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The Doctor Needs A Priest, Stat
Doctor copper that is. Because apparently someone forgot to tell China that "Europe is fine." As a result, over the past 3 days we have seen a relentless selloff in all risk assets and commodities when China is open (the weak GDP print sure didn't help), at time bordering on liquidation, but most notably in copper which is now down 7% on the week, and which in a feedback loop forces domestic speculators to sell anything that is not nailed down, due to copper's use a core Letter of Credit pledge. As a result, any drop in copper leads to leveraged selloffs in all other assets, which leads to even more selling in copper and so on. Perhaps the Beijing editions of the FT or The Guardian can promptly put an end to this lunacy, which can be ignored by vacuum tubes only for so long...
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cash is king, babydoll. falling asset prices all over da place.
Cash may be King for a day, but Copper is God
and Elvis is king, but that won't buy you groceries.
It will buy a fried peanut butter and banana sandwich........
Oh, pish posh. Silver and Gold are literally PRICELESS since there is NO KNOWN PRICE for those metals.
LOL, and what exactly is the price of a dollar?
One's freedom?
“Gold is the money of kings; silver is the money of gentlemen; barter is the money of peasants; but debt is the money of slaves.”
- Norm Franz
OFF TOPIC, but one of the most important posts you'll read:
I've been mentioning for some time that if The Bernank gets prices up (i.e. inflation) enough to offset a drop in consumption, he can claim that GDP is growing.
In this case, only NOMINAL (not REAL) GDP would be growing (in other words, people would be consuming less, but paying more for what they consumed, and round and round - death spiral of living standards).
Well, both Goldman Sachs and - wait for it - Paul 'Let Aliens Invade Earth' Krugman are now endorsing this NOMINAL GDP TARGETING BY THE FEDERAL RESERVE.
These people are pure psychopaths.
*Caveat Emptor: Reading either of these articles may put you into a rage, assuming you're of sane mind.
There is now a full court press by Goldman, JP Morgan, Krugman and their ilk, to speak of Nominal GDP Targeting, rather than intentional currency debasement, in a sick, sociopathic attempt to hide their true aspirations and goals through sleight of hand semantics. These people are absolute, filthy criminals.
In the 1970s TPTB kept the nominal value of the stock market flat, while inflation cut the real value in half. They avoided headlines like: "Stock market crashes 50%". And the sheeple slept on.
Actually, the stock market fell in REAL value by over 70% by the summer of 1982.
Have you checked out what his old scratched up 45 records have been selling for on eBay? Up to 380 FRN's! You can buy lots of groceries for a scratched up piece of Elvis vynel... or just convert to silver that will buy much more groceries later...
US airforce doesn't run on copper. oil is God.
A barrel of oil is the equivalent of about 1700kw/h. If you put Lance Armstrong on a bike hooked to a generator he'd pump out about 0.5kw/h. Thus, one barrel of oil is the equivalent of Lance Armstrong pedaling hard to power whatever you need for about 3,400 hours. $100 seems like a steal, no? (Note: this isn't a complete analysis as one has to account for combustion efficiency, metabolic efficiency, etc.)
Energy is nature's currency. If an organism wishes to survive it must obtain at least as much energy as it consumes in order to stay alive much in the way a business must make at least as much money as it spends in order to keep the doors open.
Every economic transaction that occurs in the economy is tied to energy in some way. The goods and services we consume every day are all about energy. Think about it: nothing escapes energy.
Energy is the ultimate currency. It is flexible (the amount of currency in circulation is determined by the real resource base of an economy), it is universal, it is easily measured (and measures are easily converted), it has an intrinsic negative real interest rate (which lessens the chances of a demand shock), and it cannot be "printed" by a government.
Again, energy is the ultimate currency. Gold, silver, etc are just investment vehicles. I've been pushing this for a while. Hopefully people start to listen (not being arrogant, I really believe that an energy currency would be beneficial to everyone in the long run).
