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10 Signs The Paper Gold Crash Unleashed An Unprecedented Demand For Physical Gold And Silver

Tyler Durden's picture




 

Submitted by Michael Snyder of The Economic Collapse blog,

The crash of the price of paper gold on Monday has unleashed an unprecedented global frenzy to buy physical gold and silver.  All over the planet, people are recognizing that this is a unique opportunity to be able to acquire large amounts of gold and silver at a bargain price.  So precious metals dealers now find themselves being overwhelmed with orders in the United States, in Canada, in Europe and over in Asia. 

Will this massive run on physical gold and silver soon lead to widespread shortages of those metals?  Instead of frightening people away from gold and silver, the takedown of paper gold seems to have had just the opposite effect.  People just can't seem to get enough physical gold and silver right now.  Those that wish that they had gotten into gold when it was less than $1400 an ounce are able to do so now, and it is absolutely insane that silver is sitting at about $23 an ounce.  If the big banks continue to play games with the price of gold, we are going to see existing supplies of physical gold and silver dry up very quickly. 

And once reports of physical shortages of gold and silver become widespread, it is going to absolutely rock the financial world.  But this is what happens when you manipulate free markets - it often has unintended consequences far beyond anything that you ever imagined.

The following are 10 signs that the takedown of paper gold has unleashed an unprecedented global run on physical gold and silver...

#1 According to Zero Hedge, the U.S. Mint set a new all-time record for the number of gold ounces sold on Wednesday...

According to today's data from the US Mint, a record 63,500 ounces, or a whopping 2 tons, of gold were reported sold on April 17th alone, bringing the total sales for the month to a whopping 147,000 ounces or more than the previous two months combined with just half of the month gone.

#2 Precious metals dealers all over the United States are having a really hard time keeping up with demand right now.  According to Chris Martenson, many are warning customers to expect waiting times of five to six weeks at this point...

In the U.S., all of the dealers I talk to are reporting huge demand and brisk buying. Silver in any form is quite hard to come by unless you want to pay premiums of 20%+ per ounce above spot price. Delivery times are 5 to 6 weeks out now that's an unusual situation.  If this recent slam was designed to scare people away from gold, it did not have that desired outcome; in fact, just the opposite.

#3 Individual dealers all over the country are confirming that we are seeing a voracious appetite for precious metals at the moment.  For example, the following is what a spokesperson for JM Bullion had to say...

We still have certain things in stock, like 10 oz bars, while others, like Silver Eagles, are a bit of revolving inventory.

 

The shipments are going out as soon as inventory comes in.

 

Our main challenge right now is actually getting the silver into the boxes and shipped out – we have been experiencing astounding volume.

This appears to be a widespread phenomenon.  Just check out what other dealers are reporting...

“There has been a marked increase in demand since the plunge,” said Mark O’Byrne, executive director at Dublin-based investment and bullion specialist GoldCore, referring to the drop in gold prices seen Friday and Monday. Gold futures lost more than $200 an ounce, or over 13%, on those two days. They were at $1,392 an ounce, moving higher ahead of the close on Thursday.

 

GoldCore has seen more buying than selling on Wednesday and Thursday, with buy orders “lumpier and from high net worth clients, and with most of the selling in small orders of less than 50 ounces, said O’Byrne.

 

On Wednesday, David Beahm, executive vice president at Blanchard & Co., said his precious-metals investment firm has seen “2008-like demand” for gold since Monday.

#4 Large international banks are also experiencing tremendous demand for physical gold and silver by customers right now.  The following is what Keith Barron told King World News about what he is hearing...

At the Bank of Nova Scotia in Toronto the gold window has been absolutely swamped. I have confirmed there were people lined up in droves recently for multiple-hours at a time to buy gold and silver bars and coins....

 

I then confirmed with UBS today in Zurich, Switzerland, that they are experiencing exactly the same thing. They told me people are waiting in long lines for bullion related bars and coins. The physical market is incredibly tight, and there is a huge buying opportunity right here.

 

The damage in gold will not be long-term because physical supply is already drying up. Asian countries have been aggressively buying gold. This really is an unprecedented opportunity for investors. This takedown in the metals has created incredible demand for both gold and silver, and anyone who wants to unload dollars or euros and put them into gold because they don’t trust the currency, now is the time to do it.

#5 The demand for physical gold and silver is heating up over in Europe as well.  For example, the following is from an emergency message posted on the website of a precious metals dealer in the UK...

Due to the unprecedented demand triggered by the recent fall in the Gold Price we are currently not able to guarantee Next Day Delivery of orders.

 

We anticipate that all orders will be delivered within 7 days of receipt by us.

Whilst we appreciate that these delays are frustrating for our customers we would like to stress that all accepted orders are guaranteed at the order price and will be dispatched as soon as possible.

 

It is necessary for all of our staff to be utilised in fulfilling orders and we ask for your cooperation by not calling us to query delivery times. If you do need to contact us, please do so by e-mail and we will endeavour to respond within 48hrs.

#6 On the other side of the globe, demand for precious metals is skyrocketing as well.  According to Bloomberg, people are "running through the gate" to get gold in Australia...

Gold sales from Australia’s Perth Mint, which refines nearly all of the nation’s bullion, surged after prices plunged, adding to signs that the metal’s slump to a two-year low is spurring increased demand.

 

“The volume of business that we’re putting through is way in excess of double what we did last week,” Treasurer Nigel Moffatt said by phone, without giving precise figures.

 

“There’s been people running through the gate.”

#7 Reuters is reporting that customers are waiting for up to three hours to buy gold in Japan...

A week ago, as the yen-denominated price neared a new peak, jewelry stores and gold merchants across Japan saw long lines of mostly older Japanese looking to cash in on unwanted jewelry and other items that they had held for years.

 

But on Tuesday, buyers outnumbered sellers by a wide margin. At Ginza Tanaka, the headquarters shop of Tanaka Holdings, gold buyers waited for as long as three hours for a chance to complete a transaction.

#8 According to a Chinese article quoted by the Blaze, there is a mad rush to buy gold in China right now...

People have to rush to buy gold … gold bullion out of stock yesterday, investors yesterday to spend as much as 600 million yuan to buy 20 kilograms of gold bars

The mad pursuit gold insufficiency is not just a game for the rich. Yesterday, the Yangcheng Evening News reporter learned from the East flowers to Bay store, many growers, pork traffickers, fishmonger recently put down his job went straight to the mall to buy gold.

#9 According to Reuters, dealers in Singapore are having significant trouble finding enough of a supply to keep up with the intense demand for gold that has erupted this week...

"People are actually buying everything, gold bars, gold coins. People are rushing to get a hand on it. We have a problem meeting the demand because we are unable to get new supply," said Brian Lan, managing director of GoldSilver Central Pte Ltd in Singapore.

#10 Bloomberg is reporting that over in India people are "flocking to stores" to purchase gold jewelry and coins...

Gold buyers in India, the world’s biggest consumer, are flocking to stores to buy jewelry and coins, betting a selloff that plunged bullion to a two-year low may be overdone.

 

“My daughter is just six months old, but I think it is never too early to buy gold,” said Sharmila Shirodkar, a 28- year-old housewife, while displaying a new pair of earrings she bought from a store in Mumbai’s Zaveri Bazaar. “I had been asking my husband every day if prices will go down more. I couldn’t wait anymore.”

If the big banks were trying to scare people away from gold and silver by crashing paper prices for those metals then they have utterly failed.

Instead of being frightened away, the global appetite for physical gold and silver is now more voracious than ever.

If the prices for gold and silver stay this low, we are eventually going to start seeing some very serious shortages in the marketplace.

And once reports of shortages of the actual physical metals become widely circulated, it will cause an "adjustment" in the marketplace that will shock everyone.

So hold on to your hats.  We are entering a period of time when there will be unprecedented volatility for the prices of precious metals.  It will be quite a roller coaster ride, but if you can handle the ups and downs it will be worth it in the end.

They Have Unleashed A Frenzy To Get Gold And Silver

 
 

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Sat, 04/20/2013 - 23:49 | 3479332 DoChenRollingBearing
DoChenRollingBearing's picture

+ 1

Yes, buying gold withholds no commodity that the industrial economy needs.

Sun, 04/21/2013 - 12:40 | 3480409 Alexandre Stavisky
Alexandre Stavisky's picture

If sovereign bonds offered interest rates exceeding inflation, if prosecutions were often and stern for abusers of the money/instrument system, if deficits were manageable, or if any subsidiary planks of the system weren't openly corrupt, gold would be a poor choice.  However asset stripping, dilution, bankruptcy, prevarication, financial immorality are nested and festering within the sytem, how could you hold tokens which offer shares in such a swindle?

What to hold?  Eternal, universally accepted, lightweight forever money or shares in rotting apple barrels.  For every FRN you accept counterparty risk and when those who determine the value of your notes happen to be the primary dealers, trading houses, brokerages, insurance companies etc., all of which have demonstrated contempt for the law and the muppets whose small fortunes they covet, WHO IS THE FOOL?

On one hand all the destroyed paper currencies of the world, on the other precious metals.

Why all the wringing of hands and gnashing of teeth--the simple choice stares in the face.  System dying, exponentially so.  Just because there is machinegunning of lifeboats doesn't mean you abandon yourself to an inevitable fate.

Sun, 04/21/2013 - 13:26 | 3480590 akak
akak's picture

Very nicely said Alexandre.

I always look forward to reading your posts here.

Sat, 04/20/2013 - 23:27 | 3479242 Divine Wind
Divine Wind's picture

 

 

PUD is clearly a bleeding heart, hand-wringing liberal who often has multiple views, most of which conflict with one another.

 

Sun, 04/21/2013 - 01:49 | 3479536 Simplifiedfrisbee
Simplifiedfrisbee's picture

You seem polarized PUD. Get your self together. "look within and you shall never be without."'

Sun, 04/21/2013 - 13:39 | 3480633 Poofter Priest
Poofter Priest's picture

Measure the morality of the ponzi effect and the damage done.

