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Is The CME's 150% Hike In Gold Collateral Just A Ploy To Increase Amount Of Legally Confiscatable Gold?

Tyler Durden's picture


Earlier today the CME did something quite contrarian to its nature: it validated gold by a factor of 150%, when it announced that the amount of gold bullion that customers can post as collateral is increasing from $200 million to $500 million. To confused NYU adjunct economics professors this means that the credibility of gold in the global monetary system just increased by more than ever before. Regarding the stated reason for this move "the Chicago-based company said that the change will allow market participants to better manage their risk and to take advantage of lower gold lease rates." As for the real reason for this surprising move we are unsure: whether it is due to an actual shortage of dollar dollar bill margin as collateral or some other reason we don't know. In fact, we are confident the CME will likely hike gold margins once again as soon as gold approaches $1900 shortly. But at least it has finally tipped its hand as to how even the biggest US futures exchange feel about the yellow metal. Of course, the end result is that should gold, just as cash, be used to collateralize stupid transactions which result in margin calls, the collateral will be confiscated. Therefore, one would be forgiven if one assumes that this is merely a ploy to more than double the amount of perfectly legally confiscatable gold in the capital markets. Which of course would mean that someone, somewhere would be interested in procuring far more physical gold than is already in possession. But that's just crazy talk. Why would one want gold, especially at these near record prices, when one can have glorious spam?

From Reuters:

"I think that it really shows that people in the gold market want to use gold more efficiently," Harriet Hunnable, CME Group's managing director of metals products, told Reuters.


"We are very comfortable with the amount of gold that we hold as collateral," Hunnable said.


Placing physical gold as collateral is highly effective for market participants in a low interest-rate environment, she said.


Hunnable said that CME Group has ensured there is enough liquidity in the physical gold market for its customers to provide bullion to the exchange as collateral.


Analysts welcome the move because investors could now use physical gold instead of just cash to meet margin requirements of other market products.


"It gives gold additional credibility as the alternative currency. It might also lessen liquidation of gold, as it is now used as a margin vehicle so participants are not actually liquidating," said Bill O'Neill, partner of commodity investment firm LOGIC Advisors.

Look for the Shanghai Gold Exchange to proceed with an identical action, as Exchanges around the world scramble to put far more physical gold collateral at risk in margin accounts, which then put the fate of said physical gold at the mercy of paper market manipulation, a game which is always won by the casino. Said otherwise: all the makings of a perfectly legitimate, and perfectly legal gold confiscation scheme.


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Mon, 10/03/2011 - 21:12 | 1735351 chumbawamba
chumbawamba's picture

"It is the public policy of this state that public agencies exist to aid in the conduct of the people's business....The people of this state do not yield their sovereignty to the agencies which serve them." [California Government Code, Section 11120.]

In enacting this chapter, the Legislature finds and declares that the public commissions, boards and councils and the other public agencies in this State exist to aid in the conduct of the people's business....The people of this State do not yield their sovereignty to the agencies which serve them. [California Government Code Section 54950.]

Laws, whether organic or ordinary, are either written or unwritten. [California Code of Civil Procedure, Section 1895.]

A written law is that which is promulgated in writing, and of which a record is in existence. [California Code of Civil Procedure, Section 1896]

The organic law is the Constitution of Government, and is altogether written. Other written laws are denominated statutes. The written law of this State is therefore contained in its Constitution and statutes, and in the Constitution and statutes of the United States. [California Code of Civil Procedure, Section 1897]

Any judicial record may be impeached by evidence of a want of jurisdiction in the Court or judicial officer, of collusion between the parties, or of fraud in the party offering the record, in respect to the proceedings. [California Code of Civil Procedure, Section 1916] the Revolution, the sovereignty devolved on the people; and they are truly the sovereigns of the country, but they are sovereigns without subjects...with none to govern but themselves..... [CHISHOLM v. GEORGIA (US) 2 Dall 419, 454, 1 L Ed 440, 455 @DALL (1793) pp471-472.]

The very meaning of 'sovereignty' is that the decree of the sovereign makes law. [American Banana Co. v. United Fruit Co., 29 S.Ct. 511, 513, 213 U.S. 347, 53 L.Ed. 826, 19 Ann.Cas. 1047.]

The people of this State, as the successors of its former sovereign, are entitled to all the rights which formerly belonged to the King by his prerogative. [Lansing v. Smith, 4 Wend. 9 (N.Y.) (1829), 21 Am.Dec. 89 10C Const. Law Sec. 298; 18 C Em.Dom. Sec. 3, 228; 37 C Nav.Wat. Sec. 219; Nuls Sec. 167; 48 C Wharves Sec. 3, 7.]

....This declaration of rights may not be construed to impair or deny others retained by the people." [California Constitution, Article 1, Declaration Of Rights Sec. 24.]

The state cannot diminish rights of the people. [Hurtado v. People of the State of California, 110 U.S. 516.]

The assertion of federal rights, when plainly and reasonably made, is not to be defeated under the name of local practice. [Davis v. Wechsler, 263 US 22, 24.]

Where rights secured by the Constitution are involved, there can be no rule making or legislation which would abrogate them. [Miranda v. Arizona, 384 US 436, 491.]

There can be no sanction or penalty imposed upon one because of this exercise of constitutional rights. [Sherer v. Cullen, 481 F 946.]

Whereas, the people of California have presented a constitution....and which, on due examination, is found to be republican in its form of government.... [Act [of Congress] for the Admission of California Into the Union, Volume 9, Statutes at Large, Page 452.]

Republican government. One in which the powers of sovereignty are vested in the people and are exercised by the people, either directly, or through representatives chosen by the people, to whom those powers are specially delegated. [In re Duncan, 139 U.S. 449, 11 S.Ct. 573, 35 L.Ed. 219; Minor v. Happersett, 88 U.S. (21 Wall.) 162, 22 L.Ed. 627." Black's Law Dictionary, Fifth Edition, p. 626.]

The State of California is an inseparable part of the United States of America, and the United States Constitution is the supreme law of the land. [California Constitution, Article 3, Sec. 1.]

This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby; any Thing in the Constitution or Laws of any State to the Contrary notwithstanding. [Constitution for the United States of America, Article VI, Clause 2.]

Educate yourself.

I am Chumbawamba.

Mon, 10/03/2011 - 21:15 | 1735388 X.inf.capt
X.inf.capt's picture

been digging in there, chumblez

good stuff

common law, magna carta.....

 im not too deep into the site though, but its  teaching me more....

just like ZH and ZH'ers do, everyday....

Mon, 10/03/2011 - 21:18 | 1735405 Pladizow
Pladizow's picture

Perhaps they mean post GLD as collateral!

How many parties are out there that have $500 million of physical gold and are also stupid enough to then jeopordize it - you would think these two qualities would be mutually exclusive!

Mon, 10/03/2011 - 21:22 | 1735420 X.inf.capt
X.inf.capt's picture

no kidding, plads...

i have maybe $80 face in silver...

and i would NEVER let someone hold it as colladeral.

man, who do they think the're foolin'...

Mon, 10/03/2011 - 21:32 | 1735454 flacon
flacon's picture

What's wrong with just holding the physical metal, 100% - Mike Maloney style? If we would all just buy two ounces that would be hundreds of millions of ounces taken out. 

Mon, 10/03/2011 - 21:38 | 1735468 X.inf.capt
X.inf.capt's picture

i do, flacon,

maybe 6 or 7# troy.

by ZH standards, not much...

by the 99% standards, alot...

by my standards, enough....

thank you, ZH, for teaching me the way, and showin' me the way.....

Mon, 10/03/2011 - 21:56 | 1735530 Comay Mierda
Comay Mierda's picture

confiscate gold + crash fiat currency = perfect recipe to enslave all mankind

Mon, 10/03/2011 - 22:09 | 1735576 ratso
ratso's picture

No one is going to be confiscating anyone else's gold.  Tyler, you asking an inflamtory and unnecessary question that just brings out the crazy conspiracy theoriats.  IF that's what you want - you got it.

