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Market Snapshot: Gold & Silver Continue Slide As ES Drops 20pts From Highs

Tyler Durden's picture


While Friday's dramatic skid lower in the precious metals was later blamed somewhat on a leaked margin hike (as well as the simultaneous and anti-empirical sell-off in 30Y), it seems the liquidations that were rumored (whether hedgie or central banker) are in play once again as both gold and silver (the latter very significantly!) are finding little support. After some early weakness (EUR strength), the China news we noted earlier and general lack of any actionable rescue plan or large-scale money-printing has markets in a decidedly risk-off mode for the last few hours as ES shifts into the red and very early credit runs show 2-3bps widening in the front-end of the European indices.


Its not only the precious metals but copper and oil are also dropping and the latest headline from Bloomberg is not helping:



UPDATE: Silver is now -16%!

Gold/Silver Ratio has smashed higher as Silver plummets (to Sep2010 highs) - is it too simple to see similar jarring patterns leading up to crises?

As Gold drops below $1600 for the first time since July and Silver is down a further 12% from Friday's close, it seems the relative under-performance of Gold and Silver suggest this is still liquidation (and margin-exaggerated). The dollar dipped out of the gate but has recovered and is back at last week's highs now with the EUR testing 1.34. Notably, JPY is rallying once again and while GBP is unch from Friday, JPY is stronger (vs USD) by around 0.5% as JPY crosses (carry pairs) all send a very risk-off signal.

TSYs are rallying modestly off the late Friday peaks in yields with 30Y -3bps as the whole curve flattens very slightly for now. Stocks are much more active than TSYs or FX for now having managed to get up to 1144.5 in early Sunday trading only to drop back into the red retracing 50% of the upswing from early Friday - hovering around Friday's closing VWAP level for now.

Charts: Bloomberg

Early credit index runs show modest 2-3bps decompression in CDS and in cash, we see flattening/inversion and higher yields across the board with IRE and ESP worst performers so far (though not all are open). PTE is 22bps wider vs Bunds in 2Y and 11bps wider in 10Y. UPDATE: XOver +16bps and Main +4bps - Senior FINLs +6bps

And finally, for some perspective, now all risk drivers are open we see ES pulling down towards its CONTEXT expected value:

Chart: Capital Context


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Mon, 09/26/2011 - 02:05 | 1709610 RmcAZ
RmcAZ's picture

What. The. Fuck.

Mon, 09/26/2011 - 02:18 | 1709658 jomama
jomama's picture

fundamentals. obviously.

Mon, 09/26/2011 - 02:22 | 1709668 natty light
natty light's picture

ha funny

Mon, 09/26/2011 - 02:36 | 1709703 Western
Western's picture

Blythe Masters better have a private island stipulated in her retirement plan (or bonus plan, which she probably just earned tonight). She is the face of JPM's fraudulent/corrupt silver conquest and will get shot in the head if seen in a public forum.

Double tap.

Mon, 09/26/2011 - 02:54 | 1709754 eisley79
eisley79's picture

in addition, dear reader, to the awesome youtube clip you didnt click and watch, and are missing out on.  Here's a reply of mine from down below for those ask what?


even with the latest rise, Gold's margin or leverage ratio is 20:1

For example, to buy one ounce of gold at 1750, would have cost 87.50.  So, when Gold fell over 100 dollars (or more than 5%).  Everyone who bought the top on margin lost all of their money, and some they didnt have....

We are in a massive deleveraging of margin buyers, and the more it falls, the more people's entry point gets wiped out.

These are the so called "weak hands"

In addition you have all the anti-gold noobs/tools who are shorting, or who did short and need to get out with a profit.

In addition dollar strength is working against it as well.  Not because people want dollars, but because they have to get them/use them.

Mon, 09/26/2011 - 08:50 | 1710520 trav7777
trav7777's picture

lemme guess...another silverbugz bagholder?

Mon, 09/26/2011 - 09:15 | 1710644 somethingisrotten
somethingisrotten's picture

Wow, the Morgue trolls are out in force this morning.

Mon, 09/26/2011 - 02:19 | 1709662 MFL8240
MFL8240's picture

This is the new America, how do you like it?? The courrption is more that I can stand anymore.  This is not consolidation or a correction, this is outright fraud and manipulation because that is all this country can do to win at anything. Bet my life on it that the bald liar and tax cheat are behind this planned destruction of wealth.

Mon, 09/26/2011 - 02:23 | 1709675 natty light
natty light's picture

Where else but this country can you clear a trade before it exists?

Mon, 09/26/2011 - 02:20 | 1709666 shaxmatist
shaxmatist's picture

The Silver and Gold Bubble has popped and the speculators are dumping their metals.

