through a poly, hair, blood, and urine samples and other bullshit. I asked him why she doesn't apply at one of the big mines in the area (gold) as they are looking for accountants, and he tells me she wants security, and a pension, retirement, etc. I'm like, that shits gone for govt. (correct me if I am wrong) - and that public jobs are not secure... that may be to some extent but these mines have been here forever, and they pay very, very excellent, with benefits, and bonuses, etc.

What is the obsession with working for the man?

Fri, 03/15/2013 - 16:07 | 3333383 nope-1004
nope-1004's picture

The obsession is you don't have to work.  Easy street, show up whenever, no accountability, sick days galore, etc...

 

Fri, 03/15/2013 - 16:10 | 3333390 Praetorian Guard
Praetorian Guard's picture

I hear you. However, all these pensions amd promises that the govt has told their employees, I think will not pan out for the future. They simply cannot, not enough revenue. Plus, its not a real job. Best buddy was a federal corrections K9 unit guy and quit in a heart beat to work out at the mines. Says its the best damn move he made. More money, and you get to breath fresh air. In the end, its all about $$$$.

Fri, 03/15/2013 - 16:23 | 3333416 Lore
Lore's picture

Two words: Meredith Whitney. DYODD re: the imploding world of municipal finance. 

Seeking safe refuge in government is an outdated paradigm, like treating your house as "savings."

Fri, 03/15/2013 - 18:59 | 3333763 glenlloyd
glenlloyd's picture

People reflexively turn to sovereign debt as a safe haven without considering that governments have onboarded tons of worthless paper and compromised their own balance sheets. They did it willingly and without complaint.

Eventually you run out of places to hide the mountain of worthless stuff...at some point there has to be pain.

govt debt (muni, state, fed) is not with the risk....

Sat, 03/16/2013 - 01:03 | 3334563 pbppbp
pbppbp's picture

Fresh air in a mine, haha! 

Fri, 03/15/2013 - 16:51 | 3333500 quid pro quo
quid pro quo's picture

Not to mention that once you're in, it's nearly impossible to get fired, especially if you're anything other than a white Christian male.

Fri, 03/15/2013 - 16:53 | 3333501 quid pro quo
quid pro quo's picture

double tap

Fri, 03/15/2013 - 16:12 | 3333393 Quinvarius
Quinvarius's picture

Women always want to work for the man. 

Fri, 03/15/2013 - 16:19 | 3333408 McMolotov
McMolotov's picture

"In this country, you gotta make the money first. Then when you get the money, you get the power. Then when you get the power, then you get the women."

http://www.youtube.com/watch?v=XJ7HZATMKBY

Fri, 03/15/2013 - 18:09 | 3333646 U4 eee aaa
U4 eee aaa's picture

There has got to be a short cut. By the time I get there my 11th finger won't work any more

Fri, 03/15/2013 - 18:08 | 3333644 U4 eee aaa
U4 eee aaa's picture

If the government goes broke(or maybe just admits it), the first thing under the bus will be all those high paid public servants. They won't know how to survive in the real world where the rest of us actually work

Fri, 03/15/2013 - 16:05 | 3333380 Water Is Wet
Water Is Wet's picture

They just need to go MOAR SHORTERER.  That'll show you goldbug dickheads.  Hear that Ben?  MOAR SHORTERER!

Fri, 03/15/2013 - 17:37 | 3333593 auric1234
auric1234's picture

I love the smell of short squeeze in the morning

 

Fri, 03/15/2013 - 16:16 | 3333398 Quinvarius
Quinvarius's picture

Hedgefunds and traders.  Sounds like customer money, not bank money.  Lets not forget how many of those funds are owned and run by banks who can use that customer money they contain anyway they want.

Fri, 03/15/2013 - 16:15 | 3333399 Yen Cross
Yen Cross's picture

O/T< it's a f..king miracle. Silver has been getting monkey hammered. Guess I should hit the coin shop this w/e.

                  :00:5   US 30 14508.50 -30.64 -0.21%

 

 

               
Fri, 03/15/2013 - 16:13 | 3333400 InconvenientCou...
InconvenientCounterParty's picture

China could sneeze and blow the ponzi wide open in a weeks time.

It makes you wonder what backroom deals have been done to prevent that.

Sat, 03/16/2013 - 00:08 | 3334501 BeerBrewer09
BeerBrewer09's picture

Why would they do that? They can just keep buying low until there is nothing left to buy.

Fri, 03/15/2013 - 16:14 | 3333402 Silver Garbage Man
Silver Garbage Man's picture

Just make sure you have your chair for when the music stops....I got mine.

Fri, 03/15/2013 - 16:21 | 3333417 Schmuck Raker
Schmuck Raker's picture

I'm "the Jester, on the sidelines, with a cast."

Fri, 03/15/2013 - 16:16 | 3333404 scatterbrains
scatterbrains's picture

In that 3rd chart it looks like the cot shorts were right and caught about a 15% drop in gold over the coarse of a few months. Then it looks like they managed to ease out of their shorts near the bottom before gold exploded higher.  Will they be right again in the next few weeks before the next lift off commences ?

Fri, 03/15/2013 - 16:25 | 3333431 Quinvarius
Quinvarius's picture

No.  That is not what that chart shows.

