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Bonds Becoming Unglued As Gold Drops Below $1200, Lowest In 6 Months

Tyler Durden's picture





 

Despite yesterday's somewhat lackluster response, treasury bond yields are breaking bad this morning with 5Y up 13bps from the Fed taper (and 10Y at 2.94%). But it is gold (and silver) prices that have been monkey-hammered with the former trading below $1200 briefly - its lowest in 6 months.

Gold is tapering...

 

and interest rates are displeased...

 


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Thu, 12/19/2013 - 10:00 | Link to Comment buzzsaw99
buzzsaw99's picture

sell the house, sell the car, sell the kids, BUY STAWKS!

Thu, 12/19/2013 - 10:00 | Link to Comment fonzannoon
fonzannoon's picture

Nailed it buzz

Thu, 12/19/2013 - 10:06 | Link to Comment Paper CRUSHer
Paper CRUSHer's picture

Not quite Fonzy,they want us to sell all our gold too.

Thu, 12/19/2013 - 10:08 | Link to Comment fonzannoon
fonzannoon's picture

yes correct. That is why we are not experiencing inflation or deflation or biflation. We are experiencing barflation. This is when you barf up all your assets trying to pay the bills.

Thu, 12/19/2013 - 10:09 | Link to Comment pods
pods's picture

Gonna be some projectile barflation coming.

pods

Thu, 12/19/2013 - 10:12 | Link to Comment Stackers
Stackers's picture

More QE - sell gold

Less QE - sell gold

 

Thu, 12/19/2013 - 10:19 | Link to Comment Stuart
Stuart's picture

I hope rates skyrocket and shove bankruptcy right up their ass.

Thu, 12/19/2013 - 10:28 | Link to Comment NoDebt
NoDebt's picture

Do not panic.  This is just the market "testing" the new, incoming Fed chairperson, as it always does.  At least that's what all the cool people are telling me.

Thu, 12/19/2013 - 11:54 | Link to Comment Buckaroo Banzai
Buckaroo Banzai's picture

Isn't 3% on the 10-Year supposed to be the "line of death"? If so it's quite a "test" for Yellen.

Thu, 12/19/2013 - 10:32 | Link to Comment CounterPartyVice
CounterPartyVice's picture

At this point they are just shorting more gold and buying more bonds to support the usd. Leverage in the gold paper market will hit new highs and only going to stop at a delivery failure. If they let gold moving up while bonds drop, only one fu* day people will know it's game over and which one is the real safe heaven.

Thu, 12/19/2013 - 12:12 | Link to Comment Flakmeister
Flakmeister's picture

The dollar is "supported" by the fact that the international oil trade is in dollars...

BTW, it is spelled fuck...

BTW, COMEX is cash settlement if need be....

Thu, 12/19/2013 - 15:32 | Link to Comment Never_Put_Down
Never_Put_Down's picture

Iran will receive about $4.2 billion in oil money from accounts held abroad when it fulfils the new nuclear non-proliferation commitments. Iran’s biggest oil buyers are China, India, South Korea and Japan. South Korea also has US$5.56-billion stuck in bank accounts slated to go to Iran for oil exports and a similar amount held in Japan since the beginning of the year. With $15 billion dollars floating out there for Irans oil we can only guess when they will start using gold as the exchange of currency. This would end the Dollar as the reserve currency and this is their plan

Thu, 12/19/2013 - 15:54 | Link to Comment Flakmeister
Flakmeister's picture

Why? 

Look at what Iran imports and get back to us....

Thu, 12/19/2013 - 12:42 | Link to Comment ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

" Leverage in the gold paper market will hit new highs and only going to stop at a delivery failure"

 

"Delivery" is made by handing a long a paper warrant issued by a TBTF institution.  Failure to deliver physical gold will mean the same thing that default on Germany's gold meant:  Falling prices (as expressed in paper markets).

 

When the miners shut down the press will say it only proves how little interest people have in gold.

Thu, 12/19/2013 - 10:19 | Link to Comment eclectic syncretist
eclectic syncretist's picture

One day after the taper and the 10-year is at 2.95% before the market even opens.  Way to go Bernanke, you loser.  You better get those presses cranked back up before the real bond sell-off starts and gets out of control you little bitch.

Thu, 12/19/2013 - 10:29 | Link to Comment NoDebt
NoDebt's picture

Not his problem any more.  He did his last press conference, headed back to the office, took a handfull of blue Vs, washed it down with a bottle of cheap Scotch and fell asleep on the leather couch until January when Janet takes over.

Thu, 12/19/2013 - 11:32 | Link to Comment disabledvet
disabledvet's picture

That's a real sell off in the treasury complex. These spreads are truly massive so even though the yields have never been lower in history you could get a panicked response in the one area of the market you don't want to have it (unless of course you're a natural gas tycoon...in which case you're swimming in cash and these "blowouts" in yields start getting you some return for the first time ever.)

Thu, 12/19/2013 - 10:25 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Yes, yes, sell your gold, sell it all...

to me.

Thu, 12/19/2013 - 10:27 | Link to Comment Flakmeister
Flakmeister's picture

I thought you stopped buying at $300?

Thu, 12/19/2013 - 10:29 | Link to Comment Non Passaran
Non Passaran's picture

Maybe he still is.

His problem is no one wants to sell at that price.

