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Gold Implied Vol To Surge? Gold Sept15/Dec15 $3300 Calendar Spread Trades

Tyler Durden's picture


Too lazy to bring up the chart but take our word for it: a block trade $3,330 Gold September/December 2015 calendar spread just hit the tape at 8:46 am on the CME at an 18.5 bps spread. Looks like someone is starting to believe that the CME interventions in gold via margin hikes will merely compress the implied vol which will explode sooner or later. Also, without knowing the details behind the trade, we wonder if the strike is an indication of where gold is headed or merely a arbed matrix glitch in the implied vol curve. We will try to bring you more on any other odd Greeks we notice in the gold market which is increasingly positioning itself as a reserve currency.


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Thu, 08/11/2011 - 09:14 | 1550387 DormRoom
DormRoom's picture

Keynes argued an international currency reserve would be anchored in 20 commodities, and not just gold.

Thu, 08/11/2011 - 09:16 | 1550399 Pladizow
Pladizow's picture

Can someone please provide a leymans explanantion.

And please don't simply say buy gold or that the gold price will go up.

Thu, 08/11/2011 - 09:47 | 1550576 bigdumbnugly
bigdumbnugly's picture

i'll have a crack at it, pladdy

its like if you strapped a way too tight bra on those big beauties to flatten them out (think judy garland in the wiz of oz)  and then wore it around for too long... well as soon as you loosened those monsters from building pain and pressure they would excellently explode outward.

does that work?

Thu, 08/11/2011 - 09:57 | 1550615 hunglow
hunglow's picture

Works for me

Thu, 08/11/2011 - 10:07 | 1550651 iDealMeat
iDealMeat's picture

works for me too..

Thu, 08/11/2011 - 10:13 | 1550673 bigdumbnugly
bigdumbnugly's picture

yeah, i had little doubt that would get through to the hunglows and idealmeats out there, lol.

but hopefully it helped pladdy.

Thu, 08/11/2011 - 10:30 | 1550754 hunglow
hunglow's picture

Wonder couldn't contain them.

Thu, 08/11/2011 - 10:41 | 1550801 gmrpeabody
gmrpeabody's picture

Thank you for the mental image that conjured up.

Thu, 08/11/2011 - 10:06 | 1550643 dropdeadfed
dropdeadfed's picture

+1 for booby freedom

Thu, 08/11/2011 - 10:17 | 1550690 speedy
speedy's picture

Works for me!

Thu, 08/11/2011 - 10:47 | 1550832 hunglow
hunglow's picture

Me two speedy

Thu, 08/11/2011 - 11:27 | 1551023 Strider52
Strider52's picture

Gotta like exploding bras...

Thu, 08/11/2011 - 12:44 | 1551301 hunglow
hunglow's picture

Maaa Maaaa

Thu, 08/11/2011 - 09:17 | 1550402 Mr. Fix
Mr. Fix's picture

Keynes argued for all kinds of things that have been completely disproven.

 How could he possibly still have any credibility to anyone?

Thu, 08/11/2011 - 09:20 | 1550420 SheepDog-One
SheepDog-One's picture

It is nice to finally see the undeniable end of Keynesian BS...but that doesnt mean they cant keep it trudging forward anyway for a while under new Uber Congress orders. 'Keynesian economics WILL be reinstituted, and you are ordered to like it! All your gold coins are belong to us now'!

Thu, 08/11/2011 - 09:23 | 1550435 EscapeKey
EscapeKey's picture

Well, let's face it - two economists;

one allows the government to simply print lots of money when hard times come around

the other tells the government to cut spending, and live within means

Which one do you think the government will give the job?

Thu, 08/11/2011 - 09:26 | 1550467 -Michelle-
-Michelle-'s picture

Is that a trick question?  It seems a little too easy.

Thu, 08/11/2011 - 16:16 | 1551398 malek
malek's picture

No, the trick question is:

Do you think that previous example has any connection to our reality?

Thu, 08/11/2011 - 09:26 | 1550462 DormRoom
DormRoom's picture

you need to seperate Keynesian theory from the poor execution of it.  You can have a sound theory, but  if it is poorly exercised, it is not the theory that is incorrect, but the methodology used.

Thu, 08/11/2011 - 09:28 | 1550484 EscapeKey
EscapeKey's picture

oh yawn, yeah we never heard that one before. communism never worked before, because of poor implementation - but THIS time around...

now, swap the word "communism" with "keynesianism".

Thu, 08/11/2011 - 09:36 | 1550530 DormRoom
DormRoom's picture

The American experiment doesn't seem to be working either. 

Thu, 08/11/2011 - 09:40 | 1550548 EscapeKey
EscapeKey's picture

please explain what is "free market" about endless stimulus?

Thu, 08/11/2011 - 09:46 | 1550569 malikai
malikai's picture

One cannot deny that we have evolved to kleptokeynesianism from an austrianist start.