Mon, 10/03/2011 - 22:48 | 1735697 strannick
strannick's picture

1. CME knows hard currency when they see it. And they want it. Notice they asked for actual gold, instead of bullshit, gold-demand diluting, bankster crinkly papergold GLD.

2. What the #%&@ is a theoriat?

Mon, 10/03/2011 - 22:55 | 1735719 akak
akak's picture

2. What the #%&@ is a theoriat?

I'm not sure, but I bet it wields vastly more power than a mere anthroriat.

Tue, 10/04/2011 - 00:57 | 1736059 CrazyCooter
CrazyCooter's picture

Oh, since its missing from the thread, I guess I will do the honors ...



Sat, 10/08/2011 - 07:44 | 1752483 thewhitelion
thewhitelion's picture

Of course not!  I mean hey, it never happened before. . .

Mon, 10/03/2011 - 21:49 | 1735502 Mr. Mandelbrot
Mr. Mandelbrot's picture

$80 face value silver?!! That's nothing. You need way more--quickly. If you can't afford it, just ask Chumbawamba how to use revolving credit to get your own personal bailout . . .

Mon, 10/03/2011 - 21:59 | 1735540 chumbawamba
chumbawamba's picture

One of the best aspects of taking advantage of your sovereignty is the ability to counter-sue the creditor suing you for money in your sovereign capacity in a court of record.  You can bring up issues that a civil court might disallow, like the securitization of your credit card limit, which means the banks have already been compensated for the money they "loaned" you and are trying to double dip.  And then of course you can discharge the debt entirely through your strawman.

On a side note: I cannot even begin to imagine how much your life must suck, when your greatest thrill is having the opportunity to respond to one of my comments.  My condolences.


Mon, 10/03/2011 - 22:11 | 1735582 Mr. Mandelbrot
Mr. Mandelbrot's picture

Thank you. Your acknowledgement has made my sucky, meaningless life somewhat less sucky and meaningless. Thank you Chumbawamba. Good bye everyone . . .

Tue, 10/04/2011 - 00:31 | 1736000 Whalley World
Whalley World's picture

Excuse me, sucky and meaningless?  What the heck is wrong with that?

Most people spend their entire lives wondering who or what they are!  Just knowing what you are lets you stop looking and start living.

P.S. I lika sucky sucky

Mon, 10/03/2011 - 22:18 | 1735612 Mr. Mandelbrot
Mr. Mandelbrot's picture

P.S. I always love your ideas and research and am one here who really roots for you Chumblez, but I often end up cringing at a lot of your posts because your tone too often devolves into that of such an . . .

Mon, 10/03/2011 - 22:49 | 1735702 chumbawamba
chumbawamba's picture

Yep, totally misread that comment.  God damn contextless text.  Your life has meaning.  I was talking about that OTHER Mr. Mandelbrot, that imposterous douchebag.


Mon, 10/03/2011 - 22:52 | 1735708 Mr. Mandelbrot
Mr. Mandelbrot's picture

Fail . . .

Mon, 10/03/2011 - 22:54 | 1735712 JohnG
JohnG's picture

So he's pissed off.  Why aren't you?

Mon, 10/03/2011 - 23:14 | 1735784 Mr. Mandelbrot
Mr. Mandelbrot's picture

I used to be pissed off -- super pissed off (you have no idea!).  Over the last decade, I've come to my own conclusions (helped in part by my fellow ZHers) and positioned myself accordingly so that I don't have to worry anymore.  Scenario one, my business is soaring.  Scenario two, gold to the moon.  Who needs Ambien . . .

Tue, 10/04/2011 - 00:15 | 1735960 HungrySeagull
HungrySeagull's picture

Forget Ambien.


Xanax is talking. Barring that then vices with or without legal sanction is the last resort of the lost.


No credit cards, no rental loans, no one except the Government can call me out for a student loan which will not ever be paid off until after I die, and if only my assets survive probate. (And it will not.)


I don't care that BOA is on fire I don't care if the markets rise or tank. I don't care about anything except peace, tranquility and mountains of prep for various scenarios which may or may not come true in the future.


Silver? Yes a little. Gold? sure. But I carefully look to the prices and one rule above all.


Buy low, sell high and leave some for uncle sugar who wishes to sodomize you for 30%. Cain's 999 plan should take care of that minor inconvience.


However if one morning Silver and or Gold goes Plaid and hits Ludicrous pricing, a flap of a gentle butterfly

with a glint of a few coins tumbling across the velvet will make the Government whole on the student loan, position me to buy whatever it is I desire in this world. Which is really nothing.

There will be no longer any pain of servitude to your employer, you can actually purchase the company and mold it to your way of thinking and run it as you wish, or hire a bunch of yes men/soft women who will grovel and lick your boots for approval on everything that they do, including getting up early enough to be on time to work.


It would be the Zombies who will come. And when they do, I hope my stair master will fling me half a mile across the street to my death as that old mean lady did in the movie Gremlins.


In the meantime, rent the movie "The Hudsucker Proxy" and enjoy. It's all about that Blue letter, everything else is bullshit.


And those elevators are good to the last drop. Never really cared for those autoboxes that go here and there with a button.

Tue, 10/04/2011 - 01:55 | 1736155 Prisoners_dilemna
Prisoners_dilemna's picture

Discharge my debt through ny strawman? Where can I learn more?

Mon, 10/03/2011 - 21:41 | 1735477 Kiwi Pete
Kiwi Pete's picture

Plad, is your new avatar a robot's vagina on it's side? You're becoming a bit more subtle but I like it.

Mon, 10/03/2011 - 21:49 | 1735508 Pladizow
Pladizow's picture

Do you drive?

Mon, 10/03/2011 - 21:52 | 1735519 Mr. Mandelbrot
Mr. Mandelbrot's picture

Plad, I'm a married man, but I miss the titties. Your avatar was . . .

Mon, 10/03/2011 - 22:19 | 1735615 macholatte
macholatte's picture

a robot's vagina


Hey, man. You need to get out more.

Mon, 10/03/2011 - 21:55 | 1735526 Snidley Whipsnae
Snidley Whipsnae's picture

"How many parties are out there that have $500 million of physical gold and are also stupid enough to then jeopordize it "


My reasoning... Any person clever enough to accumulate 500 million fiatscos of gold would never fall for so obvious a scam... Of course, there is the occasional fool that inherits mega wealth and then fritters it away in short order.

Mon, 10/03/2011 - 22:10 | 1735577 mayhem_korner
mayhem_korner's picture


I wouldn't underestimate the stupidity out there.  Wasn't it just a month or so ago the SNB dumped a bunch of bars in its desperation? 

Also, sometimes what you do is a function of the caliber of the gun to your head.  Maybe Mr. Corleone has whispered in some ears that there will be no liquidations of Treasuries...

Just sayin we can't see the whole landscape.

Tue, 10/04/2011 - 05:42 | 1736286 Snidley Whipsnae
Snidley Whipsnae's picture

MK... "Wasn't it just a month or so ago the SNB dumped a bunch of bars in its desperation? "

We know that SOMEONE dumped a bunch of gold just before the SNB pegged their currency to the Euro. I'm not sure which central banks/bullion banks did the dumping... but maybe you have better info than me?

" Maybe Mr. Corleone has whispered in some ears that there will be no liquidations of Treasuries..."

Extortion of this sort might work on Japan, England, and some other Western oriented central banks/soverign wealth funds... I doubt it would work on China.

I appreciate your comments and I have certainly been wrong many times in the past. All I can do is offer explanations based on what I see...which is a small portion of the pie.