Over the rest of 2011 the prices will readjust back to fair value based on supply and demand,

$1047/oz for gold and $19.57/oz for silver by january 2012 are the targets

Mon, 09/26/2011 - 02:38 | 1709707 itchy166
itchy166's picture

I hope you are right, a couple more monster boxes for boxing day!!

Mon, 09/26/2011 - 02:47 | 1709733 eisley79
eisley79's picture

"the" targets lol, shouldnt you post the link to your blog that no one will read or click on, to go with that "mu"

Mon, 09/26/2011 - 02:57 | 1709761 Spirit Of Truth
Spirit Of Truth's picture

Get upset all you want, but the gold/silver trade became grossly lop-sided and sentiment was, well, ebullient.

Chris Carolan marked the top as a Spiral Calendar anniversary, and Elliott Wave International accurately predicted the collapse in precious metal prices.

It's not a conspiracy.  It's a matter of folk here failing to recognize that they got caught up in an extraordinary popular delusion and the madness of the crowd.

Bob Prechter is right IMHO, the primary force in the world economy and financial markets is DEFLATION.  We are more likely heading into hyperdeflation than hyperinflation.  Exactly how that manifests is where Prechter and I don't see eye to eye.


Mon, 09/26/2011 - 03:03 | 1709778 tmosley
tmosley's picture

lol, Precter predicted 10,000 of the last two crashes, and anyone who invested a million dollars with that buffoon when he started offering his "service" has less than $400 to their name as of some 9 months ago.

Mon, 09/26/2011 - 08:53 | 1710533 trav7777
trav7777's picture

so, in other words, his picks are about as good as yours?

Mon, 09/26/2011 - 09:31 | 1710732 tmosley
tmosley's picture

Hmm, being right 95% of the time vs being wrong 99.5% of the time.  I can see how that would confuse you.  

Mon, 09/26/2011 - 09:15 | 1710642 somethingisrotten
somethingisrotten's picture

Wow, the Morgue trolls are out in force this morning.

Mon, 09/26/2011 - 03:17 | 1709814 ManufacturedOpinion
ManufacturedOpinion's picture

Jeezus Christ - another dolt that uses words he can't even define (hyperdeflation, hyperinflation).

Shut up kid, and leave the big words for the grownups.

Spirit of idiocy.

Mon, 09/26/2011 - 03:21 | 1709819 Spirit Of Truth
Spirit Of Truth's picture

I've never understood the logic of ad hominem attacks, but I think it stems from an emotional incapacity to deal with the truth.

Mon, 09/26/2011 - 04:02 | 1709951 eisley79
eisley79's picture

ad hominem, is attack the man.....

one guy pointed out the person you quoted has a terrible track record.

the other guy pointed out you used words ad hominem


neither of which these were.  now, they did wrap up the comments in some nice flowers for you


but i have never understood the peopel who post on zero hedge, and complain about other users's zero hedge.



Also, you should be careful about making grand sweeping statements you cant back up on here.  People will quote your owns words when they have been proven wrong, and you might have to make a new account.

Mon, 09/26/2011 - 11:17 | 1711278 Spirit Of Truth
Spirit Of Truth's picture

The most emotional arguments come out of folk who are heavily invested at tops.  Unfortunately, there are many PM bugs here at ZH who are clinging to their tulip bulbs outraged that anything could undermine the value of their precious flowers.  But reality is what it is and spurious arguments and reasoning as well as spurning those who were spelling out the truth all along will not win one anything other than even worse realized losses.

Mon, 09/26/2011 - 07:44 | 1710355 High Plains Drifter
High Plains Drifter's picture

bob prechter?     you have to be kidding?    where is gekko?

Mon, 09/26/2011 - 03:10 | 1709793 fonestar
fonestar's picture

Your obviously an idiot who has no idea about metals, "fair value" or just value at all.  Gold and Silver have INTRINSIC VALUE that cannot be calculated in USD (or other DEAD currencies for that matter).  Don't believe me?  What does silver trade for today in USSR roubles?  How about Reichsmark issued during the Weimar Republic?

Now take a numerator and divide by ZERO and what do you get?  Run and get your calculator.... hopefully you will figure it out!

Mon, 09/26/2011 - 03:28 | 1709837 Hoody Who
Hoody Who's picture

Fonestar, That was beautiful and I believe so correct!!!

Mon, 09/26/2011 - 03:53 | 1709916 A Nanny Moose
A Nanny Moose's picture

I think my calcualor is broken. It keeps telling me that it cannot divide by zero. WTF?! I tried shaking it, and beating it on the desk, but that didn't help.

Perhaps Excel is smarter. If not Excel, maybe my magic 8-Ball knows.

/sarcam -off

Mon, 09/26/2011 - 04:39 | 1710120 theotheri
theotheri's picture

I called $1000/oz when it hit $1900. You and I ate in agreement.

