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The Smoking Gun: Silver & Gold Manipulation Exposed
Submitted by Dave Fairfax via PeakProsperity.com,
Gold price suppression!
The amount of ink spilled on this topic could fill a supertanker. Goldbugs the world over believe in the suppression story as an article of faith, and indeed, the evidence that “something is happening” appears incontrovertible.
Given how important the subject is to the bullion-owning community, and the volume of energy we expend talking (and talking, and talking, and talking) about it, how much information do we really have about what is actually going on? Has anyone quantified suppression? Do we know how, when, and how frequently it occurs? Once a month? Once a day? What does it even look like? For many of us it might be like that old Supreme Court Justice's definition of obscenity: I can't define it, but I know it when I see it.
So, I'll take my best shot at defining suppression. Then armed with a definition, I should be able to discover how and when it takes place. To see how frequently it happens, and what the immediately observable effects are – as well as the apparent longer term effects of such events. Does the fact that a suppression attack occurs means the price trend changes? Is an attack prima facie evidence of successful control of prices over the long term? And is anything else being suppressed, too? Perhaps everything is being suppressed by our banking lords and masters!
The visible attacks that we have all seen involve “someone” dumping (or buying) large numbers of futures contracts in the market when activity is relatively lighter than usual, with the intent of deliberately moving price. Most goldbugs like to say that gold and silver suppression attacks occur in the “wee hours of the morning.” Loosely translated, I take this to mean during non-US and non-London trading hours. So that's the time range I will use: 4pm-3am Eastern; from just after US market close through to the London market open.
So how do we define a deliberate act of suppression – or let me state it more neutrally - a “volatility event”? The ones we have all seen involve a large spike down (or up) in a small increment of time. I'll define this more specifically as at least a 0.5% move within a one-minute period. So, at current prices, that's a $6 move in gold or a $0.08 move in silver that happens within one minute. That's just the minimum amount – often the moves are much larger than that.
Goldbugs tend to believe they are a heavily persecuted lot, with their favorite metal singled out for routine beatings. Is there a factual basis for this feeling? Or do volatility events occur for other futures contracts also?
Others (including me!) have pointed out that volatility events happen to the upside as well as to the downside. I have personally seen these spikes higher squeeze the shorts, thus driving prices even higher during non-US non-London trading hours. Some goldbugs never seem to want to acknowledge these events; some have even claimed that “they don't happen!” So do they happen? That should be easy enough to prove or refute by looking at the trading records. And if such evidence indeed exists, how often do these volatility events take place compared to the downside moves?
To answer all these questions, I wrote some software -- as I'm a programmer by training. The program sorted through intraday price data for 9 different futures markets, with the data starting in late 2009 through today, and counted all the 0.5% 1-minute price spikes (either up or down) that happened during non-US non-London trading times. Then, I entered them into a spreadsheet for analysis. Let's take a look:

Legend:
total events: the total number of 0.5% 1-minute moves during the time period for that contract.
# ev down/up: # of moves that ended lower, or higher than the starting price.
chg down/up: aggregate dollar change for all up and down events for that contract.
total change: aggregate chg up – chg down, in either dollars or points.
So first of all, are there up events as well as down events? The # ev up column says yes, definitely. Silver had 402 up events, and 467 down events. So it's not just a one way street down. Those scoffing analysts are correct: the up-events really do happen. And not just occasionally either! That said, evidence also clearly shows there are more down events than up events for gold and silver (and also for Natgas, and the e-minis).
Next, are gold and silver the only contracts that suffer volatility events during the wee hours of the morning? No. Many contracts received hundreds of similar-sized volatility events during the time period. While it is true that silver received the most total events at 869, Natgas, Wheat, and Crude have all received more total events than gold, with Natgas coming in at #2 with 489.
Could there be an active Natgas, Wheat, and Crude oil suppression campaign going on too?
No. There is one last critical part: the aggregated total change column. If you sum the price changes for all events: chg down + chg up, you get to see the net price impact of all the events. So for silver, the total change over the period is $53 up - $71 down = -$18. Compare this with crude oil, which had $43 up - $41 down = +$2.
What does this mean? Even though silver had $53 in support from the 402 up events it received, it was also hit for $71 from the 467 down events it got: net effect -$18. That's significant for something with a current price of $15. In fact, when viewed as a percentage of silver's current price (the % change column), silver was far and away the hardest hit of all 9 contracts I investigated. Gold's price impact was #2, at $379. Crude actually had a positive effect, while Natgas was dead flat. Even though Natgas had a large number of volatility events, the net effect on price was a wash. The same is largely true for wheat, treasury bonds, and the e-mini futures. Some experienced a mild positive effect, others a mild negative effect, but the effects were quite small relative to the current price of the underlying item.
So goldbugs, take a victory lap! Even though the scoffers were right – there are a large number of up events – the down events dominate for PM contracts and especially for silver. You have been singled out for beatings! Of course you already knew that, didn't you? :-)
So now that we've looked at the last 6 years in aggregate, and we've established that precious metals have definitely been singled out for “negative attention” compared to other contracts, its time to look at these events across time, to see if we can get answers to the other questions, such as: When do these events take place? What effect do they have on the price chart? Are they still happening? And if so – how often?
First, let's look at the big picture. Here are a pair of price charts for silver and gold over the five year time period, with the volatility events (red = down, blue = up, measured in dollars, weekly) overlaid.
For silver, we can see four main events: a huge spike right near the 2011 peak, another spike that seems to coincide with the low in 2011, and a couple more in early-2013 that happened during the great gold smash of 2013. We can also see that the red (the down spikes) usually is larger than the blue (the up spikes).
Gold's picture is a bit different: a few smaller spikes appear during the uptrend, a couple appear right near the peak, and a massive spike appears right after the peak. The largest spike in gold happens during the 2013 gold smash. One last big spike occurs in 2015, about the time of the low at 1075. As a general impression, gold has far more red than blue; this is borne out by the spreadsheet, which shows a 2:1 red:blue ratio.

Anatomy of a Top
The next goal is to dig deeper, and see how a volatility event storm affected price. Does a volatility event line up with a big move down? And what happens after? Does price keep falling, or does it bounce right back up? Do volatility events change trend? If so – are there conditions?
Silver has received the biggest total number of volatility events, and has received the largest negative impact as a percentage of price. Let's look at the biggest spike, the infamous 2011 peak at $50 through the lens of volatility events, and try to see what might have gone on. Did suppression cause the top? It seems like it should have – but did it?

