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Supply And Demand In The Gold And Silver Futures Markets
Authored by Paul Craig Roberts and Dave Kranzler,
This article establishes that the price of gold and silver in the futures markets in which cash is the predominant means of settlement is inconsistent with the conditions of supply and demand in the actual physical or current market where physical bullion is bought and sold as opposed to transactions in uncovered paper claims to bullion in the futures markets. The supply of bullion in the futures markets is increased by printing uncovered contracts representing claims to gold. This artificial, indeed fraudulent, increase in the supply of paper bullion contracts drives down the price in the futures market despite high demand for bullion in the physical market and constrained supply. We will demonstrate with economic analysis and empirical evidence that the bear market in bullion is an artificial creation.
The law of supply and demand is the basis of economics. Yet the price of gold and silver in the Comex futures market, where paper contracts representing 100 troy ounces of gold or 5,000 ounces of silver are traded, is inconsistent with the actual supply and demand conditions in the physical market for bullion. For four years the price of bullion has been falling in the futures market despite rising demand for possession of the physical metal and supply constraints.
We begin with a review of basics. The vertical axis measures price. The horizontal axis measures quantity. Demand curves slope down to the right, the quantity demanded increasing as price falls. Supply curves slope upward to the right, the quantity supplied rising with price. The intersection of supply with demand determines price. (Graph 1)
A change in quantity demanded or in the quantity supplied refers to a movement along a given curve. A change in demand or a change in supply refers to a shift in the curves. For example, an increase in demand (a shift to the right of the demand curve) causes a movement along the supply curve (an increase in the quantity supplied).
Changes in income and changes in tastes or preferences toward an item can cause the demand curve to shift. For example, if people expect that their fiat currency is going to lose value, the demand for gold and silver would increase (a shift to the right).
Changes in technology and resources can cause the supply curve to shift. New gold discoveries and improvements in gold mining technology would cause the supply curve to shift to the right. Exhaustion of existing mines would cause a reduction in supply (a shift to the left).
What can cause the price of gold to fall? Two things: The demand for gold can fall, that is, the demand curve could shift to the left, intersecting the supply curve at a lower price. The fall in demand results in a reduction in the quantity supplied. A fall in demand means that people want less gold at every price. (Graph 2)
Alternatively, supply could increase, that is, the supply curve could shift to the right, intersecting the demand curve at a lower price. The increase in supply results in an increase in the quantity demanded. An increase in supply means that more gold is available at every price. (Graph 3)
To summarize: a decline in the price of gold can be caused by a decline in the demand for gold or by an increase in the supply of gold.
A decline in demand or an increase in supply is not what we are observing in the gold and silver physical markets. The price of bullion in the futures market has been falling as demand for physical bullion increases and supply experiences constraints. What we are seeing in the physical market indicates a rising price. Yet in the futures market in which almost all contracts are settled in cash and not with bullion deliveries, the price is falling.
For example, on July 7, 2015, the U.S. Mint said that due to a “significant” increase in demand, it had sold out of Silver Eagles (one ounce silver coin) and was suspending sales until some time in August. The premiums on the coins (the price of the coin above the price of the silver) rose, but the spot price of silver fell 7 percent to its lowest level of the year (as of July 7).
This is the second time in 9 months that the U.S. Mint could not keep up with market demand and had to suspend sales. During the first 5 months of 2015, the U.S. Mint had to ration sales of Silver Eagles. According to Reuters, since 2013 the U.S. Mint has had to ration silver coin sales for 18 months. In 2013 the Royal Canadian Mint announced the rationing of its Silver Maple Leaf coins: “We are carefully managing supply in the face of very high demand. . . . Coming off strong sales volumes in December 2012, demand to date remains very strong for our Silver Maple Leaf and Gold Maple Leaf bullion coins.” During this entire period when mints could not keep up with demand for coins, the price of silver consistently fell on the Comex futures market. On July 24, 2015 the price of gold in the futures market fell to its lowest level in 5 years despite an increase in the demand for gold in the physical market. On that day U.S. Mint sales of Gold Eagles (one ounce gold coin) were the highest in more than two years, yet the price of gold fell in the futures market.
How can this be explained? The financial press says that the drop in precious metals prices unleashed a surge in global demand for coins. This explanation is nonsensical to an economist. Price is not a determinant of demand but of quantity demanded. A lower price does not shift the demand curve. Moreover, if demand increases, price goes up, not down.
Perhaps what the financial press means is that the lower price resulted in an increase in the quantity demanded. If so, what caused the lower price? In economic analysis, the answer would have to be an increase in supply, either new supplies from new discoveries and new mines or mining technology advances that lower the cost of producing bullion.
There are no reports of any such supply increasing developments. To the contrary, the lower prices of bullion have been causing reductions in mining output as falling prices make existing operations unprofitable.
There are abundant other signs of high demand for bullion, yet the prices continue their four-year decline on the Comex. Even as massive uncovered shorts (sales of gold contracts that are not covered by physical bullion) on the bullion futures market are driving down price, strong demand for physical bullion has been depleting the holdings of GLD, the largest exchange traded gold fund. Since February 27, 2015, the authorized bullion banks (principally JPMorganChase, HSBC, and Scotia) have removed 10 percent of GLD’s gold holdings. Similarly, strong demand in China and India has resulted in a 19% increase of purchases from the Shanghai Gold Exchange, a physical bullion market, during the first quarter of 2015. Through the week ending July 10, 2015, purchases from the Shanghai Gold Exchange alone are occurring at an annualized rate approximately equal to the annual supply of global mining output.
India’s silver imports for the first four months of 2015 are 30% higher than 2014. In the first quarter of 2015 Canadian Silver Maple Leaf sales increased 8.5% compared to sales for the same period of 2014. Sales of Gold Eagles in June, 2015, were more than triple the sales for May. During the first 10 days of July, Gold Eagles sales were 2.5 times greater than during the first 10 days of June.
Clearly the demand for physical metal is very high, and the ability to meet this demand is constrained. Yet, the prices of bullion in the futures market have consistently fallen during this entire period. The only possible explanation is manipulation.
Precious metal prices are determined in the futures market, where paper contracts representing bullion are settled in cash, not in markets where the actual metals are bought and sold. As the Comex is predominantly a cash settlement market, there is little risk in uncovered contracts (an uncovered contract is a promise to deliver gold that the seller of the contract does not possess). This means that it is easy to increase the supply of gold in the futures market where price is established simply by printing uncovered (naked) contracts. Selling naked shorts is a way to artificially increase the supply of bullion in the futures market where price is determined. The supply of paper contracts representing gold increases, but not the supply of physical bullion.
As we have documented on a number of occasions, the prices of bullion are being systematically driven down by the sudden appearance and sale during thinly traded times of day and night of uncovered future contracts representing massive amounts of bullion. In the space of a few minutes or less massive amounts of gold and silver shorts are dumped into the Comex market, dramatically increasing the supply of paper claims to bullion. If purchasers of these shorts stood for delivery, the Comex would fail. Comex bullion futures are used for speculation and by hedge funds to manage the risk/return characteristics of metrics like the Sharpe Ratio. The hedge funds are concerned with indexing the price of gold and silver and not with the rate of return performance of their bullion contracts.
