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Overnight Sentiment: Gold Rout Halted For Now

Tyler Durden's picture


Yes, there was economic news overnight, such as a Eurozone and UK CPI, both of which came in line with expectations (1.7% and 0.4% respectively), and a German ZEW which confirmed Europe's accelerating deterioration, tumbling from 48.5 to 36.3, far below expectations of a 41.0 print (somehow the huge miss has managed to push the EURUSD up by 60 pips to an overnight high of 1.31 but this is merely the pre-US open manipulation to ramp US equities higher), just as there was news that Angela Merkel's support for a Cyprus bailout is growing (was there an alternative?), and that as part of their ongoing investigation into Italy's repeatedly insolvent Monte Paschi, investigators had seized €1.8 billion worth of assets from Nomura Holdings, and that Spain as usual sold more Bills than expected, driven by oversize Japanese and Pension Fund purchases, but what everyone has been looking for is whether the relentless and record rout in gold is over. For now, it appears that is the case, with gold printing an overnight low of just over $1320 and ramping higher ever since, up 3% so far and rising.

Amusingly, Goldman was stopped out on yet another trade overnight, this time its Commodity Carry Basket which hit the firm's -6% stop loss signal, and yet even with gold crossing Goldman's target, the firm has so far refused to close out its position:

Although gold has now traded below the $1,450/toz target embedded in our short recommendation, we are maintaining our short as we argued last week that prices could decline more than we initially thought as positioning is stretched and the momentum is to the downside. The most recent ETF holdings showed acceleration in the liquidation of length, which points to a broad-based sell-off extending beyond the futures markets with potentially more room to go. As a result, we are now lowering the stop to $1,400/toz (which locks in a potential gain of 12%) while we wait for evidence of a bottom, though we are not changing our price forecasts now.

Looks like Goldman has much more gold to buy from its muppets, who continue being routed on the firm's various other trading recos with realized losses.

Below are some other fresh overnight view on gold:

Credit Suisse:

  • The price is now not far from the level CS’s technical analysts identify as the next key area of support: $1,310
  • Next key level is $1,156, then $1,122; Beyond that, $1,000


  • Factors affecting the metal: April 10th FOMC minutes showed some members favor an early end to QE, a shift out of commodities into equities and bonds, ongoing gold ETF liquidation and reduction in net longs on the Comex
  • Price break of $1,525/oz followed by $1,500/oz at the end of last week were important technical support and psychological levels
  • Of the top 20, 17 of the biggest drops occurred during the 1970s and 1980s; this daily drop is the biggest for 20 years with the next biggest occurring in Oct. 2008 at the height of the financial crisis
  • Expects “slow grind” higher


  • Gold is the key sentiment setter among commodities; price moves appear to be the result of a concerted short sale by funds trading futures
  • Seems to have been a series of drivers behind collapse; key has been the potential for an end to QE in U.S.
  • Will be a while before there can be a strong rally;  would require a big policy mistake from a major central bank to reignite anti-dollar sentiment


  • Although risks still skewed to downside, an attractive entry opportunity is unfolding, especially if gold consolidates around next technical support level near $1,250/oz
  • Recent selloff is an exaggeration; sales of ETFs have unwound almost all of the eurozone crisis buying seen in 2012


  • Longer term fundamentals remain unchanged
  • Gold likely to bounce in 2H and move slowly upward as inevitable further monetary easing comes to play


  • Collapse represents “an extreme capitulation”
  • Investment case remains fundamentally unchanged


Finally, both the bank of Sri Lanka, and the Azeri oil fund thanked whoever was selling the paper gold, saying the drop represents a buying opportunity and both would continue to capitalize on the cheap physical prices.

Looking at the day ahead, in terms of perfectly irrelevant fundamentals which no longer move any risk assets, we have housing starts, permits, industrial production and CPI. Large caps including Cocacola, Goldman Sachs and Johnson & Johnson
will be reporting earnings before the opening bell, followed by Yahoo
and Intel who report after the US market closes.


Key macro observations from SocGen:

Markets retain full confidence in central banks to soothe the path to economic recovery, but this did not halt the correction across risk assets from deepening yesterday on a variety of factors which brought commodties crashing down to earth. Is China’s growth slowdown turning into a bigger scare for global demand?