On Sunday/Monday, April 25th , 2011, “someone” hit the market with 12 different volatility events totaling $3.15, which was at that time the largest single set of volatility events in the timeseries, the same day that silver ticked $50/oz. As a result, silver printed a doji on the day. Price fell the following day, but then a funny thing happened. Price started moving higher again. Three days after the big Sunday-evening silver smash, price was once again testing $50 – and in fact it had two shots at $50 without any volatility events appearing at all on days #4 and #5. But those two shots at $50 failed, and on day #6 as price began to fade, “someone” came in with a truly absurd 51 events totaling $15.45 in impact that started the collapse in price down from the high. Buyers still tried to buy the dip that day, and price only fell $2 – a minor miracle given the pounding - but the rock had started to roll down hill, and it didn't stop until price dropped a total of $15 over 5 days.
Was the top “caused” by these volatility events? Its hard to say. Had the bulls been strong enough to push price over $50 in days #4 & 5, its likely the volatility event on day #6 would not have worked. They don't seem to work too well during an uptrend. The silver bulls had two free shots to move price above $50, completely unopposed by any volatility events at all, and they failed. Once they failed, that's when “someone” launched the second volatility event storm.
Looking at the price chart alongside the volatility event chart, it does not look like a straightforward case of “someone successfully causing the top” through direct application of force. First they used a stall to stop the upward momentum in a very extended market which resulted in the doji print, and then the buyers were unable to muster enough power to push prices higher, and then “someone” unloaded with maximum force once the buyer fatigue became apparent. That's how I read the chart anyway.
What would have happened had someone not unleashed the volatility storm on day #6? We will never know. The market would have eventually corrected at some point – no tree grows to the sky - but its hard to know how much higher it might have gone.

* * *
In Part 2: How To Protect Yourself & Profit From This Manipulation, we look further into the recent data to determine whether or not the downward manipulation of precious metals can continue as it has over the past few years. Bullion investors will be heartened to learn of the signs we're seeing that $1,05/oz gold may have been the bottom, and that brighter days may indeed lie ahead.
True or not, though, the manipulation attempts are likely to continue for some time. We look at how bullion investors can position themselves to defend against the most predictable elements of these raids, and how brave souls interested in speculating may profit from them.
Click here to read Part 2 of this report (free executive summary, enrollment required for full access)
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Manipulation?
LOL!
you Mean you guys really Believe in that?
IT'S JUST ANOTHER CONSPIRACY THING!!!!
Like the stock market being FAKE! LOL!!!!
Goldbugs tend to believe they are a heavily persecuted lot
Nobody knows the trouble I've seen.
It was a decade ago.....maybe more. Masked men rushed in and forced me to buy gold at $273. Then they mocked me as gold went down to $256.
It was a horrible experience.
hang on...so you're telling me that gold prices are manipulated ?! Hahaha, right .... next you're gonna try telling me that our president is a mus...
'The sheriffs a ni....'
He's near?
Strike up the band!
NEWS FLASH!!!!!
Everything is manipulated...
I heard that it only costs $5 to wrap a gefilte fish in paper gold. (or something like that)
I think you're confusing your currencies...
It costs only $5 to mine a BitCoin out of the interwebs.
Bitcoin is a currency? Who knew?
Want "Smoking Guns" ???
Just Check the WEEKLY comex cots...
Changes In Positions - Contracts:
Latest SILVER Commercials: LONG -3,922 SHORT +5,202
Latest GOLD Commercials: LONG -4,182 SHORT +25,843
WHY ????????????????
http://www.cftc.gov/dea/futures/deacmxsf.htm
I know some people that need to smoke some guns.
Lloyd needs to open his mouth pretty wide for that one, but he's got practice.
Dimitri Speck has already statistically shown where the price manipulation occurs - at the LBMA P.M. Gold Fixing time:
http://goldsilverworlds.com/price/gold-and-silver-price-manipulation-explained-by-dimitri-speck/
They are trading over 150 million oz. of digital (fake) gold per day in London - that is 1.5x annual mine production traded per day:
http://www.safehaven.com/article/36534/lbma-data-points-to-gold-and-silver-default
What's interesting to me is that every analysis I've seen on this subject ignores the elephant in the room - that just inducing volatility in a (supposed) "safe-haven" asset reduces overall demand for that asset.
Unlike every other "commodity" (bear with me here), only 10% of gold (and 50% of silver) end-user* demand is based on "use" as a commodity; in other words, 90% of the end-user demand for gold (or 50% demand for silver) comes from people who believe these metals will offer some kind of long-term storage of value.
If the paperpushers can knock the price sky-high and then smash it down to less than half its previous value, it doesn't matter if nett-nett they haven't changed the price overall; the real damage to the price arises from the fact that many people will be put off owning PMs as a store of value, because they perceive values to be too volatile. ie, medium/long term demand for the physical metal has been reduced.
This is why TPTB ignore these manipulations; because they reduce long term trust in the only real competitor to their chief product: fiat currency and other debt instruments.
*as opposed to paper speculators
Agreed Jim.
Stay out of gold because it's way riskier than holding paper created by the trillions in the financial system.
For safety, nothings better than flammable paper.
http://goldsilverworlds.com/price/gold-and-silver-price-manipulation-exp...
Thas ray...
A bitcoin represents a solution to a very complicated equation. One use is to demonstrated Irrefutible evidence of "chain of custody". Consequently, it is a very valuble method to "seal" transaction across a computer network!
Many are challenged with abstract resoning.
""chain of custody""
I'm not sure that I am comfortable with this. So it's better because they can track it right to you?
"Many are challenged with abstract resoning."
And others, with spelling. Your point?
Chain of custody as in one can see the impact of any one wallet holder, so long as the impact is big enough. One cannot necessarily reveal who the true owner of a given wallet is however, but once that is known, it is indeed known for all time.
My proposed solution to this is a wallet app which allows people to store several wallets with fixed amounts of bitcoin in each, and swaps these equally sized wallets with others randomly, to make it so that one cannot know for sure who is holding which wallet when, other than at the time of any one given transaction.
Including the standard of living in the West... In our favor.
This article is called have your cake and eat it too. Something Gold bugs suffer from quite terribly.
Your Gold and PM's can't be worth a lot, yet your standard of living remain the same. Since this implies your currency is worth less. (Maybe ok if you are retired, but if you work in the worthless currency, having PM's will only subsidize you until you run out)
Considering the West are deadbeat nations that produce nothing and only export misery to the developing world -- you need to remember these key facts when reading these articles trying to sell you on BS.