A rational speculator faced with strong demand for bullion and constrained supply would not short the market. Moreover, no rational actor who wished to unwind a large gold position would dump the entirety of his position on the market all at once. What then explains the massive naked shorts that are hurled into the market during thinly traded times?
The bullion banks are the primary market-makers in bullion futures. They are also clearing members of the Comex, which gives them access to data such as the positions of the hedge funds and the prices at which stop-loss orders are triggered. They time their sales of uncovered shorts to trigger stop-loss sales and then cover their short sales by purchasing contracts at the price that they have forced down, pocketing the profits from the manipulation
The manipulation is obvious. The question is why do the authorities tolerate it?
Perhaps the answer is that a free gold market serves both to protect against the loss of a fiat currency’s purchasing power from exchange rate decline and inflation and as a warning that destabilizing systemic events are on the horizon. The current round of on-going massive short sales compressed into a few minutes during thinly traded periods began after gold hit $1,900 per ounce in response to the build-up of troubled debt and the Federal Reserve’s policy of Quantitative Easing. Washington’s power is heavily dependent on the role of the dollar as world reserve currency. The rising dollar price of gold indicated rising discomfort with the dollar. Whereas the dollar’s exchange value is carefully managed with help from the Japanese and European central banks, the supply of such help is not unlimited. If gold kept moving up, exchange rate weakness was likely to show up in the dollar, thus forcing the Fed off its policy of using QE to rescue the “banks too big to fail.”
The bullion banks’ attack on gold is being augmented with a spate of stories in the financial media denying any usefulness of gold. On July 17 the Wall Street Journal declared that honesty about gold requires recognition that gold is nothing but a pet rock. Other commentators declare gold to be in a bear market despite the strong demand for physical metal and supply constraints, and some influential party is determined that gold not be regarded as money.
Why a sudden spate of claims that gold is not money? Gold is considered a part of the United States’ official monetary reserves, which is also the case for central banks and the IMF. The IMF accepts gold as repayment for credit extended. The US Treasury’s Office of the Comptroller of the Currency classifies gold as a currency, as can be seen in the OCC’s latest quarterly report on bank derivatives activities in which the OCC places gold futures in the foreign exchange derivatives classification.
The manipulation of the gold price by injecting large quantities of freshly printed uncovered contracts into the Comex market is an empirical fact. The sudden debunking of gold in the financial press is circumstantial evidence that a full-scale attack on gold’s function as a systemic warning signal is underway.
It is unlikely that regulatory authorities are unaware of the fraudulent manipulation of bullion prices. The fact that nothing is done about it is an indication of the lawlessness that prevails in US financial markets.
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The FED has proven itself to be quite corrupt. It'd be no surprise if Gold and Silver at some point shoot through the roof.
https://biblicisminstitute.wordpress.com/2014/08/24/the-corrupt-federal-...
So easy even a Fed Chairwoman can spell it...
M-A-N-I-P-U-L-A-T-I-O-N
You're giving her way to much credit. You don't need to be able to spell to press CTRL+P.
US Fed QE hot money blew up the Chinese markets.
The Chinese are pissed and selling US Treasuries.
The Chinese know if they want a stable society they need a stable monetary base.
The obvious candidate is obvious.
If one bets at the track do not all of the bets placed derive their fungibility from the horses?
How many of those betting actually will take, or make, delivery of a horse?
Does the limited number of horses determine how many bets are allowed to be made?
Must we limit the number of bets placed on the horses to the number of available horses?
Does the amount of bets for or against the horse have any factual relation to the performance of the horse, or is not the relationship visa versa?
Do facts about things either affirm or deny our opinions of the facts, or do our opinions about things deterimine the facts?
Your analogy is retarded.
Retarded, not rebutted.
Right, nothing says "store of value" or "good collateral" quite like "horses".
How does the betting on the horse determine the quality of the horse?
I happen to have worked in the Thoroughbred racing industry for decades, and your analogy is more seriously tortured than those who went through Guantanamo.
Betting on horses doesn't determine their quality, but rather which is most likely to win a particular event.
And how do "transactions in uncovered paper claims to bullion in the futures markets" determine the quality of the commodity? Or, how does it determine who will win the "race?"
But there’s a reason. There’s a reason. There’s a reason for this, there’s a reason education SUCKS, and it’s the same reason it will never, ever, EVER be fixed.
It’s never going to get any better, don’t look for it, be happy with what you’ve got.
Because the owners, the owners of this country don't want that. I'm talking about the real owners now, the BIG owners! The Wealthy… the REAL owners! The big wealthy business interests that control things and make all the important decisions.
Forget the politicians. They are irrelevant. The politicians are put there to give you the idea that you have freedom of choice. You don't. You have no choice! You have OWNERS! They OWN YOU. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought, and paid for the Senate, the Congress, the state houses, the city halls, they got the judges in their back pockets and they own all the big media companies, so they control just about all of the news and information you get to hear. They got you by the balls.
They spend billions of dollars every year lobbying, lobbying, to get what they want. Well, we know what they want. They want more for themselves and less for everybody else, but I'll tell you what they don’t want:
They don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. Thats against their interests.
Thats right. They don’t want people who are smart enough to sit around a kitchen table and think about how badly they’re getting fucked by a system that threw them overboard 30 fucking years ago. They don’t want that!
You know what they want? They want obedient workers. Obedient workers, people who are just smart enough to run the machines and do the paperwork. And just dumb enough to passively accept all these increasingly shitty jobs with the lower pay, the longer hours, the reduced benefits, the end of overtime and vanishing pension that disappears the minute you go to collect it, and now they’re coming for your Social Security money. They want your retirement money. They want it back so they can give it to their criminal friends on Wall Street, and you know something? They’ll get it. They’ll get it all from you sooner or later cause they own this fucking place! It's a big club, and you ain’t in it! You, and I, are not in the big club.
By the way, it's the same big club they use to beat you over the head with all day long when they tell you what to believe. All day long beating you over the head with their media telling you what to believe, what to think and what to buy. The table has tilted folks. The game is rigged and nobody seems to notice. Nobody seems to care! Good honest hard-working people; white collar, blue collar it doesn’t matter what color shirt you have on. Good honest hard-working people continue, these are people of modest means, continue to elect these rich cock suckers who don’t give a fuck about you….they don’t give a fuck about you… they don’t give a FUCK about you.
They don’t care about you at all… at all… AT ALL. And nobody seems to notice. Nobody seems to care. Thats what the owners count on. The fact that Americans will probably remain willfully ignorant of the big red, white and blue dick thats being jammed up their assholes everyday, because the owners of this country know the truth.
It's called the American Dream,because you have to be asleep to believe it.
I miss George...
https://www.youtube.com/watch?v=i5dBZDSSky0
Tinky, I'll give you 30 minutes for a better reply...
Trade in your worthless FRNs for silver today! There will be a day when dollars will not be accepted. Silver will always be money. Real, physical silver of course. Not this fake paper silver. Happy stacking!