Probably more children suffer from that one cause than anything else on this planet.

It is this paper scheme that allows the plundering of individual nations (the poor ones especially) while a currency that is tied to a non reproduceable item cannot play those sort of games.

Tell us how the paper game is better or what solid replacement YOU would have?

Sat, 04/20/2013 - 21:45 | 3478941 YC2
YC2's picture

You are a little confused about why people like gold.

Or trying to stir the pot.

But hey maybe im mistaken, so good luck building your morality based portfolio based on capturing growth that doesn't exist, cutting costs that were already cut.

Sat, 04/20/2013 - 20:05 | 3478599 PUD
PUD's picture

#8 According to a Chinese article quoted by the Blaze, there is a mad rush to buy gold in China right now.

key word..."mad"

as in insane, irrational, without control of ones senses...

Sat, 04/20/2013 - 20:34 | 3478714 toys for tits
toys for tits's picture

The actual chinese word doesn't translate well.

Sat, 04/20/2013 - 20:08 | 3478618 WmMcK
WmMcK's picture

In this case, I prefer ceramics -- there, a negative gold comment from me.

Sat, 04/20/2013 - 23:00 | 3479172 xtop23
xtop23's picture

"One word for you and that's all I'm gonna say....... plastics."

I miss Seinfeld.

Sat, 04/20/2013 - 20:08 | 3478620 Scarlett
Scarlett's picture

Money is not an investment.  Money is money.  The FRN isn't good money.  

Sat, 04/20/2013 - 20:12 | 3478627 PUD
PUD's picture

I agree with that.

Sat, 04/20/2013 - 20:11 | 3478630 Golden_Rule
Golden_Rule's picture

Sound Pand.

Sat, 04/20/2013 - 20:17 | 3478650 nmewn
nmewn's picture

"As much as I despise the man Warren Buffet, he is absolutely correct when he asks the question...Would you take all the gold in the world melted down into a cube 60' x 60' x 60' or a trillion fiat dollars, all the farmland in america and a ton of productive assets sprinkled on top?

If you chose gold then you are indeed not only immoral, greedy, myopic, backward thinking but the greater fool."

Challenge accepted.

Warren Buffet is a greater fool than you (if he said that). If we are to engage in hypotheticals, why would someone melt all the real money in the world down into 60' x 60' x 60' cube, to what purpose? And do you know what a trillion dollars stacked up on top of each other looks like? Its "slightly" larger than that...lol.

And how does he propose to legally aquire all the farmland in America and what productive assets? Through leveraging the unreality of fiat created from debt, a negative asset?

That would be immoral, greedy, myopic & backward thinking wouldn't it?

Sat, 04/20/2013 - 20:20 | 3478662 PUD
PUD's picture

You obviously missed the point. The point he was making was the contrast between productive assets and non productive assets. Things that add value and worth to the human condition vs. inert metal sitting in a bunker gathering dust

Sat, 04/20/2013 - 20:34 | 3478705 akak
akak's picture

So money is an "unproductive asset"?

You are a fool, to whom it is hardly worth the effort to respond.

Sat, 04/20/2013 - 20:38 | 3478721 PUD
PUD's picture

I don't suspect that you could mount much of a reply even with help. Money by itself is inert. It is totally unproductive on its own. What you do with  money defines the difference between productive or non productive

Sat, 04/20/2013 - 20:40 | 3478732 akak
akak's picture

You should go on the road with this act.

I'll tell you what is in fact unproductive --- trying to argue with an ignorant idiot such as yourself.

Sat, 04/20/2013 - 21:27 | 3478879 7againstThebes
7againstThebes's picture

PUD, I don't think you understand what money is.  It permits coordination of effort.  How many people would it take to make a pencil?  Hundreds, from all over the planet.  Money is what makes this possible.

What the "goldbugs" here are saying is that gold makes the best money.   It can't be counterfeited, making it a more reliable store of value (and making it harder for the politicos to, in effect, cheat people via manipulating the money supply).  

Yes, the mining of gold has caused and is causing lots of damage in places like Ecuador and Colombia, where desperately poor people destroy the landscape getting their hands on small amounts of gold.  I don't know what can be done about the?

Sat, 04/20/2013 - 22:06 | 3478988 Troy Ounce
Troy Ounce's picture

 

 

What about ending price suppression so gold gets a "resonable" price with the result that mining companies can afford to look more after the environment and pay good wages.

For a solution, look at Washington and Wall Street. They, of course, could not care less.

Sun, 04/21/2013 - 01:19 | 3479506 Kirk2NCC1701
Kirk2NCC1701's picture

+1

Thank you for being a voice of reason, fact and civility.

The only thing I might add, is that gold (in spite of its 'baggage' and nefarious history) provides an Anchor to fiat/paper money, or the monetary equivalent of a Local Newtonian Reference Frame.

Let's all calm down, and Up our game.

Kirk out.

Sat, 04/20/2013 - 21:13 | 3478835 DocinPA
DocinPA's picture

"Money" is merely a medium of exchange.  But it must be trusted by both parties to be an accurate representative of wealth.  When things head the way of a Diocletian double denarius, a Weimar Papiermark or a 2013 American Dollar, that medium is no longer trusted.  For over 2,000 years, that trusted medium has been gold and silver.  Um, get over it? 

Sun, 04/21/2013 - 01:56 | 3479543 Kirk2NCC1701
Kirk2NCC1701's picture

It meets the Aristotlean requirements for money. If you don't know what that is, I won't spoon feed you. You'll have to look it up.

Sat, 04/20/2013 - 23:07 | 3479201 lotsoffun
lotsoffun's picture

are you krugman?  if you are - does big bad bama ever troll here also?  you jerks have a lot in common - 'noble prizes'.  hey - where's cozine??

Sat, 04/20/2013 - 20:37 | 3478720 nmewn
nmewn's picture

I missed nothing.

You and Buffet are both rabid statists. What is productive or adds value & worth to the human condition in the counterfeiting of mediums of exchange via >>>sovereign<<< indebtedness?

If the debt will not be paid back (and it can't be now) why tax people and promote the class warfare that results from it? Why keep track of the debt? Why work at all as "money" can be created for "the good of society" from nothing?

How can there be productivity without profit motive? You thinkin people will work and be productive for free? ;-)

 

Sat, 04/20/2013 - 20:47 | 3478757 PUD
PUD's picture

Did I say one word about debt? Did I imply any endorsement of fiat? No, i didn't. I described the other side of gold that you willfully ignore.

Sat, 04/20/2013 - 21:19 | 3478859 nmewn
nmewn's picture

"Did I say one word about debt? Did I imply any endorsement of fiat? No, i didn't."

You endorsed Buffet saying to buy "productive assets" with fiat money which is derived by public debt issuance. The two are inseparable and have been for quite some time now.

If you're going to issue a challenge to commenters on ZH you should make sure you know what you're talking about ;-)

Sat, 04/20/2013 - 23:05 | 3479191 lotsoffun
lotsoffun's picture

i'm not sure what the moniker 'pud' means to you, but where i come from - well you really are a good little troll.  so - what does add value to the human condition?  i-crap?  gps?  automobiles with air-bags?  tell you one thing - you've ever had a little floozy - besides your little pud - which i'm sure has been real asset for you - little floozy today and tomorrow and 2,000 years ago would have been more than happy for a long time if you give her one a shiny trinket made of worthless relics.  because - the fact is - it is not different this time.   the stuff retains value.

tell you what.  i've got a bunch of ox-tail bones at my place.  makes nice soup.  you got something to exchange with me?  ox-tail soup adds value to human life.  oh - i forgot.  you one of 'those'.  ok.  i got some cabbage too.

(ox-tail and cabbage really nice and i don't want bennie bucks for it).

 

Sat, 04/20/2013 - 23:05 | 3479192 xtop23
xtop23's picture

Return OF capital is > Return ON capital in the current financial environment.

Sat, 04/20/2013 - 20:44 | 3478745 BigDuke6
BigDuke6's picture

Isn't this month turning out interesting, as suspected, when we last spoke nmewn?

I think the question is where will it end?

i'd be interested in your thoughts.

i dont see gold sky high but see it performing better than most.

i see europe and to a lesser extent the USA becoming more like south africa with wanton crime and high security present but a smaller city elite who live well enough....

farm animals stolen by gangs with cops not giving a shit.

thats when it gets a bit fuzzy...

Sat, 04/20/2013 - 21:05 | 3478811 nmewn
nmewn's picture

Wild ride BigD...and thanks again on the tip.

I see it slowly crawling back in fiat price terms, back to a comfort level of say high 14's. Now a technical trader may look at any chart and say "look at that right shoulder its forming back down to 11 or12"...lol.

But they deal in fiat terms in pricing...not value.

We both know they won't stop printing because they can't now. So, the value remains and eventually fiat implodes as it always does in socio-economics (which is where PUD is coming from) leaving a pile of smoldering paper ash.

From which, we rebuild (or our children rebuild) from the savings of our past labor. Our wealth, our money and again our labor for our profit and hopefully not providing for many more leeches ;-)

Sat, 04/20/2013 - 21:17 | 3478850 BigDuke6
BigDuke6's picture

Hmmm.

I've been listening to the chartists intently for the last 6 months but i agree they've now served their purpose.

The gross manipulation tells us that.

"From which, we rebuild (or our children rebuild) from the savings of our past labor."

I'll remember that - yes.

its a bit scary but its nothing that hasn't been done before by our ancestors after previous 'take-downs' by TPTB.


Sat, 04/20/2013 - 21:23 | 3478868 nmewn
nmewn's picture

Tis true D.

I've never been much concerned about us but their survivalbility rate can drop pretty dramatically in a very short period of time...historically ;-)

Sat, 04/20/2013 - 21:39 | 3478917 ChanceIs
ChanceIs's picture

Gold isn't an asset or an investment????