If the US reaches the point where Treasuries can no longer be posted as collateral in financial transactions, even commodities transactions, the game is over.


Mon, 10/03/2011 - 23:19 | 1735794 slewie the pi-rat
slewie the pi-rat's picture

it's hard to tell what is meant here

but the reason given isn't too bad: "...the change will allow market participants to better manage their risk and to take advantage of lower gold lease rates."

here's the kitco piece:  Kitco.crimex  the lease rates are negative (as usual?  again?) but at any rate, $500,000,000 worth of gold, today, is the same sized stack as was worth $200,000,000 when gold was a ways under $700;  the same # of ounces

i think that if i take my gold to crimex and sell it, it is a sale;  if i take leased gold to crimex and sell it, it is a short sale.  i think.  leasing is a kind of fractional reserve bullion banking, a forn of paper gold.  i'm not sure why "legal confiscation" is an issue.  if you don't want to lose your collateral, don't put it up to invest, gamble, or bet with, ok? 

Mon, 10/03/2011 - 22:20 | 1735617 Bicycle Repairman
Bicycle Repairman's picture

magna what?

Mon, 10/03/2011 - 21:19 | 1735412 CH1
CH1's picture

All good stuff, Chumbawamba, but the state is composed of no-think drones and operated by sociopaths. They don't care about laws or sovereignty; they love power and they mean to expand it.

Mon, 10/03/2011 - 21:41 | 1735476 chumbawamba
chumbawamba's picture

Don't stereotype.  Lots of people who work within the system love it when guys like us come in and start taking charge.  They will help you, but you have to make the effort.

Opposition only matters when you're outnumbered.  Yes, you will be opposed, and you might fail, but there will be two guys behind you to try next, and two guys each behind them.  You must learn it and pass it along.  Soon enough we shall be legion.

I am Chumbawamba.

Mon, 10/03/2011 - 22:28 | 1735639 macholatte
macholatte's picture
    We cook your meals. We haul your trash. We connect your calls. We drive your ambulances. We guard you while you sleep. Do not fuck with us.


Mon, 10/03/2011 - 21:34 | 1735457 kill switch
kill switch's picture


on October 3, 2011 8:24 AM

All last week across the media landscape, in pod, blog, flat-screen, and crunkly old newsprint columns, fatuous professional observers complained that the Occupy Wall Street marchers "have no clear agenda" or "can't articulate their positions." What impertinent horseshit. I saw a statement on one OWSer's sign that said it all: $70,000 College Debt $12,000 Medical Bills I'm 22 Where's My Bailout? What part of that is unclear to interlocutors of what we called "the establishment" back in the day? That would be the day of the Vietnam War and the Aquarian Upsurge. One difference being that in 1968 we at least had some solidarity in the older generation coming from figures of gravity like Senators Robert Kennedy (bumped off), Eugene McCarthy, J. William Fullbright, George McGovern, Rev Martin Luther King (bumped off), and even one US Attorney General, Ramsey Clark. Today, the entire "establishment" is a clueless, hopeless blob of self-interested, craven opportunism. Even the arty fringe - the people who pretend to be an avant-garde - are nothing but narcissistic self-branding operations masquerading as culture leaders. The worst offender this past week was the prating empty vessel Nicholas Kristoff at The New York Times who affected to offer the OWSers his own tidy agenda of nit-picky, arcane tax reforms (e.g "Close the 'carried interest' and 'founders' stock' loopholes") and limp-dick banking regulations (e.g. "[move] ahead with Basel III capital requirements"). David Plotz and his Gen X sidekicks at the Slate Political Podcast were equally mystified. I have some heartier suggestions: bring the full weight of the RICO act and the federal anti-fraud statutes down on Lloyd Blankfein, Jamie Dimon, Brian Moynihan, Angelo Mozilo, and a host of other impudent schmekels still at large in their world of Escalade limos and Gulfstream vistas. Or, if that's just too difficult, how about a handy lamppost and about 40 feet of stout nylon cord? It is cosmically ironic, of course, that the same generation of Boomer-hippies that ran in the streets and marched through the maze of service roads around the Pentagon has become a new "establishment" more obtuse, feckless, greedy and mendacious than the one they battled with over 40 years ago. I guess they just don't see that their time has come to get right with reality - or get shoved aside and trampled. The essence of the OWSer's argument is pretty simple: they've got a raw deal; somebody dealt them a bad hand; someone ran their society into a ditch and not a goddammed one of the older generation will set in motion the machinery to correct the situation, or even acknowledge it. At the apex of this new establishment is the Baby Boomer's moral trophy president: Barack Obama, whose election made the Boomers feel good about themselves - while they preceded to loot the national treasury's accumulated capital, and then reach forward a few generations to rob their legacy, too. I haven't heard Nicholas Kristoff (or any of his colleagues at The New York Times) complain about Mr. Obama's stupendous inattention to the crimes of Wall Street, or to the dereliction of his proconsuls in the SEC and the Department of Justice. I'd at least send somebody to hold a mirror under Eric Holder's nostrils to see if he is actually alive. For my money, the OWSers have plenty to yell about. Apart from the crimes and turpitudes of their elders, the younger generation hasn't even been prepared for the massive change in reality that these times are heaving them into. If it was me out there, I'd conclude that I'd better make up the future on my own, with no help from my parent's generation. In fact, that future is rushing toward all of us so cold, hard, and fresh even in this autumn season that it might splatter the banking establishment - and the global economy - like a bug on a windshield. The OWSers have a front row seat down there in lower Manhattan. The financial gangrene (thank you Zero Hedge) is not just seeping anymore, it's blowing through the arteries of the money underworld like fracking fluid. The damage can't be contained. Let the Arabs have spring. The OWSers of America own the fall. Rock on OWSers and don't let the "pigs" (as we used to call them) get you down.
Mon, 10/03/2011 - 21:51 | 1735513 chumbawamba
chumbawamba's picture

The beauty of sovereignty is that, as King, you can take your own action, either by presenting an indictment to a proper Grand Jury, or if you are enjoined to the bankster fraud, by suing them in your court.  They would actually have to respond.  Imagine 10,000 individual Kings and Queens suing in their sovereign capacity in their home states?  Yes, this is all doable, now.

We can literally take this country back legally and lawfully.  We can systematically repossess the courthouses, the capitol buildings, the sheriffs departments, the police stations, the city halls, everything.  Take it back piece by piece, lien by lien, lawsuit by lawsuit, a million Kings and Queens across the states exercising their sovereign prerogative and dispelling the government cronies that have taken over this land one by one until once again, it is a land of, by and for the People.

This is an achievable dream, but it can only happen if people dedicate themselves to the learning.  It is work, and it is a sacrifice, but it is a joy to learn.  What can be more joyful than unlocking the door to absolute and total freedom?

This is a whole new paradigm, a whole new way of seeing yourself as a citizen of this nation.  You are the owner, you are the sovereign.  It is your birth right.  You only have to be bold enough to claim it.

Take the red pill!

I am Chumbawamba.

Mon, 10/03/2011 - 22:03 | 1735557 TheKinski
TheKinski's picture

Good to hear from you, Chumba.


Tue, 10/04/2011 - 03:33 | 1736222 vato poco
vato poco's picture

Awww, God, another nitwit sighing with nostalgia for "the '60's, man!" Your ideas of "Figures of Gravity" were clods like RFK, Fulbright, and Mcgovern?? Srsly?? RFK: A spoiled racist (Refresh my memory: How many black folks have married into the Kennedy clan again?)(And who was the Atty Gen who kept MLK under surveillance?) rich kid who had everything handed to him via family connections - just like Bush. Fulbright: A career racist senator who not only opposed but filibustered the Civil Rights Acts of '57 and '64, and also found time to vote against the Voting Rights Act of '65, AND not only voted for but sponsored the (now proven to be absolute bullshit) Gulf of Tonkin resolution, allowing his buddy LBJ to make some serious coin for Brown & Root and, BTW, get 58,000 troops killed for no reason at all except the wars are good for the economy, and LBJ and Fulbright figured a few dead G.I.'s were a small price to pay for re-election. Mcgovern: Hell, let's just go with "LOL", ok?