Thu, 12/19/2013 - 10:33 | Link to Comment LawsofPhysics
LawsofPhysics's picture

And I thought you weren't a troll.

I didn't say what I would pay for the gold...

Thu, 12/19/2013 - 11:32 | Link to Comment disabledvet
disabledvet's picture

Time to bust out your crazy pants. We all know you got a pair.

Thu, 12/19/2013 - 11:56 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Considering the year we had, the only thing to get out now is a good tax attorney.

Thu, 12/19/2013 - 16:28 | Link to Comment MisterMousePotato
MisterMousePotato's picture

There is some genuine wit on this forum. Sly.

Thu, 12/19/2013 - 11:30 | Link to Comment Lewshine
Lewshine's picture

Better still, bond yields will improve during the course of today's trade, gold will continue to shock to the downside, stocks will remain stable to green - Same continuous shit, different day. Things couldn't be better in the land of Oz!

Thu, 12/19/2013 - 10:34 | Link to Comment Paper CRUSHer
Paper CRUSHer's picture

From Wackopedia,

Barflation-a term used to describe a persistent financial condition whereby an individual sells various kiinds of assets including precious metals,gems, family members,vital organs and in extreme cases even the soul to keep his/her inflation expectations under control by tracking the S&P stock indices to all time highs.

Thu, 12/19/2013 - 10:08 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Kinda reminds me of 2008.....and 2000 come to think of it.

Thu, 12/19/2013 - 10:07 | Link to Comment Dr. Engali
Dr. Engali's picture

Can I keep the car?

Thu, 12/19/2013 - 10:11 | Link to Comment Big Corked Boots
Big Corked Boots's picture

No - they will give you a pair of Vietnamese Nikes in trade. Or else.

Thu, 12/19/2013 - 10:18 | Link to Comment buzzsaw99
buzzsaw99's picture

you will get a new owebomba-car. it costs more, has less of everything, but everyone gets the same. :elective repair work not covered:

Thu, 12/19/2013 - 10:23 | Link to Comment CrimsonAvenger
CrimsonAvenger's picture

And a steel rod shoots up through the driver's street straight into your sphincter at random intervals. Another feature lacking in the previous substandard models you were forced to buy on your own.

Thu, 12/19/2013 - 11:51 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

I'd like my rod with the chrome option, please. 

Thu, 12/19/2013 - 10:38 | Link to Comment Lewshine
Lewshine's picture

Set your watch...Wait for it...Yields on 10 year will improve in 3...2...1   ITS part of Ben's ideal farewaell boyz!

Thu, 12/19/2013 - 09:58 | Link to Comment Debtonation
Debtonation's picture

Been waiting for a good buying oppurtunity. Thanks Fed.

Thu, 12/19/2013 - 10:30 | Link to Comment Lewshine
Lewshine's picture

Unless you are in bed with Ben, you won't have a clue when a buying opportunity takes place for PM's.  The Fed has created an absolute LANDSLIDE! And many PM's investors will sell because of this manipulation - Causing greater selling. When the Fed is done - PM's will be the most hated trade on earth. How come I don't read those lame post anymore about how the "paper price" means nothing to real value?? ...Because it sure as hell does. PM's holders / buyers are gonna be destroyed, without mercy.

Thu, 12/19/2013 - 10:48 | Link to Comment LawsofPhysics
LawsofPhysics's picture

...and only accelerating the flow of physical eastward.

Life is a long song,  yes, the Fed can manipulate for a long time, but eventually entities will take delivery and the dollar will be dead.  If the dollar dies, chaos in America will begin.

I don't see how the Fed helps itself by destroying confidence in itself and the dollar.

Thu, 12/19/2013 - 10:50 | Link to Comment GOSPLAN HERO
GOSPLAN HERO's picture

... and the paper debt-backed USD will remain a great store of value forever.

LOL.

Thu, 12/19/2013 - 12:45 | Link to Comment Bay of Pigs
Bay of Pigs's picture

Lewshine? A guy who shines Jack Lew's shoes?

One question for you troll, China is hoovering up almost all of annual world production, and importing record amounts. Why?

Thu, 12/19/2013 - 17:05 | Link to Comment Rubbish
Rubbish's picture

Do I like my stack at $1320? NO

 

Will I sell? NO

 

Will I buy more as it drops? Yes, people thought I was nuts when I used to buy at $300

 

I wear whitey tighties because I have a big sack.

Thu, 12/19/2013 - 09:58 | Link to Comment agent default
agent default's picture

Forget about taper and QE.  The Fed will just outright devalue when all is said and done.

Thu, 12/19/2013 - 10:06 | Link to Comment bozzy
bozzy's picture

eurusd=1.21 2012

eurusd=1.37 2013

Seems like a pretty good deval to me, and the silly eurosheep are just watching and chewing....

Thu, 12/19/2013 - 10:16 | Link to Comment agent default
agent default's picture

That's not devaluation.

eurusd=1.37

The next day

eurusd=2.80

That's devaluation.

And the cherry on top:

The day after:

eurusd=1.40

As if Europe is in better shape.

 

 

 

Thu, 12/19/2013 - 10:03 | Link to Comment Quinvarius
Quinvarius's picture

The gold price is being managed.  It started Tuesday.  The bond drop is real.

Thu, 12/19/2013 - 10:05 | Link to Comment Xibalba
Xibalba's picture

"oh shit."   