Mon, 09/26/2011 - 02:51 | 1709744 RmcAZ
RmcAZ's picture

Gold now down $106... 6%

Mon, 09/26/2011 - 02:57 | 1709760 RmcAZ
RmcAZ's picture

-$120... Fuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuck

Mon, 09/26/2011 - 03:09 | 1709791 jekyll island
jekyll island's picture

2008, bitchez!!

Mon, 09/26/2011 - 03:41 | 1709868 jbremner
jbremner's picture

Looking back at this liquidation on Gold, you'll see this was clearly a buying opportunity.  Buy low, but physcology makes you feel like running back to cash.  DXY's goin 88cents, commodities are gonna get burried, Europe debt crisis will get fixed with more debt and QE will jack the market again and away we go again, Gold at $2500 next summer and you'll all wish you had the guts to pile in when things were scarry.



Mon, 09/26/2011 - 02:09 | 1709611 bob_dabolina
bob_dabolina's picture

Weeeeeee hheeeeeeeeee

Almost NO BID

Mon, 09/26/2011 - 02:22 | 1709670 MFL8240
MFL8240's picture

Amazing isnt it, a freefall in a time of global turbulance.  The courrption is just fuckin mind blowing. 5000 years it was a safe haven but now its USD and confetti from an insolvent goverment.  Hope China dumps our trearuries and inflicts unimaginable pain to the system.  

Mon, 09/26/2011 - 02:42 | 1709722 JLee2027
JLee2027's picture

Paper market collapse, not a physical collapse.

Mon, 09/26/2011 - 03:04 | 1709781 bob_dabolina
bob_dabolina's picture

Oh people are still buying their physical for $1923 per ounce?

Mon, 09/26/2011 - 03:10 | 1709794 tmosley
tmosley's picture

Some are, though I can't imagine why, when it is available elsewhere for less.

Mon, 09/26/2011 - 03:44 | 1709867 bob_dabolina
bob_dabolina's picture

Anyone buying gold on ebay should rightfully suicide themselves

Get real

Mon, 09/26/2011 - 08:18 | 1710451 tmosley
tmosley's picture

Funny how you continually insult people with the same opinon as yoruself.  You are a real self-loather, aren't you?

Mon, 09/26/2011 - 09:15 | 1710640 somethingisrotten
somethingisrotten's picture

Wow, the Morgue trolls are out in force this morning.

Mon, 09/26/2011 - 08:59 | 1710552 trav7777
trav7777's picture

at this point, you have to consider paying your taxes and walking out.

Mon, 09/26/2011 - 10:17 | 1711006 mayhem_korner
mayhem_korner's picture

Finally tipped your hand, eh?  Why would I be stupid enough to run for cover when Au is 2x what I bought it for and, moreover, why I bought it (to have and to hold, 'til death do us part)?

You act like a weak hand.

Mon, 09/26/2011 - 12:17 | 1711617 MsCreant
MsCreant's picture

Love the new avatar! 

Mon, 09/26/2011 - 03:23 | 1709822 bankruptcylawyer
bankruptcylawyer's picture

dooooood . theres a difference when you have gold in your house safe and when a bank has gold in its vault. the bank's gold is a tier 1 asset from which it can borrow 95% it's value from the fed. 

there is no difference between the paper and gold markets except until soome sort of catastrophic loss of control over gold markets by tptb. 

adn when that happens, you'll be happy you have your gold, but you won't be happy. spend your gold by donating it to the ron paul campaign and help bring about change for the better, instead of hoarding it and hoping for some sort of collapse.. 

Mon, 09/26/2011 - 03:05 | 1709783 gorillaonyourback
gorillaonyourback's picture

it will,   europe will by today, change the charter for eu to make a eurobond.   gold will rise accordingly but eventually will fall in early 2012.  because they will buy bonds the (ECB) banks will park their money back at the ecb or american banks increasing the reserves but not their capital, because there are no willing lenders to us peons.  hell i would love to have that 50-60k credit line cuz i would not pay it back i would party that shit a way and have some fun and they know that lololololol

Now gold will only go up if and when the big players look at that digital number or peice of paper and say to themselves " I have to invest in something that keeps its value"  real estate ?no,whose gonna want to buy house at over inflated prices even now. stocks? no, companies bottom line will be squeezed because there is no money in circulation(capital) just look at goldman expecting first losing quarter in 2years. hookers?  yeah good value there

only safe haven is commodities only things being bought and sold with paper currency that has some intrinsic value is commodities (neccesaties, food, oil ,toilet paper, etc) when the big boys realize this its game over  revolution


Mon, 09/26/2011 - 03:11 | 1709800 Ghordius
Ghordius's picture

EuroBond? You do realize that only major players outside the EuroZone are asking for a EuroBond? The EuroBond would mean some kind of EuroTax, and this is really not that easy to ask from the peoples of the EU. Very unlikely.