While you are correct about the production in the West, many people miss this paradigm shifting point: That is, with robotics, there will come a time when production is cheaper here in the West with robotics than 'slave labor' overseas. At that time, production will return to the West or US simply because of economics and reduced shipping fees.
There is still a huge problem with wage distribution, which will also worsen with the rise of robotics and free labor... but that is another topic for another article. Gold and Silver are super relavent in terms of wealth protection AND advanced technology applications.
In order of my investing importance for me: Silver, Miners, Avanced Robotics, Solar Tech, Mining Tech (seafloor & asteroid), Bitcoin, other blockchain technologies, Gold, other tech/3dprint/companies... And... waiting for some good 'green stocks' once MJ is legalized in the US federally.
BTW ZHedgers... I'm a long time reader, first time blogger. I absolutely love all the insightful information and discussions you all post here daily. Thanks.
I have a new anti manipulation app to un-manipulate the markets to make trading safe.
Queer
http://weknowmemes.com/wp-content/uploads/2012/03/im-telling-you-the-man...
Go to Kitco and follow along at about 2:15 a.m. EST and see. Almost every Sunday night and most nights during the week. I believe this was also the time "someone" dumped 2.7 million ounces all at once and dropped the gold price over $50 in about 2 minutes. Momentarilly shut down the gold market twice. Why would anyone dump all that at once at the low volume of the day? Only a select few culprits could even carry out that.
If I could sell 100 times the amount of Gold in existence I bet I could move the price at least a tiny amount.
I think you will find they have been selling 200+ times all the gold in existence.
I think the same solution should be applied to housing. People don't need housing at the same time. Some sleep at night some sleep during the day. Some work from home, some don't.
I think that the housing bubble can be furthered....
pretty much yup
Paper Gold trading at over 250 times the Physical.
Silver who's trade vs. Gold has been 15 Oz. silver per one Oz. Gold.....Now above 70 times or
70 oz. siver = 1 Oz. gold.
I'll take 100 oz. Silver.........Physical Alex.
( Wondering since Jewish Bankers Control and buy out Governments...I think the American Gold has left the Building).
Paper Gold trading at over 250 times the Physical.
Like a 100% are going to want their gold all at the same time.....think Mcfly think!
https://www.youtube.com/watch?v=kh9PYtmVybU
Errrr what do you mean "their gold"? Are you saying their gold actually exists? Mcfly probably thought about it more than you did smartass.
/SARC <------forgot to give you that.
oh ok. just don't do it again :-)
1% is all it would take
Silver who's trade vs. Gold has been 15 Oz. silver per one Oz. Gold.....Now above 70 times or
70 oz. siver = 1 Oz. gold
JFC, not this again. When silver and gold were both money, they traded - surprise! - at roughly the ratio they are found in the earth.
Silver started being demonetised before the end of the 19th C and its value relative to gold has dropped ever since.
IF silver and gold were remonetised, they would (probably) trade around 15:1. Do you genuinely think this will ever happen again? Gold is hoarded by central banks and the rich. Silver is not. If gold is ever monetised again, its value will rocket relative to silver.
Half of all silver is used up in industrial processes. That still means half a BILLION ounces are hoarded as bullion/coins/tableware, EVERY year, and ready to be dishoarded if the price rises sufficiently.
Silver production is RISING every year, too. Look it up.
I keep hearing, YEAR AFTER YEAR AFTER FUCKING YEAR, about the imminent silver "shortage"... yet it never seems to arrive. I see the COT stats, the charts, the backwardation, tales of the US Mint's inability to deliver Eagles (as if that is somehow indicative of a worldwide shortage, LOL) yada, yada, yada, endless breathless tales of how silver holders are gonna get rich ANY DAY NOW.
I own a shit load of silver and wish I didn't.... but it's a small market, so the banksters may manipulate its price back up, like in 2011, in which case I'll be selling it hand over fist to buy gold... depending on the GSR, if that's still above 70 and we get back to USD30/oz I'll buy something else.
Wake up, people, most of us have been had. We may not get our money back for a very long time. If you bought at $4, $5, $10, congratulations. But a lot of us paid rather more.
There are as many charlatans selling silver and gold as there are stocks and bonds. Yes, I know the dollar will ultimately lose value vs PMs. But in the long run we're all dead.
PONZI
Given how important the subject is to the bullion-owning community,
And that's a really really tiny community. Kind of like talking about the Picasso owning community.
The Dynasty of Rothschild | The Only Trillionaires in the World - Full Documentary
https://www.youtube.com/watch?v=5rtRL0vvUBQ
Silver is the walking wounded here. There has never been a commodity with the massive open interest, gigantic commercial bank shorts and continuous asswhuppings silver has suffered.
It's all perfectly legal, the USG has given itself permission to interfere in all our markets long ago.
What can be done?
BUY BUY BUY
I have been assumming the pecious metals were going down in dollar terms because of the amazing economic recovery of the United States. You know, the budget surplus, the trade surplus, all the job openings even though we are already nearing full employment, the wage growth, and of course, the dwindling number of people on government assistance. Did I miss anything? I don't have time to think of more, I have to get back to watching Rachel Maddow....
Sorry Conax, the imminent silver shortage is a myth. Tha fact it gets trumpeted every year, but never seems to arrive, should clue you into analysing the figures a bit more closely. They're pretty sobering. Yes, half of all production winds up being dissipated in industrial use, but that still means half a BILLION ounces are hoarded every year.
There's no shortage of silver. Maybe there will be - assuming industrial use continues at its present rate and mine supply eventually drops appreciably - but it could be YEARS away.
There's no reason to believe that $15/oz is particularly cheap when half of all demand comes from small-time buyers like us.
just becasue they sell stuff that doesn't exist in reality only iin a paper contract which they have no way to deliver on and they multiply one ounce of physical into 100 ounces of papers that does not mean it's manipulated! come on
Jon,
Does Kitco know you're away and posting on ZH?
Daniela is coming for you Jon...and she doesn't look happy.
Jon is a long time ZHer. One of the good guys here.
I might add that the 2011 and 2013 shellackings of PM prices occured simultaneously with the Bin Laden and Boston Bombing false flag events (for those who need moar tinfoil). You really can't make this shit up it is so over the top and bizarre.
Hidden in plain sight too.
looks like they're fixin to kill bin laden again.
I might add that the 2011 and 2013 shellackings of PM prices occured simultaneously with the Bin Laden and Boston Bombing false flag events
I guess that proves that OBL and the Dunderhead Brothers were manipulating the price up; once they were out of the picture, the price fell to its genuine value.