Thu, 12/19/2013 - 10:14 | Link to Comment Dr. Engali
Dr. Engali's picture

The gold price being managed goes back a lot further than Tuesday. A Tuesday in 1971 might be a little more accurate.

Thu, 12/19/2013 - 10:20 | Link to Comment Quinvarius
Quinvarius's picture

True.  But they started their aggressive manipulation algos up again in the paper markets on Tuesday.  They had stopped them at the begining of July.  They are going to put all their gold in the pot and bluff again.  

Thu, 12/19/2013 - 13:45 | Link to Comment auric1234
auric1234's picture

I will never forget last november, when they started QE4EVA and the bullish trend reversed.

Point is, they smash it down on every piece of news, be it bullish or bearish. But they're not usually THAT agressive are they? This smells like desperation.

 

Thu, 12/19/2013 - 11:47 | Link to Comment Buckaroo Banzai
Buckaroo Banzai's picture

It goes back even before 1971-- the "London Gold Pool" manipulations happened in the late 60s.

Thu, 12/19/2013 - 11:57 | Link to Comment tarsubil
tarsubil's picture

It goes back further than that. The price was managed from FDR's confiscation/repricing to $35 in the '30s until '67 when the manipulation could not deal with the physical reality anymore and Nixon closed the window in a strategic retreat in '71. Punctuated equilibrium. Since then it has been managing the rise as they print to infinity. Maybe there will be another strategic retreat after the COMEX implodes. A reverse window? You cannot trade gold in exchanges and you must sell to gov at set price. Gold holders can be put in ghettos and moved from house to house so the basements can be dug up to look for the hidden gold. Once it has been extracted enough they can be put on boxcars to be sent to the delousing chambers. Sound familiar?

Thu, 12/19/2013 - 13:55 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

Gold has been messed with for ages. Here's an interesting example in American history...

http://en.wikipedia.org/wiki/Black_Friday_(1869)

Black Friday, September 24, 1869 was caused by two speculators’ efforts, Jay Gould and James Fisk, to corner the gold market on the New York Gold Exchange.[citation needed] It was one of several scandals that rocked the presidency of Ulysses S. Grant.

Thu, 12/19/2013 - 10:07 | Link to Comment chubbar
chubbar's picture

The following excerpt from Harvey Organ's blog:

"Thus  we have the following  gold ounces standing for gold in December:

5207 notices x 100 oz per contracts already served this month or 520,700 oz + (1550 - 67) x 100 oz = 669,000 oz or  20.808 tonnes of gold.

same as last night.

As you will see below we have only 14.18 tonnes in the registered or for sale category for the big 3 (JPMorgan, HSBC,Scotia) and 18.535 tonnes if you include Brinks. We have witnessed little gold enter the dealer except small deposits from Brinks

In Summary: if we believe the figures (and I serious reservations on the data)

i) the total dealer inventory of gold settles tonight  at  a very dangerously low  level of only 18.849 tonnes

i)  a) JPMorgan's customer inventory rests tonight at  1,014,357 (31.55 tonnes)  with a major part of this inventory in paper gold.

ii  b)  JPMorgan's dealer account rests tonight at  87,071.35 oz (2.708 tonnes)

iii) the 3 major bullion banks have collectively only 14.18 tonnes of gold left in their dealer account.(JPMorgan, HSBC,Scotia)

and what is totally remarkable is the fact that little gold is entering the dealer comex vaults despite December being the busiest month for the gold calender. We are also witnessing many adjustments which usually are involved in the delivery process.   What is troubling is the fact that for 5 straight days, 2 exact tonnes or 64,300.000 oz arrived each day  at JPMorgan's eligible or customer account.  I have not seen any evidence of settlements from this account. Bill Holter addresses this in his commentary tonight.

I believe that the gold inventory at the official comex gold vaults has paper gold mixed in with real physical making the data compromised, and  I believe you can say the same for our silver comex."

Thu, 12/19/2013 - 10:13 | Link to Comment fonzannoon
fonzannoon's picture

Someone sent this to me as a way of describing the free market against the Bernak. The Bernak coincidentally is the bald guy.

http://www.youtube.com/watch?v=w-eJSHoH9Fs

Thu, 12/19/2013 - 11:44 | Link to Comment disabledvet
disabledvet's picture

Kinda fits my mindset of late actually. "You are my Lord and Master oh Greedy One. I will not fail you!"

Thu, 12/19/2013 - 10:27 | Link to Comment eclectic syncretist
eclectic syncretist's picture

Exactly, they are going to deliver more gold this month than they have available to deliver.  That's why they need to scare all the people they can into selling or entice them into going short, so that they can buy.  I'm quite happy to be buying here. 

Thu, 12/19/2013 - 10:27 | Link to Comment chubbar
chubbar's picture

Another excerpt from Bill Holter's article yesterday that speaks to these deposits of 2 tonnes and this idea that perhaps this is really paper gold.