The Fed is still moving towards an exit strategy, but the timescales remain highly uncertain. The latest US economic indicators have disappointed, holding back any sense of urgency to start tapering bond purchases. Today’s housing market and industrial production data are expected to point in the same direction.

The BoJ is on the offensive and the question is how much further the JPY will fall. SG strategists cut their 1y USD/JPY projection from 103 to 110. Sudden moves in both the USD/JPY and EUR/JPY since the 4 April meeting prompted a pause at the beginning of the week. This was also fuelled by lower-than-expected Q1 2013 Chinese GDP. Nevertheless, the downward trend in the JPY is clearly under way and a positive outcome for US housing construction and production data today should put USD/JPY back on track for a test of 100.00. The ECB is also accommodative and further policy easing has not be ruled out: a weak German ZEW index today will boost expectations of central bank stimulus. Draghi will testify to the EP today. The BoE may well be the G4 central bank with the toughest policy challenge as CPI continues to deviate from the target, growth is lackkustre  and credit demand weak. Another increase in CPI is on the cards today.

Overall, G4 central banks remain very prudent, leaving the markets overflowing with liquidity, which will underpin the search for yield in the short term. Any easing in US yields, weakening in the AUD, downturn in the USD/JPY or upturn in the EUR/USD will offer opportunities to position on medium-term directional coverage strategies on long US rates, an upturn in the USD/JPY or a downturn in the EUR/USD.

* * *

The full overnight summary from Deutsche's Jim Reid:

Markets were already having a difficult day prior to the Boston explosions with Gold in crash territory (more below). The S&P 500 was already down 1.4% prior to the explosions but closed -2.3% as the magnitude of the events became clear. The big move of the day was the one that saw the Gold market crash as it fell 9.1% to $1348/oz. This is the 5th largest daily fall since the US suspended the convertibility of the Dollar into Gold in 1971, the point which heralded the move from a Gold based global monetary system to a Fiat based one. It was also the largest single daily fall since the 28th of February 1983.

Over the last two sessions, gold has fallen 13.7% which also makes it also the 5th largest two-day fall since Bloomberg records began in 1920. So what’s been behind the price move in gold? There has been a lot of talk that the technicals had been skewed in the lead-up to last Friday. Newswires suggest that a number of large gold investors have been forced to unwind following the triggering of stops in the $1400-1500/oz range and that several brokers who were caught long have been forced sellers in the last couple of sessions. The WSJ reported that more than $1bn flowed out of physical gold ETF, SPDR Gold Trust, on Friday marking the third-largest outflow on record since the fund’s inception in 2004. The SPDR Gold Trust shed nearly 4% or $2.3bn of its assets last week, ending Friday with roughly $57 billion. Trading volume in the SPDR Gold Trust on Monday was running more than 7x the average and was the heaviest on record, topping the previous high set in December 2009. On the macro side, there has been talk of lower Chinese retail demand amid the recent slowdown in domestic growth and the more benign inflation trends seen recently in China. Last week’s report that Cyprus may sell part of its gold reseves to raise an estimated EUR400m for its bailout has also fuelled suggestions that other indebted countries may follow suit. Our commodity strategists write that fundamentally the economic indicators are disappointing in the US and the Fed is cooling on its QE stance – reducing demand for the gold as a hedge. They also note that with marginal industry costs for the gold mining industry at around the USD1,300/oz - the market could see some support around that level if this situation worsens.

Over the past few weeks, gold has also failed to rally despite the events in Cyprus in late March and the BoJ’s announcement of a new monetary easing regime in early April. One would normally expect that the threat of a country leaving the Eurozone, deposit haircuts, capital controls and unprecedented levels of easing by a major central bank, all occurring within a short span of time, would be enough to send gold higher. The fact that it hasn’t was probably disappointing to those who had held gold to hedge against those risks, and suggests that the marginal buyer of gold was already fully exposed. In other news, Citigroup's better than expected earnings ($1.29 vs $1.17 expected) yesterday failed to offset the negative sentiment during the US session. The bank reported sluggish net interest margins and loan demand, echoing similar statements from JPMorgan and Wells Fargo last week in what may be the beginning of a recurring theme for US banks this reporting season. Despite the negatives, Citigroup (+0.2%) was only one of seven S&P500 stocks to finish higher yesterday.