Pool
I told Kitco it's some loser pretending to be the real Jon Nadler, not really me, a fake me if you will, which when they think of a fake Jon Nadler it makes them thnk it's really the real Jon Nadler, but not in a real way. Anyway sell gold because it's for losers and you can't eat it
You missed the 'margin' manipulations. I wonder how that would have added to the story. 5 margin calls in 8 trading days was real significant in effecting silver prices.
http://www.reuters.com/article/2011/05/05/businesspro-us-markets-silver-...
The most obvious tell of all.
"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K."
-- Eddie George, Governor Bank of England, in a conversation with Nicholas J. Morrell, CEO of Lonmin, September 1999
And the battles to keep the financial sociopaths afloat continue.
Modern Central Bankstering is a Ponzi.
"Paging Trader Dan... Dan Norcini to the BOE courtesy desk please!"
Great analysis, Dave Fairfax - there is not 1 in a trillion chance that gold and silver are not manipulated lower. Archived this data for future reference
More proof:
The seven sigma event in the price of gold that we had on April 15th, 2013 can be expected by random chance once in every 7.76e+11 days. Or it can be expected once in every 3,105,395,365 years of trading.
That is all the proof you need to know that the gold market is manipulated.
The late Adrian Douglas (former board member of GATA) covered this issue in detail way back in 2011 at the London Gold Conference.
https://www.youtube.com/watch?v=GmpVurAewpo
https://www.youtube.com/watch?v=mY32aVrDhGg (Part II)
It's clear from this article that the focus on gold is as a "unit of value". It is obviously not a useful store of value.
It also shows that the value of this unit is very easy to manipulate.
So what value is it as a unit of measure?
Wouldn't we be wiser to reduce all value to units that can't be manipulated and that never change over time? Wouldn't it be wiser to choose a unit that quite strictly follows population?
I suggest the HUL ... The Hour of Unskilled Labor.
Does anyone know how many ditch digger hours an ounce of gold would buy in 1913? Today it can buy about 144 minimum wage hours. In 1960 it would buy about 23 summertime job hours.
A minimum wage hour today is certainly worth the same as a summertime job hour in 1960. Thus, using gold as a measure of value where the disparity is a factor of 5 is pretty silly isn't it?
Or we could just go back to conducting trade in physical PM and semi-PM coins and let the market sort things out. Besides, somebody would figure out how to print HULs so that they could lend out more than are available.
Or we could just go back to conducting trade in physical PM and semi-PM coins and let the market sort things out.
But that adds two more unnecessary degrees of freedom. The supply/demand ratio for the PM varies all over the map. And as we can demonstrate relating PM to Hours of Unskilled labor, the perceived value (as opposed to the actual value it delivers) also varies all over the map. Why add this complication ... unless to give PM miners and holders of PM an advantage and control over other traders?
Besides, somebody would figure out how to print HULs so that they could lend out more than are available.
Not with a properly managed MOE process they couldn't. They would have to return and destroy the exact same number they print. Otherwise, they are counterfeit. Counterfeiting is a problem with any MOE.
You are still talking about a system where human management is intrinsic. It will be coopted and future generations will be sorry.
You are still talking about a system where human management is intrinsic. It will be co-opted and future generations will be sorry.
I have "never" been talking about a system where human management is intrinsic.
I'm talking about a transparent "process".
In the aggregate, the integrity of the process is easily known by showing that defaults are perpetually balanced by interest collections. It is optimized by employing actuarial techniques, just as a mutual insurance company does today (while maintaining the relation CLAIMS = PREMIUMS it attempts to classify risks and charge accordingly).
With the MOE, the risks are "propensity to default" and the charge is "interest collections".
The flaw in this logic is in ignoring inflation and assuming that real wages have remained constant. Another perfectly valid conclusion is that minimum wage in 1960 could buy 6 times what it can buy today. For purposes of evaluating pay, it is completely false to claim that "A minimum wage hour today is certainly worth the same as a summertime job hour in 1960," even if the amount of work done is the same.
Fail.
Did I miss a sarc tag somewhere?
The flaw in this logic is in ignoring inflation and assuming that real wages have remained constant
How do you "inflate" an hour of unskilled labor. In my lifetime I know many data points for hours of unskilled labor. The number of dollars they bring varies all over the board. But the amount of work they do hasn't varied in my 60 years of paying attention.
It is completely false to claim that "A minimum wage hour today is certainly worth the same as a summertime job hour in 1960,"
Why? I don't recall there being a minimum wage in 1962 but I know my unskilled hourly labor was worth $1.50/hr to the nurseryman I worked for. I suspect a nurseryman today can hire a helper for about minimum wage ... and get the same amount of work done that I did.
Did I miss a sarc tag somewhere?
Absolutely not. You missed the whole point.
OK, let's look at that another way.
The price of a gallon of gas in 1964 (last year silver was used to make dimes, quarters, and halves) was about one silver quarter = $0.25.
The price of a gallon of gas in 2015 is about one silver quarter, which now doesn't equal $0.25, but rather = $2.86.
So, the cost of the kind of things your hourly unskilled laboror can buy priced in terms of silver (and by proxy, gold) hasn't really changed that much in the intervening 50 years. But his ability to convert his houlry wage (paid in fiat dollars) into those things he would buy with that wage HAS CHANGED DRAMATICALLY! If you were paid $1.50 in silver quarters back then, you would need to be paid $17.19 in today's fiat dollars to have the same purchasing power. I doubt you would be able to find a nurseryman today who would hire you for that wage.
You incorrectly restated my argument above, wrongly asserting that the worker's hour of labor had been inflated. That is not correct, and it is not what I wrote earlier. His hour of labor has experienced DEFLATION, meaning it is worth less over time, in terms of the dollars in which he is paid. The DOLLAR, not the labor, has been inflated. And, since wages are denominated in dollars, you can't accurately use an hour of unskilled labor as a yardstick for anything that doesn't take the inflation out of the equation.
The Tylers have covered the collapse in real wages extensively in these pages. You might do well to search for some of these articles.
And, since wages are denominated in dollars, you can't accurately use an hour of unskilled labor as a yardstick for And, since wages are denominated in dollars, you can't accurately use an hour of unskilled labor as a yardstick for anything that doesn't take the inflation out of the equation.
Amazing! How can you so totally miss the point? I'm saying if the MOE was denominated in Hours of Unskilled Labor (HULs), it would be better than denominating it in something fictional (an manipulatable) like dollars.