Thu, 08/11/2011 - 09:44 | 1550560 Doubleguns
Doubleguns's picture

That would be "manipulated" American experiment. Thank the politicians, bankers and Keynesians.

Thu, 08/11/2011 - 10:44 | 1550822 gmrpeabody
gmrpeabody's picture


Thu, 08/11/2011 - 09:46 | 1550570 Shell Game
Shell Game's picture

The American experiment went terribly wrong with the War of Northern Aggression (a.k.a. the Civil War).  The consolidation/centralization of Federal power killed the Republic and sent us along this inevitable path.  Kill centralized power, give it back to States and The People, and the true American experiment can resume.

Thu, 08/11/2011 - 10:07 | 1550652 I Got Worms
I Got Worms's picture

Shell, can you point me to a book or essay that discusses the version of the Civil War/Abe Lincoln that I wasn't taught in junior high school social studies, such as the suspension of the Constitution. I get bits and pieces on blogs such as this, but still don't quite understand.  I search Amazon, and only come up with books discussing the greatness of Lincoln, ending slavery, etc. I'd like to understand from a viewpoint discussing the effect the war and Lincoln's actions had on state's rights.

Thu, 08/11/2011 - 10:16 | 1550685 Rossalgondamer
Rossalgondamer's picture

Lincoln Uber Alles: Dictatorship Comes to America by John Avery Emison

Thu, 08/11/2011 - 10:18 | 1550699 Shell Game
Shell Game's picture

Thomas DiLorenzo has devoted much effort in exposing the truth about Lincoln, the real Civil War and Federalism.  His writings are archived at here:

A must read for every open-minded American, "The Real Lincoln: A New Look at Abraham Lincoln, His Agenda, and an Unnecessary War", at Amazon.

Thu, 08/11/2011 - 11:36 | 1551062 A Nanny Moose
A Nanny Moose's picture

A great read. I would suggest this book for anyone with an interest in "questioning the received reality"

Thu, 08/11/2011 - 10:20 | 1550703 Angel Face
Angel Face's picture

Read Lysander Spooner - No Treason

Thu, 08/11/2011 - 10:49 | 1550846 I Got Worms
I Got Worms's picture

Thanks fellas - ordered all 3 books. Looks like I've got some reading to do!

Thu, 08/11/2011 - 15:36 | 1551765 Random_Robert
Random_Robert's picture

The 14th amendment turned the "Free men" of the Independent Several States of the American Republic into "Citizens" of the newly formed independent state called the District of Columbia, a non-federated sovereign (and therefore never documented to be part of the Republic of the Several States...

So, when the states ratified the 14th, they unknowingly yielded the sovereignty of their free citizens to the District of Columbia. 

And shit's been running downhill ever since.

The IRS, the Federal Reserve, the New Deal... all would have been impossible if not for the 14th.

Freeing slaves? It was hardly about that. The end product of the Civil War and the 14th was the insidious financial enslavement of anyone who dared to want to be called an American.

Here is the 14th summed up in one bullet point:

  • Black man, you can not be legally owned by any other man within these borders, but EVERYONE within these borders can be legally owned/indentured to a faceless corporate elite of international bankers.



Thu, 08/11/2011 - 10:59 | 1550882 jerry_theking_lawler
jerry_theking_lawler's picture

the "american experiment" ended around 1913.....its been in the process of being transformed into what we are seeing now every since.

Thu, 08/11/2011 - 09:30 | 1550495 breezer1
breezer1's picture

all meaningless when you mix in a little 'human action'.


Thu, 08/11/2011 - 09:37 | 1550536 ViewfromUnderth...
ViewfromUndertheBridge's picture

That's the spirit Dormer, but nobody here has read Keynes. What they mean is Post-Keynesianism...the political corruption of Keynes into pump-priming all the time.

Keynes work is worth reading, he is a perceptive funny guy whose biggest fear was inflation. Others said inflation would sort itself out in the long run and Keynes responded derisively to that with "in the long run we are all dead"...and it became the catch-cry of the short termers mis-quoting Keynes 4eva! And here we are. 

He was the smartest guy of his generation and I think he would be the smartest guy today, and he would take on TPTB and their TBTFs. He did just that in his day.

Thu, 08/11/2011 - 09:54 | 1550594 baby_BLYTHE
baby_BLYTHE's picture

He was a eugenicist and a pedophile, I hope you know

Thu, 08/11/2011 - 10:13 | 1550671 ViewfromUnderth...
ViewfromUndertheBridge's picture

That does sound like three strikes then...

I take it you have cracked the coded diary.

Thu, 08/11/2011 - 10:17 | 1550691 CosmicBuddha
CosmicBuddha's picture



It doesn't matter how smart you are, if your worldview and beliefs are not in accordance with reality then everything you say will be bullshit. This is the case with Keynes. Interest rates and prices should be set by the market and not by central planners. This is the fatal flaw in Keynesianism and why it is complete bullshit. It really is this simple.