Turning to overnight markets, commodities are having a mixed session with Brent (-1%) continuing to trade weaker but gold (+1.1%) and copper (+0.3%) paring some of the recent losses. The USDJPY and AUDUSD have stabilised at 97.55 and 1.036 respectively following sharp corrections yesterday. In terms of equities, most Asian bourses are around half a percent lower with oil, gas and mining sectors stocks leading the declines. The KOSPI (+0.1%) is outperforming despite a warning from the North Korean military to South Korea that a strike “will start without any notice”. The South Korean government unveiled a 17.3trillion supplementary budget to support exporters who have been pressured by a weaker yen and this is boosting sentiment. Staying in the region, overnight Moody’s affirmed China’s rating of Aa3 but changed its outlook from positive to stable. The rating agency wrote that progress in increasing the transparency of local government debt and reducing credit growth were less than anticipated. The move comes one day after China reported its fourth consecutive quarter of sub-8% GDP growth – the first time this has occurred in two decades, according to Bloomberg data.

We have a busy day ahead with the immediate focus likely to be on the fallout from the tragic events in Boston. On the data front, we have the Italian trade report, Eurozone and UK CPI and the German ZEW survey in Europe. Mario Draghi will be presenting the ECB’s annual report to the European Parliament at 2pm London time. In the US, the data highlights include housing starts, permits, industrial production and CPI. A number of large caps including Cocacola, Goldman Sachs and Johnson & Johnson will be reporting earnings before the opening bell, followed by Yahoo and Intel who report after the US market closes. The IMF publishes its World Economic Outlook and Fiscal Monitor report today, and the Fed’s Janet Yellen will chair a monetary policy panel at the IMF’s Macro Policy conference. The BoE’s Mervyn King will also be participating in the discussion.


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Tue, 04/16/2013 - 06:58 | 3455390 jeebus
jeebus's picture

Do we think there is one more gold smack down left??? Will we see 1250?

Tue, 04/16/2013 - 07:00 | 3455393 negative rates
negative rates's picture

Okay, who's turn is it next?

Tue, 04/16/2013 - 07:08 | 3455411 GetZeeGold
GetZeeGold's picture



If it's your first gotta fight.

Tue, 04/16/2013 - 07:22 | 3455436 Gief Gold Plox
Gief Gold Plox's picture

BTFD if you can.

An old lady was in front of me at the shop. I was there to pick up may yesterdays purchase. From her crappy looking purse she  took out 150K euro and some change and basically cleaned the shop dry. As of this morning no deliveries are possible till April 30th. I've been trying to get a hold of some silver at these prices, but ain't noone selling for less than spot +20% right now.

Crazy out there.

Tue, 04/16/2013 - 07:30 | 3455448 Manthong
Manthong's picture

It’s just a good thing there was nothing else happening in the world to take people’s attention off of the peculiar and sudden hysteria to flee to the safety of government’s warm monetary embrace.

“Help me Obi wan Bernanke, you’re our only hope.”  

Tue, 04/16/2013 - 08:16 | 3455560 Pinto Currency
Pinto Currency's picture


If Andy Maguire is right that there has been rejection of delivery requests by bullion bank(s) on the LBMA, then there is a high potential of a further physical squeeze on the fractional gold LBMA positions.

Tue, 04/16/2013 - 07:48 | 3455490 SmallerGovNow2
SmallerGovNow2's picture

APMEX ASE's going for 6.50 to 8.00 over spot depending on quantity and method of purchase.  That's about 33% over spot!

Tue, 04/16/2013 - 08:08 | 3455543 Urban Redneck
Urban Redneck's picture

Spreads look relatively stable here in Switzerland compared to the last few months, and there is supply available, but the fact that Crapmex is down to generic kilo bars implies the strong hands are busy on the other side of the pond. 

Tue, 04/16/2013 - 07:03 | 3455394 GOSPLAN HERO
GOSPLAN HERO's picture

Just BTFD.

Tue, 04/16/2013 - 08:56 | 3455676 TWSceptic
TWSceptic's picture

Nice gold rally today. Is that you Goldman Sachs buying up the dip?

