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Gold Hits $1300, Silver Surges To 3-Month Highs As China Rehypothecation Ponzi Unwinds

Tyler Durden's picture


But, but, but... Janet Yellen didn't say precious metal valuations were within historical norms? Gold and Silver are surging today (and have done since the FOMC press conference all-clear) with the latter having its best day in months and back at 3-month highs... Intriguingly, just as we warned, gold and silver have been on a significant tear since the Qingdao CCFD probe began (as synthetic hedges are unwound - which dominate pricing in PMs) while copper and iron ore and so on have all fallen (as the reality of no real demand leaks into these commodities).



Is the CCFD unwind having its impact?


As we commented previously:

When we previously contemplated what the end of funding deals (which the PBOC and the China Politburo seems rather set on) may mean for the price of other commodities, we agreed with Goldman that it would be certainly negative. And yet in the case of gold, it just may be that even if China were to dump its physical to some willing 3rd party buyer, its inevitable cover of futures "hedges", i.e. buying gold in the paper market, may not only offset the physical selling, but send the price of gold back to levels seen at the end of 2012 when gold CCFDs really took off in earnest.


In other words, from a purely mechanistical standpoint, the unwind of China's shadow banking system, while negative for all non-precious metals-based commodities, may be just the gift that all those patient gold (and silver) investors have been waiting for.  This of course, excludes the impact of what the bursting of the Chinese credit bubble would do to faith in the globalized, debt-driven status quo. Add that into the picture, and into the future demand for gold, and suddenly things get really exciting.

Here's our previous epxlanation of gold's move... if we are right that somehow China managed to push gold lower via gold CFDs, then the unwind pushes gold higher:


Here's how that might work:

In the gold markets, the paper or synthetic 'demand/supply' dominates pricing as opposed to the non-precious metals which have at least a grain of fundamental sense to them still


Throughout 2012/2013 - as the gold CFDs were booming, Chinese demand for physical gold was soaring as the price plunged (due to the forward hedging required in the CFD transactions which pressured gold swaps/futures lower and thus dominated pricing)


As CFD unwinds hit en masse, these flows must unwind (cover hedges and ensure the underlying physical is there... and if not buy it)


This will pressure gold futures prices higher and because unlike in non-precious commodities where spot markets wag the tail of the futures markets - spot gold will likely be dragged higher also (as we know the demand for the physical has been high).

So unlike in the industrial commodities - where the CCFD unwind drives prices down as the image above shows, thanks to synthetic manipulation and domination of the paper gold (and silver) market, the opposite occurs in PMs.


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Thu, 06/19/2014 - 11:49 | 4873924 Awakened Sheeple
Awakened Sheeple's picture


Thu, 06/19/2014 - 11:52 | 4873932 THX 1178
THX 1178's picture

USD you mean?

Thu, 06/19/2014 - 11:58 | 4873947 Awakened Sheeple
Awakened Sheeple's picture

You weren't here for the silver bull, were you... They were glorious times, my friend

Thu, 06/19/2014 - 12:02 | 4873966 cro_maat
cro_maat's picture

Let me see silver at $25 and rising and then I will get excited.

These are still manipulated paper markets. When I have to pay a $5 / OZ premium for physical then I will know the game has changed.

Thu, 06/19/2014 - 12:11 | 4873995 lordylord
lordylord's picture

"When I have to pay a $5 / OZ premium for physical then I will know the game has changed."

When people aren't taking dollars for silver, then the game has changed.

Thu, 06/19/2014 - 12:15 | 4874007 kliguy38
kliguy38's picture

Go ahead and wait for that premium......I want you to wait ....meanwhile I'll take all I can store at these levels.....thanks   BTW THE reason you buy physical metal is not to trade it.....and I predict RIGHT HERE AND NOW that you will NEVER own one ounce of PMs

Thu, 06/19/2014 - 12:42 | 4874029 Pinto Currency
Pinto Currency's picture


Physical silver sustaining a 5% to 6% premium at the Shanghai Gold Exchange vs paper silver on the LBMA.

It was the daily Silver Fixing in London that was recently axed after 117 years - which appears to tell us that the immediate problem with price containment is in the silver market.

The paper price containment game only works while the market respects the dropping paper price.

(next - watch the problems with platinum and palladium on the LPPM in London.  Building to be a shocker.)


Edit: see also

Banks caught in fix seek new way to price gold

Thu, 06/19/2014 - 12:57 | 4874233 BaBaBouy
BaBaBouy's picture

Iellen Is Shittin' Herself Right Now ???

Thu, 06/19/2014 - 13:00 | 4874246 BaBaBouy
BaBaBouy's picture

GOLD !!!!!!!!!!! $4500..... Oooops, I Mean GOLD $45000...!

Thu, 06/19/2014 - 13:17 | 4874340 Herd Redirectio...
Herd Redirection Committee's picture

Bread $500!

Thu, 06/19/2014 - 13:33 | 4874421 Joe Tierney
Joe Tierney's picture

Yep, and navy beans @$750/LB


Can't eat gold and silver. You'll be using it to bribe for your life when the civil collapse comes.

Thu, 06/19/2014 - 13:40 | 4874457 Manthong
Manthong's picture

In case you do not f’n know, the pirates at JPM are stacking millions of ounces of Ag whilst spewing billions of short Fed paper.