No bull here.  Back in '80 when I was just out of college and Reagan was wiping Jimmy Carter with his rhetoric about how the latter had racked up more debt than all of the previous presidents combined, I was psyched.  I called my Congresspuke and said....'for every two bucks in spending you cut, you can raise my taxes $1.'  Of course Reagan went on to rack up debt in the same exponential fashion as Carter.

After Cyprus, I called up my Congressman and said....'Look dips&^t, the United States is the IMF.  We just tried to rob poor Cypriots of their savings.  Piss ont he federal government.  I have sold half my assets and bought physical gold.  I have no faith in the banking system.'

That is the investment value of gold.  It is an investment in America.  It is the means by which you tell TPTB to f*&k off.  It is every citizen's duty to close their bank accounts (in the big banks) and buy silver/gold.  (Gawd.  I am starting to sound like Max Keiser - except I mean it.)  How else can you flush them?  Surely not at the polls in November.

Sat, 04/20/2013 - 20:22 | 3478667 evokanivo
evokanivo's picture

first intelligent thing i've read on here in a while. good job.

Sat, 04/20/2013 - 20:23 | 3478670 Unknown Rider
Unknown Rider's picture

Your words will be a true comfort to those poor folks in Cyprus that chose to invest in a simple savings account and ended up with a haircut; now they can feel perhaps more noble knowing that they weren't speculating. The bigger picture that this article express to me is that perhaps people, worldwide, are seeing a second chance to escape that same fate for themselves.

Sat, 04/20/2013 - 20:35 | 3478717 PUD
PUD's picture

You are greatly mistaken and taking one quantum leap of "faith" that some yellow metal will be the universal safety net going forward. 1. This is the 21st century so making reference to golds stature hundreds and thousands of years ago isn't relevant. They didn't shop online with debit cards then. 2. They confiscated gold once which should be all the proof you need as to its insecurity.

Sat, 04/20/2013 - 20:46 | 3478754 nmewn
nmewn's picture

1. This is the 21st century so making reference to golds stature hundreds and thousands of years ago isn't relevant. They didn't shop online with debit cards then.

Right.

Now they can freeze your account and leave you with nothing with a single mouse click. Quite the Orwellian web you're weaving...but please, do continue...

2. They confiscated gold once which should be all the proof you need as to its insecurity.

And you did continue...in proving my point of "mouse click security"...lol.

Sat, 04/20/2013 - 20:50 | 3478767 PUD
PUD's picture

You seem to have difficulty following the topic don't you? Did I endorse the current system? Did I endorse fiat? Did I endorse government? I thought not. I pointed out the folly of the madmen who love gold. I pointed out the dark side. You all can't handle that. You can't handle being party to golds ugly side. It spoils your party

Sat, 04/20/2013 - 20:56 | 3478782 akak
akak's picture

"The folly of the madmen who love gold" (and just what the fuck does THAT mean, anyway?) is not 1/100,000,000,000 as much folly, nor as mad, as the folly of the sociopaths who coerce us into playing their corrupt and unsustainable paper games --- nor the folly of the sheep (such as yourself) who blindly follow and trust them.

Poor, poor ignorant paperbug.  About to be squashed by the onrushing windshield of financial and monetary reality.

Sat, 04/20/2013 - 20:58 | 3478791 PUD
PUD's picture

You sir are not honorable. You imply things that i never said. I do not endorse the status quo. good bye

Sat, 04/20/2013 - 21:04 | 3478812 akak
akak's picture

And you are an ignorant idiot who willfully wallows in his ignorance.

Both honor and intelligence are a stranger to you.

Sat, 04/20/2013 - 21:36 | 3478913 toys for tits
toys for tits's picture

It's easy to be a critic.  

I haven't seen any of your proposals since you've disavowed fiat.

Dumb stupid fuckhead (I usually would save that for Bernanke but tonight you qualify).

Sat, 04/20/2013 - 20:58 | 3478787 erg
erg's picture

Brought to you by the self-proclaimed most intelligent person in the thread.

He approves his message.

Sat, 04/20/2013 - 21:03 | 3478799 PUD
PUD's picture

I can stay on topic and i don't put words in other peoples mouths or contort what they wrote. I probably am the smartest poster here and i would make no apology for it. I don't speak about that which I am unsure. I surely don't open my pie hole just to see what noise comes out. Cheers

Sat, 04/20/2013 - 21:10 | 3478830 erg
erg's picture

Are you a savant? It's ok...you can tell us.

Sun, 04/21/2013 - 08:06 | 3479261 xtop23
xtop23's picture

".....probably am the smartest poster here..."

Quite a statement, that. Your mother must be so proud.

Sat, 04/20/2013 - 21:12 | 3478833 nmewn
nmewn's picture

"You seem to have difficulty following the topic don't you?"

Not at all.

I just don't engage in strawman arguments (unless I'm feeling frisky) and pointed out the folly of someone like you supporting an obvious lie, that is, the counterfeiting of fiat money to buy "productive assets" for their own profit...which is illegal unless done by a sovereign in concert with crony socialists...which you apparently support, afterall you said Buffet was right.

Right? ;-)

Sat, 04/20/2013 - 20:46 | 3478756 akak
akak's picture

Fiat currency has not only a prevailing, but a UNIVERSAL record of failure, most particularly during or as a result of the kind of fiscal and monetary insanity (exponentially rising indebtedness and the corresponding monetization of that debt) being engaged in by world governments today.  Your blinkered belief that simply because it is the 21st century that therefore "everything is different" demonstrates a wild disregard and/or ignorance of both economic reality and monetary history.

Sat, 04/20/2013 - 21:41 | 3478924 toys for tits
toys for tits's picture

Amazingly, we've heard the 'everything is different this time' meme a lot in the last 15 years.

dot com bubble

housing bubble

worldwide credit bubble

I'm sure I'm missing a couple.

Sat, 04/20/2013 - 20:29 | 3478694 erg
erg's picture

This is pretty simplistic. Why is it so feared by central bankers? Has it not been proven through time as the shackle of last resort upon central bank largesse?

In case you may not have noticed - everything is messy. Do you somehow suggest that this multi-millenial fixation with gold is a mass-hallucination through time? Just one big shared illusion?

Sat, 04/20/2013 - 22:38 | 3478770 erg
erg's picture

I actually knew a guy with the nickname of PUD. 5'-5" and a giant chip on his shoulder.

Where's your response PUDDER?

I demand satisfaction sah!!

Sat, 04/20/2013 - 20:39 | 3478723 nobodyimportant
nobodyimportant's picture

You are in dire of a glass belly button!

Sat, 04/20/2013 - 20:41 | 3478731 Clowns on Acid
Clowns on Acid's picture

Not blind red arrows....

Sat, 04/20/2013 - 20:45 | 3478751 Peter Pan
Peter Pan's picture

PUD,
you are very impassioned and genuine and in a world where there were only productive investments and wise consumption, you would need very little gold just to overcome the problem with barter.

However, the world is also made up of crooks who have flooded the system with fiat and in the process have distorted prices, created excess capacity and over consumption which has lead to insurmountable debt. Furthermore, all wars have become expensive and endless because the USA can print to cover the cost which also leads to a great many other dstortions.

The beauty of gold is that it forces wise use of capital and wiser consumption. In other words itbforces you to prioritise.

Gold mining may be a filthy industry but no where near as filthy as Wall St finance, war, and rubbish dumps full of fiat and debt created consumption.

Just remember what the alternatives are to gold and you will realise that they are far worse given the weakness in man which causes him to aulterate and misappropriate and confiscate through fiat induced mechanisms,

Sat, 04/20/2013 - 20:56 | 3478783 PUD
PUD's picture

Gold solves non of those problems. Crooks can steal gold too. Is exxon going to pay for a shipment of crude with a vault of gold coins?  We live in an electronic era now and that is not ever going to change. Bitcoins is a model of what money could and should be in this age. Not that it isn't flawed but it is a model of a real and proper non debt based money system. We as a people are capable of creating such a system. Reverting back to leather pouches filled with gold dust is not only impractical it is de-evloving to a bronze age mentality. And it would not work.

Sat, 04/20/2013 - 21:00 | 3478794 ether
ether's picture

Ahh, so your agenda is to pimp Shitcoins ehh?

 

I've been on IRC enough to say i'd rather take RL bitcoins (Gold) over script-kiddie DDOS market takedowns, and java-script exploit hacked, Shitcoins, anyday.

 

 

Sat, 04/20/2013 - 21:03 | 3478802 PUD
PUD's picture

My agenda is the truth.

Sat, 04/20/2013 - 21:07 | 3478817 akak
akak's picture

Your agenda is spreading your own shameful ignorance.

Sat, 04/20/2013 - 22:41 | 3479092 lotsoffun
lotsoffun's picture

why bother with the trolls??  as i wrote a few weeks ago - krugman was trying to play the 'central banks are no longer buying pm's - so they are worthless'.  and my response was 'so - i should wrap fish with my picasso's as central banks aren't buying them'.  in all honesty, if there were any 'sound' investments left - i wouldn't be a PM bug.  but - the markets are rigged and at that point - it is the only place left to go. even buying real estate (nobody is making more land).  sound exactly like PM's (except they can dig up plenty more), but it's really NOT the same thing.

 

Sat, 04/20/2013 - 21:06 | 3478819 rajat_bhatia
rajat_bhatia's picture

PUD, they can't handle the truth ! 

Sat, 04/20/2013 - 21:10 | 3478831 PUD
PUD's picture

Obviously. It spoils their party and dreams of riches. Most of them only think in terms of how high gold will go in terms of the fiat they curse so they can turn around and use that fiat to buy shit. Ironic eh?

Sat, 04/20/2013 - 21:27 | 3478876 rajat_bhatia
rajat_bhatia's picture

Hahaha! My point exactly, they're so lost in their own contradictions, they don't even know it:-)   and she you try to point it out, they prefer the bliss of ignorance

Sat, 04/20/2013 - 21:44 | 3478935 toys for tits
toys for tits's picture

For someone that wants to learn, you sure have a bias.