Tue, 04/16/2013 - 07:03 | 3455398 nmewn
nmewn's picture

This may be as good as it gets.

Tue, 04/16/2013 - 08:23 | 3455585 unwashedmass
unwashedmass's picture


maybe not. maybe the canadians --- unlike the british --- will be brave enough to tell people what is going on. 

the program is scheduled for thursday night and being publicized. 

last time, the BBC pulled the documentary they prepared........

let's see if the canadians -- while very polite people often unwilling to offend --- have the balls to defy JPM. 

Tue, 04/16/2013 - 07:00 | 3455392 GOSPLAN HERO
GOSPLAN HERO's picture

Lots of empty shelves at APMEX and ProvidentMetals.

Tue, 04/16/2013 - 07:10 | 3455412 GetZeeGold
GetZeeGold's picture



Having a hard time putting a price on the IOUs at the moment.

Tue, 04/16/2013 - 07:14 | 3455417 JonNadler
JonNadler's picture

Everything is stock delayed at Provident

Tue, 04/16/2013 - 07:16 | 3455423 GetZeeGold
GetZeeGold's picture



Dude....don't say that. You could start a riot.

Tue, 04/16/2013 - 07:34 | 3455452 Being Free
Being Free's picture

Liberty c&pm sent out the following:

"Online ordering will be available from 7:30 am to 5:00 pm PST this week, due to volatility. We expect to resume extended ordering hours early next week.

Please note that we are seeing extreme tightness in the physical markets at this juncture, and as such delivery times may take up to 4 weeks."

I guess in this NWO this is the way markets work; if supply drops so does price.  WTF

Tue, 04/16/2013 - 07:02 | 3455397 LibertarianX
LibertarianX's picture


Earth quake here in abu dhabi

Maybe another one in Iran?

Stronger than last week

Everybody evacuating our tower


Tue, 04/16/2013 - 09:11 | 3455733 mick_richfield
mick_richfield's picture

I hope you are safe LX !

The world cannot afford to lose any of its Libertarians.



quake was 7.8, near middle of Iran / Pakistan border.

Tue, 04/16/2013 - 12:55 | 3456897 LibertarianX
LibertarianX's picture

Cheers - all ok here 

Tue, 04/16/2013 - 09:34 | 3455859 Proofreder
Proofreder's picture

USGS - it's a biggie - 7.8 preliminary reading, near western edge of plate boundry.

Not good to be that high.

Tue, 04/16/2013 - 07:02 | 3455399 jover
jover's picture

i bought some at 1350. If it drops more, i'll buy some more.

If the prise rises, though, i'll buy some more!

Hell, whenever i get some fiat, i'll buy some more.


Tue, 04/16/2013 - 07:05 | 3455403 ArkansasAngie
ArkansasAngie's picture

If it isn't one thing, it's another.

There are no free markets.

Tue, 04/16/2013 - 07:21 | 3455431 GetZeeGold
GetZeeGold's picture



I don't get it.....stawks should have been up a 1000 points yesterday.


Who's in charge of this goat roping contest?

Tue, 04/16/2013 - 08:05 | 3455524 negative rates
negative rates's picture

It's the new thing, the blind leading the blind looking for more apologies.

Tue, 04/16/2013 - 07:04 | 3455406 q99x2
q99x2's picture

I pray for a peaceful day. And, the paper gold market is pretty much its own market so not much to be concerned about except for the Morgue stealing from the paper holders.

Tue, 04/16/2013 - 07:10 | 3455414 Sheeple Shepard
Sheeple Shepard's picture


  • Collapse represents “an extreme capitulation”
  • Investment case remains fundamentally unchanged

You can say that again. If anything it has become more bullish for the contrarians among us. Never was a follower of fashion.

Tue, 04/16/2013 - 07:37 | 3455459 SmallerGovNow2
SmallerGovNow2's picture

JPM can go fuck themselves...

Tue, 04/16/2013 - 07:15 | 3455416 Winston Churchill
Winston Churchill's picture

Whatever it was that happened is being kept under wraps.I expect we will

find out Friday after hours if they stick to form..

The smackdown just emptied the shelves, not the reaction TPTB expected.