The dollar is a terrible unit of measure. It is subject to supply/demand manipulation, policy manipulation, counterfeiting by governments, and cost (interest) manipulation.
A hole in the ground can always be related to Hours of Unskilled Labor (HUL).The only difference over time is the cost of renting the shovel which would always be trivial compared to the labor component of hole creation. The value of the hole itself may change dramatically over time.
Take your example with gasoline in HULs. In my 1962 summer job paying $1.50 an hour I could buy 7.5 gallons of gas with my unskilled labor hour. Today, a minimum wage HUL of $8.00 will only buy 3 gallons of gas. That's a 60% reduction (2.5 times). A 1962 quarter would buy 1.25 gallon of gasoline in 1962. Today it will buy 1/13th of a gallon. That's a 94% reduction (16 times).
But we know the "value" of a HUL didn't change. It takes the same number of HULs to produce a given size hole in the ground today (with a shovel) as it did 2000 years ago ... and in 1962. The gasoline, on the other hand, changes dramatically with changes in exploration, production, refining, transportation, and delivery. And the value of the dollar changes dramatically with government counterfeiting and bank usuary.
My point again is that we should use units of measure that don't change over time and which are not subject to manipulation. The dollar (and an ounce of gold or a gallon of gasoline) clearly do not meet that requirement.
I believe i now understand your mistake: You are assuming that the TPTB want to have an accurate, non manipulative solution.
I believe i now understand your mistake:
Of course you are being sarcastic but unfortunately people take as a given that you can't effect change. The rot creeps quietly into processes and hides itself. But you can't remove it quietly. It takes a meat ax.
Who wields the ax and when?
How does he decide what is waste and what is good when he wields the ax?
There is no need for lengthy comparisons in some imagined scheme. Gold equals honest money. There are those who 'value' that timeless standard and there are those who don't, and will come up with you-name-it-excuses to justify their position.
The End.
Every single person who claims an absolute, such as "The End" is ALWAYS WRONG.
Gold equals honest money.
Oh really?
And does silver equal honest money? At the turn of the 19th to 20th century there was a big argument about that.
And does platinum equal honest money? What happened to its value when it became necessary in catalytic converters?
And does oil equal honest money? What happened to its value when they discovered Spindletop? When the internal combustion engine came into wide use?
And what of the honest gold money when the Spaniards plundered the newly discovered Americas? And when new sources were found in California and Alaska?
Calling a commodity money is just plain stupid!
Money is a "promise to complete a trade". It is created by traders making trading promises and destroyed by traders delivering on those trading promises. It has always been that way. It will always be that way.
Every other contrivance is injected by money changers claiming a percentage of every transaction ... and governments needing a funding source for their natural bloating tendencies ..l. or in the case of gold, by those who control it.
WTF kind of post is that? Good grief man....get a grip.
I just read that post after responding to the one he/she/it made above; and now, I'm regretting trying to talk sense into this troll. Beyond hope.
I'm regretting trying to talk sense into this troll. Beyond hope.
My feeling exactly. But if we people with sense (who know that "money is a promise to complete a trade") don't prevail, at the reset we're just going to adopt an equally bad system that just favors a different constituency.
A properly managed MOE process favors no constituency.
To prove my point:
Compare the wealth of someone holding it in gold with someone holding it is timber ... before and after gold is claimed to be money and the value is fictitiously multiplied by a number sufficient to be a store of wealth.
I never get a response to this from those claiming to "talk sense".
You do not understand what money is. Your comparison of gold to timber reflects this lack of understanding.
Please go watch some of Mike Maloney's videos on the topic: http://hiddensecretsofmoney.com/
Your comparison of gold to timber reflects this lack of understanding.
I should not have to watch your video. You should be able to state your own case in 200 words or less. I can do that and have done that repeatably.
WTF kind of post is that? Good grief man....get a grip.
Getting a grip with gold bugs and others totally clueless about money is like squeezing a wet bar of soap.
Fiat is a promise to pay(credit)
Gold is payment!(money, no counter party)
Gold is payment!(money, no counter party)
So gold is not money. Money allows simple barter trade over time and space with efficiency. Gold doesn't do that.
What is the counter party distinction? It means nothing if the trade is on on-the-spot.
The underlying concept of money is a promise ... just like the underlying concept of a contract is a promise.
OK welll In in the early 20th Century a Silver dollar was a Days wage for Doctors, Lawyers and Merchants....How would you like to try getting by today on $16 per day?
Get rid of fiat and fractional reserve banking, and you'd find that the value of silver and gold relative to everything else becomes drastically different.
you'd find that the value of silver and gold relative to everything else becomes drastically different.
Correct. But I won't find it to be as stable as the value of an Hour of Unskilled Labor (HUL).
Logic alone proves this. If you have a fixed amount of gold and a growing population (which is using gold as a MOE), the goldis going to become more dear with time. You don't want that with an MOE. You want zero inflation of the MOE itself.
OK welll In in the early 20th Century a Silver dollar was a Days wage for Doctors, Lawyers and Merchants
The question we should be asking is "how has the ratio of an Hour of Unskilled Labor (HUL) to an hour of Doctors, Lawyers and Merchants time changed?" How many ditch digger hours would a silver dollar buy in the early 20th century? An automobile was about $500. A Craftsman kit house on a lot was less than $1,500.
Since the dollar is manipulated all over the map, it's not a good measure. I suspect all these professionals are more proud of their hours today than 50 years ago (in fact I know they are ... and they are worth less), but the ratio change is far less dramatic than dollars would suggest.
And then we have the ridiculous numbers that a JPMorgan then and a Jamie Diamond now command.
Over the past 15 years alone the "disparity factor" for gold has been a factor of 7, and even the last 10 years the disparity factor has been 3 to 4.
The gold bugs can only see a year or two back and ignore what happened before that. 15 years ago the price of gold was about $250/oz, and 10 years ago it was $500/oz
I suggest the HUL ... The Hour of Unskilled Labor.
You don't understand money. In a true free market system, people trade anything they like as money: debt; interest-bearing debt; gold, silver, beaver skins, whatever.
Whereas in our vile fiat system, we trade debt issued by commercial banks, backed by the tax-gathering (and bomb-dropping) abilities of our beloved government.