Until we can discover a way to store energy for an infinitely long period of time, so that at least it would satisfy one condition of a money, this point is invalid.
I regard precious metals as equivalents to the free energy in a system that must be increased in order to overcome entropy. In this simple regard, precious metals intrinsically subsume the notion of energy or energy-equivalents as money.
Oil (the bulk of which was formed in the Jurassic period) has been sitting in the ground for over 30 million years. Is that long enough?
They stopped printing oil back in the Jurassic.
And you can eat it!
Granted this will spark rather harsh rebuttals but I take issue with the "store of wealth" aspect of money. Assets should be used as stores of wealth. Currency should not. Currency should reflect the real world. In the real world, goods and services that are left unattended decay. Thus, the currency that is a claim on these goods and services should also decay.
Consider a solar panel: every hour that goes by that it produces electricity but that electricity is not used is an opportunity lost. In a world with an energy currency, that Xwatt/hour of currency disappears. In our current monetary system (and in one based on precious metals) the holder of currency (which is a claim on that Xwatt/hour) receives no penalty. They still have their currency, their claim on that watt/hour, thus causing the owner of an asset (the solar panel) to incur an opportunity cost.
Which currency system more clearly reflects reality?
A novel idea, except for the fact that it's already in practice... and has been so for thousands of years. It's called 'bartering for food' (or with food, depending on one's role in the transaction). Or were you thinking of something with a little more sci-fi flair? Duracell batteries? Freeze-dried miniaturised cat food?
Or carbon credits? Since it's a waste product of energy consumption, thus inversely-related, that'd be the closest fit for your idea of an energy currency.
Gold???
(Not so fast, it's a cash alternative).
it's down 2% right now....will be cheaper before it gets more expensive. position limits my ass.
Remember the Bernake said Gold is not money. Sorry - can't use it.
<..
It's only used in plumbing and electrical applications due to tradition anyhow.
Not to quibble over trivialities, but most new plumbing in residential and even commercial structures uses pex tube, instead of copper tube, now. The leads (which are only maybe 3% of the total material) are still copper, though.
But for electrical, yes, copper is really the only game in town, and there's a couple of miles of copper wiring of a variety of sorts in the average new residential structure...
...not that many of those are being built right now.
FWIW, I'd be short copper right now if I dared play in the broken markets casino that The Bernank has recklessly and/or maliciously created.
Same idea here.
Forgot to add that the "huge spike" in new residential building permits (it wasn't "huge," and permits are now running at a rate of 1/5th of what they were in 2006) reported by the BLS today was disproportionately caused by multifamily dwelling structures, aka 'apartments.'
Renters, bitchez. The ownership society, negative equity and all other baggage, ain't what it used to be.
one day soon perhaps, copper won't be used in plumbing at all anymore . now they are using plex. copper will only be used for repairs of existing lines , if these lines are not replaced....plex is the future and the future is already here with no soldering and just crimping....
I knew a guy who had aluminum wiring in his house. (Built when copper got really expensive a few decades ago.) He started having problems with his microwave oven, so he replaced it. Same problems with the new one. Eventually an electrician opened up the wall and discovered sparking due to corrosion caused by dissimilar metals. Apparently connecting an aluminum wire to a copper wall socket is not good. He had to completely rewire his house with copper. It cost him a bundle.
I would never buy a house with aluminum wiring.
A half day and a $10 bottle of Noalox grease would have been enough to rework all the Cu/Al terminations in his house rather than rewiring the entire thing which would have taken months and the labor and repairs (walls, floors, ceiling drywall, studs, etc) would have far outweighed the costs of any copper material.
It wasn't just the sockets and switches. There were splices within the walls which were sparking. He showed me a piece of the old wallboard which had been removed which had a region with lots of black spots caused by sparks. He wasn't willing to risk a fire.