Mon, 09/26/2011 - 03:19 | 1709812 gorillaonyourback
gorillaonyourback's picture

they have no choice,,,,,, bank runs goin on right now is heating up real fast

Mon, 09/26/2011 - 03:11 | 1709801 gorillaonyourback
gorillaonyourback's picture

how low can it go with out pulling the eurobond trigger loloololol

Mon, 09/26/2011 - 04:40 | 1710126 theotheri
theotheri's picture

5000 years ago they didn't have computers.


Barbaric relic. Remember that.

Mon, 09/26/2011 - 09:44 | 1710820 Kobe Beef
Kobe Beef's picture

5,000 years ago they were smarter than trusting their hard-earned money to computers.

Where's your money when the power goes out, genius? Think about that.

Mon, 09/26/2011 - 03:18 | 1709818 ManufacturedOpinion
ManufacturedOpinion's picture

I will bid.

All the way down and halfway up the other side.

Mon, 09/26/2011 - 11:38 | 1711358 tekhneek
tekhneek's picture

Same.. bought at $35... bought at $30... wasted all my dry powder.

I hope this lasts til Friday and I'm going to dump whatever else I can afford in.

This is a short time period where opportunity knocks. I can't wait to see all the "targets" and "predictions" at the end of the year.

Hilarious how the vibe of ZH changes as prices of PMs go higher/lower. Lower: Everyone knew it was going to crash, Higher: Everyone knew it was going to go higher that's why they "had their calls in place months ago" when they themselves were admittedly "predicting" an absolute crash.

Only when the price drops 30%+ do you have jackasses come out of the wood work predicting another 30% loss. It's hilarious, even to the upside so to the downside. Nothing goes down forever, especially not a commodity like silver.

Buy while the buyin's good and it's still available for purchase. A lot of my vendors are completely out of stock.

Mon, 09/26/2011 - 02:06 | 1709614 MsCreant
MsCreant's picture



Mon, 09/26/2011 - 02:06 | 1709616 chump666
chump666's picture

Looks like a commodity crash, that is really bad i.e China.  Not looking good at all.

Mon, 09/26/2011 - 02:16 | 1709655 GtownSLV
GtownSLV's picture

Hong Kong is unhappy about somethinf, HangSen off over 3% early Monday. 3x down most other indices.

Mon, 09/26/2011 - 03:18 | 1709809 Spirit Of Truth
Spirit Of Truth's picture

Wouldn't be surprised if some hedge funds blew up and there's forced liquidations underway around the world.  Heck....this all could have started with the SNB's move to peg their currency.  We know at least one UBS trader was tagged for a cool $2 billion.  Who knows what other implosions have occurred along the way as the dollar carry-trade speculative bubble has begun to unwind.  Ultimately, Ben Bernanke is fundamentally to blame for the crash underway as this is all a consequence of the bubble in asset prices he and his idiotic Fed cohorts intentionally inflated under the grossly misled idea that somehow rising prices of risk assets means economic well-being and growth.  Arrogant ignoranuses...

Mon, 09/26/2011 - 03:45 | 1709873 Id fight Gandhi
Id fight Gandhi's picture

Snb put a floor in not a peg.

Big wtf moment now as silver is pretty much retracing all it's losses in a 2 hr period. Fucking Europe down, now up.

Mon, 09/26/2011 - 02:11 | 1709618 ZapBranigan
ZapBranigan's picture




The true question to contemplate is: What is the half-life viability of USTs over an eight-month time span?


You are all internally asking the same question - don't deny it - as you view your balance sheets stock-full of king dollar.


The world is waiting and everyone wants to know...where does your liquidity go from here? And when exactly does your trigger get pulled ?


Please answer the question. ('cause everyone, worldwide, is truly dying to know the answer)


Mon, 09/26/2011 - 02:07 | 1709619 FoieGras
FoieGras's picture

Game over.

Mon, 09/26/2011 - 02:08 | 1709625 MsCreant
MsCreant's picture

Disagree. In transition.

Mon, 09/26/2011 - 03:11 | 1709799 jekyll island
jekyll island's picture

Agree.  Does anybody still not see gold over $2000?  Buying opportunity.  

Mon, 09/26/2011 - 02:07 | 1709621 chump666
chump666's picture we wait for the YUAN to be re-pegged to the USD. Bear signal from hell.

Mon, 09/26/2011 - 02:07 | 1709623 Kyron95131
Kyron95131's picture

makes no sense to me, the dollar isnt even appreciating as fast as PM's are depreciating, makes no logical sense at all. but then again, everyone knows the market isnt a market but more over just one of the most organised hiests of global wealth of all time.