In the free market system - which is what (in many respects) existed before and (to some extent) during the classical gold standard, the value of money wasn't "chosen" to be the "value" of gold or silver. Gold and silver WERE money; the amount of money in circulation was restricted by the amount of those metals (and debt derivatives based on them), not their "value". Furthermore, the purchasing power of those metals - which is really what their "unit of value" equates to - would depend very much on monetary velocity and supply of goods/services. When crops failed, money's purchasing power fell; when crops had bumper years, the opposite happened.
How do you tie a currency's "value" to an hour of unskilled labour? Who issues it? How much do they issue? Less when there's no unskilled labour going on? What does your proposal even MEAN?
You don't understand money. In a true free market system, people trade anything they like as money: debt; interest-bearing debt; gold, silver, beaver skins, whatever.
No. It is you who don't understand money. What your describe is just simple barter exchange (and money is the most common object in one side of simple barter trade). But money is "created" to enable simple barter trade to span time and space. It is created by traders making delivery promises and getting them certified (recorded and monitored).
Whereas in our vile fiat system, we trade debt issued by commercial banks, backed by the tax-gathering (and bomb-dropping) abilities of our beloved government.
In our system we trade (as one side of almost all simple barter exchanges) certified trading promises. They are created by traders and certified (in our present system) by banks. They are destroyed when traders return them signifying delivery on their trade. In the mean time, they are exchanged as the "most valued" object of simple barter exchange. We know them as money and they are typically just record entries. In our current system, banks have granted themselves arbitrary interest collections. In our current system governments have granted themselves free counterfeiting previleges. It doesn't have to be that way. It "is" that way because we traders (and those who are so hopelessly confused and hoodwinked) have allowed it to be that way.
the value of money wasn't "chosen" to be the "value" of gold or silver.
Value is determined by traders. It always has been and it always will be. If an economy uses gold and silver in their tradition, the value of that material will be closely related to the cost of producing it.
the amount of money in circulation was restricted by the amount of those metals (and debt derivatives based on them), not their "value".
Correct. And that gave them "artificial" value as a Medium of Exchange. It favored traders who had access to gold over those who didn't. That's why it was ... and is ... a horrible system. The value of the MOE itself should be inflation free. A system based on any commodity will never exhibit that characteristic.
which is really what their "unit of value" equates to - would depend very much on monetary velocity and supply of goods/services. When crops failed, money's purchasing power fell; when crops had bumper years, the opposite happened.
In a properly managed MOE process, the things you enumerate like "velocity" and "supply" have no import whatever. This is because traders are free to make delivery promises any time they see clear to keep those promises.
Your illustration of crops has nothing to do with money. It has to do with the supply/demand ratio of the object being traded itself. With a properly managed MOE process, supply and demand for the money itself is in perpetual perfect balance. Its the nature of every trade.
How do you tie a currency's "value" to an hour of unskilled labour?
By relating things to hours of unskilled labor (HULs) just as now we relate dollars to things we are familiar with. The key is that a HUL never changes value. The dollar changes value according to government "policy" and money changer "manipulation."
Who issues it?
The MOE management process issues it in response to traders making delivery promises and getting them certified. It is a record keeping process. The trader promises to return the certificates when he delivers on his trade. The process monitors this. If the trader fails to deliver as promised, the process immediately recovers those defaulted certificates with equal interest collections. This guarantees zero inflation of the MOE itself. In practice it's an actuarial process.
How much do they issue?
The number the trader requests to certify. It is the trader who decides the value. He must return exactly that number when he delivers as promised ... no more ... no less.
Less when there's no unskilled labour going on?
There doesn't have to be labor going on ... any more than there has to be inches going on to describe something's dimensions.
What does your proposal even MEAN?
It means a process that:
the whole system is manipulated, we don't know of any difference
Stocks, bonds and currencies are manipulated too!
My Above Comment was SARCASM... Silly Rabbits.. JEEZZZUZZZ
Pray for the irony impaired.
Volatility, induced or natural, Wall Street's second best friend..
Always ----- ALWAYS, at the end of these articles, this:
'The world as you know it is coming to an end, but... If you follow us, you can still $$PROFIT from the Collapse...!!!
These Fuckers deserve the Luca Brasi treatment as far as I am concerned...
the world as we HAVE Known it... IS coming to an End.
the only Question is WHEN
Also it remains UNKNOWN
IF Gold and Silver will SAVE Anyone..
Many Variables..
"So goldbugs, take a victory lap! "
Yeah do that. The silver bugs will be on the podium with the champange and women.
Hedging is a great concept, Derivatives are a great concept. But it should be illegal to settle anyting other than physical or in the case of trading CDS that I actually have an interest in the underlyer. Pretty simple really. Otherwise, these markets can easiy be manipulated. Markets owned by Banksters. Banksters own the Politicians. Politicians lie to the people they are supposed to represent. God bless the fucked up "democracy" that is the USSA. You have been high-jerked. Greatest swindle of all time. It's a big fucking club and you ain't in it.
Fractional reserve banking is a ponzi. Get rid of it. If you lend money to somebody, it should not be avaliable to you until it is repaid. Otherwise, you wind up with a system that MUST grow, else it will collapse, and nothing can grow forever. We have hit the end of that growth, and it is being replaced with fraud more and more every single day. Derivatives and whatnot are part of that fraud.
Actually, it's a SMALL club (by its very nature).
You may want to think it through, rather than just regurgitate a misspoken line from a comedian-cum-philosopher.
Manipulation? Of course there is manipulation. That's what all equity markets are about, manipulation. Once we buy a position, we all stand on the sidelines and try to cheer it upward.
The harder you push something down however, the more it bobs up on the recoil.
Manipulation of the gold and silver markets is as old as the hills. Look up Jim Fisk, Jay Gould and Cornelius Vanderbilt. Look up the Hunt Brothers. This is why gold is such a poor medium of exchange. It's too easily manipulated. Look what happened to Venezuela after it repatriated its gold! Now as they're selling, they are getting just over half of what gold was trading for when they demanded repatriation.
The Chinese and the Indians are going to be in the same boat soon enough. Gold isn;t money. It's a commodity.
The problem with gold and silver right now is, contrary to all the hype from those who make a swindling living selling the precious metals, each are at historically high price levels. Now is the worst time to buy either gold or silver. If you seriously wanted to be a precious metals trader, you should have begun your quest nearly twenty years ago. Since then the price of gold has increased four-fold, more than that at its long ago laughable peak of near $2000 an ounce.
Now, gold is looking to collapse again, even worse. No one's got no money!!!! The FED is actually trying to push gold higher, not lower.