Thu, 08/11/2011 - 10:25 | 1550734 MrPike
MrPike's picture

Smartest guy of his generation eh?  Sure, if you ignore Mises, Hayek, and Schumpeter.  Their economic teachings are now ignored because it flies in the face of the all knowing government. 

Thu, 08/11/2011 - 09:47 | 1550575 ZackLo
ZackLo's picture

I'll make this easy for the keynseyian worshippers.....


line by line bitchez

Thu, 08/11/2011 - 09:50 | 1550580 slyhill
slyhill's picture

Keynesian extremists.

Thu, 08/11/2011 - 13:24 | 1551425 malek
malek's picture

You mean like Communism, Eugenics, Socialism, Exceptionalism - just to name a few?

How could one ever question the soundness of those theories!

Thu, 08/11/2011 - 09:23 | 1550437 Long-John-Silver
Long-John-Silver's picture

He's got credibility with Satan where he resides in hell. He personally sticks a trident in his ass several times a day.

Thu, 08/11/2011 - 09:48 | 1550526 cowdiddly
cowdiddly's picture

I do not know you Long John, But I commend you as the only one on this board with the vision to see the way forward. You posted months ago that you demand payment in silver for work at your shop. The bankers will never give up and will only offer some other bullshit fiat as a solution. We the people must stop merely hoarding and rat-holeing metal but start using it in exchange. This is already well underway in India. I am running an ad to sell a John Deere tractor for ounces only, not really to sell but just to get a few sheep used to the idea. I do not need nor want their fiat. We must start using a triple monetary system gold, silver, copper from now forward. 

Thu, 08/11/2011 - 09:52 | 1550588 Long-John-Silver
Long-John-Silver's picture

You better be prepared to allow someone to actually buy your tractor with ounces.

You may get shocked when someone actually takes you up on the offer.

I posted my Silver/Gold labour rate sign just to keep people from walking in

with one-off jobs because I generally setup production runs of several hundred peaces.

I've ended up doing jobs for Silver and Gold bullion and coin. I will stop a production run

and do a job for Silver or Gold bullion just because I also want to promote this exchange.

Thu, 08/11/2011 - 10:16 | 1550686 cowdiddly
cowdiddly's picture

I will gladly sell it if the bullion is purdy enough.

Thu, 08/11/2011 - 10:15 | 1550682 I Got Worms
I Got Worms's picture

Gold, silver and COPPER? I like where you're head's at. While I've been stacking gold and silver, I've also been hoarding pre-1982 pennies for several years. I got a guy at the gas station who saves them for me, and i just swap him out for new shiny pennies. Hell, the melt value on an old penny is about 3 cents. The way things are headed, we may be able to buy lunch with a few copper pennies one of these years!

Thu, 08/11/2011 - 10:22 | 1550710 cowdiddly
cowdiddly's picture

A gold only money system only leaves the banksters in control as they control most of the worlds gold er.. tungsten. Thats why they hate silver so much. Its the biggest threat to their control and copper just adds variety and ability to make change.

Thu, 08/11/2011 - 10:49 | 1550842 MsCreant
MsCreant's picture

I want to know more about why you think they hate silver so much. Got a link or can you say more about that here? Gold they can monopolize, I get that, but not silver?

Thu, 08/11/2011 - 17:42 | 1552253 Hephasteus
Hephasteus's picture

Yes. Bankers own lots of gold. They have lots of gold. They can control gold nearly completely within reason. They do NOT own silver. They can't control it by any stretch of reason. When silver get's nuts they are sort of forced to raise prices on gold. It's a distraction. It's like 2 women in a room. One is running around with topless so gold is forced to yank it's pants down and show it's ass.

Let's look at supply demand. Nearly every ounce of gold ever mined is still available. The amount above ground dwarfs what can be mined. You control supply with price. Raise prices a bit and you losen up hands.

Silver. The amount above ground is about 1/30th the size compared to golds mining supply above ground supply ratio.  You're forced to control price through mining your ass off. Problem is glut. See if you are in an economic downturn and say shipping falls on it's face. You can take 55 gallon barrels of oil and cook the gasoline out of them and then store off a 35 or 40 gallon barrel of oil that can be cooked later to make diesel. With mining you can't do that. You get it all at once. You can forestall some ore processes but there's storage problems. So in a downturn like the great depression you turn mining up to 11 and rip the volume nob off. The problem is you start glutting up all this sulfuric acid. All these sulfer compounds. All this lead. And most importantly all this copper. Which is why you will always and I mean always have a copper price problem during a heavy recession or depression. We are experiencing a 50 to 70 percent drop in manufactured goods. This is causing big problems.