Mon, 09/26/2011 - 02:09 | 1709629 MsCreant
MsCreant's picture

Sell off Pedobear, sell off. You sell what will sell to get $ to cover your losing bets you owe on.

Mon, 09/26/2011 - 02:15 | 1709653 Kyron95131
Kyron95131's picture

whos the dealer whos offloading then?

Mon, 09/26/2011 - 02:22 | 1709669 MsCreant
MsCreant's picture

Who needs cash right now?

Many off loaders with margin calls I would think, trying to recollateralize. 

Folks who have to be able to fund CDS as the failures domino.

Hedge funds panicking, seeing the unload.

Maybe it is a HFT thing too, as has been pointed out, it's like it is dropping without a bid. Though I see some 1580 action (one support level I have seen talked about, tho I doubt it, this shit show is just begining).

I so need to let you know that I am in no way a trader, just someone who has been watching and afraid of this exact thing.

Good news? I think it will reflate, but it will at least be months before it does so.

Mon, 09/26/2011 - 02:53 | 1709748 eisley79
eisley79's picture

even with the latest rise, Gold's margin or leverage ratio is 20:1

For example, to buy one ounce of gold at 1750, would have cost 87.50.  So, when Gold fell over 100 dollars (or more than 5%).  Everyone who bought the top on margin lost all of their money, and some they didnt have....

We are in a massive deleveraging of margin buyers, and the more it falls, the more people's entry point gets wiped out.

These are the so called "weak hands"

In addition you have all the anti-gold noobs/tools who are shorting, or who did short and need to get out with a profit.

In addition dollar strength is working against it as well.  Not because people want dollars, but because they have to get them/use them.

Mon, 09/26/2011 - 02:22 | 1709673 MFL8240
MFL8240's picture

Rigged!!  Fraud!!!  Get that?

Mon, 09/26/2011 - 02:08 | 1709624 Troll Magnet
Troll Magnet's picture

PMs on sale.  I bought some over the weekend but not too much.  I was waiting for this.  Buying another 100 oz bar in a bit.  Plenty more bullets left.  Bring it on!

Mon, 09/26/2011 - 02:10 | 1709636 MsCreant
MsCreant's picture

I think it drops for a while longer. I am no pro, but back of the cocktail napkin says at least the mid 1300s before the brakes are applied to this thing. Maybe worse.

Mon, 09/26/2011 - 02:18 | 1709660 Sudden Debt
Sudden Debt's picture

15 euro for silver is my target. I've got my funds ready to buy when it just touches it.

Just thinking that I was hoppeing on loading up more at maximum 33 euro :)

700 ounces instead of the planned 350 :)

It just doesn't get any better than this :)


Mon, 09/26/2011 - 02:24 | 1709677 Troll Magnet
Troll Magnet's picture

Haven't seen prices like these in a looooong time.  I'm never good at timing the market so I'm just going to keep adding as they fall the way I've been adding when they rose.  

Mon, 09/26/2011 - 02:39 | 1709710 MsCreant
MsCreant's picture

Cost averaging and long. Good luck. 

Mon, 09/26/2011 - 03:24 | 1709829 ManufacturedOpinion
ManufacturedOpinion's picture


(Buying) all the way down and halfway up the other side.

My trading account got cut in half last week.

Oh, well - it's only 2% of my net worth - better send another 2% (damn ... come to think about it, maybe i'll send THREE percent this time).

Drooling all over myself at these prices.

Mon, 09/26/2011 - 02:08 | 1709626 Dick Darlington
Dick Darlington's picture

Meanwhile in Spain which according to the endless lies of one Elena Salgado has THE BEST banking sector in Europe if not the world, the said banks WANT MORE gubbermint tit. But but, i thought the banks were fine...

By Manuel Baigorri
     Sept. 26 (Bloomberg) -- Spanish banks and savings banks
have asked the government for an extension of government-backed
bond issues for at least six months more after the current
December deadline, El Pais reported, without citing anyone.
     Spanish lenders, which hold 61.6 billion euros ($82.6
billion) of bonds issued, are having difficulties to access
financing on their own and would issue 70 billion euros of
government-backed bonds more, the newspaper said.
     Both lenders and savings banks may have requested Spain’s
deputy finance minister Jose Manuel Campa for the extension
through their lobby groups, El Pais said.

Mon, 09/26/2011 - 02:10 | 1709631 Burnbright
Burnbright's picture

Hmm paper markets collapsing?

Mon, 09/26/2011 - 02:10 | 1709633 tickhound
tickhound's picture

This is something bigger than just metals falling...

Mon, 09/26/2011 - 02:24 | 1709676 MFL8240
MFL8240's picture

You get it.  This may be confiscation we are watching.