Hardly the infallible obermensch they believe they are.

Whats going on in the shadow banking system Tyler ?

Tue, 04/16/2013 - 07:15 | 3455421 JonNadler
JonNadler's picture

that's not the way it supposed to happen, you little sheep were supposed to panic and dump everything  and listen to Goldman Sachs not empty out all the dealers in the world!!

Tue, 04/16/2013 - 07:40 | 3455464 Rubicon
Rubicon's picture

You need to change your avatar pal. I keep thinking you are about to speak a load of bollocks.

Tue, 04/16/2013 - 08:16 | 3455563 JonNadler
JonNadler's picture

well...but just look at my name, doesn't that lend credibility to my writings regardless of the avatar?

Tue, 04/16/2013 - 09:06 | 3455717 Croesus
Croesus's picture

I was wondering about that....

Tue, 04/16/2013 - 08:14 | 3455557 Obadiah
Obadiah's picture

yeah flipp the pic so its looking over the right hand

Tue, 04/16/2013 - 08:52 | 3455655 augustusgloop
augustusgloop's picture

do you think they care about a few little guys like myself trying to get their hands on silver eagles? there was obviously much bigger business to attend to - we were just the recipients of all this. 

Tue, 04/16/2013 - 11:07 | 3456282 toady
toady's picture

I'm sticking with the theory that they drove the price down for the Cyprus purchase. Those couple of hundred $ per ounce really add up when you're buying ten tons!

Tue, 04/16/2013 - 07:18 | 3455425 Sheeple Shepard
Sheeple Shepard's picture

"The smackdown just emptied the shelves, not the reaction TPTB expected"


Unless they (TPTB) are the ones filling their deep pockets. Sell paper buy physical. Prepare for inevitable s**tstorm.

Tue, 04/16/2013 - 07:15 | 3455420 RaceToTheBottom
RaceToTheBottom's picture

Pretty soon an OZ of gold will buy a Fiat.  A Fiat car that is.

Tue, 04/16/2013 - 07:17 | 3455427 Room 101
Room 101's picture

Could also be a dead cat bounce. 

Tue, 04/16/2013 - 07:54 | 3455434 screw face
screw face's picture


BTFD, then kiss your ass good by.

Engage big red button factor!

Tue, 04/16/2013 - 07:18 | 3455428 disabledvet
disabledvet's picture

First off the plan is to find out what happened in Boston. This seems very similar to the Times Square attempt so clearly "there is an enemy among us." in World War Two and Vietnam we let our freedoms do the talking so we didn't have these "fear problems" (mass hysteria/paranoia a seeming abscence of law) that we do today. Having said that if we are to look at this in strictly financial terms (and no I'm not crying over my Treasury bet...yes many other things...but no not the loss of my country) then clearly "Boston" as it is now called means further aggregation of wealth into banks and (what's left of it at least) Wall Street.

Tue, 04/16/2013 - 07:20 | 3455430 Sheeple Shepard
Sheeple Shepard's picture

"Tall buildings swayed in the Indian capital Delhi, reports say."


Tue, 04/16/2013 - 07:25 | 3455439 samcontrol
samcontrol's picture

I'm fucked!

Tue, 04/16/2013 - 07:27 | 3455444 GetZeeGold
GetZeeGold's picture



Good for you......bout time.

Tue, 04/16/2013 - 07:23 | 3455440 razorthin
razorthin's picture

From weak hands to strong hands, bichez.  The Eurozone can dump all its gold and none will make it to market.  It's equities that should be dumped here, bichez.

Tue, 04/16/2013 - 07:27 | 3455442 cutefarts
cutefarts's picture

Magnitude 7.8 Quake Hits Iran, USGS Says



Tue, 04/16/2013 - 08:15 | 3455564 RaceToTheBottom
RaceToTheBottom's picture

Probably caused by some black art programming by secret government agencies

Tue, 04/16/2013 - 07:28 | 3455446 reader2010
reader2010's picture

Gold's P&F Chart prints $920 as the next stop while $10 for Silver. 

Tue, 04/16/2013 - 07:32 | 3455449 Sheeple Shepard
Sheeple Shepard's picture

Charts? Like reading the schematics of the Titanic whilst its sinking.