The copper market will break and I mean get ripped from limb to limb. You'll be looking at 2 dollar a pound copper at a time when a box of mcdonalds fries goes for 3 bucks and a gallon of gas is 6 bucks. As you attempt to produce silver at cheap rate you're normal price and margin padder copper is getting margin compressed by 2 black hole full of hatred and malice. It doesn't margin compress you. It turns half your profits in a huge and I mean huge losses. This is coming to fruition. It started with warehouse after warehouse after warehouse of copper or and slightly process copper slabs being filled literally to the roof in china. When the barn is full. We got a problem here.

Fri, 08/12/2011 - 16:02 | 1555366 MsCreant
MsCreant's picture

Thanks for taking the time to write this. Much I would have NEVER considered on my own.

Thu, 08/11/2011 - 09:23 | 1550444 DosZap
DosZap's picture

Mr. Fix,Keynes himself did not believe his theory.....................

He thought they were idiots to implement it.

Thu, 08/11/2011 - 09:17 | 1550405 tmosley
tmosley's picture

Yes, well, Keynes also sewed the seeds of the destruction of the modern world and the way back to feudalism with his voodoo economic theories, so I think we can give up on pretty much any other ideas the guy had.

Thu, 08/11/2011 - 09:17 | 1550406 Manthong
Manthong's picture

All that Keynes stuff is working out pretty good so far..

Thu, 08/11/2011 - 09:20 | 1550425 EscapeKey
EscapeKey's picture

Nono, because what we see is not Keynesian economics. The stimulus wasn't big enough. </SARC>

Let's just ignore that governments will NEVER run a surplus during the good times, and hence Keynes' base principle has as much chance of ever working as communism.

Thu, 08/11/2011 - 09:55 | 1550602 slyhill
slyhill's picture

Life is so much easier when we have a vilified term/theory/party to blame our problems on. Why waste our energies with solutions, when pointless bickering is so, uhh, satisfying?

Thu, 08/11/2011 - 09:53 | 1550591 Smiddywesson
Smiddywesson's picture

Yes but they can't do that because of soverign debt and central bank debt.  If you use a basket of currencies to anchor your new paper you can't ramp the value of those commodities to make yourself solvent without ruining your economy.

However, if you stack enough gold before announcing a gold standard, you can ramp the price of gold to whatever level you need to restore your balance sheet and pay off the nation's debts. 

Keynes' argument was a purely academic argument (what ought to be).  Our problem is a practical one (what needs to be).  To get all the central banks and soverign nations to agree, there has to be some inducement to deal with the fact that most of the participants are broke.  That's why we are going to a gold standard, they can ramp the value of their gold as high as they need to become solvent.  You can't do that with any other commodity. 

Thu, 08/11/2011 - 09:59 | 1550624 RockyRacoon
RockyRacoon's picture

Ted Butler says:

"In gold, a different pattern has emerged... Price action and daily statistics continue to suggest that commercial short covering may be a major contributor to the stunning gains. Never have we witnessed such large price gains in gold after a large commercial short position was established.. As I wrote on Saturday, the largest 4 commercial shorts in COMEX gold had bought back a notable number of futures contracts in the latest COT report, breaking away from the 5 thru 8 largest shorts and the gold raptors which both added to their short positions. This throws out hints that the gold commercial shorts may be in trouble. Certainly, it is easy to calculate that the almost hundred dollar jump in the price of gold on Monday and Tuesday has cost the 8 largest COMEX gold shorts over $3 billion in mark to market losses and margin calls. That’s over $360 million per trader on average. These sudden losses are unprecedente d and suggestive that a real emergency may be at hand. While I can’t be sure, it seems to me that the sudden outbreak of unease in world financial markets may have driven enough worried investors to buy protection in gold and that this physical buying may have tipped the scales against the big COMEX shorts."

Thu, 08/11/2011 - 09:57 | 1550613 fonestar
fonestar's picture

Twenty Commodities:

1) Tungsten

2) Depleted Uranium from Iraq

3) Fukishima wholesome broccoli

4) Irradiated Pacific Ocean Orca

5) Fake Chinese Morgan Dollars off eBay

.....okay I just got up, need another 15

Thu, 08/11/2011 - 13:27 | 1551435 lolmaster
lolmaster's picture

Keynes also destroyed the world economy an is arguably responsible for more deaths than hitler (but not Marx)

Thu, 08/11/2011 - 09:14 | 1550389 Ancona
Ancona's picture

Gold bitchez, when fiat fails, there truly is no other substitute.

Thu, 08/11/2011 - 09:16 | 1550391 High Plains Drifter
High Plains Drifter's picture


Thu, 08/11/2011 - 09:16 | 1550397 toothpicker
toothpicker's picture

wow , things are better than i thought (only $3300)

Thu, 08/11/2011 - 09:16 | 1550404 SheepDog-One
SheepDog-One's picture

But Becky Quick just said gold is icky and you should sell it!