There were splices within the walls which were sparking.
buried splices within a wall cavity is against any building code, all splices have to occur in a "box" and be accessible bc of fire hazard regardless of what material the wiring is. whoever did the job was not an electician but probably worked for the fed.
@jdrose1985 and prains - Thanks for the information!
Beware aluminum wiring. The problem goes much deeper than a Noalox "fix".
Modern Al alloy can be and is used. The older Al alloy caused sparking, etc bec of excessive temperature expansion,deformation specifications. That caused pressure-terminations to "relax" and/or gap, which caused increased resistance between terminals, and worsening over time. There were 1,000's of house fires before the older alloy was discontinued for wiring.
See a qualified, professional electrician and do not attempt repair unless you/he are qualified on the precise tools/procedures and specs mandated by your local E inspector.
wonder what the melt value of pre82 pennies are?
you can check that info here:
http://coinflation.com/
thanks, larry
HEY! Ya gotta watch crude, production cost for most is now + $80 - $100 per barrel. Credit death in China means crude that costs more to produce than what 'consumers' can affort to pay!
(Crude cost is why we're having a 'finance' crisis, btw: $10 barrel in 1998).
The outcome of 'too expensive crude (despite the 'cheap' price)' is physical shortages -- which are now taking place in China.
China's customers cannot afford expensive crude in the form of poison dog food and toys made out of lead and plutonium. China's shortages are likely permanent.
What about ours?
Drive a car or eat. I got rid of the goddamned car, I like to eat!
Gave ya a greeny... But new US land production runs $30-60 in costs. And production runs are sold for some time. I agree that oil was a major factor in the crisis, and told anyone who would listen back in 07.
Although those high prices in 08 helped finance the technologies, and more importantly the capital needed to setup the new production now being seen.
"The outcome of 'too expensive crude (despite the 'cheap' price)' is physical shortages -- which are now taking place in China."
Really? I drove while over there and didn't see that. Do you have link or speak from personal experience or ???
I have.. The lived there past 5 years. And you,re correct, Chinese have no real issue with fuel prices at these levels. Even the have-nots can afford to keep their Honda 110cc moped filed up.
Short the rally in cash - Cash is Trash.
Those stupid commies just need to start building empty cities faster.
Or, are they fascists? Or brilliant central planning czars?
Democrats.
OT..After listening to Biden today this has to be the worst administration I have ever lived thru. The white house which was that "shining city upon a hill" has been turned into a slum lord of policy and and bankrupt. This has got to end.
Women are gonna be raped if the jobs bill isnt passed, says Biden.
Meanwhile, Bernanke continues to rape ALL savers and pensioners, regardless of gender.
You'd think he'd get tired after a few million, but similarly to an old Timex watch, he takes a licking and keeps on printing.
Well, according to Joe, at least they can dial 911 during the rape.
The chutzpah of these regulators.. damn. Saying they will apply position limits (after they define 'swap') oh, and after 60 days, and maybe by the end of 2012, it was all a dog and pony show.
Maybe it's time to dump metal and go long on tar and feathers. Something has to give, the camel is staggering.
Tyler,
Didn't JP Morgan take a massive long position on copper about 6 mo ago? Are there implications for the Morgue in this sell off?
just shows you how dumb wall street is, they also went long EUR, while hedge funds took them to the cleaners. their best bet was probably the silver short ala Goldman re: Aug7/8 selloff
cash or silver......cash or silver.....cash or silver......i thought i had it figured out, but i have come to realize i have no idea
50% metal 50% cash.
emerging markets bitchez
A watcher.
Offshore investment funds, bitchezzz
+100% per year
nickels worth less than 5 cents now. Down to 4.9 cents.
Haven't seent that in 3 years.
Transitory.. only as compared to the papier du jour.
Uh-Oh....
Another day where "Paper" rules over "Hard Assets"
Today's move in many commodities was more proof that prices can be set by TPTB, with the simple threat of more margin hikes, contract limits, or whatever else they can dream up.