Tue, 04/16/2013 - 07:39 | 3455461 cutefarts
cutefarts's picture

Those fresh shorts who joined the bandwagon from overnight asian and NY sessions yesterday might be sitting quite nervously with this bounce.

Tue, 04/16/2013 - 10:18 | 3456059 Diogenes
Diogenes's picture

After yesterday we all need fresh shorts.

Tue, 04/16/2013 - 08:16 | 3455566 reader2010
reader2010's picture

Three days ago its PF chart said $1300 as the next stop

Tue, 04/16/2013 - 07:40 | 3455463 new game
new game's picture

has anyone thought that maybe the whole plan is to minimalize gold and silver to the point that it is a worthless placement of fiat.

so costs exceed value. so what. if the ptb can keep minimalizing value then they have acheived their goal.

not saying it will work.  but as the pundants keep saying 99 percent don't even own any, but wait til they do.

hmmm, contrarian to the contrarian, i say this may be a losing battle only raged in your mind as your hard earned fiat get shrunk in value.

collect all you desire, as you still have that freedom, but the question i ask is; what is it worth?

time for me to rethink my excess labor placements or work less...

leaning toward less labor and more time to not give a shit about any of this crap called savings of excess labor.

Tue, 04/16/2013 - 07:44 | 3455471 Sheeple Shepard
Sheeple Shepard's picture

"if the ptb can keep minimalizing value then they have acheived their goal." They can minimize the perception of value, not the value its self. And only if we allow them to.

Tue, 04/16/2013 - 07:49 | 3455486 razorthin
razorthin's picture

Right.  Fuck the "we", like "we" matter.  Tell that shit to the nations who keep accumulating by the tonne.

Tue, 04/16/2013 - 07:58 | 3455514 new game
new game's picture

to unlock that value it must be used and widely accepted as tender or trade.

case in point-last fall i offered a 20 oz tube of eagles for a colt woodsman target (about the same value) and have offered to sellers on gunbroker(several times) trades plus or less fiat and the same response-NOT interested. so until we don't have to get ass raped by dealers, this just another trade for someone elses baggage because in the time of need(ACCEPTED FORM OF PAYMENT), nobody wanted my silver for equivalent value.  and will that change? well that seems to be the theme for holding pm. but when that happens, something tells me we got much greater problems.  do i want your pm for my bread - sorry but id be more interested in that warm coat you have...

Tue, 04/16/2013 - 08:11 | 3455545 Sheeple Shepard
Sheeple Shepard's picture

I just save my money in PMs, dude.

1: Because its a historically proven means of storage of value

2: So i can opt out of this Satanic system of debt based currency as much as possible. 

If it ever gets to the point where i need to trade for bread, well, thats a different matter entirely. 

Tue, 04/16/2013 - 08:23 | 3455588 Manipuflation
Manipuflation's picture

"If it ever gets to the point where i need to trade for bread, well, thats a different matter entirely."

Agreed.  We will be trading lead at that point.  Good luck today.

Tue, 04/16/2013 - 13:17 | 3456984 Himins
Himins's picture

Which is precisely what I did. My new "assets" are a 10 acre farm, off the grid with solar panels, heat home AND water with both wood and solar, shoot and grow my own food, invested in a bunch of truck farming equipment.
I NEVER guessed how effective solar panels were, nor how inexpensive they were compared to the cost of electricity...they paid for themselves in just under 12 months. I do have to hang my cloths to dry as I didn't size the system large enough to run and electric dryer.
I have strung many months together with a total income of under 50 dollars...thats where my silver went, and don't have enough dry powder to take advantage of this dip, but I am finding folks who can.

Tue, 04/16/2013 - 07:49 | 3455488 Seasmoke
Seasmoke's picture

Serious question.

Last night I was checking prices and saw the 1320 price and decided to follow my gut instincts and buy 25 ounces. Make a long story short I somehow bought 50 ounces. Well I wake up today and look at that, I may have actually caught the falling knife. I have to send bank wire today. Question is . This is most all my fiat money I have left. Was not planning to use it all last night , what would you all do ???? as I'm currently up $70 but of course that can disappear quickly.