Thu, 08/11/2011 - 11:50 | 1551126 Strider52
Strider52's picture

Would somebody *please* get Jim Cramer off CNBC?? I never watched him on Mad Money. Now, when I'm just checking the POG, I have to listen to his 'just did a gagger' rants on 'buy everything no matter what'. He constantly steps on everyone else's microphones. If you're constantly wrong, you don't belong.

Thu, 08/11/2011 - 09:18 | 1550409 ben_bernanke
ben_bernanke's picture

Is the great bear market in gold at hand? Well this period certainly bears resemblance to the late 70's, even with a Jimmy Carter in office and a bond yield explosion on the cusp, so it's only a matter of time before gold prints $900. Buy stocks for that 80's renewed Reagan run the next decade promises.

Thu, 08/11/2011 - 09:22 | 1550432 Caviar Emptor
Caviar Emptor's picture

You don't know history, sonny boy, and you also don't see how our present situation bears no resemblance. 

Thu, 08/11/2011 - 09:22 | 1550433 Withdrawn Sanction
Withdrawn Sanction's picture

"Do you take drugs, Danny?"

Thu, 08/11/2011 - 09:25 | 1550461 Pool Shark
Pool Shark's picture

"Every day."

Thu, 08/11/2011 - 10:00 | 1550628 slyhill
slyhill's picture

"Good. Then what's your problem?"

Thu, 08/11/2011 - 09:37 | 1550531 jus_lite_reading
jus_lite_reading's picture

I seriously hope you are being facetious...

Were you even around then? The main driver at that time was housing. You could pick up a two family house for $40k and buy a new Mustang for $3k.... Enough said.

Thu, 08/11/2011 - 09:43 | 1550559 SheepDog-One
SheepDog-One's picture

Comparing the 1970's to today you may as well be comparing 800 BC to today.

Thu, 08/11/2011 - 09:56 | 1550607 Smiddywesson
Smiddywesson's picture

If they could push it that low, rogue central banks would rush in and buy it.

CENTRAL BANKS are buying.  If they could get it down that low, they would have already done it.

Thu, 08/11/2011 - 10:54 | 1550868 MsCreant
MsCreant's picture

You effing effigy you! Nice troll work, excellent performance. Thing is, you must stay in character.

Thu, 08/11/2011 - 09:18 | 1550412 monopoly
monopoly's picture

Would like to see a retrenchment to 1650 or so. Will add more physical near that level. Of course I have been waiting for a dump since 1,450 to add. Obviously, I got that wrong as I have not added.

Remember, nothing goes straight up, even real money. But long term our patience is starting to pay off.

Thu, 08/11/2011 - 09:46 | 1550468 ViewfromUnderth...
ViewfromUndertheBridge's picture

watching to see if $1,764 (the last Golden Angel before "exponentiality") is now support...if it holds the last train is leaving the station.

Edit: Oh well, next train coming soon.

Thu, 08/11/2011 - 10:06 | 1550644 Dr. Engali
Dr. Engali's picture

I hope it pulls back. I've been waiting patiently with cash burning a whole in my pocket to add to my position. Buying more silver today.

Thu, 08/11/2011 - 12:17 | 1551213 DosZap
DosZap's picture

 ViewfromUnderth...  @ 09:46

Nadler (Yeah that NADLER), is prediciting a 35% correction in Gold.

Off the high, that would put it roughly back into $1,200.00 oz range.....................

If that happened, WHAT world event,would it take to ALLOW that kind of correction?.

None I can see.

$1,200.00 Gold in this total DISASTER we are living together, would see a buying frenzy like we have not seen.

It would likely cause a .gub intervention.

Thu, 08/11/2011 - 09:19 | 1550415 machineh
machineh's picture

Like terrorist bombs, margin hikes are rarely one-shot events.

After the first one, you'd better brace for the next shoe to drop.

Twenty-two lousy percent ain't gonna exterminate enough bugs, from a bankster POV.

Thu, 08/11/2011 - 09:22 | 1550429 SheepDog-One
SheepDog-One's picture

Margin hikes may pinch speculator traders of volume, but still people have no problem paying cash up front.

Thu, 08/11/2011 - 10:00 | 1550626 Smiddywesson
Smiddywesson's picture

This isn't a speculative bubble.  Margin hikes will yield diminishing returns.  Stocks are up today but everyone knows what is coming.  When faced with a margin hike, would you close the profitable stock trade to cover margin in your gold trade, or close the gold trade, hoping stocks continue to climb. 

Although you are supposed to let your winners run, I'd close the stock trade because I don't believe in this rally.  That's why gold isn't crashing. 

Thu, 08/11/2011 - 10:10 | 1550649 RockyRacoon
RockyRacoon's picture

You've touched on a factor that has always caused me some ambivalence toward the margin shenanigans.  It can't be all bad that speculators are throttled somewhat, thereby leaving gold in strong hands.   When the price moves are quickly retraced it just indicates that gold is still quite strong.   What the hey?


London Trader - Many Gold Shorts Wiped Out, Lost Everything!