You might want to do a little research before lionizing dipshits like those in a post complaining of intergenerational theft. Who the fuck do you think led the charge to fuck over the unborn generations to come, hmmm? WTF do you think 'Social Security' and 'Medicare' are? Well-conceived, brilliantly-run, abundantly-funded social programs dedicated to helping people? ? Or vote-buying scams funded with the kiddies (unmade) money? The bankers just took the ideas & tactics of the statists/fascists you've rhapsodized about and ran with the ball. Took it to the next level. But they were essentially just following the playbook written by your gravitas-laden heroes. So who should get the lion's share of the blame here? The criminal scum of the moment? Or the criminal scum who **set the precedent**?

But don't feel too bad. At least the "kids" down on Wall St. "fighting the power" now, right? Of course, there IS a slight problem.....Along with jacking off to impotent fever dreams of hanging or RICOing Dimon, Blankfein, et al, we read they're also squealing to "Re-elect Obama!" Yeah, that'll fix the problem. ("Gulag prisoners riot; demand better conditions and continuation of Stalin's reign") And after awhile, they'll peter out and slink on home, because in the end, nothing beats NFL action, baby!! Or 'American Idol'!! Of course, this leads to an uncomfortable question: Who's stupider? The fuckwits demanding "change!" while simultaneously clamoring for the re-election of the guy with the single most responsibility for saddling them with mountains of unpayable debt.....or the guy who scribbles poorly-written love letters (with no breaks for paragraphs, because paragraphs are, like, bourgeois!) to said fuckwits?

Tue, 10/04/2011 - 05:44 | 1736274 Tapeworm
Tapeworm's picture

0000, and why bother any more.

Mon, 10/03/2011 - 22:03 | 1735554 holdbuysell
holdbuysell's picture

Interesting site. Will need to look more. Thanks for sharing.

Tue, 10/04/2011 - 02:35 | 1736179 Ben Bermonkey
Ben Bermonkey's picture

Hey folks and gold bucks read the FT, page 13, comment from Mark Williams

the gold bubble is finally bursting, expects Gold to fall down to USD 700 due to ETF leverage, forced sales.


Of Course, this is, not my opinion, ladies.

Since, it was not by chance, hehe, as the impeccable conquestor not longtime ago said

Tue, 10/04/2011 - 03:37 | 1736202 akak
akak's picture

Yeah, I really believe that the price of gold is going to fall back to its average cost of production, if not below it --- and that ignores the likelihood of rising energy costs, and thus a further rise in the average per-ounce cost of production for that one reason alone in the years ahead.

Such stellar analysis and insightful commentary is worthy of The Jon Nadler Award for Best Disinformation Disseminated in the Service of the Power Elite.

Tue, 10/04/2011 - 05:47 | 1736289 Tapeworm
Tapeworm's picture

I get it, bt Pt is 191 USD below Au at this moment so I suggest converting to Pt before glod goes to 300

Mon, 10/03/2011 - 21:08 | 1735360 Captain Benny
Captain Benny's picture

I take this to mean that a bear raid across the commodities market is about to commence.  Increase the effectiveness of gold, encourage deposits of physical, squeeze the markets harder than they've ever been squeezed before.  Not only let prices collapse, but make it worse by increasing margins across the board.  Margin call the shit out of every single leveraged long.  Take gold collateral and empty long bank accounts.

Fed has unlimited fiat to play with, I'm sure they'll be a factor in it all... probably through their favorite puppet: JPM

Mon, 10/03/2011 - 21:13 | 1735382 CH1
CH1's picture

That's a fair guess, but who can tell what the sociopaths will do?

Buy and hold physical - sleep well at night.

Mon, 10/03/2011 - 21:52 | 1735516 jekyll island
jekyll island's picture

Fed > JPM puppet.  I think you may have that backwards.

Mon, 10/03/2011 - 22:14 | 1735596 bankruptcylawyer
bankruptcylawyer's picture

lather , rinse, squeeze, repeat. 


works every time, till you've cleaned your dishes to the point where you can't eat on them anymore.

Mon, 10/03/2011 - 22:16 | 1735603 Snidley Whipsnae
Snidley Whipsnae's picture

CaptBenny, CH1... Buying physical and holding is the only way to beat the bastards and their continuous printing.

Demand for physical is still waaay beyond what can be filled in Asia, India, and the Mid East...

All the physical coming on the market is being purchased.

Central banks are under great stress... If they lease forward more gold to bullion banks to depress the market it is being snapped up. If they stop leasing the price of gold rises and makes their paper look like the crap it is.

We have SE Asia, India, the Mid East and many more individuals/soverigns on our side. We will prevail.

Keep the faith, keep up the pressure, forget paper PM games.

Mon, 10/03/2011 - 22:45 | 1735691 DoChenRollingBearing
DoChenRollingBearing's picture


Everyone should be listening to Uncle Snidley! Be your own central and buy gold.

Buying and holding physical has numerous benefits, Snidley points out a great one: that it puts the central banks (the real ones) under a lot of stress.  The more they try to keep the price forced down, the greater the blow-off will be.

Yes, we the holders of gold will win.  Have no fear, we will win!

Mon, 10/03/2011 - 21:10 | 1735362 DormRoom
DormRoom's picture

I have a suspicion big money is playing a sovereign cds / hedge with GLD trade, in case Euros are printed.  So if Germany or Greece exits, and no Euros are printed, I expect GLD to collapse.  It may also explain the decoupling between GLD and gold mining stocks, since GLD, a proxy for gold,  is not an 'alternative currency', but one side of lucrative either/or trade.

Mon, 10/03/2011 - 21:11 | 1735378 akak
akak's picture

Yes, GLD will collapse --- as actual physical GOLD soars.

But that result was already long ago baked into the cake.

Mon, 10/03/2011 - 22:49 | 1735703 DoChenRollingBearing
DoChenRollingBearing's picture

Yes.  Physical gold only.

And no, no way anyone gets my gold.  Until I give it away, real nice and quite like.

Mon, 10/03/2011 - 21:11 | 1735379 Captain Benny
Captain Benny's picture

Its stupid to think Germany would exit the Euro.  There are too many incentives to stay.  You have to understand that they do not want a strong local currency, it would devastate their already weakening export economy.

Greece on the other hand has every interest in exiting... if only their idiot politicians would stop shoving their faces with baklava and do something right for their citizens (and world) by defaulting.

Mon, 10/03/2011 - 21:17 | 1735396 DormRoom
DormRoom's picture

Germany would exit the Euro to put a firewall around its banks, possibly nationalizing the weak ones, reprint Deutsche marks,  and protect Germans, and their assets, from contagion, and hyperinflaiton.

Mon, 10/03/2011 - 21:26 | 1735429 Captain Benny
Captain Benny's picture

You really think they'd try to isolate Deutche Bank with its TBTF attitude, holdings, and off balance sheet leverage of who knows what ratio?  I venture to say that there will be a lot swept under the rug during this collapse, but there is no run big enough to hide a "TBTF" ...

Mon, 10/03/2011 - 21:19 | 1735413 Spitzer
Spitzer's picture

That is not true. Germany has always had a strong currency with a strong export sector. Japan has too. Japan and Germany have higher wages then the US, yet they both have trade surpluses with China.

The dollar has fallen from 120 to 76 and exports have fallen. The trade deficit in the US has widened even though the dollar is falling. That puts to rest the keynesian nonsense idea that a weak currency is good for exports.