I'd join the cult....but giving up my gold is wacked.
Congrats to OC Sure for the most junks ever in a single thread.
Unlike MDB....he was completely serious.
He may be completely serious, but that does not preclude still being a complete fool.
If the COMEX is a bookie, then they're not merely selling horse race bets, they're selling horse race bets which are convertible into horses. They think that they are safe since they have a stipulation that if the person converts the bet slip, they can pay in cash the value of the horse rather than the horse itself. What they don't seem to realize is that one of these days, they're going to have a different kind of horse run on their hands, whenever people start to discover that both sides of the bet are less profitable than exercizing their convertibility option.
The only way they get out of this in one piece is if there is a Hunt Brothers 2.0 moment, where someone goes to convert a whole bunch of options at once, and the CFTC crucifies him. If instead, it is a whole bunch of smaller actors acting together without any real coordination, they're finished.
In future, try reading the author of the post before responding ignorantly.
Is not the essence of ignorance to accept an argument's assertions because of the argument's author and not because of the author's argument?
...And my advice to you, always let go of the faith and embrace the facts. Please.
OK, I'll embrace the fact that your contributions on this thread have thus far been idiotic.
You are being far too kind, more like moronic double-talk from a troll...
Retarded, idiotic, moronic, double-talker, troll;
however, not rebutted.
Totally rebutted ass clown. you just can't fucking read.
Retarded, idiotic, moronic, double-talker, troll, ass clown, and illiterate!
However, not rebutted.
Since no one can post a counterpoint spontaneously, why not just follow up in another article an explanation as to how the betting on the performance of the underlying source of the derived price actually determines the performance of the source itself?
Good Luck!
(and don't forget, bread and cereals are at their highest demand ever as consumers can't seem to get enough but the prices of "paper grains" are falling! Oh my, how can this be?)
I've seen some real fucktards and clowns pass through this place over the last 5 years but you're right up there with the best of them!
Yup. 13 horses and 13 jockeys, yet fourteen horses asses in this race. Man, this guy is a young fool without a clue or and old fool. There's no fool like an old fool, so what's his age?
Sure, dipshit, I'll bite on this (and afterwards, you can bite on this).
In the world of precious metal ETFs, too many people are holding tickets for horses that don't exist. Never did, never will. In the world of physical, everyone who buys and holds wins. Everyone.
a bet on a horse race, is not a promise to deliver a horse, or several horses, later.
Didn't you see those common sense safety videos as a child? When you're on fire: Stop! Drop, and Roll!
Pardon me good Sir,
The contention is that the paper market sets the price for the physical market - to the extent contracts are referenced to a paper market price, this is a tentatively operative relationship, until the rouse falls over.
Now, if your horses (as proxy for the performance of the underlying source) looked at their own odds, decided those odds were oracular, and all raced such that the horse with the shortest odds won, and the horse with the longest odds came last, and the field finished in accordance with this rule - then your metapor might have some comparative value.
Also note that racehorses are not perfectly fungible like an ounce of gold is - perhaps if you plan on eating them and can't notice the taste difference in the horsemeat of one animal versus another - but not in the sense their of their idiosyncracies (weight, training, temperament, etc) which have an effect on their probability of winning a race.
As for where the bets themselves derive their fungibility - one would need to consider the counterparty risk of all the bookmakers. If they all had the same likelihood of delivering on the bet, then the bets would be fungible with comparable bets (the same outlay, on the same horse, in the same race, at the same price/odds, etc.)
Indeed the weight of betting doesn't have any "factual relationship" (the word you are looking for here is 'influence') to the performance of the horse (it might on the jockey), and the reverse is true - however, in the case of precious metals markets, the weight of 'betting' (as reflected in the paper price) does affect the performance of the underlying because the paper price is the predominant reference upon which physical transactions are priced.
It is also a rather odd to ask whether the amount of betting is limited by the constrained number of horses. Sure, maybe if the bookmakers owned the horses and there was some provision that the winners could take their proceeds in horsemeat rather than cash, then there would be a limitation to the number of bets - and this is why there is a little enabling loophole called 'cash settlement'.
Hope this helps,
Ancestor :)
Top rebut something you must state an argument, you asked a series of asinine equine questions. What is your agrument?
OC Sure, I'll give you a lifetime to figure out that the answer is right in front of you.
The force is strong in this one.
It determines your fucking stupidity
Clearly you are a moron as the others have said. The betting at a track has nothing to do with the price of a horse.
Let me take a crack at it. To use your horse analogy:
1) Betting on a horse race is establishing a derivative position on the outcome of a future condition. It does not effect the value of the horse asset as the value is determined by the event outcome and not the bets on the outcome. Bets are expected to be settled in cash and there is no expectation of transfer of the underlying asset.
2) A better analogy is a livestock auction which sets the value of the horse asset. This is more similar to the commodities exchange. An analogy to a future offering is selling a horse for future delivery with the associated risk that the horse will no longer be alive and the deal is then settled in cash per the terms of the contract. A naked future sale would be analogous to offering a future unborn colt of a designated sire for current purchase. The potential value of the colt determined by the probability of issue and the reputation of the sire.
So I don't see the value of your racetrack betting analogy to a commodities market.
quod erat demonstrandum
The key: "...there is no expectation of transfer of the underlying asset."
This should put the whole rancid discussion to rest.
Hi Rocky,
I have not seen lots of posts from you for a while until lately, I hope everything is okay with you.
Since you are in the business, my take on paper gold is equivalent to the six teenagers who went with their parents in a mountain resort with few things to do for youngsters. They decided to play friendly pocker game with few dollars each one had.
After an hour or two all the money had gone to two of the teenagers and the other four were busted. So then since the idea was to pass the time, the two decided to allow the others to produce chits of papers with their name and a value on it so the game can cont.
At the end of the weekend, all the cash (call it gold) was in one pocket and the rest was in several pieces of paper with names and values like Jake $5, John $10 (call them derivatives) When at home the holders of these chits tried to collect to no avail as their parents will not support the claim and the collateral was now in a possesion as per Greesham's law. Even if these chits were to be traded amongst the holders there will be no collateral available to pay.
Paper derivatives are deadly.
However, there is a theory that these derivatives may be traded mainly by JPM and Citi by selling to eachother at a prespecified times and create sweeps up or down thus picking up the small players's stops through forced liqidation. The same can be said for FX trades
Your thoughts
Undoubtedly true. And, the event has to be set up before hand with both the seller and the buyer. If you want to sell 1000 contracts and get them bought, all in a matter of less than a second and the existing buyers before the event only number 10 sellers with an aggregate bid for 100 contracts in total .... Then that is all that will get filled. Yet there always seems to be enough in volume being bid to always fill all of the asks.
Now how do you suppose that happens in the leanest trading periods of any 24 hour day?????
I see no problem with your analogy. It's just too sad that many more regular folk are being deceived and rendered destitute so that the big guys can play amongst themselves. That makes the situation deadly -- literally.
'tarded and 'butted...
of course they're selling and buying among themselves
+100 Fuck totally. I'm betting on the horse to run around a track and win the fucking race. Sure as fuck do not want to take delivery of the fucking thing.