With gold hovering near Jim Sinclair’s resistance point at $1,764, a trader out of London told King World News today, “I fully expect to have $2 moves in silver and $50 moves in gold as absolutely normal at this point.  If you don’t expect that, you are not going to understand what is going on, but don’t forget that we are in August and you normally have juniors manning the desks. 


This is highly unusual and we do have very thin liquidity in the metals.  So that’s one of the reasons you are seeing things move so quickly in both metals.  You are talking about a one minute bar in gold being a ten dollar range.”


London Trader continues:


“The physical buyers still have not been filled and they are getting nervous.  The buyers in size have not been filled and they are underpinning this gold market.  If gold pulls back the buyers will get some fills, if not they are going to have to start chasing this market.  In fact, don’t be surprised to see a $100 move in gold if they lose patience.”


When asked about shorts who have been badly mauled he responded, “Well what’s happened with the shorts that were in there is they were absolutely crushed on that overnight rise on Monday.  There were some margin calls on some serious players.  There were some anguished faces on Monday. 


These guys in London woke up with their asses handed to them and I don’t think some of these guys will ever be short again, if they are still in business.  So some of these perennial shorts that have always joined in the party got screwed, I mean literally lost everything.  For the ones that didn’t lose everything, they certainly lost an awful lot.


Gold just gapped up and didn’t come back and these guys were heavily short.  I believe there is still enough momentum to push gold into the $1,800’s.  We are moving into season now and things are happening in China that will impact the markets in due course.  Because we have been seeing that point of capitulation, we have been witnessing some dramatic moves as the shorts have been mauled, and as I mentioned, in some cases to the point of ending careers.”


This trader previously called the $50 overnight move in gold prior to it happening and also said the shorts would get crushed.  Shortly thereafter both events took place.

Thu, 08/11/2011 - 09:20 | 1550422 Caviar Emptor
Caviar Emptor's picture

No, I believe $3,300 by 2015 looks cheap.

It will take not years but decades to straighten out the mess the global monetary system is in. And the road to 2015 is strewn with land mines. The types of blow ups, collapses and problems that can and will happen are also gigantic game changers with huge implications. 

Nope, gold will continue to act as the world's go to reserve currency in the absence of an official replacement for the current broken system. And it's getting highly likely that a new official reserve currency will be backed by gold. 

Thu, 08/11/2011 - 09:25 | 1550454 SheepDog-One
SheepDog-One's picture

These are just men, no matter how much they may consider themselves gods, and any number of pitfalls await them. Well they wanted total control, theyve pretty much taken that, but lets see how the masses go along with their plans of world slavery with a few ultra rich kings as the world is driven into abject poverty, thats never worked once in human history.

Thu, 08/11/2011 - 09:47 | 1550568 slackrabbit
slackrabbit's picture


Gold is indeed becoming a default standard because anything else offered up simply will not be trusted.

TPTB had their chance to prove how brillient they were, and now no one is listening.

Thu, 08/11/2011 - 09:23 | 1550442 Arch Duke Ferdinand
Arch Duke Ferdinand's picture

*****Why Speculators Should Sell Their Gold

Four Gold Bubble Factors....

*****The Creek...short video.

Parallel to knocking your head in the Stock Market...

Thu, 08/11/2011 - 09:28 | 1550480 Kina
Kina's picture

Gold price in USD is intimately tied to the debt ceiling. Unless people are saying the US is suddenly going to pay off a few trillion of debt then gold will continue to climb to catch up with recent ceiling increase, and future ones. This is Fact.


The bubble is not gold at all, it is n over abundent USD.

Thu, 08/11/2011 - 09:39 | 1550541 Long-John-Silver
Long-John-Silver's picture
The date on the article you link is Monday, January 17, 2011.

Gold on that day was $1,360. Lets see now. 1761 - 1360 = 401. So if anyone had taken your advice and sold their gold they would have lost $401.

I would sugest you find a diffrent article to link to so you do not continue to expose yourself as the idiot you are.

Thu, 08/11/2011 - 09:41 | 1550549 SheepDog-One
SheepDog-One's picture

Ive been hearing 'gold is a bubble, you should sell it' ever since it was at $400.

Thu, 08/11/2011 - 10:10 | 1550655 Smiddywesson
Smiddywesson's picture

Agreed.  Fiat has reached bubble status as evidenced in the housing market, the national debt levels, and inflated stock prices.  That bubble is in the process of popping.  Gold CAN'T go down and stay down until until the process of fiat bubble popping is complete.

The unharnessed might of TPTB have utterly failed to keep it down because it can't be kept down.  They can only play a delaying action.

Thu, 08/11/2011 - 11:40 | 1551084 RockyRacoon
RockyRacoon's picture

The only bubble is gold talk and BS, no bubble in ownership.