Tue, 10/04/2011 - 02:10 | 1736166 jomama
jomama's picture

my bet is that impossibly indebted nations like greece would be kicked out of the euro before germany leaves the euro.  

germany maintains too many trade benefits from it.  imho the main reason why they haven't opted out already...

Mon, 10/03/2011 - 21:06 | 1735364 The Shootist
The Shootist's picture

phyzical metalz bitchez!

Mon, 10/03/2011 - 21:17 | 1735384 Pegasus Muse
Pegasus Muse's picture

 "Why would one want gold, especially at these near record prices, when one can have glorious spam?"

Lookie here.  A buyer of size plans to go on a spam-free diet.  Maybe more sovereigns will do the same since the market riggers at the CRIMEX/CME handed them a big 30% off sale. 


Qatari wealth fund plans $10bn gold buying spree

The Qatari Royal family plans to spend up to $10bn (£6.4bn) buying stakes in gold producers through their sovereign wealth fund, The Daily Telegraph can disclose. 

Mon, 10/03/2011 - 21:22 | 1735419 HoofHearted
HoofHearted's picture

There's no way that Spam can be collateral because you can't eat it. actually eat Spam? Explains a helluva lot...

Tue, 10/04/2011 - 07:27 | 1736392 StychoKiller
StychoKiller's picture

I don't always eat gold, but when I do, it's chocolate-covered gold bars!  Stay hungry, my friends.

Mon, 10/03/2011 - 21:30 | 1735447 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Nice move by the Qatari Royal Family.  Let's announce our plans to buy gold therefore driving up the price of that which we wish to purchase.  Brilliant people, but at least they had enough sense to poke a hole in the sand.

Mon, 10/03/2011 - 21:52 | 1735518 HellFish
HellFish's picture

I'm pretty sure it wasn't the QRF poking the holes.  It was the West.  The only poking the QRF was doing was camels and young boys.

Mon, 10/03/2011 - 21:07 | 1735365 PrintButtonMoney
PrintButtonMoney's picture

Gold @ 2100 by january?

Mon, 10/03/2011 - 21:54 | 1735524 mayhem_korner
mayhem_korner's picture

Not based on this little ploy.  Crimex now has both up and down levers.  Lever up the paper, deliver the physical on the downside.  I'd look for highly contrived and wild swings between 1600 and 1850 for the next few months whilst CME stacks "other people's collateral."

Tue, 10/04/2011 - 00:40 | 1736023 MsCreant
MsCreant's picture

Why would you print a Butt on Money?

Mon, 10/03/2011 - 21:09 | 1735370 Dr. Engali
Dr. Engali's picture

So if you use gold as collateral and they drive the paper price down they can confiscate your physical to meet your margin call. I wonder how many genius "money managers" will jump on this once in a lifetime opportunity?

Mon, 10/03/2011 - 21:09 | 1735371 akak
akak's picture

I do believe I detect the smell of growing desperation in the continually evolving moves against gold and silver by the bullion banking "industry" and the controllers of the PM futures markets.

Mon, 10/03/2011 - 21:17 | 1735402 agent default
agent default's picture

Go buy some gold  and some silver and stick it under your mattress.  If you want to screw hem, buy and hold the real metals.

Mon, 10/03/2011 - 23:03 | 1735749 SubversiveSheep
SubversiveSheep's picture

Two thumbs up with the idea of opting out of the system with physical metals but definitely do not stick them under your mattress. Think long and hard about how you store/hide them.

This is a pretty topical concern for me because I came home from work today and found our house torn up and burglarized, with our PMs among the missing. No kidding. We had them in a smallish fireproof safe, which was very well-hidden; unfortunately the keys to the safe were not well-hidden, and it appears that once the asshat found those keys he tore the house apart looking for the safe. The cops said it looked like he had been in the house for a good, long time and in any event, there was not a single inch of it that was not completely torn apart -- our pantry, boxes of Christmas decorations, you name it.

My husband and I had opted for the safe out of concern for fire, since we also kept some documents with our rounds. (Yep, the documents are gone too.) You can bet that in the future we'll be approaching PM storage a different way (and hiding our keys better for lagniappe).

For what it's worth, we live in an older and slightly run-down house in a middle-class neighborhood, drive 10+ year old vehicles, and don't display any outward signs of prosperity, nor had we mentioned our PMs to anyone outside of my parents and one close friend who is also a PM owner. It appears this was a completely random break-in.

Let those with ears hear; I hope others can learn from our misfortune. If a properly-motivated thief has the time and the motivation, your PM hiding strategy needs to be very good indeed.

(Apologies to agent default, who probably wasn't being literal with the mattress thing -- I wanted to make this point, though, for those who might be new to PMs and apt to take a comment at face value.)

Tue, 10/04/2011 - 06:42 | 1736323 Withdrawn Sanction
Withdrawn Sanction's picture

Sorry for you loss, man. And thanks for the reminder.

And Im sure you've thought of this, but given that "don't display any outward signs of prosperity," why would a thief take such a long time looking? Given his determination, sounds like he (and it's most likely a "he") had inside information. Overheard a whispered conversation, was working in your house, someone got a little mouthy at a bar..who knows. But the other add-on to your sad tale is, two can keep a long as one party is dead.

Tue, 10/04/2011 - 17:48 | 1739168 SubversiveSheep
SubversiveSheep's picture

We suspect that he (we're pretty sure it's a "he" too) knew that we have a metric crapton of firearms in the house -- we're both avid shooters and when you shoot at local matches, there's no way to keep your gun-owning status private. The bad guys beat up the safe pretty good with a crowbar but weren't able to get into it (it's a combination and keyed combo safe), but in searching for the gunsafe key it appears they found the PM safe key and decided to pursue the contents of that safe as their consolation prize.

Lessons learned: 1) good gun safes are totally worth what you pay for them and 2) hide the keys better anyway.

Mon, 10/03/2011 - 21:21 | 1735404 Captain Benny
Captain Benny's picture

I don't think it needs to be said.  The last year has been full of evidence and actions that make the case for the PMs.  The only thing against PMs has been the big shakeouts like we've seen in silver.  Volatility has scared and burned the little leveraged guys.

I haven't sold a single 90% dime.  The cartel can fuck off.  They're desperate and we're squeezing their balls blue right now.  Provident Metals is out of 100oz bars.  APMEX has almost all of their 100 oz bars on backorder... they've been that way for a week now.  APMEX has 90% silver coins on backorder till at least Oct 7th!  Listen to Bill Haynes on KWN's weekly metals wrap and he even says 90% has premiums increasing.

Physical metal market is being raided right now.  Its harder to find a large supply of physical today than yesterday.  Imagine how hard it'll be when the big dealers stop taking orders due to supply constraints and increasing demand at the start of secretive QE3 (or whatever the fuck they call it).

Mon, 10/03/2011 - 21:25 | 1735428 akak
akak's picture

The idiotically transparent (and patently criminal) moves by the anti-gold cartel, and by the central banks and their TBTF lackies, are of danger only to those with a terminally short-term outlook, a historically ignorant mindset, and/or a hopelessly gullible and dangerously naive faith in governments and the power elite.  Let such people burn in their own stupidity and cowardice.

Mon, 10/03/2011 - 21:36 | 1735459 reader2010
reader2010's picture

Physical gold confistication is coming, and only gold that they will allow you to own will be paper gold. 

Mon, 10/03/2011 - 21:52 | 1735511 akak
akak's picture

There is no "confiscation" of gold coming, soon or ever; all such talk is either pure ignorance, or else just more fearmongering by minions of TPTB to scare the average Joe away from gold.

Sure, the sociopathic power elite can try to make gold illegal --- but that is all that they can do. And maybe they will be almost as successful in their statist attempts at controlling gold as they have been with marijuana and other illegal drugs!