Tue, 04/16/2013 - 07:59 | 3455520 xtop23
xtop23's picture

Ill take 10 off your hands if you're really concerned

Tue, 04/16/2013 - 08:11 | 3455548 negative rates
negative rates's picture

Drop back 5 yards and punt!

Tue, 04/16/2013 - 08:14 | 3455556 Manipuflation
Manipuflation's picture

I understand how that works.LOL  I think you are OK.  We will find out shortly.  I assume you have some rice and vodka stored up somewhere?  You will still need to eat and have some booze on hand.

I hope you win big Seasmoke.

Tue, 04/16/2013 - 09:18 | 3455757 mick_richfield
mick_richfield's picture

But that's easy.

You were led to buy double what you intended for a reason.

Now, sell half and keep half.

Use the profits on that half to buy food, water, etc.  Stuff you will actually use in any case. 

The angels gave it to you for free.

Tue, 04/16/2013 - 10:22 | 3456075 Diogenes
Diogenes's picture

Buy it and hedge with a put. I don't know where the market is going but I don't think the rodeo is over.

Tue, 04/16/2013 - 07:52 | 3455496 uhb
uhb's picture

Made 10% ROI yesterday by going short gold;

Made 6% ROI today by going long gold;

putting the profits into physical...

I love these markets!

Tue, 04/16/2013 - 08:20 | 3455580 RaceToTheBottom
RaceToTheBottom's picture

Over the long term ROI (return on investment)  does not equal ROG (return on gamble).  But congrates on your trade

Tue, 04/16/2013 - 08:35 | 3455609 Kina
Kina's picture

It has been a long time coming.... the blow up of the LBMA


LBMA Closes Off Public Access To Key Bullion Bank Trading Data


So if the bullion banks can't deliver, and holders wont accept fiat (especially at a slammed price of gold)...what they going to do?


They could go buy it and eventually push the price to highest levels yet, probably bankrupting themselves in the process.  Borrow it from the USA (if it has any)...or declare force majeur and say bad like, thanks for all the fish and fail....but I doubt fail is any option for them, TBTF.


So if the US has it will it give away all its gold to keep the bullion banks from crashing?


Well the stupid thing is if the Cartel and Fed did not play with Gold and Silver prices probably nobody would be looking at securing the actual physical or cashing it in. Maybe these guys unable to stay away from corrupting everything they touch have just ruined themselves by playing games with bullion markets.



Tue, 04/16/2013 - 08:42 | 3455622 Manipuflation
Manipuflation's picture

Or they made bullion cheap to interested buyer nations so that those nations keep buying shitty Western debt. 

Tue, 04/16/2013 - 08:46 | 3455638 CEE
CEE's picture

the ratio of gold/gold miners at historical highs... any interpretation?


Tue, 04/16/2013 - 08:48 | 3455641 CEE
CEE's picture

the ratio of gold/gold miners at historical highs... any interpretation?


Tue, 04/16/2013 - 08:55 | 3455661 EmileLargo
EmileLargo's picture

Cost of mining gold is around $1600 an ounce right now and is expected to rise to $2000 an ounce by 2016. No miner can make any money at these prices. Its nuts.

Tue, 04/16/2013 - 09:02 | 3455695 CEE
CEE's picture

so shouldnt we buy gold then? the price can stay below the production cost only until they sell the stock supplies

Tue, 04/16/2013 - 09:20 | 3455775 mick_richfield
mick_richfield's picture

1. the stock supplies are substantial.

2. everybody lies about how much gold they have.

3. silver gets consumed.

Tue, 04/16/2013 - 09:18 | 3455766 screw face
screw face's picture

Well heck then, sell, sell, sell.....then kiss your ass good by.

+1 for the patch.

Tue, 04/16/2013 - 09:31 | 3455840 CEE
CEE's picture

atcually it is up by 100% in two years. has mining changed that much?

Tue, 04/16/2013 - 08:57 | 3455663 Arius
Arius's picture

sell both short!  that was Goldman's advice, cant do better that that! As of today, they see it under 1400, of course, you are running your own risk and Yes, GS will take the other side of the trade if need be to provide for the team so to speak.  But .... all is well!