What do they know that you do not?

Thu, 06/19/2014 - 13:53 | 4874518 SWRichmond
SWRichmond's picture

with the auditors coming it must be time to actually get some.

Thu, 06/19/2014 - 14:34 | 4874670 Save_America1st
Save_America1st's picture

@lordylord  "When people aren't taking dollars for silver, then the game has changed."

Ain't that the truth!!!

My 2 copper cents-worth suspicion though is that this is way to steady and deliberate of a climb from the open today to not be manipulated.  I still think there's another major smack-down (or 2) still in store for us either by the end of this month or sometime in July.  Maybe after that we'll see something really significant happen. 

But can any positive gains that may occur, even if all the way back up to 49+, be considered "real" until and only until the Crimex has defaulted and gone tits up???

We can't ever have a real market even if "prices" are 500 per ounce if the Crimex is still in business and the paper market persists. 

I sure hope that day comes soon.  I'd love to keep on seeing these sub-30 prices for a long time further so that I and others can keep stacking relatively cheaply.  But the day the Crimex goes bust will be when the real celebrating can finally start. 


Thu, 06/19/2014 - 14:37 | 4874691 BaBaBouy
BaBaBouy's picture

""Bread $500!""

Ya' Thinks So?
Well Buy & Store Bread Then...

Thu, 06/19/2014 - 15:16 | 4874879 Xibalba
Xibalba's picture

PM's don't mold

Fri, 06/20/2014 - 04:12 | 4877171 thisisjustarand...
thisisjustarandomusernameicreatedforzerohedge's picture

Copper sharply up again


thought the last China copper articles were bearish...

Thu, 06/19/2014 - 14:38 | 4874699 NoDebt
NoDebt's picture

Up $43/oz. TODAY.

Forty Three.  Flirting with $1320.

Holy cow.

Thu, 06/19/2014 - 14:59 | 4874737 strannick
strannick's picture



But but, Goldman said that unwinding unbacked paper claims on limited commodity supplies would drive prices LOWER..  What gives??

Thu, 06/19/2014 - 16:44 | 4875218 Manthong
Manthong's picture

"Up $43/oz. TODAY"

..when you see $100-200 swings daily, you will know that the market is enforcing itself. 

Thu, 06/19/2014 - 14:40 | 4874707 DoChenRollingBearing
DoChenRollingBearing's picture

It has taken a long time, much longer than I expected, but Freegold will arrive with its shockingly high price ("$55,000").  My guess would be that silver rides along, but I am moar confident that gold will take the prize.

It still could be well off in the future.  Or it could happen tomorrow.

Thu, 06/19/2014 - 15:45 | 4874991 Never One Roach
Never One Roach's picture

"If you don't hold it, you don't own it."


Peeples are beginning to understand that. Some learn from history. Many learn the painful way thru loss and tears.

Thu, 06/19/2014 - 15:49 | 4875005 fockewulf190
fockewulf190's picture

Been expecting MDB to show up with his usual anti-gold theatrics.  Alas, he is a no show to the party.

Thu, 06/19/2014 - 16:10 | 4875099 Buckaroo Banzai
Buckaroo Banzai's picture

MDB trolls for fun, not profit. Keeps his own schedule.

Thu, 06/19/2014 - 16:28 | 4875157 Bananamerican
Bananamerican's picture

For the 10 billionth time...

Thu, 06/19/2014 - 19:42 | 4875864 Rubbish
Rubbish's picture

Quite a few cash buyers in LA today. Never seen it like that. $$$$ on the counters. People know the dollar is losing it's value rapidly now, this will catch fire soon.

Thu, 06/19/2014 - 13:41 | 4874459 Flakmeister
Flakmeister's picture

Or pay the local doc for the emergency appendectomy performed in your living room...

Thu, 06/19/2014 - 13:44 | 4874472 7.62x54r
7.62x54r's picture

Beats not having one, or not having anesthetic.

During the soviet era, you had to pay the dentist in dollars for the novocaine.

Thu, 06/19/2014 - 13:42 | 4874464 7.62x54r
7.62x54r's picture

Gold to buy your life, silver to buy rice and beans.

Thu, 06/19/2014 - 19:07 | 4875657 Down to Earth T...
Down to Earth Thinking's picture

@ 762X54 and paying for novacaine Same will happen here with Ocare and worse ! and a good reason to have some storage.


We have not seen anything yet ? As it all melts down into ever more chaos it will make the last runup look like a blip on the radar screen and all because of fear, but rational fear !


Ponder this just for shits and grins, is the meltdown of the current regime having any affect on PMs ? I say absolutely but it won't happen all at once just as most events don't. It will be at a direct relationship to the unwinding of the current illusions. Which are imploding as we speak and the rest of the world has zero confidence in USSA .


But for all who think PMs will actually save you , think again. there is much more to the equation. Fat guys hoarding PMs , beans and bullets will still get it all taken way from them and be victims. Just like those with zip.  


There is a much better way and it only involves a bit of knowledge and some effort but not much. The best of all worlds or ideas is always the best solution.

Thu, 06/19/2014 - 13:56 | 4874531 PenguinMan
PenguinMan's picture

I remember reading a WWII story about how prisoners, bribed a German guard for 2 ounces of gold to turn the other way when the order was given during the imminent liberation of prison camps on the Polish border, to kill all of the prisoners and retreat leaving nothing standing.