Whatever anyone holds in regard to physical metal is and always will be safe held in their own hands, as we wait out the death throes of the current financial, monetary and political paradigms, and the rebirth of economic and monetary sanity.

Mon, 10/03/2011 - 22:08 | 1735570 reader2010
reader2010's picture

Don't tell that to Gerald Celente.


"They have regulated the price of gold before, not that they will be able to do it, but I am concerned they will try something to regulate the supply (to the people) and the price of gold as the price eventually keeps going higher.  Silver to me is not going to have that kind of regulation imposed upon it.  


So I’m buying a position in silver against any future actions taken by the world governments to restrict the supply and the price of gold.  They did it before in the US, they will do it again.”"


Mon, 10/03/2011 - 22:31 | 1735652 Snidley Whipsnae
Snidley Whipsnae's picture

reader2010... If you are so faint of heart you don't need to be buying physical PMs. This is a war to determine what is going to be 'money'. If the azz hats knock on your door and demand your PMs are you going to hand them over?

PMs are wonderful... but they don't think for you. You have to do the thinking for your financial assets, whatever they may be.

If you want the fucking bankers to continue to enslave you with fiat, by all means support central banks and their manipulations of the world financial system and all main st economies.

If you want a higher degree of economic freedom, buy physical PMs and hold them.

Mon, 10/03/2011 - 22:43 | 1735687 reader2010
reader2010's picture

Thanks for your advice. But, I have been in accumulation mode for physical gold and silver since 1998. 

Mon, 10/03/2011 - 22:52 | 1735710 DoChenRollingBearing
DoChenRollingBearing's picture

1983 for me.

Mon, 10/03/2011 - 22:33 | 1735660 GrinandBearit
GrinandBearit's picture

Akak, the average Joe cannot afford gold at these prices.

Mon, 10/03/2011 - 22:41 | 1735684 akak
akak's picture

Sure he can --- it's just a question of how much.

Coins with less than 1/10 oz. of gold are readily available in the marketplace.
And then, of course, there is always silver.

Mon, 10/03/2011 - 22:56 | 1735724 DoChenRollingBearing
DoChenRollingBearing's picture

akak is completely right (as usual).  $200 is enough to buy a 1/0th oz gold coin.  When you see how insanely small that 1/10 th oz coin is vs. its worth, it is a mental experience that is hard to match.  And I used to think that paying $500 for an oz of gold was whole lot!

Last I looked, TULVING did not have kilo bars of gold...

My coin shops (where I have bought ALL of my gold) have NO 2011 or 2010 Gold Eagles.

Time's a wastin...

Mon, 10/03/2011 - 23:08 | 1735744 akak
akak's picture

Thanks DoChen!


Last I looked, TULVING did not have kilo bars of gold...

My coin shops (where I have bought ALL of my gold) have NO 2011 or 2010 Gold Eagles.

Time's a wastin...

And have you seen the current premiums for even one ounce gold coins on APMEX?  Ay caramba!  Even Tulving's premiums on gold (as a percentage of the spot price) have risen significantly over the last few months.

Don't anyone try to tell me that this is not indicative of a (physical) market in growing distress.

Tue, 10/04/2011 - 00:12 | 1735965 DoChenRollingBearing
DoChenRollingBearing's picture

I just looked at the imperfect widget at 24hgold / eBay joint venture and found:

21% + premium of AGEs to spot

80% + premium of ASEs to spot

NO ONE at eBay wants to let their Eagles go for under $2003... (the widget is at the bottom of that page).

Tue, 10/04/2011 - 05:56 | 1736292 Snidley Whipsnae
Snidley Whipsnae's picture

DCRB... Thanks for the info. Wow! some premiums to spot!

If this is not evidence of divergence of physical from paper, what would be?

Tue, 10/04/2011 - 06:22 | 1736312 fiddler_on_the_roof
fiddler_on_the_roof's picture

Quoting EBAY for Gold prices is BS. it is always over priced. Try tulving or local dealer. eagles also over priced.

Maples best - 2.8% premium only. Pamp bars 1.5%.

Mon, 10/03/2011 - 21:10 | 1735373 drwillia
Mon, 10/03/2011 - 21:14 | 1735381 Au_Ag_CuPbCu
Au_Ag_CuPbCu's picture

I'll keep my "collateral" right where it is, in a safe in my basement snuggled comfortaby next to two hand guns and plenty of ammo.   But thanks just the same...

Now a plug for Attackwatch:  Fuck the Fed!

Mon, 10/03/2011 - 21:28 | 1735443 LeonardoFibonacci
LeonardoFibonacci's picture

Same here, my PM are in a Gun Vault that holds a 12 guage Mossberg & 2 Beretta px4 STORM handguns + unlimited rounds!  Cum get some!

Mon, 10/03/2011 - 21:48 | 1735498 mayhem_korner
mayhem_korner's picture

Agreed.  But you're not holding enough to make the market move.  Those that are might find this little ploy fits their liquidity standards just fine and stupidly hand over...scratch that, truck over, a big ol' bunch-o-bars to Crimex's grubby paws.  And then, when the iron gate closes, they will be overcome by that feeling one gets when you realize you just paid a scalper top dollar for yesterday's tickets (and he's long gone...)

Just ramblin...

Mon, 10/03/2011 - 21:57 | 1735534 Au_Ag_CuPbCu
Au_Ag_CuPbCu's picture

Fools and their money soon part.  SSDD.  There is no hoard too small for these greedy, rapacious scumbags....just saying.

Mon, 10/03/2011 - 22:00 | 1735546 mayhem_korner
mayhem_korner's picture

Of course.  They'd take your teeth if you got too close.  But they know that there are some wise folks out there (us).  This is kinda a voluntary program for the intellectually challenged that happen to be managing billion dollar funds.

Mon, 10/03/2011 - 21:15 | 1735387 bob_dabolina
bob_dabolina's picture

What a bunch of whiners. 

Who cares about margin req. for gold? The problem IS leverage in gold.

(I'm ready for the 50-60 trolls that will pop out about the dollar...bring it)

Mon, 10/03/2011 - 21:54 | 1735522 bob_dabolina
bob_dabolina's picture

I'm sorry brother, I'm not watching youtube videos tonight.

Mon, 10/03/2011 - 22:07 | 1735556 fuu
fuu's picture

Del may be a little much for a Monday.

Mon, 10/03/2011 - 23:31 | 1735850 SumSUN
SumSUN's picture

I wonder if Del is stackin' nowadays?  Pretty brilliant lyricist that guy is.  Can't wait for "Deltron Event II"  !

Tue, 10/04/2011 - 02:04 | 1736161 jomama
jomama's picture

epic win.

Mon, 10/03/2011 - 21:14 | 1735389 gkm
gkm's picture

Why would one want gold, especially at these near record prices, when one can have ...


...362 Olympic sized pools filled with dollar bills which is the existing gold volumetric equivalent of (only) the US M1 money supply.

Tue, 10/04/2011 - 00:48 | 1736035 MsCreant
MsCreant's picture

Just a little more printing and I can have a fresh pool of money to swim in every day! Hey Ben?

Mon, 10/03/2011 - 21:15 | 1735395 AldoHux_IV
AldoHux_IV's picture

Indeed, a perfect way to confiscate more from those that aren't on the inside.

Something should be done to change this rigged game, but looks like the criminals will go on stealing.

Mon, 10/03/2011 - 21:17 | 1735398 PulauHantu29
PulauHantu29's picture

What if they eat your yellow metal instead of merely confiscating it?  You never know what these mischievous people will do in Chicago.

How Barbaric!

Mon, 10/03/2011 - 21:16 | 1735399 nmewn
nmewn's picture

God, I love it. I do love it so.

I love the smell of desperation in the morning.

Mon, 10/03/2011 - 21:32 | 1735451 LeonardoFibonacci
LeonardoFibonacci's picture

I love the smell of a 100 troy oz Royal Canadian Mint Silver bar.  Purchased last week for 3650$.