I'll bite - and perhaps regret it.
Did you comprehend this paragraph?
"Precious metal prices are determined in the futures market, where paper contracts representing bullion are settled in cash, not in markets where the actual metals are bought and sold. As the Comex is predominantly a cash settlement market, there is little risk in uncovered contracts (an uncovered contract is a promise to deliver gold that the seller of the contract does not possess). This means that it is easy to increase the supply of gold in the futures market where price is established simply by printing uncovered (naked) contracts. Selling naked shorts is a way to artificially increase the supply of bullion in the futures market where price is determined. The supply of paper contracts representing gold increases, but not the supply of physical bullion."
WTF is with your horse race example? I think all the connections between 'bets' and the underlying gold can be readily ascertained in this one paragraph - no?
Hey genius , maybe you work at Goldman Sacks.
"How many of those betting actually will take, or make, delivery of a horse? "
The main difference being that precious metals were used as a medium of exchange long before the dollar. So people actually want to take delivery on gold and silver. The reason everyone thinks your analogy is retarded is that no one takes delivery on horses, because THAT IS NOT WHAT YOU ARE BETTING ON WHEN YOU MAKE BETS AT A RACE TRACK.
"Does the limited number of horses determine how many bets are allowed to be made?"
No, the racetrack who controls the entire system can limit how many bets are allowed to be made. Almost like a commodities exchange.
"Must we limit the number of bets placed on the horses to the number of available horses?"
No we can bet on horses not in the race. /sarcasm.
"Does the amount of bets for or against the horse have any factual relation to the performance of the horse, or is not the relationship visa versa?"
Sometimes, yes. There are people who actually follow horses and actually bet on specific horses they believe have a chance to win a particular race. Also the way the odds are determinded is by the bets being made by people. So while it does not have to have a factual relation, usually the horse with the best chance to win has the best odds to win the race.
Do facts about things either affirm or deny our opinions of the facts, or do our opinions about things deterimine the facts?
Take part one lies are misrepresented as facts all the time. There used to be scientific studies claiming smoking was good for you. It was supposed to be determinded by factual scientific studies. Our opinion about things sometime determine if we believe these so called facts, because sometimes we know the "facts" are misrepresented. Take the economic data coming out of the government for an example.
Now please shut up, fuck off, and go away.
Emily, I have a confession to make. I'm really a horse doctor. But marry me and i'll never look at another horse
Parimutual betting has little in common with modern commodity futures markets - with or without the assumption of manipulation in the latter.
The manipulation is now so obvious and blatant that one can only conclude that "They" don't give a shit if you know (They have the Fed behind them and a captured "Regulator") and actually want it to be quite clear that PM's do NOT represent an escape route for the plebs. If so, metals could very easily decline further. Given that artificial paper Gold supply can be created ad finitum, the Cartel can do exactly what they want to the price through the Futures "Markets".
Faced with this, my strategy is to hold all my physical and play the trading game with The Cartel (Not against them) using the Commercial net short position as the guide to the wash and rinse cycles within the trading range, which is broad enough to be profitable (Because that is how the Cartel profits). I use the proceeds from trading to buy more physical. In a nutshell, don't give up but play them at their own game.
Exactly. I am using DUST and NUGT in order to play their game, take profits, and then buy physical.
Life is not a game, unless games are your life.
Philipat,
Exactly.
Michael Hastings comes to mind
in that all Mercedes when they hit trees have their engine leave the frame and catapult to the rear. Of course.
*phys holder 30 years
Yeah, I have 2 Mercs, an S and an SL and, strangely, neither of them has YET expoloded, hit trees or had the engine block fly out several hundred meters away. Strange how Hastings car could do such a thing isn't it? ;-)
I do think that this is a slightly differnt situation in this is something they WANT to be known. They are telegraphing loudly and clearly that you should NOT buy Gold because it is going to get crushed and is NOT an escape route for the plebs, who should just BTFD's and keep all their savings (Such that they might still have) either in Stawks (Shortly to be destroyed) OR in the "Security" of the Banking system (Where it can be subjected to Negative interest rates and then "Bail-Ins".
I trust them inplicitly of course/s
If the Banksters are not scared, why is there such a media war against PMs?
Yeah SDRs lol
38BWD22's wife has banned further purchases of gold for our Central Bank. Too bad, because the price is so low that a BTFD is very logical here. But, in the end, that's OK. We have enough...
^-- Iridium (above) is a precious metal too.
* * *
Anyone who does NOT own any physical gold should consider these prices a gift. Don't screw up, buy physical gold. Even BANKERS say 5% of your assets in gold is OK.
Smart "money" is far move overweight than 5%....
That is so fucking sad.
What else does she control?
"...wife has banned..."
Just fucking sad, sad and sad.
Even worse, you admit it.
On the day you really need Gold, I promise she'll slap you for not buying more!
"...banned..."
I keep promises I make to my wife. Nor do you have any idea how much gold I already own.
I don't drink either.
I guess that just makes me sad... Not!
Having a good marriage and life partner is more important than arguing over money. Good for you!
Ohhh the "M" word, How you dare.
Supply and demand curves. How quaint.
You forgot the government curve. The one that goes straight across the graph and sets the price where they want it, regardless of how much or little is changing hands.
Imagine the outcry if by executive / dictatorial / whatever fiat gold futures could no longer be cash settled.
OR if naked shorting were banned. OR if position limits were installed. None of which is going to happen because the Central Banks would then no longer be able to control the price of Gold via the paper futures markets. It will only change either when the Spec crowd finally realise that they are being screwed by the Cartel and stop playing in Comex/LBMA OR if the new ABX exchange and the new physical futures market in Shanghai marginalises Comex/LBMA to the point that they become irrelevant.
Or if people buying longs in Chicago bought metal in Shanghai instead and stood for delivery.
Only people who stand for delivery of metal affect the long term market.
Those who buy for cash and take delivery in cash have no long term effect either way. They are just hopng to catch a wave, they do not make their own waves.
I could imagine it, easy. 'Disappearances' of certain individuals. Perhaps even a 'color revolution/s' of sorts by those with the funding and soldiers-of-fortune in their pockets willing to do a 'Maidan' in the U.S.
I love curves
If I understood this article correctly, the key is the stop-loss orders.
Naked shorts must be covered or the market will break; the shorts are covered by knowing where the stop loss orders are. Those are triggered and the manipulators use the newly liquid gold to plug the holes. This system only works while there are stop loss orders existing. So if things start getting very bad and traders withdraw from the market, there can't be manipulation.
Yeah so what can you or anyone do about it? The complicit and corrupt government regulators won't do a fucking thing. Because they've been purchased by the very scum running the scam.
All just noise. Who cares about paper gold, real gold, we all should just be glad that the price is much lower now that we can buy in slowly.
Right JJdog, so much horse shit about supply and demand. Just BTFD in the physical market!
My comments:
1) physical gold is not comparable with commidities like oil and ags which are consumed. Since most of the mined gold is still around, potential supply is almost unlimited.
2) the supply and demand curve does work for the paper market: a lot of supply leads to a lower price. So the author's are contradicting themselves.