Come and get it! LoL Put your money into buying something that is appreciating, like plumbers, electricians, heavy equiment operators, and mechanics, or better still, competent salespeople, engineers, accountants and lawyers.
These skiled labor markets are skyrocketing in value. There is a very real shortage of skilled labor. And when you need these guys, unlike gold and silver, you have got to have them. There's no choice about it.
The only skilled labor market that is rising is CEOs who break the law.
each are at historically high price levels.
1) Moron
2) Liar
3) Lying moron....
There are many down-thumbs for this post here. The problem for gold owners is that this post is spot on. NOTHING has value intrincsically. This is the primary take that I have on anything. Look at cars: this is a perfect example. Depreciation is built in by a Blue Book page entry, nothing more and nothing less. It is MANIPULATED to lose value over time (most cars, anyway). WE ACCEPT this. How many times have you traded in a vehicle only to be told, "that car is worthless to us." This is due to manipulation in its worst case example. It is the same as Gold. The example of Venezuela is PERFECT. TIMING is the value. There is therefore VALUE IN TIME. What time is it? HOW MUCH VALUE do you ascribe to anything tangible. I am living on a property and looking at a "vintage" Cruiser boat that I would not offer a dime to the owner for acquisition. WHY is he working on it? He is actually spending money to fix something that is worthless to me! ONLY TIME will tell. But, at this very moment, this timeframe, I would not be sinking cash into this machine. So, the frustrations with Gold and its marketed value is only as precious as to how LONG you are willing to hold it, with hopes and dreams. So long as someone else has the edge in volume over your holdings, you will lose money in Gold. By the time it is worth something, it will be too late to own. And, when you get ready to cash it in, will the timing be right? Only time will tell.
The bold font doesn't improve you argument.
Ask yourself why the CB's hold gold and please don't say "tradition".
Yep, and gold has even less intrinsic value than other commodities becasue it's never "used up". Only 12% of annual gold prodcution goes to industry and is consumed (and much of that is later recoverable), so that means the stockpile just keeps getting bigger and bigger.
Without industrial demand, it means the value of gold is entirely speculatory. So the value will fluctuate wildly based on SENTIMENT, not need.
Your characterization of the gold market in general is absurd and wildly off the mark. Industrial demand? LOL...
Maybe go back to the start of the article and actually read it?
The article makes a lot of wrong assumptions.
And my characterization of the gold market is a lot closer to the truth than any gold bug will admit. Gold demand is all about tradition (as gold bugs believe) and greed, not "need".
If SHTF worldwide, as it partially did in 2008, the price/value of gold will DROP very substantially, as it did in 2008. Why is that? Let's hear your excuses.
You don't argue the facts, so why bother with your anti PM propaganda? And btw, gold and silver have already dropped substantially (in USD terms anyway).
At least your name fits you in Greek, "useless". Funny you blast them all the time as well yet don't acknowledge those Greeks who held some gold and helped to save themselves from financial misery (36% living in poverty now).
https://en.wikipedia.org/wiki/Anopheles
The Greeks who held USD did far better than holding gold over the past few years.
Greeks use the Euro but I guess you are too fucking dense to realize that fact.
Gold up 154% in USD and 168% in Euro terms the last ten years.
And what about the past 3 years? Why pick an arbitray value that only supports your theory?
How about the 20 years before 2005 when interest rates were very high and gold and silver did NOTHING?
Why argue about a value that is clearly manipulated. Why say the gold price has come down in recent years if all the mechanisms of demand and supply have been outstripped for a ponzi scheme. If you knew something about this topic you wouldn't be using nominal value at face value. Plus for a starters, you say the quantity of gold in circulation has only increased in recent years? What about the quantity of Dollars in circulation?
You brought the Greeks up on the other thread, not me. I was simply responding to your false claims.
You're such a shitty troll you can't even keep your lies straight, let alone stay on point.
WRONG AGAIN! Tradition? LMAO! Then go ask the central banks why are they storing the shit out it. Must be tradition.......
You forgot to add the human progress factor. The population growth has outgrown the gold. The assets created has outgrown the gold supply. If this were not the case, gold would still be at the $35.00 an ounce when Nixon yanked it out from behind the currency. Using your logic, it would now be even less than $35.00 an ounce as the supply has expanded and hasn't been "used up" since then.
Another IDIOT! So you are saying that Paper gets used up.... how about those 1's and Zeros?
@FED-Up with Bei... Go back and read your post and put USD in every place you have the word GOLD. You will see why you are wrong! Money loses value over time....it's called inflation. If you have noticed..... GOLD has gained value over that same timeframe. You are completely wrong!
Hey Fed up
How much would you pay for his boat when the local river is "five feet high and rising"?
And if you pay them with Zimbabwe zim dollars, you really got yourself a bargain.
Everything and I mean everything is manipulated. Whether it be public opinion, elections, politics, interest rates, the stock market, crops etc they are all manipulated.
What they can't manipulate is the inevitable. Only its timing but not its happening.
All I know is that the day when the economy is booted out the plane, the only parachute that will open is gold and silver.
I"ll buy what has been manipulated down....you idiots out there buy what has been manipulated up.....
Anything that can be manipulated will be.
Oregon marijuana sales equaled 10.8 million in first 6 days after legalization....Much more than colorado and washington first week sales. Green gold??
Sure, until the federal government decides to clamp down on it. If too many states go the way of CO and OR, the DEA might have to cut some jobs.
Anyone who has kept current with GATA for the past 16 years knows this article is a re-write of GATA's voluminous research. GATA has done the heavy lifting. Yet not a word from peakprosperity about GATA. Unbelievable, but not surprising. Here's a tip for peakprosperity: The Titanic was reported lost in 1912. Check on that rumor also, if you will.
exacty,this author really believes to be breaking new ground? his constant referral to "gold bugs" should give you a clue of his/her level of ignorance of thousands of years of gold history,remember those crazy byzantine gold bugs? perhaps he is a "stock bug" or a "bond bug" or even worse,one of those dreaded "fiat money bugs" ? thanks for coming though!
Fiat money is ponzi king!!! How dare you non chosen ones speak about our gold.
Sell your gold!! We will give you worthless paper (aka shekels) for it.
Hey. When you think of it, those foil covered chocolate coins are at least edible. Eating paper dollars won't do much for your digestive tract.
You can look at all the technicals you like but if a mine can sell silver for a profit its not manpilulated is it.
Huh?