Mon, 09/26/2011 - 02:28 | 1709684 you enjoy myself
you enjoy myself's picture

if its not, then i think this has just forced me to abandon silver miners for good.  anything that can take what could be a 50% dump in 5 trading days, absent an epic overall market collapse, is not a game i want to play anymore.

Mon, 09/26/2011 - 02:32 | 1709694 MsCreant
MsCreant's picture

Why do you think today an epic overall market collapse is not going on?


Mon, 09/26/2011 - 03:27 | 1709827 you enjoy myself
you enjoy myself's picture

because this could easily just be a fund (or CB) liquidating their PMs (in a larger replay of Jan 2011) -- god knows what redemptions are looming.  if we get another day like friday where the S&P finishes up close to 1% but silver pukes another 15% then i have no idea what to think.

and to think that just three short hours ago i was looking forward to falling asleep....


Mon, 09/26/2011 - 02:31 | 1709692 RmcAZ
RmcAZ's picture

Agreed. At first I was thinking that commodities had priced in QE3, and now it is being de-priced in. But this drop is unprecedented... there must be something else at play here, and not just with metals/commodities.

Mon, 09/26/2011 - 02:16 | 1709635 Attitude_Check
Attitude_Check's picture

The FT is showing Gold at 1659 as of 1:53 AM, with Gold rising - what is the disconnect I wonder?

Mon, 09/26/2011 - 02:51 | 1709743 Who is John Galt
Who is John Galt's picture


Mon, 09/26/2011 - 02:12 | 1709638 FoieGras
FoieGras's picture

Want to know when to buy? When John Paulson says precious metals are finished. That's your buy signal.

Mon, 09/26/2011 - 02:12 | 1709639 Blorf
Blorf's picture

Yippee ki yay motherfucker!

LOL at silver.

There has to be selling exhaustion at some point. Will I be the one catching the knife? No.

Mon, 09/26/2011 - 03:27 | 1709833 ManufacturedOpinion
ManufacturedOpinion's picture

I will.

Every time silver goes down 5% I convert 1% more of my net worth to silver.

All the way down and halfway up the other side.

Mon, 09/26/2011 - 04:05 | 1709976 Gief Gold Plox
Gief Gold Plox's picture

Ditto. Since I only ever invest money I don't need and family doesn't knows I have, dips like this make me very happy. Think I'm gonna have to get a bigger vault, though.

Mon, 09/26/2011 - 02:13 | 1709643 bob_dabolina
bob_dabolina's picture

Copper is off more than gold in percentage terms. 

Big sell offs

Mon, 09/26/2011 - 02:20 | 1709665 Blorf
Blorf's picture

Bob, you are this generation's (this quarter's) Mathman.  The much hated guy with a pile of cash.  Nice work.  Please invite me to your private island's opening ceremony.  Will bring Tequila.

Mon, 09/26/2011 - 02:23 | 1709672 scatterbrains
scatterbrains's picture

Given the size of this decline in silver I'd guess an over shoot to the downside is probable and silver has a ways to go just to get back in line with it's historic ratio to copper.

Mon, 09/26/2011 - 04:38 | 1710107 lewy14
lewy14's picture

Ahah. That rings a bell. 2008 playbook redux: commodities indexes. And their derivatives. They include gold. Hedge funds bailing on commodities index plays caused a good bit of the gold liquidation IIRC - it wasn't gold per se, it was just levered longs needing to get out of basket positions.

Gold got dragged down quite a ways then.

Mon, 09/26/2011 - 02:15 | 1709649 X.inf.capt
X.inf.capt's picture

oh well, in for a penny, in for a pound

 i guess 'this is time that tries mens souls'.

get out the BIGBOYS PANTS.

and as i said before...

im scared, but buying this this silver on the way down

and ill see ya' guys on the beach...


Mon, 09/26/2011 - 02:59 | 1709768 slewie the pi-rat
slewie the pi-rat's picture

maybe give the dimes a break?

if the "price" dips, again, 10 silver eagles = $300?

or trade for dimes. even...w/ silver price low, not too many dimes for eagles?  L0L!!!  that is a fallacy

w/ a dime = .07 oz silver, abt 150 dimes (150 X .07) =  10.5 0z and this ain't gonna change!

silver is the most volatile gamblin-ramblin play on the board, at least! 

Mon, 09/26/2011 - 02:15 | 1709651 PhilofOz
PhilofOz's picture

I saw silver in total freefall get down to $26.11. Wow! We are all saved... it's back up to $26.64!!  [Sarc]

Mon, 09/26/2011 - 02:16 | 1709654 bob_dabolina
bob_dabolina's picture

Volume in gold futures almost as high as normal trading hours.