No limit on the number of U.S. Fiatscos you can hold, or Treasury Bonds, or SBUX and WFM stock certificates either.
Those assets are all Fed-sponsored and TPTB-supported.
so were federal pension plans....
question, did they ever put those assets back...
or did they just put tresuries in place of those assets....
or did they just take 'em like tptb took the SS trust fund....
well, robo?
It is much bigger and more ominous than a manipulation. There has been a secular demand reduction. It will continue.
People used to laugh when i said i could hear the deflation monster roar.
Germany is fighting the last war, hyperinflation. If we play it right we can monetize the hell out of our debt and own the world. However we will be too cautious too and sink with them.
.
+1
Copper chart - Complete the dead cat bounce here to support, set a divergence and have one last brief pop up to complete the right shoulder of the large head and shoulders - or just puke up a lung now - either way not good.
http://bit.ly/r5hSLI
We maybe starting a leg down in SP500 which will take us to 900 range. All suckers are in, Cramer is masturbating on CNBC fast and furious, so it is time to have this lovely meltdown. This should cut down Cramer's audience from 10 to 5.
Maybe, but I don't think so, not yet. We hopefully will drop down to 1170 (so I can unload some Nov puts) before finishing this rally with another bounce up to around 1270 (Decemberish), and then we tank, and take out the 2009 lows sometime next year.
Copper was selling before the Aug sell off, so was the Shanghai A and B, Shanghai B (a lot of o/s investors were selling) got decimated in Sept. Copper is the pre-curser to the Aug leg down. We are due for another one, say 200+ drop on the Dow, then trading into lower ranges (S&P etc). So this is a very bearish signal. Even if markets rally into next week, mid week into the following week (maybe sooner) and the market collapses again.
The EU ESFS will flop hard, no one is going to agree on major German/French contributions and banks won't write down anything. Plus, France gets a credit downgrade, Germany could be next. It's a mess. But the volatility should continue to the next market meltdown. A liquidation short trade is due.
Let the smackdown begin... And let me get my truck in reverse... Thank you for the gift; Gold, that is (probably Platinum too)... Stackin it higher.
Oh, and back from China too. An awesome visit; good food, good people, great opportunities... Though there are challenges, I found the environment to be better than prior visits, infrastructure has improved (reliable and modern but still several years behind the West), and people were generally optimistic and friendly. Many of the cities I visited were bustling with activity and numerous foreign high-end brands were evident (I still laugh about seeing a Walmart, however). We have a new consumer class, and they are just getting started. Kinda scary in a way, but encouraging from a capitalistic view (and something I couldn't say about the West right now; especially with the US ever more leaning towards Socialism/Marxism, and no bitchez, I ain't givin you my hard earned coin). It seems there might be a move in my future...
Good luck with the growth, dude.
Uh huh... And where do you think it's better?
Nowhere. Global depression in the making.
I tend to agree, coinciding with the fiat currency depreciations and/or collapses that historically have inevitably followed every such example of exponentially rising governmental debt.
This time it is NOT different!
Good luck when you tell CCP you're not giving them any hard earned coin.
ES should already be atleast 1150 level if not 1130.
You don't need a doctor honey, you need a mortician.
Tylers... Thank you for all of the overlay knowledge you have inadverently passed my way.
Hopefully?... One day we can plan an offshore symposium. That would make ( SEEKING alpha @ ) look like a picnic!
Long cash, long physical gold with 1/2 hedged with GLL from $1850.........long physical/short paper gold is a no brainer...premiums are already rising and the one sure trade is that premiums will continue to rise.....even to a point where paper gold will fall as physical rises. So your short and long will both be winners.........
Not even cuddling with my stack of silver provides comfort anymore. Not since the CFTC ruling that exempted the silver shorters.