In times like that, Gold price has a completely different value.

Thu, 06/19/2014 - 14:09 | 4874569 DoChenRollingBearing
DoChenRollingBearing's picture


Thu, 06/19/2014 - 14:38 | 4874698 rum_runner
rum_runner's picture

Begs the question why the guard didn't just take the gold and shoot the prisoner.  As a non-gun-owner I'm bothered by the reality that after Katrina-like events it's the lead that matters, not the gold/silver.

Thu, 06/19/2014 - 14:59 | 4874804 Flakmeister
Flakmeister's picture

Because as a rule ~95% of people have some shred of honor.... 

It is the other 5% that fuck it up for everyone...

Thu, 06/19/2014 - 15:07 | 4874832 TheReplacement
TheReplacement's picture

Knowing what you know, why on earth would you not be a gun owner?

Thu, 06/19/2014 - 18:46 | 4875611 OceanX
OceanX's picture

A gun is a first strike weapon, you can't draw second.  Predators alway have the advantage, they choose the time to strike.  A strong community is your best defense.

Thu, 06/19/2014 - 19:03 | 4875672 Down to Earth T...
Down to Earth Thinking's picture

Oceanx on a gun ? Good luck with that . you will need it. Whats your address ?

Thu, 06/19/2014 - 23:29 | 4876772 Bohm Squad
Bohm Squad's picture

"In a need to take your time in a hurry." -Wyatt Earp

Thu, 06/19/2014 - 13:57 | 4874532 HyperinflatmyNutts
HyperinflatmyNutts's picture

You can not eat FRN either!!!!  I never understood why the paperbugs say that?

Thu, 06/19/2014 - 14:22 | 4874606 Schaublin
Schaublin's picture

What will YOU use for bribes when the civil collapse comes?

Thu, 06/19/2014 - 15:08 | 4874838 TheReplacement
TheReplacement's picture

Why pay bribes?  Stand up and be a man or just go around.  Never pay bribes.

Thu, 06/19/2014 - 18:28 | 4875544 7.62x54r
7.62x54r's picture

If you are outnumbered 5 to 1 by by heavily armed assholes, you may want to re-think that.

Thu, 06/19/2014 - 14:43 | 4874720 Slave
Slave's picture

I'm pretty sure everybody here is advocating having both. We should throw in guns and ammo too.

The real question is, are navy beans all you have?

Thu, 06/19/2014 - 15:39 | 4874958 Gaius Frakkin' ...
Gaius Frakkin' Baltar's picture

Speaking of beans, I paid a $1.29 for a can of Bush's Baked Beans last night. I know that same can sold for a $1.09 within the last two years... 10% YOY inflation on fucking beans!

Thu, 06/19/2014 - 20:56 | 4876160 Miffed Microbio...
Miffed Microbiologist's picture

I think you may be shocked to find out that can contains less beans and more unsavory fillers with the increased price. I haven't bought a can of beans in years realizing we were paying a premium in convenience. It really is cheaper and healthier to buy dried and in bulk.


Thu, 06/19/2014 - 15:15 | 4874872 Xibalba
Xibalba's picture

exacly.  And those without any will pay with thiers. 

Thu, 06/19/2014 - 16:37 | 4875172 Calmyourself
Calmyourself's picture

So whats your saying Joe, is that it (AU-AG) will save my life when the time comes.  Well thanks thats good enough for me, too bad about you though..

Thu, 06/19/2014 - 13:46 | 4874480 7.62x54r
7.62x54r's picture

BaBaBouy: Gold will go to infinity when the dollar collapses. Along with everything else.

Thu, 06/19/2014 - 12:50 | 4874178 cro_maat
cro_maat's picture

kliguy38 - Maybe you didn't get understand my comment. I was stating that I am not that excited by the relative price movement of the rigged paper market that has no relation to the true value of physical. Despite boating accidents there is a good amount at the bottom of my lake and I am not interested in diving for it to trade for worthless fiat from ogre Yellen. As a matter of fact I will be having more boating accidents in the future regardless of what the rigged paper market does.

Thu, 06/19/2014 - 13:04 | 4874270 Syrin
Syrin's picture

That reminds me, I need to take all my physical along with all my buddies' guns and ammo on my next fishing trip....

Thu, 06/19/2014 - 14:30 | 4874656 IndyPat
IndyPat's picture

Now's the time to get your guns and ammo off the bottom of the lake, slick.

Thu, 06/19/2014 - 13:24 | 4874370 Tinky
Tinky's picture

Actually, it does have some relationship. When the time comes that the two have no relationship, the paper markets will have defaulted.

Thu, 06/19/2014 - 16:36 | 4875187 kliguy38
kliguy38's picture

yup... I took it wrong....they've got so many peeps baffled by bullshit that i just get unhinged when they put them all to sleep with the grind

Thu, 06/19/2014 - 14:28 | 4874637 shiftless
shiftless's picture

Unfortunately I lost all mine in a tragic boating accident while on a cruise to Cancun. I'm here to tell you gentlemen, alcohol and precious belongings and open seas do not mix. Well it does mix, but when the solution is allowed to settle, the heavier particulates sink down to the hopelessly unreachable bottom; where all my silver and copper now sits gleaming brightly, making the local fish feel just a little bit richer. So now I'm destitute and helplessly at the mercy of the Federal Reserve and its Notes. But I applaud all of y'all who are fortunate enough to have substantial (or any) PM holdings. You will soon be vindicated, while the rest of the morons of the Western world in general and America in particular will of course never have seen it coming. Now if you'll excuse me, I've got to go pay some taxes.