Mon, 10/03/2011 - 21:40 | 1735473 nmewn
nmewn's picture


I keep mine in small coin form though, that way my pants don't droop so much ;-)

Mon, 10/03/2011 - 21:49 | 1735504 Captain Benny
Captain Benny's picture

The only thing that goes in my pants is warm like an oven mit and wraps my di... oh nevermind.  I weigh down my boots with the RCM bars... provides a good workout when kicking cans down the road.

Mon, 10/03/2011 - 22:13 | 1735588 nmewn
nmewn's picture

At this point, thats all there is...kicking cans and waiting.

Mon, 10/03/2011 - 23:00 | 1735738 DoChenRollingBearing
DoChenRollingBearing's picture

YES!  Green.  We wait, those of us with PMs.

Go ahead, kick that can!  It sounds like most of us ZH-ers with GOLD have it in STRONG HANDS.

We will win.

Mon, 10/03/2011 - 21:18 | 1735406 Tater Salad
Tater Salad's picture

Tyler(s), can you put up more video on the stinky hippie, grunge fest going on in downtown NY...

I miss the idiotic posts...

Mon, 10/03/2011 - 21:46 | 1735492 LynRobison
LynRobison's picture

Hmm, they aren't all hippies, and they aren't all wrong. Check out:

Mon, 10/03/2011 - 21:55 | 1735525 akak
akak's picture

I'll take a stinky hippy over an impeccably groomed sociopathic bankster or any of the legion of well-dressed central banking super-Madoffs any day.

Mon, 10/03/2011 - 23:19 | 1735798 Tater Salad
Tater Salad's picture

"super Madoffs"

Man, you are a fuckin' dip shit!



Mon, 10/03/2011 - 23:21 | 1735807 Tater Salad
Tater Salad's picture

Can anyone, ANYONE, tell me what these idiots are protesting? 

Tue, 10/04/2011 - 01:02 | 1736066 MsCreant
MsCreant's picture

What you have missed is that multiple groups with multiple interests are converging on WS. The only common agenda they have is they are all looking at "banking culture" as the problem. This is what should be happening in Washington DC. Instead, the only folks with a voice there are folks who can afford to pay lobbiests. It is mono-culture/mono-voice.

A real movement (and I am not saying we are there yet) WILL start this way.

Mon, 10/03/2011 - 23:27 | 1735833 akak
akak's picture

As so often happens when it is left out in the open for any length of time, methinks that this tater salad has gone rotten.

Tue, 10/04/2011 - 00:58 | 1736061 MsCreant
MsCreant's picture

It seems clear to me it was deliberately served that way. As Bob Dylan sez, you gotta serve somebody. I think it is clear who TS serves.


Mon, 10/03/2011 - 21:18 | 1735408 Blagio
Mon, 10/03/2011 - 21:58 | 1735537 akak
akak's picture

Maybe not, but it is tradition ---- like beards and falsehood-telling shaking voices and quivering lower lips.

Mon, 10/03/2011 - 21:21 | 1735416 IrritableBowels
IrritableBowels's picture

What happens to silver?  Realizing that it may be the "poor man's gold," should one sell to acquire the more historical monetary base?  Or was the comparative  dip today merely due to gold NOT dipping because of this particular news?  Any advice is welcomed.

Mon, 10/03/2011 - 21:24 | 1735426 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Sometimes we try to outguess ourselves.  Until proven otherwise, I am taking this simply as further validation that "gold is money".  Sorry Ben:)

Mon, 10/03/2011 - 23:04 | 1735750 DoChenRollingBearing
DoChenRollingBearing's picture

IrritableB, take a look at FOFOA, it IS long and hard reading, but he is MY Trail Guide, and he likes GOLD!

Silver not so much.  FOFOA's opinion, my opinion.

There is a good case to made for silver, perhaps a great case, there are at least 3 ZH-ers who follow silver closely and can comment on "The Case for Silver" much better than I can.

Mon, 10/03/2011 - 21:24 | 1735427 CapitalistRock
CapitalistRock's picture

The move simply shows that people are more willing to trade with the gold currency. Nothing sinister. Simply another sign that gold is being treated more like money.

Store physical long term in an inaccessible hiding place. This is bullish for gold.

Wed, 11/16/2011 - 23:54 | 1735434 LittleAl_1
LittleAl_1's picture


So did the CME just grant the banks the ability to post an additional 300 million in GLD etf shares…?  For which they are the custodians…lol


The NYMEX  recognizes gold backed ETF’s as the “physical commodity”,





Alan Palmer Chicago

Mon, 10/03/2011 - 21:27 | 1735435 DavidPierre
DavidPierre's picture money and now displaying it's true character. Gold is up $30 at $1,655 while platinum is down $24 at $1,499 which puts Gold valued in Dollars at a $156 premium. You can go back 4 or 5 years and platinum was nearly triple the price of Gold at $2,000 to Gold's $800. Why is this significant? We are in a currency crisis no matter what Washington, Wall St. or their paid media want you to think. What has been occurring very very quietly with no fanfare whatsoever is Gold reassuming it's historical role as "King money"

All during the 11 year bull market, platinum traded at significant premiums because investors were bidding up all sorts of commodities as The Fed pushed more and more Dollars into the system. This was a natural reaction by investors expecting inflation as a result. But something started to change back in the April/May period when the cartel attacked Silver and other commodities fell in sympathy. Remember, Gold will do well in both inflation and deflation BECAUSE it is money, hard money, while platinum is a commodity. Platinum can perform as money but is now and has been primarily a commodity which is "used" in applications, not as money.

Gold is now signalling that the long forecasted currency crisis is here and now. Believe me when I say that if "they" could have held Gold down further "they" would have. The physical offtake of late has been remarkable and a primary reason that Wall St.'s paper games have done so little damage. Yes, the recent correction has been painful but pale's in comparison to the 2002, '04,'06 and '08 smackdowns. Gold is finally being "seen" for what it really and THE safe haven that it is.

It has been said that Gold's recent correction was in part caused by traders selling Gold to pay margin calls on other assets which I believe is partly true (along with cartel help). But, think about what "they" are really admitting. "They" are telling you that investors are looking to Gold for liquidity and selling what is "up". "They" are admitting that Gold is doing what it always has done, namely allow holders liquidity during "hard times". The next step in my opinion is a mass awakening to Gold. This "awakening" has already happened but it is still very early and has been obscured by the Fed's purchases of Dollars. These Fed purchases are the only reason that the Dollar has any "safe haven" perception OR bids. This will not last for long because the currency crisis is already so big that Treasury bonds will be called upon for liquidity.

This selldown will occur while the Treasury is in maximum "borrowing mode" as it is now. Treasuries cannot be a safe haven as they are THE most over owned asset in the history of the planet AND the most over issued. Treasury bonds ARE the definition of supply and potential future supply. Gold on the other hand is very very finite in it's supply. I might add that it is much more "finite" than those in power would want you to think. Gold also has real demand as evidenced by the real offtake as oppossed to paper trading back and forth.

It is important to understand this role that Gold is displaying. Gold is being "voted" on every day as all assets are by investors. It has now taken on the role as the ultimate metal and has for 10 years been acting as the ultimate "money". Anyone can say what they want but Gold has for 10 years outperformed ALL paper monies and only recently become "the most expensive" metal. Gold is telling you that the currency crisis has arrived . The fact that everything is now computerized and "much faster" than ever before tells me that the unwinding of the currency markets cannot be far behind AND will end in a "lightening fast event!

Gold made what I believe to be a hard bottom last Monday. The specs are out and the commercial shorts are now very light in comparison to the last 10 years. Many are calling for chop here and may get it as more investors "use it" to provide liquidity. I"however believe we could have a huge up move from here and skip much in the way of chop. I believe this because as the paper currencies unwind, the real "fear and flight to safety" will take over. I will not bat an eye nor be shocked to see Gold at new Dollar highs before you dress up for Halloween! Let's see.