I just recieved some more bullion yesterday. Hell, PM's are on sale.
Crash 'em. BUY SILVER. It's on sale right now.
Like the Terminator, the Bankster Cartel has no pity or remorse and absolutely will not stop. Taking the other side of the trade - swapping their Fiat FeRNs for physical metal at absurdly low prices - is the only way to shut down the cyber-racket, just like the London Gold Pool.
My stack is 3,000 oz heavier this month, so I've done my humble part.
Thanks central planners! See you on the other side.
So much PM is sold out online thats closer to spot price, or awaiting a mid August delivery date. 1 kilo gold bars don't seem to sell out though. News about PM's is really hard to figure out. Saw somewhere the US mint isn't coming back online until September. Plus the obvious troll websites spewing complete garbage. Comment sections are much more interesting lately.
The daily gold bashing articles over at Marketwatch are pretty hysterical. For such a tiny market, the stock market circle jerk and finger blasting is unprecedented.
I know why it's important to own gold & silver outside the banks, but what I can't figure out is why they've gone on such a gold bashing binge? I mean it's really over the top. Cui Bono?
To scare the shit out of those who don't know any better and buoy those who think they've got it made in their 401k.
Few things validate gold's inherent value more than the fixation baseless fiat banksters and their shills have on it.
"The lady doth protest too much, methinks" is a quotation from the 1602 play Hamlet by Williams Shakespeare It has been used as a figure of speech, in various phrasings, to indicate that a person's overly frequent or vehement attempts to convince others of something have ironically helped to convince others that the opposite is true, by making the person look insincere and defensive."
How a "pet rock" could cause such consternation is actually no riddle at all.
These guys all make the same silly arguments.
If physical gold is undervalued, then, at these 'low prices' all the know physical would be purchased and the paper market would go away
But it hasn't! Let's not use gold, let use BMWs. Supposed there was a paper market in BMWs in parallel with the physical market. If the paper price 'drove' the price down to unreal levels, would there be any BMWs in the show rooms? Wouldn't there be a bidding war at the dealerships to grab an undervalued physical car?
Use steaks, burgers or anything else
The time isn't right yet for fiat to rush into gold, so paper is winning
That won't always be the case. But it is now. This conspiracy stuff is embarrassing and whiny
You are leaving out a coordinated marketing attack on BWM's to go along with the paper price suppression. That is essential.
Example isn't perfect by any means. But if gold is significantly undervalued, then the physical markets should be on fire and supply would be purchased. Hell, it's been over 20 years of suppression talk. You'd think all CB gold etc would have been purchased and the paper players would have been exposed
But that hasn't happened. Physical supply and physical price are not creating panic buying or selling. That tells me that all this paper stuff is just whining. When there is a fiat crisis, lots of big money may run to gold, then physical will disappear, fiat prices will rise and gold will only trade at prices much higher than today
Till then, enjoy the bargain. I like prices at this level. I hope it goes lower and lower.
Suppose Englishmen, Robert Menendez, Members of US Congress, Bilderberg, European Royals & Western Bankers all refused to Buy Whores in public or on public exchanges no matter the country.
So in effect in the west the price of prostitutes was suppressed in a period of political activism... leaving the sex trade in USA, UK, and much of EU Cities depressed and only to be found in rural areas or along highways and streets.
In effect the sex trade goes black market or underground. But the Wealthy enjoy the trade in private venues, on private estates, off-shore ships, private islands, exclusive resorts. Maybe they don't care much about the prices or having to use planes or limos or ships to bring the people to them.
Can Gold & PM be compared.
Would Google, Apple, Microsoft, and Western Tech Leaders be complacent to work off-shore or in private markets to get what they want and what is the implications of private markets and controlled venues. Like a Sheik or a Mughul controlling the market.
Are there Private Markets for Diamond and Gold & Silver? Yes, of course.
And we have to understand these private markets if Oligarchs can buy PM on the side or directly from peasants in Latin America or Africa.
Sophist - you are an idiot.
Gold is money, quite a bit of which (physical) is held off of the 'market' by CBs as a de facto backstop to fiat currencies. BMWs are not money.
What is happening is the Central Banks are effectively printing money - paper GLD - at a rate at least equal to the rate of printing fiat money. So long as the masses do not recognize the difference between GLD and physical gold, the CBs can deflate gold by printing GLD shares faster than the dollar or other fiat currencies.
Gold will outlast the fiat currencies - always has. The question is whether you or I will outlast the ruse. Don't know.
Nonetheless, your analysis is deeply flawed because you do not account for the most fundamental thing - gold is real money. Neither your BMW or any other "good" you plug into your feeble example is a meaningful surrogate for gold.
not as hilarious as the washington fucking post...
"That sound you hear is goldbugs insisting that this is just a flesh wound. Sure, gold is down a lot, but that makes this is a buying opportunity! Just wait until China starts snatching up gold as an alternative to the dollar. Then prices will shoot back up. That, at least, was the story they told themselves until earlier this week, when China revealed that it hasn't been purchasing nearly as much gold as people had assumed. Not only that, but a big fund dumped its gold in the middle of the night, driving the price down to a 5-year low. That's left the goldbugs most impervious to empirical reality with nothing to say other than that "gold hasn't lost any value, the dollar has just strengthened." Right, and my stocks aren't worth any less, I'd just get less money for them if I sold them."
http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/25/gold-is-doomed/
this guy is a fucking mron.
Thanx for the link. I'm still laughing.
no problem...they'll be plenty more i suspect...
I already got a lg freezer of it, so count me out.
Still laughing: "...a big fund dumped its gold in the middle of the night..."
Not likely a fund, and not real gold. Who believes this crap anyhow? Oh, wait, I know. People who need a rationalized notion to justify their timidity in purchasing a real asset. Stock puppets.
"It is unlikely that regulatory authorities are unaware of the fraudulent manipulation of bullion prices.'
lost me right there.
The Fed has unlimited fiat. The global economy has a yet undiscovered "house limit".
This global "house limit" will be unexpectedly struck like an iceberg and the global economy will go down.
The Martingale System is commonly compared to betting in a casino. When a gambler using this method loses, he or she doubles his or her bet. By repeatedly doubling the bet when he or she loses, the gambler will (in theory) eventually even out with a win. Of course, this is assuming the gambler has an unlimited supply of money to bet with and that there is no house limit.
Is there a JPM, HFT, Hedge Fund Hyena curve?
I rather buy gold at $1000 Than $10000. Keep up the good work with the manipulation
A time will come where mostly everyone will willingly and voluntarily buy gold for that price, and still they won't get it. There is no upper limit for the price of gold, it just depends on how much paper notes you have to have to get it. In Germany there wa a time where one would need 4 200 000 000 000 RM for just one USD, to that time gold /USS was somewhat around 20 US/ 1 ounce... So the "price" was but just one thing astronomical. Why do you think they will stop printing money? Just have a look ast Zimbabwe or Venezuela. There is no limit to any price in whatever funny paper one named "money". There is no limit on printing a number with al lot of zeroes on one piece of shit, as long as it' tender money. But it's nothing it exactly that a piece of shit. Yes you can buy something of that shiit currently, but be aware of what you buy with it....