Thu, 06/19/2014 - 12:13 | 4874005 AllWorkedUp
AllWorkedUp's picture

Well said Cro. Miles to go before we rest. We've seen false rallies for a very long time now.

Thu, 06/19/2014 - 12:55 | 4874211 SuperRay
SuperRay's picture

It'll be back down again. Has to be, because the fed isn't done yet. They'll desperately sell it down because they have no choice. Wait til it hits 1250 again, then buy more. If it drops more...

Thu, 06/19/2014 - 12:56 | 4874224 thamnosma
thamnosma's picture

One good day means nothing, that much we've all learned.  Just seems that there's more upside at these prices than downside. 

Thu, 06/19/2014 - 13:47 | 4874490 SAT 800
SAT 800's picture

So, if I understand you, your ambition is to become "excited". How interesting.

Thu, 06/19/2014 - 19:21 | 4875748 thamnosma
thamnosma's picture

What the hell are you talking about?  Are you okay?

Thu, 06/19/2014 - 13:48 | 4874492 Groundhog Day
Groundhog Day's picture

rehypothication in reverse is a bitch....WHERE's MY FUCKIN GOLD!

Thu, 06/19/2014 - 15:44 | 4874985 debtor of last ...
debtor of last resort's picture

Big money moving into mining shares, SRS rocco:

Thu, 06/19/2014 - 12:15 | 4874015 THX 1178
THX 1178's picture

i was only kidding


Thu, 06/19/2014 - 13:40 | 4874454 Lionhearted
Lionhearted's picture

Yea because paper that can be printed at will out of NOTHING has value. The dollar says right on it "Federal Reserve Note" they used to say "United States Note". Redeamable in one dollar silver coins. Try that with a "Federal Reserve Note". It costs $25 in "Federal Reserve Notes" to buy ONE silver dollar.

Wish it still said this:$100-SC-1878-Fr.337b.jpg

Thu, 06/19/2014 - 14:05 | 4874553 scuttlebutt
scuttlebutt's picture

People.  Change whatever Fiat you have into something tangible. Sooner rather than later. PM's in all terms are too cheap... not to.

Thu, 06/19/2014 - 12:11 | 4873997 Canadian Dirtlump
Canadian Dirtlump's picture

I'd say there is more than the ponzi unwind at play here but the point is well made. I'm glad to see some metals rallies either way more for my own juvenile peace of mind.


I nuked some of my RRSP and am sitting on the money until the shit hits the fan. We can't not see another wash out because at some point the crash induced forced selling will push prices down and then I'll add the final piece to my position.

Thu, 06/19/2014 - 12:17 | 4874026 Grande Tetons
Grande Tetons's picture

Call me crazy..but I am of the belief they will increase withholding taxes on both sides of the border on IRA/RSP accounts in the not too distant future. Smart move. 

Thu, 06/19/2014 - 12:24 | 4874056 Canadian Dirtlump
Canadian Dirtlump's picture

I'm cashing all out here soon. The holding company I'm part of has moved into heavy equipment which we lease to our company and based on looming future withholding taxes of 100% and the fact that the system and those who run it can eat shit and bark and the moon, I feel the need to fully walk the walk.

Thu, 06/19/2014 - 12:36 | 4874099 Grande Tetons
Grande Tetons's picture

I had a hard time pulling the trigger on my retirement account. I started chipping away slowly....then the Cyprus thing happened...and the chipping turned intto a full scale exit.  Who knows...maybe I panicked for nothing....but I feel better knowing that I have exited that part of the game. Bought real assets...PMs...some RE...shit that I can see. 

Thu, 06/19/2014 - 13:08 | 4874291 Syrin
Syrin's picture

I CAN'T pull the plug on mine.   I've tried 4 years in a row now, and they won't let me.  Despite it rising over those 4 years, I have no faith in it being there in 10 years from now

Thu, 06/19/2014 - 13:17 | 4874339 thamnosma
thamnosma's picture

It's sometimes true -- if it's one of those employer-based 401Ks you have to leave your job to roll it over to an IRA.  However, I'm thinking if you have one account that you paid into and another that the employer paid into you should be able to move your own account out.  Might be dependent on the employer and the plan.  

The other problem is if you've put money into those "traditional annuity" funds some 401K's offer.  You are guaranteed a low level of interest payment in return for long-term storage of your money.  I had a little in those and can only take 10% per year out.  Totally messed up.

Anyway, try some more investigation and insure you can't pull it out even with a penalty.

Thu, 06/19/2014 - 13:22 | 4874358 linniepar
linniepar's picture

Slow down PMs! I haven't jailbreaked my IRA fully just yet!