Mon, 10/03/2011 - 21:42 | 1735481 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Well stated Monsieur Pierre!:)

Mon, 10/03/2011 - 22:17 | 1735607 bankruptcylawyer
bankruptcylawyer's picture

gold isn't money, it's super money.

Mon, 10/03/2011 - 22:46 | 1735692 Snidley Whipsnae
Snidley Whipsnae's picture

Thanks Jesse... BTW, I enjoy Jesse's Cafe Americain daily... and I agree totally with your take on what is happening with fiat vs gold.

BTW, anyone curious about what the world physical demand for PMs are can google 'london trader says demand for gold'...

Mon, 10/03/2011 - 23:09 | 1735771 DoChenRollingBearing
DoChenRollingBearing's picture

^---  What you guys said.  

+ $55,000

Tue, 10/04/2011 - 00:39 | 1736020 PaperWillBurn
PaperWillBurn's picture

You don't see hundreds of millions of Asians lining up to BTFD in Platinum.


Enough said

Mon, 10/03/2011 - 21:27 | 1735437 RyanW525
RyanW525's picture

answers that don't answer, explanations that don't explain, and conclusions that don't conclude....

Mon, 10/03/2011 - 21:28 | 1735438 reader2010
reader2010's picture

Gold is not money for the serfs.

Mon, 10/03/2011 - 21:28 | 1735441 Bansters-in-my-...
Bansters-in-my- feces's picture

What the fuck is this "gold leasing" bull fucking shit manipulation all about.

Is this shit not criminal...???

Mon, 10/03/2011 - 21:43 | 1735484 DavidPierre
DavidPierre's picture




Can anyone imagine being paid to lease a car? Or paid to lease an apartment?

When the price of g/s gets relatively high, the bullion banks desire to hold the price down as g/s is a competitor. Occasionally, they will make it very much worth someone’s effort by the negative rates.


Let’s say, I’m a company that wants to help out the bullion banks, with the least amount of risk to me. I know they want to short g/s, but since the price can, in theory, still go up, I have a legitimate concern.

So I decide to inquire at my friendly bullion bank, as to leasing 1 ton of gold (32,000 oz.) for the next 3 months, after which time, I must return it. My friendly banker lays out the scenario for me.

1. The Bullion bank will pay me .004%. So if gold is selling for $1800/oz. and I sell 32,000 oz., I make (for ¼ year) $57,600.

2. He tells me that since I’d be joining a group that is selling, and this scheme has always worked in the past, I can sell the gold at $1800 and buy it back from the shepple in the Comex at $1650. Since I have a "heads up" of when all of the selling will occur, I’m safer.

3. This will result in my making a tidy profit of $150/oz. for 32,000 oz, which equates to $4,800,000. Not bad.

4. But how can I be sure, the price won’t go up? Well, the CME is in on it also, my friendly banker explains. You see, we start selling thousands and thousands of contracts during late at night (when few buyers are around), and we also hit all of the stop loss orders. This
action will drive the price down at least $50/oz. The CME then comes in as they are chartered to decrease volatility and they raise margin requirements. Of course, this raising of margin always has the effect of forcing people to sell more. These people are the shepple who I would ultimately buy the gold back from in order to return it.

5. But what if all of this, still does not work? I heard that China has big buy orders in at $1720. Well, the bank says, China was asked if they wanted to buy it at $1650 instead? He didn’t know officially what China said, but so far it looks like a win-win.

6. But what if it all still does not work? Well, he says, you can take the $57,600 fee and place a buy an order to stop your position if the price goes to $1805. Then you would lose $5 an oz. (times 32,000) or $160,000. But if I include my fee, I say to myself, of $57,600, I risk only about $100,000.

7. But you can make $4,800,000, says my friendly bullion banker. I think it is worth the risk, but it sounds too good to be true.

8. But is this legal, I ask? Sure, the bank says, there are no position limits yet from the CFTC. Don’t worry about them, they’ve been "investigating" us since 2008 and haven’t come up with anything yet, he laughs. Even if they do, we settle out of court for peanuts.
How do you think we get all of those year end bonuses? We all have a big laugh.

9. You know, I think to myself, maybe I should get my son into this business.

Tue, 10/04/2011 - 00:56 | 1736055 Phil Free
Phil Free's picture

About takes your breath away.


Mon, 10/03/2011 - 21:29 | 1735445 chump666
chump666's picture

Asia CDS spreads are blowing out like no tomorrow. 

Mon, 10/03/2011 - 21:31 | 1735448 wang (not verified)
Mon, 10/03/2011 - 21:37 | 1735452 BlackMagician
BlackMagician's picture


Mon, 10/03/2011 - 21:35 | 1735458 atomicwasted
atomicwasted's picture

They want to get your physical so they can lease it out and drive down the price.  More and more I think that GATA is right and that there are serious delivery issues related to people that want to get their physical back from the bullion banks.

Mon, 10/03/2011 - 21:39 | 1735472 Yen Cross
Yen Cross's picture

 I clearly stated my best wishes to J,R. )  I do not agree with his post, however he has the right to post his feelings.

     J.R called the usd/jpy trade back in ( May) of 2010 ! He called the trade like a glove! 

       J.R. even went so far, to give the yen a boost!  J.R. is a swing trader and he knows his trades. Politics aside, The man has tought me  well!

Mon, 10/03/2011 - 21:40 | 1735474 Zaphod B.
Zaphod B.'s picture

I need it for my teef

Mon, 10/03/2011 - 21:43 | 1735475 Printfaster
Printfaster's picture

This allowance of collateral for gold is a desperate attempt to locate liquidity somewhere in the world.

Like Weimar, there is no real liquidity, ie having in possession something of fungible value that can be readily traded for needed goods.  Cash is being destroyed because the credit that backs up the intrinsic value of cash is being destroyed.  Only gold will survive the credit collapse.  All currencies must die.

The dogs are sniffing for gold.  The desperation is reminiscent of Hitler holding the jews of Rome hostage, trying with all desperation to extract the gold from the jews.  Gold, gold, who has the gold?

Mon, 10/03/2011 - 21:47 | 1735493 bob_dabolina
bob_dabolina's picture

You're reaching...


Mon, 10/03/2011 - 21:49 | 1735505 Printfaster
Mon, 10/03/2011 - 21:52 | 1735520 bob_dabolina
bob_dabolina's picture

I'm sorry brother, I'm not reading wiki articles tonight. 

Tue, 10/04/2011 - 01:18 | 1736095 MsCreant
MsCreant's picture


I saw the posts from the other night that claimed that all of the profits you made were done on pretend accounts and that you did not have any of your own money in the game. Is that true? I'm giving you a chance to clear that up.

Mon, 10/03/2011 - 21:54 | 1735523 whaletail
whaletail's picture

I call Godwin's Law.

Mon, 10/03/2011 - 22:14 | 1735564 Printfaster
Printfaster's picture

Actually it is more like Max Bialystock's law  This whole affair reminded me of Hitler's desperate need for gold.  Historically, Hitler traded gold to Portugal  for tungsten, Sweden for steel, ball bearings, and Switzerland for weapons and other needed materiel.

Actually the Nazis were the best example of what happens when liquidity disappears.  Hard to find other good examples.

Gold was the last refuge of scoundrels.  TEOTEWAKI.  This is a warning sign of global FUBAR.  Not over the cliff yet, but the stream is getting a bit noisier.

Mon, 10/03/2011 - 21:42 | 1735480 Caviar Emptor
Caviar Emptor's picture

It's the perfect casino credit arrangement. You transfer in something actually valuable in return for the right to make bets on all the tables any which way you want. 

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