Well, most gold is indeed only a pet rock as it is drawn up like dollars.
Gold bullion isn't though - but as long as no one is demaning deliveries, the show can go on.
But when it eventually stops, you better chose private security as your trade of business.
No, you have a diversified portfolio that includes the recommended 5-10% steel and lead, "the other white metals."
you can demand delivery, but it's really just a request, like germany made.
"Rajesh Exports Ltd., India’s biggest exporter of gold jewelry, agreed to buy Swiss refiner Valcambi SA from owners including Newmont Mining Corp. for $400 million.
The cash purchase helps ensure gold supplies to India, the largest consumer of the metal after China, Bangalore-based Rajesh Exports said in an exchange filing on Monday. Its stock rose to close at the highest level since at least July 2000, while shares in Newmont, the largest U.S. gold producer, fell.
“On a theoretical basis Valcambi is capable of supplying the entire gold requirement of India,” said Chairman Rajesh Mehta. Credit Suisse Group AG has agreed to fund 30 percent to 35 percent of the acquisition through long-term debt, which Rajesh Exports plans to repay through Valcambi’s future earnings, Mehta said at a news conference in Mumbai.
Valcambi, founded by a group of Swiss entrepreneurs in 1961, has processed and sold an average of 945 metric tons of gold and 325 tons of silver annually during the last three financial years, according to the statement. India imported 891.5 tons of gold in 2014 to meet demand of 811.1 tons, according to the World Gold Council."
http://www.bloomberg.com/news/articles/2015-07-27/india-rajesh-exports-p...
These are the guys who made (still make?) those nifty little 'chocolate bars' that you can break off 50g pieces or similar size, no...?
Nope, they are guys who replace their teeth with gold plated tungstun.
yeah...
I guess a follow up to the gold and PM bashers might be "yeah, I guess 1.3 Billion Indians, and about the same number of Chinese are fucking stupid for buying the relic hand over fist." Half the fucking world residing in just two countries can't be wrong. Or the fact that there are PM dealers all over the fucking place trading physical for a living - they all fucking wrong too? At some point their ignorance can no longer be excused - it just fucking can't!
One thing I never see analysts talk about is why the US treasury continues to carry a book value for gold at $48 per ounce. If we truly do have 8,000 tons of gold, wouldn't it be better to change the book price to the current market price, even periodically, to yield a higher price for US gold?
Rothbard made an interesting point in one of his writings that when the fed was chartered, their charter included a clause that stated in the event of a US default on outstanding debt, the fed could exchange any treasury bonds they held in possession for US gold at the book price.
If that is true, then US treasury has been derelict in it's duty to revalue gold in it's book price most likely so that in the event of a US default the fed could confiscate all of treasury's gold holding.
Yup. And Kevin Henry will really scare the pants off of the soldiers guarding it at West Point and Fort Knox when he dons his camy uniform ...
It's very possible the US does not have 8000 tons of gold. As I'm sure you're aware, Fort Knox has not had a close look in 60 years. It's possible some weird shit went down on 9/11 and a bunch of gold was stolen then as well. Germany asked for its gold back from the US, and we hemmed and hawed and then stole all the gold from Ukraine and gave THAT to them instead. Maybe we've got the gold, maybe we don't; tough to tell anything nowadays, since it's all lies all the time.
Yes, there are all kinds of theories for instance Another believes that the US exchanged our gold reserves for Saudi Arabian oil. That is oil sales were reported in dollars but a certain amount of gold bullion was always also part of the purchase. Same could be said of our export deficit with China, that is they accepted our bonds as long as there was always an undisclosed amount of gold in the transaction.
I'm also aware of the legal issues surround the use of gold and silver coins as money in the states. For instance there was an employer in Nevada who would pay his workers in gold coins in order to report the face value of the coins as wages in order to pay less taxes and unemployment insurance.
The point is, there is a huge discrepancy between the coins which treasury mints and are legal tender versus the spot price of gold. It would only make sense from an accounting point of view to continually count the real price of gold on US treasury balance sheets as it would be a greater asset. They could then mint gold coins without any stated price on the face of the coin, instead of a newly minted $50 one ounce coin (eagle) the coin would simply state the weight and purity of the coin.
The fact that treasury doesn't do this stinks of a hidden agenda.
Yep. It's in there... somewhere:
http://ubercraftorg.ipage.com/thoughts/
ANOTHER (THOUGHTS!) Foundational Gold Trail Commentary The Inside Story on the Gold-for-Oil Deal that could Rock the World's Financial Centers1997
October
November
December
1998
January
February
March
April
May
June
July
August
September
It's not possible, it's a certainty.
Don't fucking get me started on 9/11 and the Israel/Neocon/MIC fuckery
Why do you need israel as scape goat. Why aren't your own politiicans more than enough? Israel does not make your laws, and you are serioiusly believe they do?
Are you blind?
Maybe you can start counting the number of US politicians and non-elected beauracrats that hold dual US/Isreali citizenship??? Isreali citizens ARE making US laws. Congress is "occupied territory".
GAC or GTFO
Non stackers of precious metals are missing out on the fire sales.
No, they are buying something they will be able to use or that produces a return, gold does neither. Gold doesn't even hold it's value the last 5 years.
what does a $20 dollar face value .999 Gold coin buy u compared to a $20 dollar Federal Reserve Note?
and what value has the dollar returned since the creation of the Fed...?
Gold does not have to return anything it only has to protect purchasing power...
that is the primary component of REAL MONEY....
now, please go far away.......
+100 for Gold does not have to return anything it only has to protect purchasing power...
PM bashers still don't get it. Its not complicated, but, .....they still don't get it.
you are missing the point... $20 of something buys $20 worth of goods.. regardless of the currency....
but in order to keep the dollars worth something, they ruin the rising value of gold. and that scheme shall break soon...
Well if you want to put any significant money into gold, you can't. Only people with a few thousand dollars to put into gold can do it. Real money has to go elsewhere, that is why the price remains low. Real money doesn't play the paper game, it buys real assets like land or control of corpoations or debt instruments. So the fact is, real money doesn't go into gold, small timers buy coins and any real deliverable bars cannot be bought by individuals. If you can do it, then I would like to see someone here take delivery of a 400oz bar and show us the picture. Gold is a clownshow, not an investment and sadly, the people here haven't figured out they have been made fools of.
"Real money doesn't play the paper game, it buys real assets like land or control of corpoations or debt instruments."
u sound like an idiot u know that dont you?????
from whence does every green piece of paper you've been told (and stupidly believe apparently) come from????
and can debt be money????
finally, what is a Federal Reserve NOTE???????
Obviously debt is money, like it or not. It's exactly what credit produces and why banknotes circulated. Credit is the value of your future output and if you have no future output worth anything then you have no credit. If you are a bum on the street you don't have much credit. If you are someone who has a small business that produces goods and services, then you have credit and that can be used to support circulating currency based on the value of your future output. The way credit becomes money is described in the real bills doctrine and it's the mechanism by which the Fed was initially intended to work. Lous McFadden made a famous speech against backing circulating currency with bills of sale.