"Before I finish I want to remind you that for all intents and purposes the COMEX has ALL registered Gold already spoken for.  Will they have Gold delivered in to make full deliveries?  Where exactly will it come from?  It seems to me that obvious (if you are looking) monkey business is already going on there as JP Morgan has reported 5 straight days of "triple zero" deposits.  "Triple zero" as in EXACT weights.  They have now supposedly taken in EXACTLY 2 tons each day for 5 days.  Yes we will hear that "these are kilo bars" and are exactly two tons each day, I don't buy it.  Are you going to tell me that "kilo" Gold is shipped in from Switzerland only to then be shipped out again to the East?  There have been far too many other days with ".000" that are not divisible by kilo weights to be "coincidence".  Statistically a ".000" deposit or delivery can only happen once every 1,000 times, 25 or more in a year have less odds than winning the lottery.

  February has open interest that represents over 20 million ounces, what if that month ends with another 500,000 or 1 million ounces that stand?  Where will the metal come from?  China will import nearly 100% of global production this year and the ETF's, COMEX and LBMA have lost massive weight already, how much more are Western central banks willing to lose?  How much more do they even have left to deliver.  I will leave you with this quote from Harvey Organ, "I don't know how much Gold is left or where future Gold will come from but I do know one thing, China will get their Gold before anyone else does".  This quote is spot on and you can bet your financial life that when the day comes that "they don't get their Gold", you will know it within 24 hours!  Regards,  Bill H.
Thu, 12/19/2013 - 10:42 | Link to Comment FieldingMellish
FieldingMellish's picture

People need to stop following these goldbugs. They will ruin everyone who does. Sinclair, Moriarty, Organ, Ferguson, they are the real fraudsters here.

Thu, 12/19/2013 - 10:41 | Link to Comment Boston
Boston's picture

Manipulated or not, BOTH gold and Treasuries are on sale, so I'm buying BOTH.

Thu, 12/19/2013 - 13:40 | Link to Comment auric1234
auric1234's picture

If you buy treasuries, you should know the only way you can recover your investment is by selling them to someone else.

Or by waiting until expiration, which will be paid by someone else buying more treasuries.

In both cases you need a greater fool.

Oh and if this greater fool is the Fed, it means you lost money. Because the Fed only pays with more IOUs.

 

Thu, 12/19/2013 - 19:14 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

the USD gold price has been managed since it was 20/oz.
SRSLY, you didn't know this? it wasn't Tuesday.

Thu, 12/19/2013 - 10:03 | Link to Comment Iam Yue2
Iam Yue2's picture

1100 on the cards, if support fails at 1155.

Thu, 12/19/2013 - 10:05 | Link to Comment Xibalba
Xibalba's picture

Support?  How is it that you can chart a rigged market? 

Thu, 12/19/2013 - 12:47 | Link to Comment ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

Not that I ever really learned TA to begin with, but over the last two years the only thing gold has is resistance.  "Support" levels give way almost instantly every time they are tested. 

 

You can definately see it bounce off those overhead "resistance" points though.  So I guess TA is a half decent approach to understanding markets

Thu, 12/19/2013 - 19:11 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

You can always chart a rigged market as long as you condition your kernel functions to look for rigging.
You can't ever chart support & resistance because these concepts are linear & invalid.
The only possible curves, not lines, are those that are relative to inflation & relative to risk avoidance FOR inflation OR for an estimation of losses people could get at a certain buy-in price meaning you need to look at volume at a prior date/price as well.
Otherwise they are meaningless.

Thu, 12/19/2013 - 10:04 | Link to Comment Winston Churchill
Winston Churchill's picture

I'm sitting here hoping your right.

Got a lot of dry powder locked, and loaded.

Fri, 12/20/2013 - 14:08 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

if you're interested in chasing paper alongside metal delivery a couple things may be of interest:
AGQ: agq = silver2 x 8/191 : I'm eyeballing 2016jan calls, have 3 already for 2015 expiry
tsx HVU: hvu = 19.8444  19.8444 / SPY 11

My estimation is that AGQ could hit 200 to 400. HVU could hit 700 to 5000 but there is no time limit without options. With AGQ I'm not looking at the ETF price itself except as it changes the options prices.
agq, silver
400, 97.71428571
350, 91.40334473
250, 77.2499257
200, 69.09443405
in 2015 (before expiry 2016 jan) 

hvu, spy
8.007, 181.49 (actual HVU matching today: 7.97/share http://scharts.co/19HFq8R)
8.767, 180
11.952, 175
16.440, 170
32.028, 160
139.136, 140
758.321, 120
5634.391, 100
65592.944, 80 (not impossible: http://flic.kr/p/enJ7Cs )

If these work out then that's more paper to get metals, food, tools, ammo, etc.

If they don't they are low-cost to get into:

AGQ C 15JAN16 25 ask 2.70

AGQ C 15JAN16 30 ask 2.10

AGQ C 15JAN16 20 ask 3.60 but I don't personally feel like that's worth the extra cost to get in given the high targets for AGQ later. if it's wrong your limited downside is how little you put in to start. 2.10 is much better in that regard. if AGQ hits 200-400 then having strike 30 instead of 20 pretty much means not one fuck will be given that day. The break-even on that one will probably sit around 33 (silver at 28)

Sun, 12/22/2013 - 21:21 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

Bit of an update on that HVU vs SPY equation.

Having xx in equations is cumbersome & doesn't retain accuracy very well when adjusting for changes. 19.8444 19.8444 was removed and the new equation is not fitted to a trendline but should be in the near future.

Currently I'm using SPY x HVU (1/11) = C , some constant, which for now looks to be around 16471 / 75 = C.