I guess everything you say is bull shit.

Sat, 04/20/2013 - 21:59 | 3478969 rajat_bhatia
rajat_bhatia's picture

Oh Yes, "Everything"

Sat, 04/20/2013 - 22:14 | 3479004 toys for tits
toys for tits's picture

Are you saying 'everything' ironically?

Sat, 04/20/2013 - 21:41 | 3478927 Vooter
Vooter's picture

LOL! Get in line...

Sat, 04/20/2013 - 21:07 | 3478800 akak
akak's picture

 

Gold solves non of those problems. Crooks can steal gold too. Is exxon going to pay for a shipment of crude with a vault of gold coins?  We live in an electronic era now and that is not ever going to change.

I can just imagine some Chinese official during the early Ming dynasty saying essentially exactly what you are saying here: "Who needs that nasty and heavy gold and silver?  We live in a modern age now with paper money, and have for over a century, and NOBODY is ever going to stop using paper currency or go back to using those archaic heavy coins!".  Just before, of course, their experiment in fiat currency collapsed for the last time, and they went back to using gold and silver as money for over half a millenium.

Besides that, it does not matter if gold and silver are never used as currency again --- they are still real, tangible, physical, desirable goods which can and do function as a store of value, even in an "electronic era".  Your argument is, once again, not only irrational and ignorant, but just plain stupid.  You are a very stupid, stupid person, and I feel soiled having to even address your stupidity and willful ignorance.

Sat, 04/20/2013 - 21:09 | 3478821 PUD
PUD's picture

No. Gold is a perceived store of value. Tell me what its intrinsic value is please.  waiting...waiting...

Food has value, water has value, shelter has value, air has value, clothing has value

The things that make food, clothing, shelter etc have value

Gold has value only as much as its worth in filling your teeth, coating a satellite and your distorted perception of its worth

And that jack if fact

Sat, 04/20/2013 - 21:13 | 3478836 Peter Pan
Peter Pan's picture

PUD,

Who are you going to trust? The man who sweats all day to mine an oz of gold or the man who pends five minutes making a photocopy and handing it to you for your daily production?

Wake up PUD. pm's are not perfect but they leave paper and electronic systems for dead.

Sat, 04/20/2013 - 21:16 | 3478854 PUD
PUD's picture

I trust no man. So  far as any money system goes, I'd trust the one that does the least harm. That isn't gold.

Sat, 04/20/2013 - 21:29 | 3478886 erg
erg's picture

I can't help but notice that twice you have mentioned the teeth thing. So...you're saying we can eat it?

Sat, 04/20/2013 - 21:36 | 3478907 nmewn
nmewn's picture

So this has all been a "raping of the planet" type of truth...that can only be found in bitcoin, which itself rapes the planet because it needs plastic & energy sources in order to function type of truthy, truthiness?

Dear Lord...now there's an hour I'll never get back...you're also a time thief?

Sat, 04/20/2013 - 21:54 | 3478955 Peter Pan
Peter Pan's picture

"Time thief." I like that. +100

Sat, 04/20/2013 - 22:05 | 3478985 rajat_bhatia
rajat_bhatia's picture

LOL

Sat, 04/20/2013 - 21:36 | 3478914 Peter Pan
Peter Pan's picture

The only man you can fully trust is dead.

So who are you going to deal with and trust now? And on what basis? Just barter?

Sat, 04/20/2013 - 21:47 | 3478943 toys for tits
toys for tits's picture

PUD

If you participate at all in the fiat system then you are trusting to the same degree of your participation.

Thinking that you don't shows how stupid you are.

Sun, 04/21/2013 - 11:49 | 3480225 Non Passaran
Non Passaran's picture

> I trust no man.

You lying cunt, 10 comments above you said you trust the majority of nodes on the Bitcoin network.

Sat, 04/20/2013 - 21:20 | 3478840 akak
akak's picture

So every paper asset, and fiat currency itself, by your own (specious) definition therefore "lacks value" as well.

You are truly a complete and total idiot.  An idiot without an iota of intelligence, insight or historcal perspective.  A brainwashed sheeple of the first order, a worthless fucktard merely occupying space and wasting resources in perpetuating his own worthless existence.

Oh, and by the way:

Paper has value only as much as its worth in printing books, wiping your shitty ass and your distorted perception of its worth.

Sat, 04/20/2013 - 21:40 | 3478920 Vooter
Vooter's picture

"Gold has value only as much as its worth in filling your teeth, coating a satellite and your distorted perception of its worth."

Yeah, so the reality of the matter is, it HAS VALUE! Funny how that works. Gold has been accepted as a store of wealth since the beginning of recorded human history, and since as far as we know humans are the only creatures on this planet who understand the concepts of money and wealth, that's a pretty ringing endorsement for gold! But when that changes, please give us a call...

Sun, 04/21/2013 - 11:47 | 3480218 Non Passaran
Non Passaran's picture

Here we go, the moron says Bitcoin has intrinsic value and gold doesn't !
Didn't I say we're dealing with an idiot here?

Sat, 04/20/2013 - 21:47 | 3478938 ChanceIs
ChanceIs's picture

The most rational reason I heard for the invasion of Lybia and slaughter of Khadafi w/o trial was that he was setting up a Pan African oil bourse denominated in gold - and succeeding.  He isn't around any more.  Neither is his gold.  Anybody know where it went?  I think the same place MF Global's went.  Life can be a beach when you are small fry and somebody needs your gold to make physical settlment at the COMEX.

Sat, 04/20/2013 - 21:08 | 3478822 Peter Pan
Peter Pan's picture

PUD, you will get no down vote from me but you need to be less emtional and a little more clear headed.

First of all there is no need for puches of gold coins.....just a gold backed system which can also be run electroncally.

Yes, crooks can steal gold but crooks can also tap into computers and steal from there as well.

Bitcoin may be a terrific system of exchange but why does it have its origin in a fiat purchase?

Gold on the other hand never had its origin in fiat. It was simply the starting point and the mother of all currencies long with silver. Unfortunately everyone loved the concept of money (as started by PM's) but we have had nothing but a string of counterfeiters and crooks who seek your goods and services with the flick of a switch on a computer or printer.

It's strange how after 3000 years of virtually every alternative to pm's biting the dust, and despite civilizations having prospered using pm's that you somehow ignore this and prefer the trash that civilzation is now producing through over production, over onsumption and unending conflict.

Sat, 04/20/2013 - 21:14 | 3478838 PUD
PUD's picture

Why do you distort what I said? Why? I said absolutely nothing endorsing the status quo. Did I? I point out the moral objection to gold, the folly of believing in its magic powers. That in no way makes me a fan of the current system. Get it?

Sat, 04/20/2013 - 21:40 | 3478921 Peter Pan
Peter Pan's picture

So what is your system if you do not like the folly of a gold system and you are not a fan of the current system?

Sat, 04/20/2013 - 21:31 | 3478890 Vooter
Vooter's picture

"Is exxon going to pay for a shipment of crude with a vault of gold coins?"

The Turks have already done exactly that with the Iranians, so why not?

Sun, 04/21/2013 - 08:40 | 3479814 francis_sawyer
francis_sawyer's picture

It's a moronic statement anyway... You don't have to ship gold bars back & forth... Accounts on each side are merely credited & debited [electronically, or otherwise]... If the mayor of Baltimore makes a bet [a bushel of crabcakes] with the mayor of San Francisco [wtf do they have, I dunno, a couple of eggrolls] on the outcome of the Superbowl... What? Do you think they have to send trains to escrow the shit in Kansas City?...

Sat, 04/20/2013 - 21:18 | 3478828 mendigo
mendigo's picture

I think it is fair to say that "Invest in gold because the financial markets are going off a cliff (for the nth time)" is pretty much a central theme behind the web site and the reason for the drum beat of negativity. So the site favors gold and I imagine gold favors the site. But along with the negativity comes a lot of info you won't hear from the mainstream which is forced to promote stocks for similar reasons. That said this was a particularly uninformative and transparently promotional artical. I suspect that that as was suggested by another member that part of what is happening is that gold inventory is being help back in hope of a rebound or is being sold above spot - I don't know but makes sense to me.

Still I cannot believe that Buffet would say something so obviously invalid. That is equivelant to saying "would you rather have a trillian dollars or all the cheese in the world?" WTFwould you do with all the cheese in the world. Still maybe Bernanke doesn't see that as he keeps force feeding the rats more cheese in the expectation that that will make them more productive. But of course we only get really fat rats.

Sat, 04/20/2013 - 21:29 | 3478880 Vooter
Vooter's picture

I like to buy gold and silver out of spite. In other words, whatever the subhuman vermin who run the U.S. government and the banks like, I DESPISE. Even if I lose money in the deal. Getting a chance to take a giant shit on the greasy, fat-fingered, christo- and judeofascist moneychangers of the world is worth EVERY PENNY I might lose, because those people are inferior beings who aren't worthy enough to lick my hairy asshole, no matter how much money they have in the bank. Get it? So...investment? Speculation? WHO GIVES A SHIT? I can't take my gold with me when I croak, and Warren Buffett can't take his farmland and fiat dollars with him. So in the end, it looks like we have a TIE. And now I'm gonna go buy me some more gold and silver, so have a great fucking day!

Sat, 04/20/2013 - 22:34 | 3479015 JustObserving
JustObserving's picture

If you chose gold then you are indeed not only immoral, greedy, myopic, backward thinking but the greater fool.

Gold has been the basis for sound money.  When the US spent $738 billion on the Vietnam war in 2011 dollars, it was forced to go off the gold standard on Aug 15, 1971.  

All the current US wars are enabled by fiat money which can just be conjured up.  The wars in Iraq and Afghanistan will cost between $4 and $6 trillion in 2011 dollars.  So all the evil of those wars was enabled by fiat money - so much for your thesis that owning gold is immoral.  The US is on the verge of wars with Syria, Iran, N Korea, Pakistan, Somalia - the list is endless.  All these evil wars are enabled by fiat money which is not backed by gold.  How many millions have died and how many more millions will die? Yet you have the temerity to call owning gold immoral.  