Thu, 08/11/2011 - 09:23 | 1550443 Steroid
Steroid's picture

This might be an oxymoron trade: It is possible that there won't be CME in 2015, especially if gold is over $3,300.

Thu, 08/11/2011 - 09:27 | 1550479 SheepDog-One
SheepDog-One's picture

Any speculation of what things will be like in 2015 is just pure guessing, the world wont look anything like it does today thats for sure. Well before 2015 I believe they will have declared PM's illegal to own and trade amongst the peasantry. They just cant have it and central bank control, look at how its already falling apart for them.

Thu, 08/11/2011 - 09:54 | 1550598 Steroid
Steroid's picture

Well, you may still be able to trade your contract. (If you find a buyer, that is).

Gold is an elusive mistress.

Thu, 08/11/2011 - 10:20 | 1550707 Smiddywesson
Smiddywesson's picture

Oh I don't know, I would say it's a pretty good bet that the changes between now and 2015 will pretty much resemble the changes between the beauty of Europe in 1911 and what they had in 1915.

Thu, 08/11/2011 - 09:28 | 1550481 Debtless
Debtless's picture

Oddly enough, this morning's constitutional was a dead brown ringer for Steve Liesman. A much taller, thinner Liesman nonetheless. I take this as an omen as my shits usually are either lookalikes of Bernanke or Obama, and thus have went all in today and BTFDs.

Thu, 08/11/2011 - 09:52 | 1550587 youngman
youngman's picture

I like your trading strategy.....what do you do when you have the runs.....

Thu, 08/11/2011 - 09:57 | 1550616 Debtless
Debtless's picture

That's the redflag for going to all cash.

Thu, 08/11/2011 - 10:15 | 1550679 Divine Wind
Divine Wind's picture

Got tears in my eyes Bro. Lol

Thu, 08/11/2011 - 09:28 | 1550482 MDIB
MDIB's picture

This block trade occurred in eurodollars not Gold.  U15/Z15 is a calendar spread in the gold pack in the ED strip.

Thu, 08/11/2011 - 09:30 | 1550493 Long-John-Silver
Long-John-Silver's picture

The American $50 Gold Eagle will follow the same path as the German Gold Mark.

History always repeats

Thu, 08/11/2011 - 10:13 | 1550672 Manthong
Manthong's picture

Might not be so bad.. I have a spare AGE I'd like to use to pay off the mortgage about a third of the way up that hockey stick.

But I'd rather use a bar of Ag to do it.

Thu, 08/11/2011 - 10:24 | 1550727 Smiddywesson
Smiddywesson's picture

This will be a controlled transition.  They have had years to prepare.  The banks are stacking gold and will pull the plug long before that hockey stick lets you escape your mortage.  They are controlling inflation as  much as possible, especially wage inflation, while stacking gold so they, and only they, benefit from the transition.

Thu, 08/11/2011 - 11:54 | 1551141 Manthong
Manthong's picture

SW.. tell me how you think they will do that.

If the fiat price of the metal goes up and the mortage stays the same, they would have to try some sort of repression to avert that.

That might not work out so well for them.

Oppressive taxes or confiscation breeds black markets and/or (whatever). 

Thu, 08/11/2011 - 09:53 | 1550592 turbojarhead
turbojarhead's picture

I have an investing question for you guys(and gals). What would you do with a 401k?Cant get to it without quitting, so as much as I would enjoy that, it is off the table. I have it in bonds now,mostly due to the trashing I took in 2008, but they are now allowing us to roll into a Schwab account with ETF. Would it be wise to move into GLD? Thanks for any info

Thu, 08/11/2011 - 10:02 | 1550633 slackrabbit
slackrabbit's picture

if it ain't physcial gold don't touch it

Thu, 08/11/2011 - 10:30 | 1550729 Manthong
Manthong's picture

My 2c -- if you have to keep a 401K:

1) Get it all where you have the most options to control it.. cash seems to be king now 

2) Make sure the core cash stays in a FDIC sweep - not a MM (preferably NOT BofA)

3) Consider PHYS and PSLV.. big premiums but,  a) best chance the metal is all there  b) Eric Sprott seems to be at as trustworthy and earnest as any other counter-party, if not more so, and  c) The fund and metal is in Canada

Get options if you can and figure a strategy to accumulate by selling puts.. best way to buy the dips.

I risk small amounts in SLV and GLD (danger) to trade/sell and then buy PSLV and PHYS to hold - but that's just me.

Thu, 08/11/2011 - 10:43 | 1550802 Smiddywesson
Smiddywesson's picture

GLD and SLV are a death trap with no physical to back them up.

Sprott's Physical Gold Trust PHYS, has actual gold in the Canada Mint.  SGOL has physical gold in Switzerland.

Sorry, that's the best you can do unless you pay the penalty for early withdrawal and take delivery.  I do both.

Counterparty risk:  There is still counterparty risk.  Each of these funds could be confiscated by the government or go under due to unforseen issues.  Only physical is safe.