Thu, 06/19/2014 - 13:45 | 4874479 MidwestJester
MidwestJester's picture

In the same boat, though because of age restrictions on the 401k.... Pondering taking a loan out against it, but I'm guessing that's really not that good of an idea as I would be paying the broker to have my own money and would probably still have to pay back the full amount, even if I were to never see it in my account again. I guess that money is just lost...

Thu, 06/19/2014 - 14:34 | 4874672 thamnosma
thamnosma's picture

You have to decide whether the 10% penalty for early withdrawal is worth it or not.  It may be worth taking some out if you are looking to grab some bullion.

Thu, 06/19/2014 - 14:43 | 4874721 Citxmech
Citxmech's picture

I pulled everything I had out 7 years ago and just ate the fines.  Made the penalty back and then some within a year or two.

I sure do sleep much better now.

Thu, 06/19/2014 - 15:32 | 4874927 gobsmack
gobsmack's picture

You have to pay a market rate of interest but you aren't paying the broker, that money goes back in the 401k to you. The loan payments are in after tax money which is the sucky part but it makes sense when you think about it. 

Thu, 06/19/2014 - 14:01 | 4874540 quasimodo
quasimodo's picture

Me too, and now the Mrs. is putting money in hers again. Granted, it's a paltry sum but I can't bear the thought of a penny going there.

"But it's like free money with the match!" she says.

So naive. I try to convince her otherwise, but it's a lost cause and I am happy to just shut up; I get my way most of the time so it's a trade off. 

Like you Syrin I know mine will probably have gone into some worthless notes or nothing at all by the time I want to cash out.

Thu, 06/19/2014 - 14:24 | 4874614 Gern Blanston
Gern Blanston's picture

Tham is correct - plans vary on their rules.  I am considering what many folks regard as a "nuclear option" on mine... take a loan to buy PM just to get something out of it and out of FRN.

Have you checked to see if you are allowed to take a loan?  Most 401k plans allow you to borrow up to 50% of the balance to be repaid within up to five years.  If the SHTF / economy craters / plan craters / job loss occurs before you can pay it back, and assuming the other 50% craters, I think the most they can do is a forced conversion of the unpaid balance into taxable income.  You then take the tax hit, but hopefully at that point it won't matter.  That also assumes the tax collectors have remained at their posts.

Thu, 06/19/2014 - 15:42 | 4874640 WillyGroper
WillyGroper's picture

keep in mind, if you're 55 or over & separate from employment for whatever reason, you can cash out that 401k w/o the extra 10% penalty. you'll get any after tax $ unemcumbered, any pretax at the prevailing rate including capital gains.

if you roll it over, you're screwed, they'll whack you for the extra 10% if you're under 59.5. 

they'll try like hell to get you to leave it in their plan or roll it. I literally had to scream at them "you give me my fucking money" sounding like Rhoda on "The Bad Seed" before they abliged. 

good luck.

Thu, 06/19/2014 - 19:24 | 4875762 thamnosma
thamnosma's picture

I rolled mine over with no penalty.  Not really sure what you are talking about.  As long as you roll it over into an IRA.  Cashing out doesn't qualify as a "rollover".

Thu, 06/19/2014 - 22:44 | 4876604 WillyGroper
WillyGroper's picture

The convo was about getting your hands on it.

My post was how the law reads at this time on how to get your hands on it without getting whacked the extra 10%. 

If you rolled it over & are under 59.5, you just screwed yourself if you want your paws on it.

re:read 4874672

Then go back & read my post.

Fri, 06/20/2014 - 02:03 | 4877069 JustUsChickensHere
JustUsChickensHere's picture

Leave the job, and leave the country for a year or two.... on that basis, everything can be cashed.

Thu, 06/19/2014 - 17:24 | 4875325 Too Big 2
Too Big 2's picture

If you have a SEP/IRA you can do a "self-directed IRA" where you can buy metals, invest in real estate, hard money loans, etc. 

Thu, 06/19/2014 - 19:25 | 4875763 thamnosma
thamnosma's picture

Some 401k plans are self-directed as well or close to it.

Thu, 06/19/2014 - 12:51 | 4874185 robertocarlos
robertocarlos's picture

Please don't use the N word that way.

Thu, 06/19/2014 - 12:58 | 4874239 hankwil74
hankwil74's picture

You've probably been saying that since gold crossed back below $1900

Thu, 06/19/2014 - 13:34 | 4874425 Hugh G Rection
Hugh G Rection's picture

You can thank me for the sudden rise.  I decided to gamble away $1200 at the Indian casino last week instead of picking up another 60oz.

Thu, 06/19/2014 - 14:42 | 4874714 SilverMoneyBags
SilverMoneyBags's picture

Its called a technical breakout you tards.

Thu, 06/19/2014 - 11:51 | 4873926 Grande Tetons
Grande Tetons's picture

Outside of the night I lost my virginity...I have never wanted to see something go up this bad. 

Thu, 06/19/2014 - 12:25 | 4874059 Canadian Dirtlump
Canadian Dirtlump's picture

Speaking of which, perhaps blessedly so, at 40, there are time I wish to see something go down.

Thu, 06/19/2014 - 13:43 | 4874468 Lewshine
Lewshine's picture

Here's the best indicator that determines if this PM move is real;

Watch US equity markets drop more than 10% in one trading session.
This tells you that the Fed had lost its magic wand, which would allow all other manipulated assets to streak to their natural levels.