No object in itself is immoral.  By your specious reasoning, a computer would be highly immoral since you can access violent porn with it and because it creates lots of pollution.  But obviously, you use one.  So to denigrate gold buyers is to be irrational, childish and churlish.  And simply wrong.

Some people are too stupid to know they are stupid.

 

 

Sat, 04/20/2013 - 22:29 | 3479042 chindit13
chindit13's picture

While you unabashedly go for the downvote record, perhaps you should just sit back and enjoy this phenomenon that is the PM frenzy.  You will never win an argument, so better just do what you do, let others do what they want to do, and try to keep your mind as neutral and un-sheeple-ish as can be.  Everyone is entitled to his opinion, though it seems some opinions bring out the fatwas.  Being skeptical of PMs as the be-all, end-all is akin to Danish cartoonist blasphemy.

Clearly this is a retail frenzy, whether born of irrational or well-founded fear, with a little bit of central bank kicker thrown in.  Jim Sinclair said years ago that the PM bull market would end when central banks start buying.  Now that the likes of "perennial economic powerhouses" (sic) like China, Russia and India are buying, and PMs have subsequently tumbled, all the Sinclair-followers---plus Sinclair himself---forget his statement.  (Personally, if I was India, I'd install decent sanitation for the billion souls who still lack it there before I dropped my wad on PMs, but I guess I'm fastidious and prefer an unfragrant and sanitary environment.)

Consider other things overlooked in this PM bull/bear market, and wonder why.  I noticed another writer reporting something I had researched myself, in which this blogger reported that during a period when US debt rose from $1 trillion to $5 trllion, gold actually fell from $800 to about $250, and silver from $48 to $3.  Also, during the greatest period of worldwide central bank fiat printing in history (2011-2013), gold fell and silver tumbled.  Supposed connections don't quite exist, unless you allow for a good bit of poetic license.  Now the aficianados might cry "manipulation", but how real is that?  Wouldn't someone arb out the difference between "paper" and "physical"?  It's not like the elite all get along so well and wouldn't like to screw each other if they could (see Icahn/Loeb vs Ackman for some insight into what the "New World Order" really is, and isn't).

One now famous PM Guru claims the cash price for large physical gold is $2000/oz. (This same man claims JFK is still alive somewhere, so factor that in when assessing his believability.)  Being naturally incredulous I made some calls to large dealers/holders (think Middle East).  They laughed.  I never knew them to have a sense of humor.  I came away thinking that $2000 price wasn't quite accurate.

As for the shortage of stock, I suspect it has something to do with size, as in coins and bars vs ingots.  I have had the pleasure of visiting some rather impressive private vaults.  Other than the expense involved in constructing and maintaining these storage behemoths, what struck me most of all is that the uber wealthy don't buy Monster Boxes.  They don't buy coins at the local shop, nor from the US Mint, nor do they order online from Tulving.  Think pallets of good-for-delivery silver ingots.  Pallets.  Forklifts encased inside vaults.  (Incidentally, these long time hoarders hedge from time to time, especially during periods of bull markets.  One can only guess who they retain to orchestrate their not-so-naked hedging.  They also sell, and I am led to believe, but can offer no proof, they are doing so now.  Those wanting coins and bars should just be patient, as it takes time to melt down these ingots and stamp out coins.)

Look at all the blogs this PM phenomenon supports.  Have some compassion for Michael Snyder of "The Economic Collapse blog".  What would he do for a living if he couldn't be a part of the end of the world syndrome and join the "good guys" wishing for total economic and societal annihilation?  He may be right about the rush last week to buy PMs at "discounted" prices, but I also suspect that these crowds are dwarfed by the 3 billion odd souls who "line up" each working day in the hopes of getting their share of fiat.  By the way, the Chinese also shove each other lining up for rhino horns, tiger parts, gift coupons at a famous Hong Kong bakery, and even lines of which they don't even know the purpose, but fear missing out on something.  Should we all do the same?

PM Guru is a new vocation, or club.  They all know each other and interview each other for their own retail constituency, then link in a Mobius Strip to each other in their own blogs and websites.  They selectively ignore certain aspects of the PM move, since these might prove confusing or even heretical to their own claims (not only the aforementioned dubious connection between debt/printing levels and PM price movement).  For example, they ignore the almost equal "frenzy" of big money, really big money, moving into productive assets like farmland, resource land, rental real estate, transport systems, company shares (public and private), and "toys" (increasingly being done at the expense of long held PMs).  For the better part of 500 years there has been a trend on the planet toward more widespread ownership of productive (as opposed to inert) assets.  The common man was riding a wave of ownership previously unknown in human history as power and control was shifted from monarchs, warlords and the uber elite.  The planetary Qini Coefficient was declining.  That trend has now reversed.  The elite now are acquiring productive assets at an unprecedented pace, as wealth gravitates toward them.  One prone to believing conspiracy might think the decade long PM bull market that ended in 2011 was really a Masters-ful pump and dump carried out by generational holders of PMs who now prefer fun and productive assets.

Those who have never been ultra rich have been spared one of life's most disconcerting and intractable problems:  what does one do when every dream one ever had has come true?  A guy like Warren Buffett (love him or hate him) is rich beyond his wildest dreams.  He could, if he so chose, acquire a cube of gold eleven feet on a side.  Then what would he do?  How many times would Becky Quick come to interview him and buff his cube?  Once, maybe twice?  He'd be bored and lonely, the lead in his pencil replaced by a shiny lump of metal, impotent as well as inert.  So he buys up companies and transport systems instead. He collects trains, and not the little ones favored by the likes of Frank Sinatra and Tom Snyder.  He competes with his equals, getting the same kick an athlete gets taking on his arch rival, like Bird vs Magic or Ali vs Frazier.  His little amusements, as he kills the time from cradle to grave, throw off earnings and dividends, employ people, and are simply much more fun than staring at a lump of metal, admittedly adored by billions of the now dead, but less the fancy of the modern world money oligarch, not to mention the billions enamored of the current 180 forms of fiat floating free.  Other uber wealthy, besides acquiring productive assets, are also picking up mega-yachts, G650s, and massive tracts of isolated land.  They are doing something a bit unknown to the stacker crowd:  they are trying to enjoy a life without constant fear and worry.

No need for you to mention environmental degradation or worker abuse relating to PM mining.  Such concerns are irrelevant, or at least best kept for criticism of things like Steve Jobs, Apple and Foxconn.  Also, don't you know you haven't lost if you haven't sold...well, except if you own APPL---no matter your acquisition cost.

The beauty of the PM bull market (or whatever it is now that Ag is down more than 50% and Au down 20 something percent) is that everybody gets what he wants.  The Buffetts of the world are scoffing up assets equivalent to what kings, emperors, and warlords of old controlled back in the eras of serfs and slaves, and the retail set is getting shiny coins and bars that will give them hours of counting and stacking pleasure as they await their hoped-for societal destruction.  Ideally, you take a bit from each camp, holding a little PM as a hedge against uncertainty (it could go to the moon), and also acquiring productive assets that can provide protection plus the psychic pleasure that comes from getting one's hands dirty and using one's brain for more than trying to remember the combination of the safe.

Sun, 04/21/2013 - 04:14 | 3479632 e-recep
e-recep's picture

thanks, i enjoyed it.

yes, self-made wealthy men like to be rich but they also like to command people around, be bossy and compete with rivals just for the thrills. it keeps them alive.

Sun, 04/21/2013 - 05:05 | 3479653 saveandsound
saveandsound's picture

@chindit13: good analysis, there is not much to add

Sun, 04/21/2013 - 09:23 | 3479836 francis_sawyer
francis_sawyer's picture

It's a fucking bullshit analysis... Too long to pick apart the whole thing, so I'll focus on one paragraph...

~~~

For example, they ignore the almost equal "frenzy" of big money, really big money, moving into productive assets like farmland, resource land, rental real estate, transport systems, company shares (public and private), and "toys" (increasingly being done at the expense of long held PMs). 

The so-called 'elite', if they're buying FARMLAND, REAL ESTATE, & COMPANY SHARES are buying at the fucking top... They're paying a premium for these assets far greater than inflation adjusted gold [or silver], over the past 30 years... So they're basically STUPID...

For the better part of 500 years there has been a trend on the planet toward more widespread ownership of productive (as opposed to inert) assets.  The common man was riding a wave of ownership previously unknown in human history as power and control was shifted from monarchs, warlords and the uber elite. 

Yeah ~ It was called the Industrial Revolution, & the planet added 5 billion people [who polluted the world]... It's fucking over [unless you believe in the 'infinite resources on a finite planet', 'growth to infinity' paradigm]...

The planetary Qini Coefficient was declining.  That trend has now reversed.  The elite now are acquiring productive assets at an unprecedented pace, as wealth gravitates toward them. 

Wealth isn't 'gravitating towards them'... They're fucking STEALING it by manipulating the prices of worthless paper that they control the franchise of printing... How many cars do people need to drive [let alone can afford]... A 96 month car loan ought to tell you something about that...

One prone to believing conspiracy might think the decade long PM bull market that ended in 2011 was really a Masters-ful pump and dump carried out by generational holders of PMs who now prefer fun and productive assets.

The truth is that the creation of paper markets [in PMS, as well as hard & soft commodities], was a clever way to try and develop a 'pre-set' reasoning response among people who don't, & never have understood what money was in the first place... The whole '401k' phenomenon really began to gain momentum around the early 80's... It was kept intact through the 80's, & 90's, through various means, then, when it blew, a housing bubble was blown... All the while, as balances grew, & incentives were given, people religiously tithed to the system & now proudly sit with what they believe to be their little 'nest eggs'...

The story is continuing... Only now... Some people are beginning to wake up & the attacks on PM's have to become more flamboyant...

Fun & Productive assets?... Like what?... The only thing that seems to be selling out lately are ammo & PM's...