I love my gold and silver but I am also a carhead. I found this gem on craigslist and it looks awesome. I love the classy touch of having white walls on the front but not the back. Better yet it has a V8 engine. That is so redneck and I love it. I already called the guy and I am on the way with cash. Mrs. M already gave me the middle finger. She says it is an old lady car.;-) That may be so but she is not young anymore either but more importantly if you a smash into a Prius it is pretty obvious who will come out on top. I like my metal no doubt. If I buy this car it will be my six or seventh car so far this year.
Keep stacking metal of any sort.
I bought that car. Had to.
Comparing the natural gas market to the gold/silver markets? Natural is traded by both financially and physically at city-gates. If you want the two to converge, you need to take delivery.
What's bullshit about the paper gold and silver markets that the market operator can declare a financial settle on a physical commodity. I don't want $X worth of gold. I want gold.
This has been studied already and is common knowledge among educated PM holders. But the data here is only based on non-US and European market hours. If you add in the U.S. opening slam, the "after Denny's grand slam" slam, and the into the close slam it would look a hell of a lot worse than that.
I suspect though that this will be coming to an end sooner than later however. I had a thought the other night about how China could retaliate for the soon to be "sail-by" of the Spratleys... Not a shot fired, or a missile launched- but rather a COMEX cleansing event.
Can or will anyone name the mysterious "Someone"?
Goldbug Silverbug..BAH Whatever is being manipulated, I hate being pidgeonholed into those groups.
Most guys are probably like me....I did some research, i don't have much faith in governments or their ability to stop the debt spiral and currency meltdown.
i own a small pile of gold/silver for those reasons. That makes me a good father/husband for my family, NOT a paranoid schizo.
Most sensible post I have read on ZH for ages.
www.teamramgold.com/about-us
My pet rocks look just about the same as when I bought em. Maybe its the perceived value of the dollars I used to buy them that is different today.
Good job explaining the 4/25/11 topping event. The crippling volatility events were executed by a very deep pocket. Next question....Who?? Can these conspicuous trades be traced to the trader/money source?? Has it been the same source the entire price decline, 2011-2015?? To me, this is the real critical question to be answered.
Ask Andrew Maquire. Make sure your gas tank is full though.
It's easy to blow the lid off any doubt. Simply make it a law that all gold contracts cannot be settled in paper dollars. All contracts must be settled with actual physical delivery. Can you spell "skyrocket?"
I'm smelling the bovine excrement presented in the article.
Gold is, and always will be, a fundamental tool in Central Banker's bag of tricks. And, as they have to maintain the illusion their bits of paper have intrinsic value they're forced, ubder the "Theory of Rational Expectations" to have visible signals to inspire confidence. Gold, being real money with intrinsic value, rare easily stored, is their tool. By weakening the price of gold against their fiat they can illustrate the "stength" of their paper. Conversely, by strenghening gold they can signal inflation, something they are now trying to bring about.
The series Gold Rush began as gold ramped up into its $1,900 top.
Business Week had a cover story titled "Why We're Gaga Over Housing" as housing ramped up to its bubble peak. The home builder stocks peaked the next month and prices a while after that.
It is at tops, that the shoe shine kid or the taxi driver is giving clients stock tips.
Gold and other commodity prices have been falling, over the last several years. Gold Rush was the equivalent of the Business Week cover story near the top of housing market.
Anatomy of a top.
You're out of your fuckan mind. At no time was gold or silver anywhere near that kind of mania or top. The vast majority of the public never even participated in the PM rise from 2001-2011. Only 2-3 of the public? Maybe 5%. That is not a sign of a top.
You are either willfully ignorant on this subject or a troll.
Martin Armstrong: " When a commodity is moving opposite of its sector, then there is something to look at. These same people told everyone to buy silver for it was heading to $100 back in 1998. They claimed a fake shortage because the manipulators simply moved silver from NY to London. It is always the same scheme.
Just look at these two charts. Gold was declining into early 1998 when silver was rallying. This was the Buffet involvement; the big players all knew this was rigged. The profits always rely on manipulating to the upside, not to suppress a market indefinitely to keep it down. Where is the profit to just suppress a market? There is none. Those who manipulate markets are in and out. They are looking for instant profits, not 20 years down the road.
Silver was rallying and gold was declining. That was a clear sign that something was wrong. Today, all commodities are under pressure. This is a commodity deflation. Demand has been on the decline no matter what they claim. So this is a sector move and nothing is out of the normal. It will turn when the time is right, but they are trying to make a living by selling to you every day."
"Demand has been on the decline no matter what they claim. So this is a sector move and nothing is out of the normal".
Suggesting that physical demand for gold is down worldwide (China, Russia, India, etc...) and that all is normal is beyond the pale. Completely false too.
Demand IS down. Why? Because the market isn't able to absorb 2,400 tonnes of NEWLY mined gold EVERY YEAR.
That's why the price is down and will be dropping further.
Over 10 years, that's an additional 24,000 tonnes added to the world supply of gold. How much is enough?
Down you say? Ahem.. cough cough...
Shanghai Gold Exchange Withdrawals Running at Record Pacehttp://jessescrossroadscafe.blogspot.co.uk/2015/10/shanghai-gold-exchang...
As long as GREED prevails there wil be corruption and manipulation.
Ths is not rocket science.
Why do you think Sinclair said a year ago, physical gold in USD is no less than $50,000 per oz.? And just a little over a month ago, he has not changed his standing.
More than that, his partner Bill Holter, who more recently repatriated from Costa Rica back to Texas, home of the only gold depository outside of Fort Knox, West Point, and Manhattan has stated on the public record:
IF there is a total of ~8000 metric tonnes in the U.S. Treasury, via its 3 major vaults, the physical price of gold is no less the $50,000 per oz. If there is anything less than 8000 tonnes, it goes up incrementally.
i.e. if ~4000 metric tonnes, then $100,000 per oz. If no physical gold can be accounted for, then in USD physical gold is priceless. Hence, hyperinflation. If one cannot afford an oz. of physical gold at 100k / oz., then at what price does same afford a loaf of bread?
We're screwed ..
Here are your true smoking guns as to why Gold and Silver fell when they did...it called margins.
Something the author of this article failed to look up when he questioned the volitility in both metals at their peaks.
Silver margins surge 84 percent in 8 days
http://www.reuters.com/article/2011/05/05/businesspro-us-markets-silver-...
CME Increases Gold Margins as Investors Drive Record Rally
http://www.bloomberg.com/news/articles/2011-08-11/gold-futures-margins-i...
CME raises Comex gold margin requirements
http://www.marketwatch.com/story/cme-raises-comex-gold-margin-requiremen...