Mon, 09/26/2011 - 09:05 | 1710583 trav7777
trav7777's picture

bc mfers is gettin SMOKED.

Mon, 09/26/2011 - 09:14 | 1710633 somethingisrotten
somethingisrotten's picture

Wow, the Morgue trolls are out in force this morning.

Mon, 09/26/2011 - 02:17 | 1709657 Central Bankster
Central Bankster's picture

Drops like that will put the fear in ya.

Mon, 09/26/2011 - 02:23 | 1709674 Sudden Debt
Sudden Debt's picture

It totally blew my weekend. And my wife constantly saying "what's the matter honey"...

But this is a oppurtunity. they'll print more a this drop will kill the silver supply.


Mon, 09/26/2011 - 10:27 | 1711046 mayhem_korner
mayhem_korner's picture


Over the weekend of angst, the US accumulated $11 Billion in new, unrepayable debt.  The PIIGS (and Cyprus) are all just as bad.  Keep in mind the most basic underlying driver of what's going on.  :D

Mon, 09/26/2011 - 02:18 | 1709659 Who is John Galt
Who is John Galt's picture

The Asians are going to buy the hell out of this dip, and come out smelling like jasmine incense by the new year after QE to infinity is announced.


Thanks Ben! I am sure the Asians appreciate the free money!

Mon, 09/26/2011 - 02:44 | 1709727 Flatchestynerdette
Flatchestynerdette's picture

I read a news article that said China was zero GDP growth. If that's the case, then they really were selling US Treasuries in the early part of this year to do a TARP themselves. Now, they've run out of money themselves. What do they turn to raise money to sustain their growth rate? Sell Gold. If not China - then who? Its got to be someone big and now Drudge has a headline that the IMF needs a bailout - ok, never mind about china - look to the IMF and all the central bankers selling - but China will need to sell treasuries to convert to cash to pick up the gold. I don't see the spreads in the bonds yet to support this idea.

Mon, 09/26/2011 - 02:54 | 1709753 chindit13
chindit13's picture

Hold on to that dream.  That is all it is, however, a dream.

I'm out here in "Asia".  Asians are getting their butts kicked in copper.  They are getting their butts kicked in equities.  They are getting their butts kicked in PMs.  They will be getting their butts kicked in RE.  If they are going to be buying anything right now, it is booze.

I've written about this before, and admittedly it is anecdotal, but it is what I see.  This weekend at the gold shops there was plenty of stock, priced as usual at 1% above spot.  Yes, SPOT.  The shops were empty.  Whatever you may have been led to believe, Asians like bull markets.  Gold and silver no longer look like bull markets.  They would rather go to the racetrack or Macau.

At the beginning of August, the economy where I am---which is virtually 100% funded by China---absolutely fell off a cliff.  Like a light switch.  The flow of Chinese money stopped on a dime, and a Roosevelt dime at that, not a Mercury head.  It suggested to me that an ill wind was blowing through the "World's Savior".  Could be coincidence, but it sure makes sense.

If you really want to "back up the truck", make a trip to Asia to do it.  What you save in premiums will pay for the trip.  There is plenty of Au and Ag out here.

By the way, Asians were waiting in line on Saturday.  At the new Apple Store in Hong Kong.

Mon, 09/26/2011 - 03:15 | 1709810 tmosley
tmosley's picture

What of the central bank, which is the entity that robs the people of much of their earnings abroad via maintenence of their dollar peg?

Mon, 09/26/2011 - 03:26 | 1709831 slewie the pi-rat
slewie the pi-rat's picture

prob just really hungry

they don't mind if they miss the bottom, but they want to try to approach it, and not buy all the way down;  most retail buyers do the same;  and would rather buy on the way up. 

and they're very patient?

the rising dollar is making PMs tough right now! 

paper wealth is going up in flames by the trillions due to deflation recently as "capitalism" exhales

do not re-finance & capitalize the failed banks.  anywhere.  this is ridiculous!

Mon, 09/26/2011 - 03:29 | 1709841 ManufacturedOpinion
ManufacturedOpinion's picture

The Asians are going to buy the hell out of this dip ...

Me too.

All the way down and halfway up the other side.

Mon, 09/26/2011 - 02:22 | 1709671 baten
baten's picture

I'm waiting, with my cash in USD, for silver to settle for a few days in the range of 12-16, they I am a buyer. Last time I bought silver at 9 USD.

It will get back to 50 in a year or two, I can wait... 