~~~

A dude writes a treatise on 'WHY THE FUCKING WORLD IS FLAT' [because he likes the way it sounds, or hates bandwagons] & gets 11 upvotes for it?... People in Russia, China, India, & whoever is buying in America are ALL, stupid for emptying the shelves of gold, but those half dozen 'elites' who are buying farmland at all time record prices are the only SMART ones on the planet... Warren Buffett is a friggin' GENIUS!... JFC ~ Bring back the 'math question' to ZH...

Sun, 04/21/2013 - 11:02 | 3480052 saveandsound
saveandsound's picture

Hi Francis,

I agree instandly to you saying "Wealth isn't 'gravitating towards them'... They're fucking STEALING it by manipulating the prices of worthless paper that they control the franchise of printing...". For some people ("banksters") is it easy to get fiatmoney and they are operating at someone else's risk and expense. And as you said, all asset have become uncomfortably expensive.

However, when it comes to SMART and STUPID... don't forget, to every trade there is somebody glad to buy the asset at the current price AND someone else glad to sell the asset at the current price. That applies to PMs as well as to stocks. Time will tell.

 

Sun, 04/21/2013 - 11:51 | 3480233 francis_sawyer
francis_sawyer's picture

However, when it comes to SMART and STUPID... don't forget, to every trade there is somebody glad to buy the asset at the current price AND someone else glad to sell the asset at the current price

~~~

That's supposedly how it works in a Free Market System...

The problem is... This IS NOT a Free Market System... It's a Rigged System... Whereby ~ With paper, you can create an illusory "buying & selling" dynamic... If you're so inclined, you can NAKED SHORT a hundred blablillion contracts on anything you want out of thin air [and use any astronomical amount of leverage you desire to achieve the results]... In theory, someday, you're going to have to buy to cover those, but who the fuck cares?... When the time comes, you do so by doing the same thing, yourself, on the other side of the ledger... It doesn't matter if either 'TRADE' shows a paper loss [because you're using money that to PRINT YOURSELF ~ or is printed for you by the cartel you belong to]...

You never lose... You just skim the profits off & use them incrementally to stockpile physical... Then, one fine day, you blow the whole system up on purpose [&, of course... Nobody could have ever seen it coming]... When the dust settles, the masses will be clamoring for a NEW system to be erected that is BACKED by something other than promises... Voila!... You open up your filled warehouse [& change your name to 'ALLY'}...

You're still king...

~~~

What I disliked about the comment above is that it read, to me, like somebody who was simply making an argument to make an argument... It sounded like somebody sick of hearing about GOLD & decided to make up a story [chock full of facts], about how the ELITE were buying productive farmland... All I see is that farmland is 10x more a bubble than gold ever was & as for future planning, well, half the bastard spawn of these fuckwads spend their time partying in Ibizia...

It sounded more like the argument that a 'technical' trader might make... You see ~ half of technical trading has to do with market psychology... So it's the BIBLE to technical traders that if a chart gets broken, then some mysterious 'Web Bot' of sentiment has been ruptured... I'm not totally against that notion, but it's only VALID in Free Market psychology... Technical traders cannot reason in a MANIPULATED or RIGGED market environment because their whole 'Raison d'Etre' gets blown up...

Sun, 04/21/2013 - 06:51 | 3479714 Uh Oh
Uh Oh's picture

Best comment in this thread!

Sun, 04/21/2013 - 10:18 | 3479932 fiftybagger
fiftybagger's picture

Nice try.  F for effort.

As opposed to other paid shills and stooges, you actually have some ability.  Clever enough to even get a majority of thumbs up.  Good work for your London paymasters.  Unfortunately, your brave foray into enemy territory will be even less successful than your admired coward and scumbag Brigadier Orde Wingate.  Just like Operation Longcloth, your retreat from the power of the east will be a march of shame and disgrace leaving the wounded to fend for themselves.

"Jim Sinclair said years ago that the PM bull market would end when central banks start buying"

He was talking about western central banks you nitwit.  Right now your paymasters in London are coughing up so much physical gold to the east hey are puking up blood.  Eastern banks are buying gold and western banks are bleeding gold.

FUD SCORE: 2 out 10

"during a period when US debt rose from $1 trillion to $5 trllion, gold actually fell from $800 to about $250, and silver from $48 to $3"

You picked the top of the last secular bull market, how convenient.  But you forgot to mention that real interest rates were yielding in the teens.

FUD SCORE: 3 out 10

"Wouldn't someone arb out the difference between "paper" and "physical"?"

That's precisely what is happening right now you disingenuous liar, as they are scooping up physical hand over fist.  But it's pretty hard to arb something that is OUT OF STOCK!

FUD SCORE: 2 out 10

"the uber wealthy don't buy Monster Boxes.  They don't buy coins at the local shop, nor from the US Mint, nor do they order online from Tulving.  Think pallets of good-for-delivery silver ingots"

Really?  Well isn't that special.  I guess your uber wealthy friends aren't so uber wealthy after all due to fact the total mining output FOR AN ENTIRE YEAR is only worth 18 billion dollars.  One billionaire could buy it ALL.  Maybe you meant uber liars.

FUD SCORE: 1 out 10

"What would he do for a living if he couldn't be a part of the end of the world syndrome and join the "good guys" wishing for total economic and societal annihilation?  He may be right about the rush last week to buy PMs at "discounted" prices, but I also suspect that these crowds are dwarfed by the 3 billion odd souls who "line up" each working day in the hopes of getting their share of fiat"

There is no end of the world scenario for the growing economies of the east unless your psychopathic bosses in London and Washington start a nuclear war to distract the world from their collapsing socialist ponzi schemes.  The 3 billion poor souls who work so hard every day wouldn't have to work so hard if it weren't for your central banker buddies who are robbing them blind through inflation.

FUD SCORE: 2 out 10

"The elite now are acquiring productive assets at an unprecedented pace, as wealth gravitates toward them."

The elite have always controlled productive assets you nitwit.  Wealth isn't gravitating towards them so much as they are looting everything that isn't nailed down and leaving the taxpayers with the tab.  Your hero Buffet would be a penniless beggar if it weren't for bought and paid for whore politicians bailing him out on my dime.  Which BTW pays for your worthless screed as well.

FUD SCORE: 3 out 10

"Those who have never been ultra rich have been spared one of life's most disconcerting and intractable problems:  what does one do when every dream one ever had has come true?"

How about lust after power and control of others?  Fantasize about creating a world police state where every move is watched and you need state permission to wipe your ass.  Sound familiar?

FUD SCORE: 2 out 10

"No need for you to mention environmental degradation or worker abuse relating to PM mining."

Really?  Seriously?  So now your ravenous paymasters are concerned for the environment and worker abuse?  Hahahahaha.

FUD SCORE: 0 out 10

"plus the psychic pleasure that comes from getting one's hands dirty"

Oh I'm sure your hands are very dirty.  God knows :-) But not from what most people think that means ;-)

 

Overall FUD score 1.9

YOU FAIL

Silver For The People



 

Sun, 04/21/2013 - 10:56 | 3480020 i-dog
i-dog's picture

+10/10. Excellent deconstruction of the odious quisling.

Sun, 04/21/2013 - 11:19 | 3480115 saveandsound
saveandsound's picture

Hi fiftybagger,

"You picked the top of the last secular bull market, how convenient.  But you forgot to mention that real interest rates were yielding in the teens."

That's the point. Keep your eyes on the interest rates. That is why I believe that PMs still have a long way to go. But I wouldn't bet too much, since I can't know anything about the future. You neihter, I suppose.

"Prognostics do not always prove prophecies, — at least the wisest prophets make sure of the event first." (Horace Walpole, 1717 - 1797)

Sun, 04/21/2013 - 12:57 | 3480466 chindit13
chindit13's picture

Contrary to popular opinion, Zerohedge Comments only appear to be an echo chamber.  There is no site bylaw requiring that it be so.  Such is the view that it is (an echo chamber), however, that anytime a contrary view arises it is immediately labelled a "paid shill".

Unlike you, I actually like to see a range of opinions, and can even consider that someone (other than me) might be right.  I do like to point out things, though, that seem inconsistent with common and widely held beliefs.

You say I chose the end of a secular bull market by picking the start of the Reagan Debt Explosion to contrast the movement in PMs.  It looks like I did it again when I chose the turbo-printing period of 2011-2013, since gold is down and silver butchered since that starting date.  I guess 2011 was the end of another secular bull market in PMs?  If the PM Gurus are right in justifying PM purchases on the basis of out-of-control debt and printing, then shouldn't the secular bull markets have continued and not ended just when debt and printing were taking off?  Maybe the Gurus logic is flawed?  If it is, that could cost those who accept without actually looking at the facts.  That alone demonstrates the value of second opinions and open minds.

A few weeks ago Tyler ran an article that contained a chart of Dow/Gold.  Comments under the article almost exclusively claimed the chart was bullish for gold and demonstrated its superior value.  Nobody actually looked closely at the chart (1913-2011) to see that---according to the chart, and without factoring in dividends---equities dramatically outperformed gold since 1913.  When I read through those comments, it reinforced my own view that PM fever blinds the afflicted.

We'll all get a chance to see how this shakes out.  No doubt you know lots of folks loading up on PMs.  I know folks doing the opposite, cashing out of a long term trade (somebody had to get the bull market started in 1999), and using the cash to buy fun and productive assets.  Maybe the Chinese and Russians will buy everything they sell and PMs will subsequently rise again.  Good for you if it does.  On the other hand, there might be a lot more selling to come over the next year or two, putting a cap on any rally and dashing incipient hopes. 

Once China has all the gold in the world (except yours, of course), good for them, but I'm not trading any of my assets for it, nor I suspect will any of those formerly large PM holders now selling and acquiring productive assets.  PMs already served their purpose for me, and I'm largely out of the trade (except for a core position that serves as diversification 'just in case').  Gold or silver is wonderful for you, maybe even a way of life.  For me and for many others, they're at best a trade, and at worst pretty much an afterthought.  I'm well aware gold has little to no inherent value nor use, but from time to time it catches the public's fancy.