The trends for this are shown (x75, so you can easily see where the 16471 sits for now): http://flic.kr/p/iwHcZZ

Thu, 12/19/2013 - 10:20 | Link to Comment Dr. Engali
Dr. Engali's picture

I don't know why you're getting junked. Gold will move to wherever they want it to move. If they manipulate it too far then we will see physical break free from paper. Personally I hope they do.

Thu, 12/19/2013 - 10:26 | Link to Comment Spastica Rex
Spastica Rex's picture

That will be one point of evidence that the con is over.

Thu, 12/19/2013 - 10:37 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

The cheapest gold to mine is above ground.

Ever heard of "Cash for Gold", especially in a "BARFlation" economy?

Thu, 12/19/2013 - 10:45 | Link to Comment Dr. Engali
Dr. Engali's picture

The only way they get gold off the streets is by allowing the price to rise. They already have the gold from the desperate, now it's time to destroy the miners by driving gold down past the cost of production.

Thu, 12/19/2013 - 13:47 | Link to Comment D-liverSil-ver
D-liverSil-ver's picture

I agree, they already have the easy gold off the streets.

A year ago we had three "Cash for Gold" stores in our town, only one left.

One shut down and the other turned into a Title Loan place.

Thu, 12/19/2013 - 18:51 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

I junked him because there's no such thing as support given as a price without a date range or perhaps an equation.
A singular price indicates no change up or down with time & an infinite period of validity. Impossible. Market don't work that way.

Thu, 12/19/2013 - 10:03 | Link to Comment XAU XAG
XAU XAG's picture

it's not the price TODAY that counts

 

It's the price when you "need" to sell that counts.

 

Thease prices will look like the price of google or microsoft when they first came on the market

Thu, 12/19/2013 - 10:08 | Link to Comment holdbuysell
holdbuysell's picture

Slight tweak to the above:
One doesn't 'sell' money; one 'spends' money.

Thu, 12/19/2013 - 10:28 | Link to Comment Flakmeister
Flakmeister's picture

Gold is not money, it is a commodity with value. One buys and sells commodities...

Sorry, but you seem to be confused...

Thu, 12/19/2013 - 11:01 | Link to Comment HoofHearted
HoofHearted's picture

And what did the actual James Pierpont Morgan have to say about gold and money???

Thu, 12/19/2013 - 12:13 | Link to Comment Flakmeister
Flakmeister's picture

In his day it was, it case you did not realize it...

A fixed convertability into another MOE implies that Au was money then...

Thu, 12/19/2013 - 13:31 | Link to Comment auric1234
auric1234's picture

If it quacks like a duck, it walks like a duck, it smells like a duck, it swims like a duck. Heck, I guess you should entertain the possibility that it IS a duck?

I don't care what you call it. Gold isn't or ceases to be money because some idiot calls it that.

 

Thu, 12/19/2013 - 14:18 | Link to Comment Flakmeister
Flakmeister's picture

Go ahead and buy something with it today. Go down to your favorite store and buy something and pay for it with gold...

It was money, it no longer is. You are so fucking thick that  you think that it implies that it has no value... 

Thu, 12/19/2013 - 18:49 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

FOR A short period of time governments strongly discourage use of gold as money, but outside of those countries & between them gold IS money, even to the central banks of those same countries.
Gold's still money.
And yes, there are stores right now in North America, few but some, where you go in with GOLD and walk out with GOODS.

Thu, 12/19/2013 - 20:12 | Link to Comment Flakmeister
Flakmeister's picture

The exception also proves the rule...

Yes, Au is easily used as a MOE between parties, but here is more to money than being a simple MOE...

Thu, 12/19/2013 - 23:14 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

no exceptions here - the rule itself is the majority of activity. Must have intrinsic value (non-monetary use), must be fungible (atoms), must be safe to handle (non-reactive, not too heavy, not radioactive, not liquid, etc.), must be easily recognizable, and so on. Money can't happen without all these qualities satisfied.

Fri, 12/20/2013 - 02:53 | Link to Comment Flakmeister
Flakmeister's picture

Sorry, but what you claim is wrong... Money does not follow such a strict definition. I have a bunch of FRNs in my pocket that are good to exchange for goods in most of the world...

Fri, 12/20/2013 - 04:35 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

no good for exchange in many parts & those parts of the world are growing in size.
No good for exchange with me.
That's not what makes money: the US government actively MURDERS people who try not to use dollars.
That's not a choice, that's not money.
That's no better than threatening to kill your children if you don't use POCKET LINT as money.
That doesn't make pocket-lint into money.
That's a sign your a hostage or a slave.

Thu, 12/19/2013 - 21:01 | Link to Comment RaceToTheBottom
RaceToTheBottom's picture

They have credit cards that sell bits of gold as needed to cover net purchases, every day.

Thu, 12/19/2013 - 20:59 | Link to Comment RaceToTheBottom
RaceToTheBottom's picture

They have credit cards that sell bits of gold as needed to cover net purchases, every day.

Thu, 12/19/2013 - 18:47 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

No, you seem to be confused. ALL goods are money:
copper, silver, gold
canned food, medicine, tools
vehicles, various items of property which don't degrade rapidly in physical structure
the only thing that's NOT money is services & debt.
Fiat currencies are debt (today: they need not be but today that is the case).

Thu, 12/19/2013 - 20:15 | Link to Comment Flakmeister
Flakmeister's picture

You are again confusing money with MOE....