X/F the ruling has no bearing on you. Applies to commercial traders and I highly doubt you trade > 25% 0f the physical holdings you have. The actual number of contracts, 500toz X? is still undetermined. These are also contracts for undelivered " trades", and you make the spread off the contract inbetween dealers! Get it?
In the comfort department, don't overlook the therapeutic use of the stash. The wife gets occasional leg cramps and I gave her a 10 oz. Silver Towne to keep on the nightstand – the cold metal acts to counter little spasms. It really works. As it is a rounded edge cast bar, once it is warmed up, it has other applications as well.
It has an interesting patina now.
If there was ever TMI in a post, you just won it hands down (grasping a rounded edge cast bar... no, wait... see what you did!?!?)...
The junks just re iterate your loss.
I would appreciate it if you stick/ away from me!
http://books.google.com/ngrams/graph?content=gold%2Csilver&year_start=1800&year_end=2008&corpus=0&smoothing=3
If you want to see an argument for buying silver and gold look at this graph on the ngram viewer.
If you haven’t heard of it, Google has digitized 5 million books so far and the ngram viewer lets you search for usage of words in the books but it takes it one step more and puts it on a graph comparing it’s usage over time.
The usage of the word gold and silver is on a graph on that link. Look at it and consider the following:
It starts low in 1800’s and goes up peaking in the late 1900’s and again between 1935-1940.
Now consider:
1) In 1893 http://en.wikipedia.org/wiki/Panic_of_1893 there was a financial collapse related to bank failures.
2) In 1937 http://en.wikipedia.org/wiki/Great_Depression it was the worst year of the depression.
Look at the curve on the right side at 2006 – it is increasing and this is before the 2008 collapse. We are entering a financial downtime and a huge bull run for gold and silver.
That's an interesting view; thanks! And a +1.
What is the 'smoothing' index represent? This link is set to 3.
Look at data startng from 1500. Change Smoothing to 0.
I don't know very much about history but it seems to correlate to TPTB and resource explotation through Empire building or sustaining of their Kingdoms. Also, I do recall Land Barrons eventually gave more to the Peasants, though not out of compassion, but necessity of survival for their Power and to pay their debts.
I'd like to see more about the historical significance of these charts. Great resource, HarbourCity!
How long will it take before this affects cable prices? or is everything sticky? I am talking buried utility/service type wire.
That was a good post . Thanks Harbour City.
Biden probably told the Chinese Dr. Copper knows shit because the asswipes printed by Bernanke are rather golden. Keep your faith by repeating the mantra.
Build another Colossus
I wrote this several times in the past about china and commodities. China may make this commodity bust last a long time.
China was selling silver up through the low twenties then became a net buyer.
They bought guaranteed oil contracts from goldman when oil was 147 a barrel then made noises about canceling them.
They bought and hoarded all sorts of metals as prices were rising last year. Just watch as commodity prices drop. Volume out of asia will not pick up. China always buys high and cuts back on purchases on the subsequent downslope. Classic procyclical behavior.
And these ghost city building central planners with accounting and lack of clarity on par with greece is going to take over world finance? Dont think so.
You're right; it's the pious West that will maintain that status. Rrrriiiggghhhtttt.... Whoops, almost forgot... /sarc
People will eat the least stinky shit and fuck the least ugly girl.
That is the usa dollar.
Besides, we got gresham's law on our side. The way to become the most used currency is not to have a good currency but a bad one.
Dude... I told ya not to inhale... WTF!? Gimme dat shiznit back...
China was selling silver up through the low twenties then became a net buyer.
Let's hope that they decide to dump it all!
I have to say - all the pro-Chinese government talk I often hear - like, "the Chinese think in terms of decades", or, "the Chinese Central Bank knows what it's doing", runs at odds with all the historical evidence that central planners not only are truly clueless, but are unable to get a clue because they make decisions based on politics rather than price.