Enjoy your coins.  May ownership bring you joy and fulfillment.

 

Sun, 04/21/2013 - 14:24 | 3480650 akak
akak's picture

Chindit wrote:

A few weeks ago Tyler ran an article that contained a chart of Dow/Gold.  Comments under the article almost exclusively claimed the chart was bullish for gold and demonstrated its superior value.  Nobody actually looked closely at the chart (1913-2011) to see that---according to the chart, and without factoring in dividends---equities dramatically outperformed gold since 1913.

Chindit, you may have made this claim regarding equities outperforming gold in all sincerity, but it is simply specious and nonsensical.  ALL charts purporting to show a long-term relationship between gold and stocks which use the NASDAQ, or the DOW, or the S&P500 are crap, because of "survivor bias".  There IS NO single DOW, or NASDAQ, or S&P500 over the long term, as failing companies are and have been continually dropped from those aggregated indices while newer up-and-comers are added to them, radically skewing and corrupting the long-term relationship. 

This same phenonmenon, of course, holds for the broader stock market in general --- ANY basket of stocks over the long term is going to see a fair number if not many of those stocks eventually decline in value or fall to zero as the associated company loses market share, goes bankrupt or is rendered obsolete.  How did the holding of the former blue-chip shares of Kodak or Citigroup or GM or AIG work out for those who held out "for the long term"?

In order to demonstrate the relationship which you claim exists between equities and gold over say the past century, you would have to take the performance of say the DOW as it existed in 1913 and compare it to the performance of gold since then.  And just how many companies that were in the DOW in 1913 are still in it today?  Actually, there is only one.  So any comparison of the value of any major stock index over a multi-decade period, relative to anything else or even to itself, is necessarily comparing apples to (cherry-picked) oranges, i.e., essentially meaningless.

Sat, 04/20/2013 - 22:35 | 3479062 Room 101
Room 101's picture

PUD: I actually happen to agree with a lot of what you have to say, I just wish you wouldn't be such a jackass in saying it and thus cut out the legs from your own argument.  

-  I agree that gold (or any other PM) is not an investment.  It's a store of value. Or money if you prefer.  It's proven over time to be a pretty good store of value. FIAT, not so.

- Gold is in my view a less desirable PM. I don't own it. While I sure wouldn't take offense if someone handed me a few ounces, it's isn't for me.  It's very pretty, but other than that it isn't much use.  Great conductor of electricity, but way too expensive to use for that. Other PMs have far more uses. 

- The way that gold is mined in the third world is a travestry but ironically, that will drives up it's value over time.  As gold miners around the world demand something approaching tolerable living conditions, it's price and rarity will increase. 

- While I'm no great fan of gold, relative to fiat it's not even a contest. 

- It's true that PM's in effect just sit there.  Unless they're used in some product. But then again that's what they're supposed to do. Sit there and remain scarce. 

Now that I've agreed with a large part of your post, let me tell you what I don't do: criticize the goldies.  Why?  Because I'm not so sure of my position that I feel the need to criticize theirs, nor do I wish to be the one in the glass house tossing about stones. I also don't see it as a zero sum game.  They don't need to be wrong so that I can be right.

 

Sun, 04/21/2013 - 06:18 | 3479690 PUD
PUD's picture

well then, why don't you go sit in the middle of the boat where you won't be afraid of rocking it

Sun, 04/21/2013 - 07:03 | 3479725 Room 101
Room 101's picture

I don't worry about rocking the boat.  There are plenty of keyboard provocateurs and sunshine revolutionaries out there "rocking the boat"  to zero effect. I've noticed that the ones that actually make a difference and who need to be listened to are usually the ones that quietly state their point, if they bother to state it at all.  

Although you're an asshole, I actually enjoy reading your posts as they're generally well crafted and contrary to the orthodoxy.   

Sat, 04/20/2013 - 23:04 | 3479179 maximin thrax
maximin thrax's picture

Would you take all the gold in the world melted down into a cube 60' x 60' x 60' or a trillion fiat dollars, all the farmland in america and a ton of productive assets sprinkled on top?

If you chose gold then you are indeed not only immoral, greedy, myopic, backward thinking but the greater fool.

Before you lay down all the red arrows which I know will blindly be forthcoming....think of a rational reply to what i just wrote and challenge any part of it.

Answer me this - in your little deal above, what did you do with all the farmers who owned that land? There's a lot more farmers than gold miners, I can assure you. Therefore, there's a greater human toll in securing all the nation's farmland for one person than there was in mining all the world's gold. Not to mention what you'd have to do to folks to take a trillion dollars in fiat out of the economy and a ton of productive assets for yourself.

Besides, I can take my giant cube of gold and dump it into Mordor and nobody is hurt but me. But if, as owner, I mismanage all the farmland in America because I'm too rich now to give a shit, or if I bankrupt the nation because I am hoarding a trillion dollars in physical fiat that's not being used as capital instead of hoarding gold, and likewise mismanage all the tons of productive assets I got in place of the gold cube, I am in the position to cause the severe distress if not outright deaths of billions of people worldwide from lack of food and other basics. And of course when the zombies I've created come after me, I'll just have to mow them down indiscriminately to protect evreything I own from being taken from me.

It's much better for the World for one man to own all the gold than for one man to own all farmland, almost all unencumbered capital and tons of productive assets to operate at his whim/incompetence level. That's why we have government - for redistribution. I'd stand a better chance to keep my gold than I would to keep the alternative trade (land, cash and means of production) from being taxed out of my hands or worse. So, now who's being myopic?

Sun, 04/21/2013 - 01:24 | 3479512 lakecity55
lakecity55's picture

I think all of us PM guys know it is moar a STORE of WEALTH, nimrod.

Sun, 04/21/2013 - 04:32 | 3479643 saveandsound
saveandsound's picture

Hi PUD,

if you were wrong, why do so many ZHers react so emotionally towards your critisism? Aren't they on the secure side, hence abel to post unexcitedly?

As you say, Gold is not an investment. PM mining does harm to enviroment and people. You are right. However, gold and silver are still money, that has been true for more then 5000 years. Believe it or not, they are a store of value and an insurance against tail risks.

Now, hording of Money (or PMs) does not contribute to economy. We know that. So why do so many people buy PM? Why don't they invest or spend their money?

Because they don't trust the central banks and the goverments any more. And they do right so. In case more trust is destroyed - and chances don't look too bad - fiat money, the so-called financial world and the beloved world trade are in serious shit.

Historically the situation is fundamentally different from the early 80s - it looks more like the beginning of the 70s, on a much larger scale.

I believe ZH is clearly "selling the book" of it's advertisers paying their bills (in US-dollar I suppose ;-) ), just take a look a the bitcoin-coverage. However it isn't to dumb to own a bit of physical insurance against the upcoming crash at the goverment bonds market. Whenever that will be. It took indeed quite a while for the other bubbles (stocks, real estate) to burst.

Good luck

Sun, 04/21/2013 - 06:15 | 3479688 PUD
PUD's picture

It is a perceived store of value. Take away that perception, ban its sale, raise awareness of the dark side, convince the masses that it is just a mineral...that perception would vanish overnight.  Treasuries were once viewed as "safe" Tulip bulbs were once thought "investments"  The mindset changes. Gold is not an investment or a store of value like a grain silo filled to the brim with wheat, it is a perceived store of value and investment. All subject to the passing whims and regular manias of people like those posting in its favor here.

Sun, 04/21/2013 - 09:46 | 3479896 saveandsound
saveandsound's picture

@PUD: Alright, let's assume, the ownership and/or sale of gold would be forbidden. What do you think would be the price of gold at the black markets? Besides, what would be goverment's or parlament's reason for banning gold at first place? Isn't this supposed to be capitalism or freedem of markets? Aren't we allowed to choose our investments or our preferred currency?

Take a look at the yieldcurves: sooner or later goverment bonds have to come down. Either in nominal terms or in real terms, maybe in both ways. In first case we would see a deflationary shock, in the second case we would see a potentially very ugly inflation.

I believe, PMs might take a break für a couple of years, but in the long run still have a long way to go. Nothing against other assets with well know advantages and disadvantages.

PS:

I'd liked to read more from guys like you. When everybody just posts "gold bitches", the discussion get's a kind of boring ;-)

Sun, 04/21/2013 - 11:30 | 3480147 Non Passaran
Non Passaran's picture

His comments are garbage. None if that is unique or new.
I can't eat gold? Oh shit, he got me! What am I going to say now?
Only an ignorant moron would speculate what would happen if the government banned the sale of gold.

Sun, 04/21/2013 - 11:25 | 3480124 Non Passaran
Non Passaran's picture

Ban its sale?
LOL! Fuck off you ignorant moron.
(It's interesting how the perception of this nonexistent value has been stable through centuries...)
Tell me, how long can your gain silo store value?

Sun, 04/21/2013 - 13:50 | 3480675 Not My Real Name
Not My Real Name's picture

"It is a perceived store of value."

After 5000 years of gold and silver's historical affirmation as the ultimate store of value, I think it's safe to say "perception" has officially morphed into "reality." By the way, if you happen to have a few spare AGEs in your change jar, I'd be more than happy to take them off your hands for a freshly printed $100 FRN.

"Take away that perception..."

And how do you intend to overturn millenia of human perception?

"... ban its sale ..."

Oh, I see. By force. Spoken like a true statist.

"... raise awareness of the dark side, convince the masses that it is just a mineral..."

And propaganda! Again, more tools of the statists.

"...that perception would vanish overnight."

If you say so. Pud.

 

Sun, 04/21/2013 - 07:39 | 3479755 samcontrol
samcontrol's picture

you have some great points...
people here sometimes , well most of the times will not answer.
They are above you and i.

mining gold is fucking dirty and useless. But you will hear more about boating accidents than that on here.