APMEX has kilo bars of gold in stock for $36,000 each. You want to order a 100 of them, go ahead. Give them a call. I'm sure they can help you out. You're going to draw a lot of attention towards yourself. Most stackers buy a little at a time. http://www.apmex.com/product/73950/1-kilo-gold-bar-pamp-suisse-july-29th
You just made my point. Why not buy a house if buying 100 kilo bars, which you can't do anyway, draws attention to you? No one is going to break in and steal your house. LOL!!! You could also buy an apartment building which generates rents. This is why people with money in size just don't like gold that much and why the clownshow on the CRIMEX is meaningless but designed to keep people away from gold.
Yes and if you want to leave your country, you take the house with you. Why do you think they name it immovables?
Stopped reading when you said real money has to go elsewhere. If it isn't real money, then why are Central banks holding it?
By real money I am referring to money in size, i.e. 8 or 9 figures, not 5 or 6 figures. Seven figures might be possible but it's in the range where it's really difficult to get that much into and out of gold in a reliable and timely manner.
half the global silver produced last year, was purchased by private buyers. that's a lot of coin
8 or 9 figure physical Gold isn't for flipping every oither week ... it's for long-term wealth insurance.
Interesting post in light of the fact that the likes of Ray Dalio and a few others of similar stature have mentioned it being a good idea to have gold in one's portfolio a while back. (I believe he mentioned 5 to 10 percent or something in that neighborhood.) I personally don't own any gold but it is getting attractive, for various reasons. It's a commodity, but, in my view, one affected by more than just everyday market forces. USD strength and the general commodity deflation will run it's course and the gold bugs will later rejoice. I just don't know exactly when, and niether does anyone else.
Back to killin' snakes...
Who would get a 400oz bar and post pictures of it online?
Is that random farmer in Zimbabwe going to have better use for gold dust or a 34lb bar? Or how about we switch Zimbabwe funny money to something like CAD or AUD. Did gold go up or down in relation to those two currencies as gold goes down? This all works fine for the USD as it stays stronger, until it doesn't.
Let us calculate around 163 000 t or 163 000 000 kg of Gold. One kg is around 35 000 USd So we are just talking about:
5 705 000 000 000, so no one can not put significan amount of money into gold. Now lets take a price of around 1 000 000 USD/ kg
Then we're talking about: 163 000 000 000 000 is that serious enough money for you? It's so stupid to to accounting in something one can change within no time. It's really astonishing how serious one takes the paper money. It's very easy for you do not buy gold if it's worthless to you. Anyway if you think it's worthless you can send it to me and I pay the postal rate.
So don't hesitate, I will "ease" you pain and I will ease the weight you have to bear.....
Masterful analysis--thanks. However, the authors should have cited GATA and other sources--people who have been saying the same thing for decades.
Hello! Earth to DUHH!
When composers write songs about it you know that it's......
https://www.youtube.com/watch?v=PYI09PMNazw
Does anybody have a song about FRN's???
A friend of mine works in a small coin shop. He reports that few are selling, only the most desperate, and the only buyers tend to be desiring large quantities. He says he pays the few sellers that come in up to 10% over spot.
In some cases, to fill large orders, they, he and his boss, are having to pay suppliers (large shops in the city) as much as 20% above spot, and then charge a commensurate amount of markup to the buyers, who willingly pay it.
I can report that legit sellers on Craigslist have evaporated as well.
Liberty is a demand. Tyranny is submission..
Steel for guillotine blades is still readily available though.
If you don't want to sell your coins at this price then why would the coin shop guy do so if he paid a signficantly higher amount for his coins? He won't and he isn't, he is only selling what people will sell him for less than the reported spot price. If you really want some, offer him a lot more for it and I bet he can find it for you but you will have to pay him first. This is why the whole thing is a clownshow and not really worth the effort except to small fry with small sums of money to put into metals.
They need to "churn" metal to make profit enough to pay the bills.
Used to be enough coin collectors, and buyers and sellers of metal to do so easily.
Few collectors now, and no one is selling, so they have to offer up to 10% over to get inventory that then goes to clients buying in bulk. These bulk buyers are really paying extra for the service of my friend and his boss putting together the allotments, and not paying extra for the metal itself. I.e. the buyers have made some calls, and can't find anyone with 200 ounces that they can buy from, at least not without generating a paper trail, and so they utilize my friend and his boss' service and contacts.
To review: Few sellers, tough to get metal. Few buyers, but those that are buying are buying a lot of metal in bulk. A tight squeeze.
Liberty is a demand. Tyranny is submission..
Hmm, I wonder how your friend's coin shop can stay in business paying 10% over spot, when he can pay ~4-5% over spot buying from Texas Precious Metals or APMEX
Thank You???
YES ... the prices of gold and silver are BULLSH*T on the futures commodities markets.
HOW to handle this?
Simple. DO NOT buy/sell real gold through dealers in the USA or the UK.
Until there is a serious currency crisis in the western fiat currencies gold will languish, unless of course the central banks themselves start to bid it up.
never have precious metals been so low since 2011.
I guess Yellen is yelling here comes rate hike.
There's a lot on the line here. The article by Kranzler touches on it, but the magnitude and the consequences are quite sobering. All that is left for the United States is confidence and a huge military presence to ensure that the stability (read: Supremacy in $trade) is maintained. That means, whoever isn't toeing the line is subject to overthrow, color revolution, covert black-ops actions, currency war, market manipulations, etc., ad-infinitum.
Bait and switch article. You cannot use the demand for gold eagles as a proxy for aggregate world gold demand. Gold eagles are a small fraction of the gold demand, and it is a very particular and specialized sub-sect of the gold demand at that. People who want gold eagle bullion is not representative of anything else. Even worse gold eagles are minted by the US government which by definition does not care much about supply and demand curves of the free market. So squeezes in this prove nothing.
When the day comes when people stand for delivery on a gold futures contract and someone has to go to the market to get the physical and they wind up paying through the nose for it, or if they default, then you will see the price go to the moon. Until then the paper prices are not real physical demand since they don't represent people who want to really take delivery, they just represent demand for an ability to bet on the movement in the price of gold, not gold itself.
I do own gold btw. Everyone should be dollar cost averaging into it. Eventually it will have it's day. But I do not buy the narrative that you can hide real physical demand with paper.
My first post really, and given the gold fanatics, I'm sure I'll get huge down votes. I'm ready.
Naw your as good as anyone here.
Thanks, I think so but I think my opinions on this will be unpopular, but that's ok.
As long as your opinions are well reasoned they will not be rejected here. Your observation about the U. S. gold and silver eagles sales is important but perhaps for a reason you have not considered. Yes, it is a very small subset of the overall metals market -- but an important one. Predominantly, we presume, those sales are to U. S. entities; therefore, the importance of precious metals to the U. S. has been expanding. Hey, in anybody's book that's a good thing! The more demand, the merrier, from whatever source. COMEX must be busted.