Thu, 06/19/2014 - 11:54 | 4873929 Squid Viscous
Squid Viscous's picture

Long Dong Silver, bitches. Almost sold some back to Gainesville, but I never got around to it

Thu, 06/19/2014 - 11:59 | 4873949 thatthingcanfly
thatthingcanfly's picture

I have no idea what I just read.

I'm glad the PMs are going up though.

Thu, 06/19/2014 - 11:59 | 4873952 thatthingcanfly
thatthingcanfly's picture

I wonder what Kim Kardashian thinks about this.

Thu, 06/19/2014 - 14:13 | 4874577 BurningFuld
BurningFuld's picture

What's a Gold???

Thu, 06/19/2014 - 12:00 | 4873956 The Abstraction...
The Abstraction of Justice's picture

Sold all my bitcoins. It's silver all the way to the moon.

Thu, 06/19/2014 - 16:30 | 4875164 messystateofaffairs
messystateofaffairs's picture

Not so sure about that. Bitcoin gone from 450 to 600+ recently. Damn thing just won't die. I'll keep mine, just in case.

Thu, 06/19/2014 - 16:43 | 4875216 The Abstraction...
The Abstraction of Justice's picture

I sold mine on the news from the FBI sale, and the 51% mining pool. I'm out for a bit.

Thu, 06/19/2014 - 12:05 | 4873977 1stepcloser
1stepcloser's picture

well I guess you will be on clound nine when PMs can't be coverted into FRNs any longer.

Thu, 06/19/2014 - 13:40 | 4874455 thatthingcanfly
thatthingcanfly's picture

So long as I can still convert PMs to 7.62x39 ammo, yes.

Thu, 06/19/2014 - 18:36 | 4875579 Manthong
Manthong's picture

Y’know.. you were absolutely correct in the assertion that a 7.62 x 39 round (even a bunch) would not be effective against the underbelly of an MI-24.

Might you care to opine about how a bunch of these might work at a hundred meters or so.. maybe even the ones with pretty colored tips..  (I kind of like Ag ).

..all in good fun.   :-D

Thu, 06/19/2014 - 18:45 | 4875604 thatthingcanfly
thatthingcanfly's picture

I retract - some - of the bad things I've said about you.

Thu, 06/19/2014 - 21:04 | 4875616 Manthong
Manthong's picture

ok.. I kind of like you too.

maybe I should get a Facefart page.

..anybody who spends that much time in in Jane's or Aviation Week is someone I would enjoy conversation with. 

(I am one of the few left who has hundreds of hours in an EC-121M

 -- my Navy version had a lot more Intel stuff inside)

and.. I was one of the first in an EP-3E (>2k hours).

crud.. that is not entirely correct,, my last 600/800 or so hours or so were spent in a P-3A as a radio operator with the best view seat behind the flight deck. 

If you want to do a gut check, try being in a MAD trap at <1000 feet above the water at a couple of G's in the soup knowing that the left seat guy only has the radar altimiter to keep you from becoming a statistic.

and oh..oh.. try typing on a TT-264 to send the position report out on HF when you can barely lift your arm.  :-)

Thu, 06/19/2014 - 22:32 | 4876572 thatthingcanfly
thatthingcanfly's picture

Annapolis, class of '98.

In the early 2000s, I was an MH-53E driver, doing it in weather as shitty as that which you described, flying mail and cargo to the big deck because that was the only time the jet kids were not conducting their air ops. Risked my life - and those of my crew - for fucking mail. 

Gut check? Yeah, I was the left seat guy. Yeah, the RadAlt is life.

I resigned my commission in 2007, with some bitterness.

Recommend against the social media sites. I confess I have a LinkedIn page, however. Look me up. I'm probably the only guy in Arkansas with the kind of resume bullets you'd guess.

Fri, 06/20/2014 - 02:09 | 4876782 Manthong
Manthong's picture

I almost drew duty in the back of an All Three Dead -- (also known as the whale on deck).. flying to the airport that would not stay near sea level.  Best thing that ever happened to me was getting EW in a big bird that went to wonderful places and put my butt in nice hotels.

..near 10 years in the Navy ( 4 years active.. 6 reserve) .. outside of a guided tour never spent time on a ship.

I bailed when the Soviets were in Afghanistan, Carter was the CIC and I realized that if the SHTF I could not pay my mortgage on military pay.

In one way it way it was a good thing, on the other I would have another grand or so a month riight now,

Annapolis.. ’98.. I am genuinely impressed and respectful. 

And oh..oh. oh.. my wife love's the movie Officer and A Gentleman..

I told her all about the parachute drag, the dilbert dunker and the altitude chamber, but I do not think she understands. :-) 

 and gee.. I don't think anyone could understand what it was like to miss a mid-air with an IL-38 at a couple hundred feet or so.  

and.. and.. I recorded the X-Band paintings as the MiGs lit us up with FC all the time. It really was SOP back in the day.. Likely it is that way now, too.  

 and.. seems like radar alt and a some beeps was your regular duty.. to me it was the exception, but we both likely have trophy undergarments with skidmarks of accomplishment. 



Fri, 06/20/2014 - 02:16 | 4877079 Manthong
Manthong's picture


You have the prize.. my hours ain’t squat compared to the danger you have experienced.