Thu, 12/19/2013 - 23:16 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

no, you are confused. What is not a commodity is by definition anti-money, not-money, at all times.

Dollars are not money. MOE = garbage

money is a physical good. Never has been anything else in all history. Ever.

People today don't use money. People today use debt notes and PRETEND it's money. It's only because they're born into a system of lies & slavery.

It's like wearing a slave collar and pretending it's jewelry (voluntary, decorative) but you can't ever take it off and people use it to hold you in place against your will (not jewelry). No matter how much you pretend it's jewelry, no matter how many generations the lie lasts - it's a slave collar.

Fri, 12/20/2013 - 02:55 | Link to Comment Flakmeister
Flakmeister's picture

Lay off the ideological clap trap. seriously... 

I have heard all these arguments ad naseum, repeating them does not make them any more true...

Fri, 12/20/2013 - 04:36 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

Yes, as a matter of fact, it does.
The repetition, by action not by word, throughout history, is the one thing that does make it true.
Truth in trade is the act of trade, not your opinion, and the act of the trade, the act that makes money by need, by hand, by exchange, is not word of mouth, is not ideology, is not debt, it is historical fact carved in stone, in coins & inscribed on scrolls in every civilization.

Thu, 12/19/2013 - 10:33 | Link to Comment Flakmeister
Flakmeister's picture

Gold's real buying power has cratered... BFD if it now goes to $5000 while the price of oil goes to $450 a barrel...

I envy those that sold their PMs back in the summer of 2011.. 

Thu, 12/19/2013 - 10:34 | Link to Comment the tower
the tower's picture

Your logic is lost on me... when you NEED to sell that's the moment when you are broke, i.e. when everyone's broke, so you will get zilch for your silver and gold, since no-one will be looking to buy.

When you WANT to sell is WAY after the SHTF, when the world is back on its feet and willing to pay a reasonable price for your metal.

Since by then people are not in NEED to buy (no crisis looming) prices will be nothing like you're paying now.

Gold at $300 was an OK price for a bit of security. Right now you're just stupid to buy, you will get back 10% if you're lucky.

Gold was a bubble, let's face it. Internet memes sure make some people rich.

Thu, 12/19/2013 - 10:47 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

+1 for your last sentence.

Malleable 2D Sheeple love to go "all in" on some fancy (get rich quick) promises. And they then have the gall to bitch about 'Casino Capitalism'. They clearly need to look in the mirror.

What they really should be doing is DIVERSIFY their assets into a balanced mix of Primary, Secondary and Tertiary wealth. All else is Speculation (Wheel of Fortune).

Recall HH's post of yesterday, where S&P 500 was UP 27%, Gold was DOWN 27%. Need we say more? Besides "Beware of Shills"?

Thu, 12/19/2013 - 18:30 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

but but but the markets are rigged!!
which is why be must buy the all time high, right?

- soon to be Shillionaire

Thu, 12/19/2013 - 11:05 | Link to Comment OneTinSoldier66
OneTinSoldier66's picture

So, your long paper then?

 

I know, it takes so damn much energy, effort, and time to come up with digital pieces of paper on a computer keyboard when The Fed does it'ds QE. Real valuable stuff! /s

Thu, 12/19/2013 - 13:16 | Link to Comment Flakmeister
Flakmeister's picture

Are you familar with the argumentive fallacy of the excluded middle?

If you are not, you better look it up...

http://en.wikipedia.org/wiki/False_dilemma

You really should simply STFU as you are probably a fool and opening your mouth only confirms it...

Thu, 12/19/2013 - 17:24 | Link to Comment Meat Hammer
Meat Hammer's picture

Serious question: Why can't you argue your points without being such a fucking asshole?  

Thu, 12/19/2013 - 20:17 | Link to Comment Flakmeister
Flakmeister's picture

I get tired with dealing with fucking idiots that cannot grasp basic ideas....

You are one of them BTW....

This one is for you

http://data.giss.nasa.gov/cgi-bin/gistemp/nmaps.cgi?year_last=2013&month_last=11&sat=4&sst=3&type=anoms&mean_gen=11&year1=2013&year2=2013&base1=1951&base2=1980&radius=1200&pol=reg

Hottest November on record.... 

Thu, 12/19/2013 - 17:41 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

that's "dumb shit" logic you're using.
Smart-people logic is to see years in advance what your needs are & to sell in advance to ensure you can meet the need when it arrives.

Gold is not a bubble: NO commodity can be. The paper itself is the bubble & your failure is to pretend it's real money. Dollars aren't real money. They are fiat scrip. They have no value but the guns behind them. nothing.

Gold is real value, as is silver, wheat, canned beans, ammo, land you can protect & grow food from, clean water, etc.

You are so lost.

Fri, 12/20/2013 - 06:10 | Link to Comment the tower
the tower's picture

I'm a realist and work the system, you're an idealist and a dreamer.

Fri, 12/20/2013 - 14:12 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

no, you're just not very bright so to you what is impossible is to me, just normal.

You're not a realist, you're sub-par.

Thu, 12/19/2013 - 10:03 | Link to Comment Save_America1st
Save_America1st's picture

sell any of the worthless shit you don't need and grab as much phyzz silver as you can...this firesale isn't going to just last forever ya know.  And when the SHTF (soon....very soon, I suspect....well before the end of 2014) you'll never be able to get an ounce of silver this cheap ever again.  Last spot is showing 19.24 for the paper shit. 