Not that we're in any different a situation in the 'free' West any more, mind you....
obviously, there was a copper bubble
Biden probably owns " Swaps in Zinc and Copper" , and has them hedged against " WOOD ". < sarc off / (:
Gold and silver have moved pretty much in lockstep with other industrial metals for two months now.
Kevin, is that you? :)
That is a completely inacurate statement. Gold has fluctuated much more than silver, even with 5% moves in place.
I'm not a metals trader. If I were! I would take the risk /reward of xag or other industrial metals over xau for the medium term.
Bottom shopping. Have you been to the grocery store lately?
Yeah, I bet you get fluctuations in something that is almost totally useless and yet sells for fiftysomething bucks per gramme.
Thanks for your reply. Grams? English Style?
I'm looking for engineers. At least Siemens says so?
Gold has fluctuated much more than silver? WTF are you talking about? Silver was $50 in May. Now it's banging around $30. That's a drop of 40%.
Gold was $1940, now it's $1610. That's around 15%. How is that more than 40%?
I read your replies here, YC, and sometimes I have not even the vaguest idea how they follow from the postings you're (supposedly) replying to. It's like you've accidentally hit the 'reply' button to a completely different thread.
If that gonzola lyra guy get's his 2.67 price target I'm going to be so mad. He'll just be impossible to live with.
There's more coper in China than rice,stolen American patents, lead paint, rice, and infant girls in the bottom of wells.
Someone tell the slick haired FCX shill on CNBC.
Yeah; nothing like a fetus being ripped prematurely from a woman in the west (but hey, it's legal)... Dumb fook...
Yes. It is SO much easier and simpler to kill them after they are born.
That way, you will be sure you aren't killing a much more valuable boy.
You're right; now what about 3rd trimester abortions? Another Dumb Fook...
Again, why bother with abortion, when the (Chinese) age-old custom of infanticide (not to mention forced abortions of infants of both sexes) is so much simpler and easier?
http://www.msnbc.msn.com/id/5953508/ns/world_news/t/china-grapples-legac...
http://en.wikipedia.org/wiki/File:Sex_ratio_below_15_per_country_smooth.png
Funny how anything critical of the corrupt and degenerate Chinese Communist Party, or its authoritarian society, is immediately jumped on here by trolls working for the Central Committee. Just curious, do they pay you in yuan, or copper futures, or releases for relatives working in the slave-labor lead toy and poison dog food factories?
No need to prove anything to a twit like you (msnbc; great source); but having run into too many of your toothless, dribbling, banjo playing kissing-cousins (males of course), have decided it is time to leave the rot to you and yours. Continue to play your fiddle and spout your sophistry if you must but, in the end, you are only showing your ass to the ROW; and I'm sure they're still laughing at you. I know I am...
Your misdirected, bitter and blanket hate are a disservice to this site.
Pot meet kettle...
Say hi to your Chinese Propaganda Ministry handlers.
Seriously, IronShield, are you paid to defend China's reputation, or do you do it free out of 'loyalty' to the motherland?
Twas listening to Schiff today and the "offcial" inflation numbers were very high, around 4% all this deflation talk is pissing me off.
Deflation is a threat in search of a reality.
"which in a feedback loop forces domestic speculators to sell anything that is not nailed down"
Does that include the coffin of fiat money even if it's missing one last nail?
When does the SS Jiugang relaunch?
http://www.chinasmack.com/2011/stories/17-million-rmb-luxury-boat-sinks-immediately-after-christening.html
Gee, I don't know... How about sophisticated bridge building (good vibrations...): http://www.youtube.com/watch?v=j-zczJXSxnw
THE DOCTOR( needs ( some ( VAN HALEN....
Hot For TEACHER!
EUR got smacked down
Perhaps you should ref: my call 2 days ago. I'm not going to give any more trades away.
Albiet. I like the cable trade!
Copper is certainly King, but gold remains the standard. Our London Escorts
certainly prefer gold.
Excellant, copper down, cotton down..., both shorts up and pants down!