That said , no bigger FOOL than me . I bought miners with my excess paper money , hating them and all, thinking they would at least match physical . Probably now down some 200k in miners.....
I have no access to physical here... even if i did, it is NOT a better idea than buying an apartment , farmland , timber and/or water.

Sun, 04/21/2013 - 08:31 | 3479807 Snoopy the Economist
Snoopy the Economist's picture

PUD,

Why buy gold? Because there are people whom were only able to survive some of the worst inflaionary events in history because they purchased gold ahead of time.

Sun, 04/21/2013 - 09:48 | 3479898 Jim B
Jim B's picture

Ben, Call me! 

Sat, 04/20/2013 - 19:54 | 3478569 stant
stant's picture

i bought my wife a 25th anv present. a silver necklace and ear rings. when it rang up it was 10 bucks less than what it was marked . when i asked the cashier she said it was on sale according to her computer.  hummmmm

Sat, 04/20/2013 - 20:10 | 3478621 toys for tits
toys for tits's picture

Walmart rollback.  Cool.

Sat, 04/20/2013 - 20:45 | 3478749 stant
stant's picture

how gosh! montana collection tractor supply. thats how we roll out here in horse country

Sat, 04/20/2013 - 19:57 | 3478577 U4 eee aaa
U4 eee aaa's picture

I think I am starting to agree with the gold bears. This is definitely the end of the gold bull market.....

......and the beginning of the mania!

That would be great if all those junior gold stocks did what the Inet stocks did in the late '90's. I'm all ready for that! :)

Sun, 04/21/2013 - 07:41 | 3479759 samcontrol
samcontrol's picture

If that happens you are invited to a one week ski trip all included to south America...

never been that lucky but there is always a first time.

Sat, 04/20/2013 - 19:58 | 3478580 cristo
cristo's picture

This question goes out to everyone that thinks the bullion banks where behind a plot to take down the PM's .

I'm still undecided on this opinion .

Why are the bullion banks giving us such a great deal on PM's ?

 

Sat, 04/20/2013 - 20:08 | 3478616 U4 eee aaa
U4 eee aaa's picture

it is called shake and take. When you are loaded to the rafters with short positions you slam the markets in order to shake out all the weak longs and close out those positions. It is a form of damage control

Bombs like that quite often are a signal that they are going to soon be panic buying because their positions are becoming overwhelmingly underwater.

We can only hope it is the case but if not, we can wait

Sat, 04/20/2013 - 20:24 | 3478679 rajat_bhatia
rajat_bhatia's picture

Only the sheep panic, my dear, not the guy who sold 400 tonnes of gold on Comex

Sun, 04/21/2013 - 11:51 | 3480235 U4 eee aaa
U4 eee aaa's picture

You need to do some research on the days when gold was around $300. Back then they panicked so hard that the Bank of England had to make an emergency announcement that they were selling their gold into the market. Now why would a bank announce before they were doing it that they were going to dump gold into a market that killed the price? Isn't that a little counterintuitive? You have an asset that is appreciating (it was breaking out at that point), then you announce a sale that knocks a significant percentage off the value of the price. THIS is good central banking asset management?

NEXT!

Sun, 04/21/2013 - 14:35 | 3480827 auric1234
auric1234's picture

Why don't you document yourself? COMEX doesn't trade gold.

 

Sat, 04/20/2013 - 19:58 | 3478581 GOSPLAN HERO
GOSPLAN HERO's picture

There are empty shelves at APMEX and Providentmetals.

 

THIS IS NO DRILL!

Sat, 04/20/2013 - 20:12 | 3478639 StarTedStackin'
StarTedStackin&#039;'s picture

But those are outfits for pikers

Sat, 04/20/2013 - 20:14 | 3478641 dreadnaught
dreadnaught's picture

shortages...shouldnt the price of gold/silver be skyrocketing about now....?

Sat, 04/20/2013 - 20:20 | 3478658 StarTedStackin'
StarTedStackin&#039;'s picture

One who was unschooled might ask that question before contemplating the difference between physical and paper

 

 

 

I say that physical is much like a woman......

 

 

If it's truely mine, I can rub my hairy scrotum all over it!

 

 

Try rubbin' it on paper sometime.....

Sat, 04/20/2013 - 21:57 | 3478963 knukles
knukles's picture

Why would I rub your scrotum on paper?
Just askin'....

Sun, 04/21/2013 - 11:18 | 3480109 Non Passaran
Non Passaran's picture

It's not advisable. Last time I tried, I cut myself.

Sat, 04/20/2013 - 20:20 | 3478664 aphlaque_duck
aphlaque_duck's picture

You can still get junk silver from Tulving, now only 23% over spot.

Sun, 04/21/2013 - 09:49 | 3479901 Jim B
Jim B's picture

They are out of ALL low margin silver products! WTF!

Sat, 04/20/2013 - 19:59 | 3478582 tom
tom's picture

Yawn. Arguing with the tape.

As ETFers sold out, the gold was pulled out of ETF reserves and sold into the spot market. The spot market fell just as hard as "paper gold".

Yes, there's more physical buying after such an episode because ... there has to be. Somebody somewhere has to own all the gold that's out there, so if the ETFs are increasing their selling, the physical market must be increasing its buying, either as bar or coin or jewelry. What encourages the physical buyers? Lower price. Gosh, it's a functioning market. What a surprise.

We'll see where the price settles after this. I don't rule out that the ETFers oversold and the market will fairly quickly go back to say $1500. But the Asian demand just wasn't strong enough at over $1500. You can come up with as many lame-ass excuse conspiracy theories as you like, but the bottom line is Asian demand just wasn't holding up at prices over $1500.

Sat, 04/20/2013 - 20:20 | 3478663 SmallerGovNow2
SmallerGovNow2's picture

ignorant arguement.  paper selling goes to paper buyers....

Sat, 04/20/2013 - 20:23 | 3478671 StarTedStackin'
StarTedStackin&#039;'s picture

Did not see your post when I replied, but

 

 

+1

Sat, 04/20/2013 - 20:25 | 3478686 SmallerGovNow2
SmallerGovNow2's picture

Back at ya Ted... +1

Sat, 04/20/2013 - 20:22 | 3478665 StarTedStackin'
StarTedStackin&#039;'s picture

So when the markets sell paper gold it's the same as selling real gold?

 

 

 

 

WHO is selling REAL Gold?

Sat, 04/20/2013 - 21:45 | 3478933 Peter Pan
Peter Pan's picture

Exactly the point I made much earlier. Is there are a possibility that despite their differences, that USA, Russia, Japan etc are unloading enough physical to take the sting out of a price hike that would have followed such a big up ramp in demand for physical?

Sat, 04/20/2013 - 23:22 | 3479249 rajat_bhatia
rajat_bhatia's picture

If there is no physical selling, why are physical gold falling too? Shouldn't retailers that bought physical from the manufacturers at 1500+ stop selling it, as they know better than you that "this is a paper gold conspiracy"? Why in the hell will physical gold ever fall in price ? It shouldn't , no?

Sat, 04/20/2013 - 20:23 | 3478674 newworldorder
newworldorder's picture

You must be referencing GLD and not the Canadian and Swiss physical bullion ETFs. Assuming you are correct on physical being pulled from GLD and sold - When demand picks up again in the GLD and other ETFs, where is the supply going to come from? I have not seen a huge liquidation in the physical ETFs. Those who bought physical on the downturn will not sell in the same volyume on the upturn.

Sat, 04/20/2013 - 22:04 | 3478977 tom
tom's picture

Yes, GLD is by far the biggest gold ETF and there have been huge amounts pulled out of it in recent months. It's publicly available information, google it.

I know you guys on here like to believe that GLD is fake and has no relation to the physical gold market, but  those who do, you're simply wrong on that. When the gold price was going up, GLD was having gold put into its reserves. When the gold price fell, those reserves were being taken out and sold.

The argument that "paper gold sellers only sell to other paper gold buyers" isn't really true. The way GLD is kept in line with the spot price works like this: when GLD is being bought or sold more actively than spot gold, a minute price difference and this arbitrage opportunity opens up between GLD and spot. So-called "authorized participants" then close that gap by either buying up gold on the spot market and converting it into GLD shares, or buying GLD shares, canceling them and taking ownership of the gold, and selling the gold on the spot market. Joe Schmoe GLD owner can't convert his shares into gold, but "authorized participants" can, and do, often.   

You don't have to like the structure, I'm not recommending GLD at all, I'm just saying, it is as connected to the physical gold market as any other ETF, as any other part of the gold market. The recent big sell-off was mainly due to GLD being sold leading to "authorized participants" taking gold out of GLD and selling it on the spot market.

Sat, 04/20/2013 - 20:37 | 3478719 Al Huxley
Al Huxley's picture

So you figure the 1200 tons held by GLD defines the gold market, not the other 180,000 tons held by Central Banks, the ultra-rich, individual savers, etc...?

Sat, 04/20/2013 - 23:30 | 3479275 rajat_bhatia
rajat_bhatia's picture

Whyre you angry Al? Ashamed of admitting all those doomsayers you paid to read, and on whose flimsy cons you bought worthless relics, fooled you? And now you see your wealth deteriorating day by day.. All that gold you bought at 1700+ is depreciating in value? Cheer up Al, never too late to correct your mistakes

Sun, 04/21/2013 - 14:40 | 3480839 auric1234
auric1234's picture

For a moment, I got shit scared when reading your comment about our wealth deteriorating.

Then I rechecked my stash, and it's all there.

 

Sat, 04/20/2013 - 19:58 | 3478583 Goldilocks
Goldilocks's picture

Neil Young - Rockin' In The Free World
http://www.youtube.com/watch?v=PdiCJUysIT0 (3:28)

Sat, 04/20/2013 - 20:22 | 3478677 StarTedStackin'
StarTedStackin&#039;'s picture

Lots of talent, but a blabbering Socialist tool

Sat, 04/20/2013 - 21:05 | 3478809 Goldilocks
Do NOT follow this link or you will be banned from the site!