Buy phyzz!

 

Thu, 12/19/2013 - 10:25 | Link to Comment Non Passaran
Non Passaran's picture

Are they still printing insane amounts of fiat?
Is fraud and deceit in finance rampant?
Are most countries and banks insolvent?
....

Nothing has changed.
Keep stacking.

Thu, 12/19/2013 - 10:34 | Link to Comment Flakmeister
Flakmeister's picture

They are not printing physical cash... these be sterile digital dollars that will vanish (deflate away) when the bond market cracks...

 

Thu, 12/19/2013 - 11:06 | Link to Comment agent default
agent default's picture

WTF do you mean "digital dollars"???  If you have dollars in an electronic account, you can credit one of the Fed's accounts in return for paper dollars.  You can also convert your  "digital dollars" to printed dollars at an ATM.  And you can send printed dollars to the bank to credit your account. The Fed is similar at an institutional level.

Haven't the people who are spewing out this "digital dollar" crap ever been to a bank?

 

Thu, 12/19/2013 - 11:29 | Link to Comment Flakmeister
Flakmeister's picture

Do you think that the excess reserves held at the Fed, i.e. the QE dollars will ever be printed up let alone make into circulation?

Thu, 12/19/2013 - 12:22 | Link to Comment agent default
agent default's picture

QE dollars are not held at the Fed.  The crappy assets bought with QE dollars are held at the Fed.

Thu, 12/19/2013 - 13:16 | Link to Comment Flakmeister
Flakmeister's picture

You really should not make shit up when you need to defend your position...

Why don;t you look up what is actually held on the Fed balance sheet and what Excess reserves actually are...

Thu, 12/19/2013 - 10:35 | Link to Comment agent default
agent default's picture

Yes it has.  They are piling it higher and deeper. 

Thu, 12/19/2013 - 10:05 | Link to Comment Lewshine
Lewshine's picture

Ben's perfect "ride into the sunset" scenerio. Things couldn't be more perfect for those who CREATE the economy needed to meet the lies it is all based on. Reaching into your safe or safe deposit box at will, stealing the value of your precious metals and converting those dollars into equity value. Fed MANIPULATION will soon be a studied science in the higher learning zombie factories of the world.

Thu, 12/19/2013 - 10:08 | Link to Comment Flakmeister
Flakmeister's picture

Raise your hand if you are tired of taking in the ass with gold...

Thu, 12/19/2013 - 10:13 | Link to Comment Dr. Engali
Dr. Engali's picture

Define taking it in the ass. Are you selling? If so then it sucks. If not then it's just another day. Gold is an insurance policy, not an investment.

Thu, 12/19/2013 - 10:30 | Link to Comment eclectic syncretist
eclectic syncretist's picture

Predictions are hard to make, especially about the future, but I predict that one day in the probably not too distant future a lot of people will wish they had bought more PM at the current prices.

Thu, 12/19/2013 - 10:43 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Correct.  Chance always favors the prepared.  Hell, if things really go south then a can of beans will have great value.

Thu, 12/19/2013 - 10:38 | Link to Comment FieldingMellish
FieldingMellish's picture

An insurance policy that you are never going to collect on. Not even your grandchildren. The gold bubble is over. Finished. Kaput.

Thu, 12/19/2013 - 11:31 | Link to Comment IridiumRebel
IridiumRebel's picture

Spoken like typical faggot trader mindset.

"Citizen! You have spoken ill of the glorious state! You have been deducted 100000 credits. Please report to reeducation at Site 101 immediately."

[summons storm troopers and pushes button to freeze account]

Thu, 12/19/2013 - 12:26 | Link to Comment agent default
agent default's picture

So the debt will be paid down and real interest rates will become positive once again right? If these things happen then yes gold will crash for good.

Thu, 12/19/2013 - 12:47 | Link to Comment constantine
constantine's picture

You seem awefully invested in making this point.  It's the same with goldbulls who celebrate everytime bitcoin goes down.  The truly sadistic nature of people is never on better display than when people who missed a bull market revel in the perceived pain of those who diagnosed it.  I've heard this 'gold bubble' meme since $400.

 

Thu, 12/19/2013 - 13:55 | Link to Comment FieldingMellish
FieldingMellish's picture

More pain in gold, much more, to come. Many have been blinded by the ZH meme of buy gold and hold it until you die.

Thu, 12/19/2013 - 17:36 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

Bartering gold for goods or services is perfectly fine.
Are you very serious in thinking that's never happened?

Thu, 12/19/2013 - 17:37 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

WTF.
bitcoin for cash is a ponzi.
Only a fool would do that. No gold is required to realize this is true.
By all means another digital means of vouching for value, say, PGP / GNUPG signatures, would be fine - quick & unbreakable - but bitcoin?
It's severely flawed & the fiat-exchanges which are one-way black-boxes of Corzinedom don't make it better.

Thu, 12/19/2013 - 14:24 | Link to Comment Deathrips
Deathrips's picture

Yellen is that you....I was confused..you didnt shave today.

 

RIPS

 

BUY IT STACK IT HOLD IT.....

Thu, 12/19/2013 - 17:31 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

it's tradition! :-)

Thu, 12/19/2013 - 11:48 | Link to Comment disabledvet
disabledvet's picture

There is a point where this becomes a war aim.