Fri, 03/15/2013 - 16:32 | 3333449 scatterbrains
scatterbrains's picture

Well it wouldnt be the 1st time I'm missing something but on the chart around april/may 98 gold is at 285ish while cot is at the highs 90k-ish.  Despite Cot at the high 90k-ish a few months later gold is at 250ish as the shorts are peeling off.

Fri, 03/15/2013 - 16:46 | 3333486 ParkAveFlasher
ParkAveFlasher's picture

When the shorts become the crowd, and there's a distinct tipping point, then it's far more profitable to go long - I think that's the story here.

Fri, 03/15/2013 - 16:53 | 3333509 scatterbrains
scatterbrains's picture

I totally agree I'm just hoping to take a 2nd swoop at gold in the 1350 to 1400 range.. pretty much my plan of attack.. this 3rd chart gives one hope that there will be a flush before reality hits.  A lot more peeps need to puke their gold up before we bottom... or so I'm hoping.

Sat, 03/16/2013 - 14:11 | 3335569 dogbreath
dogbreath's picture

1350?   aint gonna happen.  Those charts and the COT are psycological warfare.   OOOOhhh look at the scarey shorts, its gotta go down. 

You'll be lucky  to see 1520.

Fri, 03/15/2013 - 18:24 | 3333682 Go Tribe
Go Tribe's picture

Yep, that's the way I read it, too. Shorts did great, drove price into the ground before getting out. There was one last short attempt in August - the suckers who got greedy. But overall the shorts did well.

Fri, 03/15/2013 - 16:16 | 3333406 goBackToSleep
goBackToSleep's picture

It's simple comrade. You don't wanna be the last motherfucker pulling the cart. That would be stupid. You're gonna wanna ride in it for a while before the SHTF! Comrades get paid, the rest will be EBT zombies. You can take the comrade monies and plow them into "real money" and bug out. Just my .02. Please don't be the last one into the "Free" health care system. You're already paying for it with your 7 dollar loaf of BernanQE inflated bread. All bets are off. Game the system. If we all jump in the cart, it will cause the reset to happen quicker. There's absofuckinglootely now way they can back this shit out. It you think they can, you probably need to go back to sixth grade pre-algebra class.

Not an attack at you, PISSSSST off right now!

Fri, 03/15/2013 - 16:20 | 3333415 NoWayJose
NoWayJose's picture

Makes you wonder if China is shorting paper gold so it can load cheaper physical...

Fri, 03/15/2013 - 16:25 | 3333423 Lore
Lore's picture

...Through intermediaries. Yah. Wouldn't you?

Fri, 03/15/2013 - 16:24 | 3333424 chubbyjjfong
chubbyjjfong's picture

Absolutely. And not just China!

Fri, 03/15/2013 - 16:49 | 3333497 ParkAveFlasher
ParkAveFlasher's picture

Me too.  I'm literally short dollars, because every time I get some cash, I pack into the mortgage, or buy something shiny, or lock it up, or just turn it into something else.  Doing my personal part to keep the velocity of money at a "healthy, vigorous" level.

Fri, 03/15/2013 - 16:29 | 3333442 realtick
realtick's picture

back to the serif font, huh?

Fri, 03/15/2013 - 16:39 | 3333468 McMolotov
McMolotov's picture

All these charts should use fucking Comic Sans.

Fri, 03/15/2013 - 18:46 | 3333725 ebworthen
ebworthen's picture

Serf font?

But seriously, the serif's make the text more legible in general, and especially for anyone with visual impairment.

Anyone comes out with a Sans Serf or a Sans Sheriff font that uses serif's I'll be all over it.

Fri, 03/15/2013 - 16:43 | 3333480 Sigep0612
Sigep0612's picture

This is nonsense.  We've been conditioned to think in bubble terms.  We're all puppets.  Dot com, Real Estate, Gold & Silver, and now once again, the stock market.  The guys pulling and pushing our strings know what they're doing.  The ying and yang is required in order to thwart civil uprisings.  Divert attention away from the national debt/worldwide debt, have a complicit media, and continue to dumb down the (American) public.   (I know it's hard to believe that Americans can become more stupid than they already are but....I have faith).    

However, it's the unknown ...an unknown event...that will ultimately destroy the power brokers but at the same time destroy civilization.  When that happens is anybody's guess...but I am convinced it will happen. 

Fri, 03/15/2013 - 17:48 | 3333611 Cacete de Ouro
Cacete de Ouro's picture

Pisani's destination, the GLD bars, the HSBC motherlode, hidden in plain view, a river runs through it...

Fri, 03/15/2013 - 18:12 | 3333654 U4 eee aaa
U4 eee aaa's picture

Silly me. I was begrudging buying anything resembling gold or gold stocks (still doing it but just grumbling about the price). I was thinking the price was expensive. It is nice to see the rubber band effect in place as these guys continue to make it cheaper (relative to the coming explosion) by the day.

I wasn't able to properly catch the first wave up in the early 00s. I'm glad I've got a seat on the second train out

Fri, 03/15/2013 - 18:54 | 3333746 ebworthen
ebworthen's picture

Fly on the wall heard this at Goldman Sachs March 2009:

"Okay, we have to ramp equities, keep PM prices contained, and make buying barbarous relics, holding cash, or buying treasuries look like a fool's game. 

It will probably take $6+ Trillion up front - probably more - and a lot of talking heads and headlines of recovery to sucker those sheep back into equities but it's the only way to maintain our gravy-train, our control, and not return to free markets that determine prices and the allocation of capital."

"ENGAGE!" Said Ben.

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