Fri, 06/20/2014 - 02:52 | 4877112 Manthong
Manthong's picture

..and I will look you up because I really want to be more southern.

Fri, 06/20/2014 - 04:42 | 4877185 Manthong
Manthong's picture

gosh, I have a hard time envisioning putting a heavy rotary  on a reeling deck. 

Thu, 06/19/2014 - 12:02 | 4873962 alexcojones
alexcojones's picture

Silver "Surge?" 

To me a silver surge is a dollar-a-day for more than a week. This is like a Viagra spurt.

A true surge is not a temporary Re-surgance. More than a bunch of unemployed "USIS" trained, Toyota-driving, bank-robbing and mass-executing You-Tubing, Twitting crackheads

Thu, 06/19/2014 - 12:52 | 4874191 thatthingcanfly
thatthingcanfly's picture

Umm... we're about to hit the dollar-a-day mark right now. But I agree, let's see moves like this for a week or more.

Thu, 06/19/2014 - 12:02 | 4873965 buzzsaw99
buzzsaw99's picture

<-- when it's down it's just poo poo paper

<-- when it's up it's WOOT WOOT WOOT!

Thu, 06/19/2014 - 12:04 | 4873975 Da Yooper
Da Yooper's picture

The morgue & sucks white shoe boys must have today off & there is a power failure at the fed.

Wait till they wake up tomorrow will suck

Thu, 06/19/2014 - 12:06 | 4873984 Seasmoke
Seasmoke's picture

We have seen $1300 in our lifetimes again !!!!

Thu, 06/19/2014 - 14:13 | 4874574 fockewulf190
fockewulf190's picture

Someone is dining on some serious hat right now.

Thu, 06/19/2014 - 12:10 | 4873991 TalkToLind
TalkToLind's picture

Oh shit!  Silver is out of control.

Thu, 06/19/2014 - 12:11 | 4873999 DannoH
DannoH's picture

The question is how long to hold onto the worthless paper (AGQ) before I exchange it for more worthless paper (USD) to convert to less worthless paper (GBP).  

Thu, 06/19/2014 - 12:14 | 4874009 grekko
grekko's picture

Dude, that seems like a major bummer. Best of luck though.

Thu, 06/19/2014 - 12:15 | 4874018 Winston Churchill
Winston Churchill's picture

It it moves up $100 in a day, I'm all in.

Otherwise I'm staying 50% cash.

Thu, 06/19/2014 - 12:21 | 4874046 Dr. Engali
Dr. Engali's picture

Your methodology is all wrong. I don't care a bit what the price is beyond the fact that I like to get as much for my fiat as I can. Gold is an insurance policy against distastor, not an investment.

Thu, 06/19/2014 - 12:35 | 4874097 Winston Churchill
Winston Churchill's picture


If we see a $100 up move in gold(outside WWIII openly starting between US and Russia).

it will mean the FedRes has lost control completely, in which case I don't want to be holding

anybodies fiat ,or paper promises..The disaster would have already happened.

Whether I can actually get delivery is another question.

Thu, 06/19/2014 - 13:33 | 4874420 Dr. Engali
Dr. Engali's picture

That's my point. If you don't own some before a disaster, it will be too late to get your hands on any after it happens. Because if and when disaster strikes, it will be fast and furious.

Thu, 06/19/2014 - 13:48 | 4874491 Winston Churchill
Winston Churchill's picture

I had 50% of my capital in it before an unfortunate gardening accident.

The Swiss way of saving,as taught to me by my father ,and grandfather.

Thu, 06/19/2014 - 13:50 | 4874502 Dr. Engali
Dr. Engali's picture


Thu, 06/19/2014 - 15:24 | 4874905 Gern Blanston
Gern Blanston's picture

Whether I can actually get delivery is another question.

= calling to buy the insurance after your house has caught fire.

Thu, 06/19/2014 - 12:35 | 4874098 jaxville
jaxville's picture

A financial disaster is a foregone conclusion when you allow some vermin to operate a fractional reserve/credit based money scheme. The only question is a matter of "when". To not hold a decent percentage of your investable assets in physical in such an environment is the height of irresponsibility.


Thu, 06/19/2014 - 12:39 | 4874117 McRocket
McRocket's picture

His methodology is wrong for you...but it maybe right for do not know his situation. Most people should not go all in for PM's...but Zero Hedge is full of people who are not 'most people'...thank goodness.

Thu, 06/19/2014 - 13:14 | 4874320 SoilMyselfRotten
SoilMyselfRotten's picture

I don't know Win but looks like they have little to say about this rally. I could be wrong and they used mini-pukes today to knock it down but certainly with little effect.

Thu, 06/19/2014 - 13:27 | 4874382 Dr. Engali
Dr. Engali's picture

Uhmmmm......... Where did I say anything about him going all in? My point is that if he waits for the disaster to own gold it will be too late.

Thu, 06/19/2014 - 22:18 | 4876506 McRocket
McRocket's picture

You said gold is not an investment. It is for some. And provided you know the risks and plan for them, it can be a great investment.

Thu, 06/19/2014 - 17:19 | 4875313 Lionhearted
Lionhearted's picture

It's all BULLSHIT debt paper. A US dollar is a DEBT note. It is proof of money owed to "The Federal Reserve" and all currencies are pegged to it. So it's all a major Ponzi scheme. I am creating my own gold standard. In a sense stackers are bringing the gold and silver standard back. But my stack keeps sinking to the bottom of the lake.