Tue, 04/16/2013 - 09:19 | 3455778 Debugas
Debugas's picture

miners' profit-margins (earnings) got sqeezed so P/E had to readjust accordingly by sending stock prices down

Tue, 04/16/2013 - 08:52 | 3455650 exgop
exgop's picture

Provident Metals in Texas is sold out

Tue, 04/16/2013 - 08:53 | 3455658 EmileLargo
EmileLargo's picture

Well the message from the TPTB is that if you buy gold and/or silver we will from time to time give you a damn good thrashing. The only way to play this is by making sure you keep a percentage of your portfolio in PMs and always cash at hand for opportunities like these.

Tue, 04/16/2013 - 08:59 | 3455688 Kina
Kina's picture

ANd from the past...shows how serious this shit is...


You Don't Mess With The LBMA - Assassination Attempt On Silver Market Manipulation Whistleblower?

Tue, 04/16/2013 - 11:10 | 3456300 polo007
polo007's picture

The Internet has also made it possible for truth seekers to understand the complex policy of financial repression that explains the current historically low negative real interest rates, restrictions that appear to benefit government and banks at the expense of pensioners and savers and the desperate need to shake people out of gold and savings and into the stock markets. Financial repression is a policy that explains the "why" of this mystery. A thorough investigation of financial repression can be gleaned from such documents as the NBER working paper, The Liquidation of Government Debt by Carmen M. Reinhart and M. Belen Sbrancia or the exhaustive work of financial analyst Gordon T. Long.

Through such investigation we will find that, just as Cyprus revealed bank depositors are viewed as "unsecured creditors" by the central banks, financial repression teaches us that pensioners and savers are viewed as a direct source of funding for government debt and are the victims rather than the beneficiaries of such government policies. The global fiat- or debt-based model that has existed since President Nixon removed the U.S. dollar's final international peg with gold in 1971 is in many ways the polar opposite to the value-based model that exists when a currency is pegged in some way to gold. Although most pensioners were brought up to believe that debt is bad, that saving and living within one's means is virtuous, in the bizarre world of fiat debt-based finance, the opposite is true.

Mounting debts are becoming unsustainable at government, business and personal levels, and must be addressed. Yet the fiat reality has spoiled Western investors, and direct taxation and austerity measures are a Western politician's guarantee of removal from public office. Therefore, indirect taxation, rules that make assumption of government debt through mandatory Treasury purchases by large funds, and debt reduction through currency debasement are the preferred option for reducing debt. All of these policies rob taxpayers and punish savers.

Precious metals are the one asset class that still remains beyond the control of central bankers and government policy makers. Precious metals are limited in supply and, although the paper market has demonstrated its ability to temporarily affect the price of gold and silver, it cannot change the fundamentals. Precious metals paper instruments such as ETF shares, mining shares and futures and options sustained even more damage during this longest correction in gold since 2000. Those who continue to own bullion to which they hold title are unaffected. Their holdings still retain purchasing power even while government policies decimate the purchasing power of paper currencies. An ounce of gold will still buy approximately the same number of loaves of bread as it would have in Biblical times.

There is another unexpected consequence of currency debasement that might also be responsible for this desperate campaign against gold. Japan's decision to win the "race to debase" has resulted in unprecedented Japanese gold buying as the yen weakens against the yellow metal. As several commentators have noticed, the gold war has become a battle of titans as vast amounts of Eastern capital challenges Western capital for the limited supply of physical gold.

Another clue is provided by the spate of new China-centric trade alliances that seek to circumvent the U.S. dollar. Brazil, Russia, India, China, South Africa and now Australia are all moving towards multi-billion dollar trade agreements that will bypass the use of the U.S. dollar completely. This is a significant threat to the U.S. dollar's global hegemony and a direct threat to the policy of financial repression, as this alone could force interest rates higher. By one account a single-point move in official inflation could add a trillion dollars to the outstanding U.S. debt because of indexed pensions and other unfunded government liabilities. This is another reason gold, the only true threat to paper currencies, and a much clearer indication of true inflation than doctored government CPI figures, must be discredited through price depreciation.

Financial repression is all about control of information. The well-timed, coordinated torrent of gold-negative reports such as those from Goldman Sachs and Societe Generale's The end of the gold era, each warning investors to flee the gold market, were highly suspicious examples of their cozy relationship with the central banks.

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