"My first post really, and given the gold fanatics, I'm sure I'll get huge down votes. I'm ready."
first, i believe u have misjudged the importance of ur opinion which is flies in the face of documented facts....
second, there is an abundance of evidence which shows the unprecedented demand for Gold lead by the China, Russsia, India, just to name the heavy hitters who r draining western vaults of what little PHYSICAL they have left...the Gold Eagle story is just more irrefutable proof that SOMEONE is intervening to disrupt the NATURAL LAW of supply and demand which SHOULD be the determinant of price - an economic axiom...
lastly, if u really believe that futures that r unbacked by PHYSICAL to the tune of about 116 to 1 r not being used to suppress the phony paper prices of both forms of REAL MONEY in part on behalf of the moneychangers whose fraudulent fractional reserve banking system they r attempting to protect from its inevitable collapse, then there aint much to talk about...
ps: u might want to aquaint urself with the ESF.
"Section 10 of the act established a stabilization fund of $2 billion under control of the Treasury. These funds came from the profits the government earned when it raised the price of gold. The Treasury could use the Exchange Stabilization Fund (ESF) to buy or sell gold, foreign currencies, financial securities, and other financial instruments in order to control the dollar’s value and to conduct open-market operations without the assistance (or approval) of the Federal Reserve. The Treasury could also use the ESF to transfer funds clandestinely to neutral nations and international allies; this tool proved useful during World War II."
http://www.federalreservehistory.org/Events/DetailView/13
"lastly, if u really believe that futures that r unbacked by PHYSICAL to the tune of about 116 to 1 r not being used to suppress the phony paper prices of both forms of REAL MONEY in part on behalf of the moneychangers whose fraudulent fractional reserve banking system they r attempting to protect from its inevitable collapse, then there aint much to talk about..."
Why would there not be much to talk about? That is the type of thing someone who uses faith and not facts or reason says.
As for vaults being drained, I agree that is probably happening. If there is gold manipulation going on it is there. I do think it is probable that Western governments are manipulating the gold price by dumping physical on the market clandestinely to keep the price down. That is not paper manipulation and that game runs out when their physical gold stash runs out or they stop.
Explain to me how it is plausible that a bunch of people try to buy physical food, gold, oil, or anything else and price does not go up because of paper manipulation. Believing in paper manipulation is like believing you could suppress the price of hamburgers by selling people pictures of hamburgers or promises of hamburgers in the future.
"Explain to me how it is plausible that a bunch of people try to buy physical food, gold, oil, or anything else and price does not go up because of paper manipulation."
here is what i will explain...
the price of food has gone up astronomically but is denied by officialdom which points to their phony CPI. why? becuase the currency is being debauched and the price of the CURRENCY (interest rates) is being manipulated to hide said debauchment...
energy - the same...
its a fact that every so called market in the world known to mankind is being manipulated at this very moment but u want others to entertain that Gold and Silver markets which consist of a PHYSICAL and FUTURES market which have disconnected entirely r not???
and since when did oil and hamburger become alternative currencies that Central Banks feared on equal footing with the only 2 forms of real money....?
Memorandum of Conversation 1Washington, June 19, 1967, 2:30 p.m.
SUBJECT
International Liquidity
“Mr. Bator said the wrong kind of compromise would do the world no good. Many French officials don't want the price of gold to go up in any event. The others must be made to realize that gold won't go up. “The game won't be played that way.” Secretary Fowler said that if the world divided into two blocs—a gold bloc and a dollar bloc—Germany would be isolated with the French in the former.
Mr. Schiller made a long speech on German loyalty to the U.S.A. Secretary Fowler said he had no doubts on this score but what we must focus on is making the first step—and it must be on the right path and a big enough step to convince the world that the price of gold would not go up. Otherwise, we would have crisis after crisis. The French may have abandoned the direct approach in the increase of the price of gold but could be seeking the same result by their efforts to abort the liquidity exercise."
Foreign Relations of the United States, 1964–1968;International Monetary and Trade Policy, Document , Document 129
""Explain to me how it is plausible that a bunch of people try to buy physical food, gold, oil, or anything else and price does not go up because of paper manipulation."
here is what i will explain...
"
It's not that compilated. Every central bank can print money effortless. No central bank of this earth can say. There should be one gram more of bread in the world. So all prices do raise becuase of the simple fact that central banks just do money printing.
It's simply uncomplicated as that.
You make no sense here. In fact you have made the argument for my case while claiming ot argue against it. You get that printing money means higher prices all else being equal right? Not falling prices?
People see the price of food going up. It is not hidden. Most people don't even know what CPI is, let alone think it means anything. The method to hide price costs from the American public is simple and has been used for decades - farm subsidies and subsidized public lands for cattle grazing. Taxes and borrowing against the future keep the cost of food down, not futures contracts where people do not take delivery.
its a fact that every so called market in the world known to mankind is being manipulated at this very moment but u want others to entertain that Gold and Silver markets which consist of a PHYSICAL and FUTURES market which have disconnected entirely r not???
You did not make an argument at all, just a claim to authority and wisdom of the crowds. Lots of qustions marks does not prove your point either. Once again explain how a futures contract on which delivery is NOT TAKEN represents true physical demand? Then explain how if demand for a commodity exceeds supply explain how the price will drop.
I am not saying there is not manipulation. There is tons of manipulation in the markets. I am saying manipulation fails when the reality of supply and demand meet. I am saying that when people do not stand for delivery they did not have a demand for the physical commodity but only for the ability to bet on the movement of said commodity. I am saying that no force on heaven or earth prevents the market dynamics of supply and demand working. If I stand for delivery of gold, hamburgers, oil, anything, then that demand will be reflected in the real price. Governments can use propoganda to help manipulate demand, they can use subsidies to hide the cost, they can provide supply to keep the price down, they cannot actually override the mechanics of supply and demand.
and since when did oil and hamburger become alternative currencies that Central Banks feared on equal footing with the only 2 forms of real money....?
I never said they were alternative currencies. They are both physical commodities and thus constrained by real supply. Once again you poorly strawman me. First most gold is not a currency though some gold is minted into such. Gold mainly fulfills the store of value side of the money equation, but very few people are exchanging gold for products and services. Secondly I used the hamburger analogy for what I thought was a clear purpose but that you failed to understand. People get that if they need to buy food no paper manipulation will matter. You could have futures contracts of millions to one dealing with food, the price will be determined by those who want to eat and those who have food to sell. Same holds true for gold and you have not proven how that reality can be washed away by any paper only manipulation. This is why illegal drugs cost a lot of money, and why food cost a lot during the Great Depression and is going up in price in our new Great Depression II despite so many other commodities falling in price due to fallign demand.
I agree with you that gold eagles are not a good representation of the overall market demand. However, I don't ageee with "But I do not buy the narrative that you can hide real physical demand with paper". That's exactly what's going on.
You say that they do that but make no arguments for how. If people go to the market to buy a physical good and will not accept a substitute then explain how that demand can be satisified with paper. Explain how people needing food for example can have said demand hidden with futures contracts and paper only manipulation.
maybe this video will help explain things;
https://www.youtube.com/watch?v=iM4s3LYZQHM
Modern warfare doesn't prove who's better. It proves whos left.