Thu, 06/19/2014 - 12:12 | 4874000 grekko
grekko's picture

I may be premature, but its about time for some good news.

Thu, 06/19/2014 - 12:22 | 4874028 Cthonic
Cthonic's picture

As big as they are up today, there have been worse times to buy some GDX/GDXJ.  The past three years have been a bloodbath for miners.  Maybe it's just a short squeeze, but it's nice to be above water for a change.   If the gap fills and holds, it might be off to the races.  Worth watching, anyway.

Thu, 06/19/2014 - 13:53 | 4874523 Greenskeeper_Carl
Greenskeeper_Carl's picture

ya thats what im wondering, if this is just another short squeeze. i look at them and see they are up, as is my account, but its still been a painful couple of years. im still 50% cash in my IRA right now, just cant make myself buy more into the miners


Thu, 06/19/2014 - 15:34 | 4874940 MsCitizen2
MsCitizen2's picture

After all, stock is just paper.

Thu, 06/19/2014 - 12:13 | 4874004 KnuckleDragger-X
KnuckleDragger-X's picture

Buy the rehypothocated paper gold...

Thu, 06/19/2014 - 12:14 | 4874006 Winston Churchill
Winston Churchill's picture

Looks like all the ruminating on ZH,last year, about the PBOC being behind the paper shorting was

right after all.I'm sure the FedRes was only too happy to assist them, looking short term only.

Lets hope this is a start of a bull run back up to $1900 on its way to $10k.

Thu, 06/19/2014 - 12:15 | 4874016 Quintus
Quintus's picture

Not to worry.  I'm sure 'Belgium' will suddenly find that it has a pressing reason to sell a bazillion ounces short for some wholly legitimate and not in any way suspicious reason.

As long as the price is set in the paper market, there will be no PM price reset.  That said, it certainly does feel like the dominance of the Comex on PM pricing is looking shakier than every before.

Thu, 06/19/2014 - 12:16 | 4874020 disabledvet
disabledvet's picture

"gaining traction" after a total collapse last year. the collapse in Silver has been even more spectacular...until now.

We shall see. The energy inflation from last year was devastating to the American "recovery" thesis. As with all raw commodities "turning it into the refined product" is the problem. If Australia starts importing the refineries and stops exporting the raw materials you could really get a price spike in all metals here...not just gold.

To call the contradiction between such a truly massive move in equities, a huge rally in treasuries and "war everywhere" while commodities tank "contradictory" is an understatement.

The (dark) heart of the matter remains massive debt creation funded by a total collapse in employment and wages.

While Great Depression 2.0 has been prevented this more than just the worst post World War II recovery in history but in fact is a "non recovery" as everyone "slides backwards" save for very few.

Thu, 06/19/2014 - 12:23 | 4874051 dressguard
dressguard's picture

Melt-up phase in gold and silver! Squeeze the little fuckers!

Thu, 06/19/2014 - 12:24 | 4874052 D-liverSil-ver
D-liverSil-ver's picture

Go Silver!

It only needs to go up $5/oz. more and I will break even! Yeah!!!

Thu, 06/19/2014 - 12:31 | 4874082 rubiconsolutions
rubiconsolutions's picture

"It only needs to go up $5/oz. more and I will break even! Yeah!!!"

It only needs to go down $10 and I will break even. "Stacking since 1981"

Thu, 06/19/2014 - 12:36 | 4874096 Toolshed
Toolshed's picture

"It only needs to go down $10 and I will break even. "Stacking since 1981"

Show off!

Thu, 06/19/2014 - 13:31 | 4874412 greatbeard
greatbeard's picture

>> $5/oz. more and I will break even!

Bunch of Turdites looking at $25 to do that.

Thu, 06/19/2014 - 15:40 | 4874967 MsCitizen2
MsCitizen2's picture



Sold mine at 300%+  TRADING since 1978!

Thu, 06/19/2014 - 12:34 | 4874091 Toolshed
Toolshed's picture

My friend, any time you can trade worthless scraps of paper for physical precious have already won. I wish they would stomp on gold and silver some more..........and they likely will. I love those discount prices!!!

Thu, 06/19/2014 - 13:33 | 4874418 greatbeard
greatbeard's picture

>> I wish they would stomp on gold and silver some more.....

For the life of me, I'll never figure you guys out. 

Thu, 06/19/2014 - 15:42 | 4874976 MsCitizen2
MsCitizen2's picture

So they can back up the truck

Pay 'tench! : )

Thu, 06/19/2014 - 12:24 | 4874055 Dr. Engali
Dr. Engali's picture

"Gold will never see $1,300 again".

~ Morgan Stanley.

Thu, 06/19/2014 - 13:12 | 4874312 thamnosma
thamnosma's picture

Goldman Sachs will never utter the truth again.

Thu, 06/19/2014 - 13:24 | 4874367 Pool Shark
Pool Shark's picture



They were right; just early,... and from the wrong side...



Thu, 06/19/2014 - 14:48 | 4874744 Citxmech
Citxmech's picture


Do NOT follow this link or you will be banned from the site!