Confiscation:  It is a real risk, but a remote one.  The USG confiscated everyone's gold in the 1930s, so there is legal precedent for them to do so, but there are very good arguments why this time is different.  There were gold coins in circulation they needed to collect and melt in the 30s.  They were also going off a gold standard, and therefore telling everyone gold was irrelevant.  Today we are going ON a gold standard, and explaining that their new paper is trustworthy because it is backed by real value, gold.  You can't logically make that argument and then confiscate and laugh it off as anything but confiscation. 

I think the best argument against confiscation is the public doesn't really hold that much gold in this country.  The rich and the insiders do.  Do they ever screw the rich and the insiders?  Do they even have to do so when they have been acquiring gold for at least two years (that we know of).  The bullion backed funds are exposed to confiscation in your country and the country where the bullion is kept.  That's double risk, but I regard the risk as low.

Tax risks:  Taxes are not going down.  That 10% penalty will look cheap in the future.  Also, your IRA might not even have any tax benefits if they change the rules and limit IRAs to government bonds.  They can also change the tax situation anytime, hitting you with a windfall profits tax for any profits from gold backed funds.

Physical, safely planted under the pink flamingo in your back yard, is the safest option.

Thu, 08/11/2011 - 11:14 | 1550939 turbojarhead
turbojarhead's picture

They have us so hamstrung that basically you stick your bucks in like the other sheeple and let the all-knowing father tell you what is good for you. I am unable to access the cash without quitting, and the field I am in is so oversaturated that I would probably never work in it again, so quitting is a non-starter. I think I will put it in one of the gold holding funds, I MAY get burned and lose it, but I am thinking that in equities or bonds it is gone for sure.

 Thanks again for all of you guys info, I appreciate it!

Thu, 08/11/2011 - 13:10 | 1551377 Bastiat
Bastiat's picture

I think the best argument against confiscation is the public doesn't really hold that much gold in this country.  The rich and the insiders do.  Do they ever screw the rich and the insiders?


Thu, 08/11/2011 - 20:05 | 1552589 rodocostarica
rodocostarica's picture

Excellent post smiddy. Good info on options.

And why the hell did you pick under the pink Flamingo. How the hell am I supposed to find that with all of them out there?



Thu, 08/11/2011 - 10:43 | 1550817 JohnG
JohnG's picture

Ask your employer if you can "quit" for a week or so, transfer to a trading account.

I've been doing that exact thing for my employees for over two years.

Thu, 08/11/2011 - 10:08 | 1550653 Badabing
Badabing's picture

QE stealth

Odd days up even days down, the 22% margin hike in gold by the CME will let the PPT concentrate on the Dow, S&P, Nasdaq while the gold day traders who value a paper prize will abandon ship. Don’t forget the big guys the central banks and such will contribute to the shortage in PM’s by overstepping the market and accumulate directly from the miners, a possible ploy that may force nationalization of mining company’s.   

Thu, 08/11/2011 - 10:14 | 1550675 thunderchief
thunderchief's picture

There is a lot of hype right now, and I believe it is all due to the fact that gold is the only thing going up.  It has not moved too far off its last trading range of around 1500, so it still seems steady.  2500 in short notice would worry me.

Thu, 08/11/2011 - 10:15 | 1550676 Rossalgondamer
Rossalgondamer's picture


Thu, 08/11/2011 - 13:03 | 1551356 jomama
Thu, 08/11/2011 - 16:23 | 1551626 DosZap
DosZap's picture


I despise the termnology these shysters use to steal Gold.

Sell us your "SCRAP" Gold...................................there is not such thing.

They make it into a lot like REALLY want/need to get rid of that Crap.................

Thu, 08/11/2011 - 13:07 | 1551369 Bastiat
Bastiat's picture

Supporting at 1764 today very impressive on huge volume again . . .and silver back over $39.  

Looks like the the Wicked Witch lost a few monkeys this week:,_Lost_Everything%21.html

Thu, 08/11/2011 - 13:33 | 1551453 Bastiat
Bastiat's picture

Looks like they are going for some downside follow through on gold after hours. 

Thu, 08/11/2011 - 14:34 | 1551588 DosZap
DosZap's picture


Upping the margins, no more than they did, in no way caused Gold to dump to this degree.(IMHO)

And WHY are the WHITE metals(Plat,Pal, UP same as yesterday?.)

Someone far more intelligent than I pls explain the HOW, the takedown this far.

Normal correction?.Overall it's healthy, but I do not get it..............

The world is still in flames,markets are worse not better, with no relief in sight, and the #1 safe asset, is dropping like a rock, and tommorrow it will be at $1,700.00..............

Someone advise?.

I am clueless how we turn on a dime( w/out a REAL Fundie change?),and Industrial metals go up,or stay close to the same.

Wed, 09/14/2011 - 05:51 | 1667690 chinawholesaler
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