Thu, 12/19/2013 - 12:24 | Link to Comment agent default
agent default's picture

Gold is a bet on the stupidity and incompetence of those in charge.  As such it is an investment and  insurance policy. 

Thu, 12/19/2013 - 10:13 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

I'm still doing OK......thanks for asking though.

 

Of course I was buying gold when everyone else was buying tech stocks.....they made fun of me then.....and not much has changed since.

Thu, 12/19/2013 - 10:15 | Link to Comment LawsofPhysics
LawsofPhysics's picture

The last time I bought physical it was under $300 an ounce.  Wake me when it's there again.  Gold is not an investment, it's a safe store of value, a life preserver in a sea of fraud.

Thu, 12/19/2013 - 10:20 | Link to Comment Flakmeister
Flakmeister's picture

Good for you.... you still should have sold back in 2011 when it was a store of value. It's buying power has been cut in half vis a vis food and energy... 

PS I don't believe you when you say that you bought your last physical at $300... Sorry but my bullshit meter is in the red..

Thu, 12/19/2013 - 10:22 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Why isn't gold a safe store of value now?  I have never had a problem exchanging it for someone's labor.

Talk about bullshit, you might want to put that meter in the other room, it's sensing you.

Thu, 12/19/2013 - 10:29 | Link to Comment Seasmoke
Seasmoke's picture

As much as I hate what you are posting, it's the one thing I can't get my head around. If you bought gold at $300 and didn't sell at $1900 , right now you cost yourself $700.....whether paper or physical !!!!!

Thu, 12/19/2013 - 10:35 | Link to Comment LawsofPhysics
LawsofPhysics's picture

I am not a trader.   Please, having physical sitting in a safe hasn't "cost" me shit.

Thu, 12/19/2013 - 10:49 | Link to Comment Seasmoke
Seasmoke's picture

It Cost you having more physical coins in your safe. 

Thu, 12/19/2013 - 12:51 | Link to Comment ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

I cant speak for LawsOfPhysics, but whenever I suffer a lost Opportunity Cost, I make up for it by Imputing Income for myself.

Thu, 12/19/2013 - 17:27 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

that's a pretty big risk, unloading physical in hopes to get more for paper in the middle.
one day someone will try & it won't work, no matter the price.

Safer just to trade paper like agq puts or gld puts at a peak, gld calls, agq calls at a bottom, and hold the physical safe.

Thu, 12/19/2013 - 12:19 | Link to Comment tip e. canoe
tip e. canoe's picture

valuing gold in a paper currency (even if it is the global reserve currency) is perhaps why you can not wrap your mind around it.   some people do not value it in the same way.

Thu, 12/19/2013 - 10:31 | Link to Comment Dr. Engali
Dr. Engali's picture

Not that it matters, but Laws has been consistent with his last buy price for as long as I can remember.

Thu, 12/19/2013 - 10:37 | Link to Comment Flakmeister
Flakmeister's picture

So he get props for being a consistent bullshitter...

Thu, 12/19/2013 - 10:38 | Link to Comment LawsofPhysics
LawsofPhysics's picture

No, I was simply paying attention when my grandfather spoke about surviving the great depression and two world wars.  It's really not that complicated (for most).

Thu, 12/19/2013 - 10:52 | Link to Comment greatbeard
greatbeard's picture

>> when my grandfather spoke about surviving

It's a crying shame he only told you when to buy but nothing about when to sell.

Thu, 12/19/2013 - 11:07 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Who said I have not sold some?  when gold was going over $1700, land was still fairly cheap.

I need as much arable land as possible.

Thu, 12/19/2013 - 11:30 | Link to Comment Flakmeister
Flakmeister's picture

Priced in gold, desirable  land just got a lot more expensive....

Thu, 12/19/2013 - 11:45 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Yes, glad I purchased what I needed already.

Thu, 12/19/2013 - 11:33 | Link to Comment greatbeard
greatbeard's picture

>> when gold was going over $1700,

So you bought the bottom and sold the top?  Kudos my man.

Thu, 12/19/2013 - 11:52 | Link to Comment LawsofPhysics
LawsofPhysics's picture

The only thing that one should worry about with respect to land/real estate is what sort of crazy shit governments will do as these municipalities start going bust around the country.  Nine times out of ten, your taxes go up significantly.  Honestly, a wise investment now is a good tax attorney.  This applies to anyone who has done well this year.

Thu, 12/19/2013 - 12:08 | Link to Comment seek
seek's picture

Most goldbugs are in it long term, it's entirely plausible his last buy was 10+ years ago. I've got a purchase at $282 from back then (fantasy trading account, of course, pre-dating my lake accident.)

Thu, 12/19/2013 - 12:27 | Link to Comment quasimodo
quasimodo's picture

I would raise my hand Flak but they are both currently tending to my sore ass from this constant violation.

Thu, 12/19/2013 - 13:21 | Link to Comment Flakmeister
Flakmeister's picture

The only thing being stacked by the clowns here is Prep H wipes....

Thu, 12/19/2013 - 16:22 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

only applies if prices go so high I can't get any gold.

Thu, 12/19/2013 - 10:10 | Link to Comment 1835jackson
1835jackson's picture

Heisenberg bitches. 10 yr at 3.25.

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