Mon, 09/26/2011 - 02:29 | 1709687 PhilofOz
PhilofOz's picture

12 to 16 ?! Well my stash @ $30 is already in big trouble. I'll wait with you but I don't think I will be waiting that long... a bit over $20 and I will commence my build up of physical. Even so, this fall off the cliff hurts for all us stackers, whether newbies or old hands. :-((

Mon, 09/26/2011 - 02:45 | 1709717 baten
baten's picture

I'm out of silver since some time now - I'm in gold/physical. My guess is we will get to the 70-75/1 ratio again, so I will exchage the gold in silver.

As for the bottom - this is not a down spike. When it hits the bottom, it will stay there for a week or more, so we will know it has bottomed. Dont buy this dip, wait util it settles. Patience is always the key to good investing.

Mon, 09/26/2011 - 02:26 | 1709682 tmosley
tmosley's picture

Hope you bought physical, cause the big online retailers are running out fast.

Spot price and OI have completely detached from demand for physical.  Expecting a public COMEX event within two months, possibly in the coming week.

Mon, 09/26/2011 - 02:48 | 1709737 itchy166
itchy166's picture

COMEX event or not, if dealers will not sell at these prices then these prices are irrelevant.  


Mon, 09/26/2011 - 02:52 | 1709745 tmosley
tmosley's picture


The scary part is when you realize that a lot of industrial users hedge on the COMEX.  Once it no longer reflects real prices, they will be forced to buy off the open market, and will do so all at once (as there are no reliable futures markets that allow for delivery after if the COMEX is no longer viable).

This is what I think is going to drive silver to parity with gold.

Mon, 09/26/2011 - 03:59 | 1709944 rokka
rokka's picture

When you realize, after being in denial for quite a while, that COMEX is not good enough for you - you'll be out of business with your dreams about gold.

That happens again and again and nothing can't be done - because people like to dream.

Mon, 09/26/2011 - 08:26 | 1710463 Hephasteus
Hephasteus's picture

Every gold exchange that has ever been formed in the history of the planet has gone under due to fraud.

Mon, 09/26/2011 - 02:53 | 1709746 MsCreant
MsCreant's picture

What if they are scared and won't buy?

Mon, 09/26/2011 - 02:55 | 1709755 tmosley
tmosley's picture

lol, I don't think that will be a problem.

If nothing else, APMEX is now paying above spot for genergic silver rounds.

Mon, 09/26/2011 - 09:10 | 1710619 trav7777
trav7777's picture

can find you a dealer within 10 seconds who will.  Stop listening to this idiot mosely-claven

Mon, 09/26/2011 - 09:09 | 1710612 trav7777
trav7777's picture

ROTFL...just like the dozen or so you were "expecting" in the past year?

You've been bleating about this shit all the way up and now again all the way back down?

buy now or be priced out forever!!!!!  wtf, you sound like a RE shill

Mon, 09/26/2011 - 09:38 | 1710770 tmosley
tmosley's picture

I said in February to expect increasing volatility with a downward bias.  I reiterated this before the early May slaughter (you and other trolls like to cherry pick my exasperated comment about rising prices, which I HATED, because rising prices save the COMEX while ignoring the fact that I was calling for exactly this sort of thing to happen).

In case you forgot, "volatility" means the price goes UP AND DOWN.  You don't seem to understand this.  Understandable, as you ARE demented.

You telling us you don't own physical silver anymore?  You think I forgot about that?  You bleat on and on about how you hate silver while you own it yourself.  You are actively trying to cause people to lose money because you think they are "unworthy" and you want them to die because you are a miserable selfish old man who has alienated everyone and everything precious to him.

Why don't you go down to the ghetto and offer them some cash for sterilization?  You'd get what you so richly deserve.

Mon, 09/26/2011 - 02:30 | 1709689 Sequitur
Sequitur's picture

Lot of gold and silver holders sounding like speculators. I own some phys too, but it was increasingly clear a deflationary spiral is now upon us.

Looks like the metals simply are not good deflationary hedges, even though there is some research out there to the contrary. The inflationary case is looking weaker by the day, deflation is here, and I think PMs will continue to get clobbered.

Mon, 09/26/2011 - 02:35 | 1709702 tmosley
tmosley's picture

I bet you thought that in 2008, yet here we are.

Deflation in fiat currencies is a historical abberation.  It is not sustainable at all.  More likely is that this is merely a ploy to force the politicians to come begging for more QE.

I further suspect that someone knows there is something about to go terribly wrong in the metals markets, and is getting out.

Mon, 09/26/2011 - 02:39 | 1709709 Sequitur
Sequitur's picture

It's not deflation in currencies. It's deflation in credit/debt. Banks have many tens of trillions in outstanding credit, that is what is getting crushed. Money supply is but a fraction of the credit/debit/notional derivatives value.

Also, I do not see QE in the immediate future.

Mon, 09/26/2011 - 02:42 | 1709721 tmosley
tmosley's picture

You think no fiat system has ever been built up on credit/debt before?

They were ALL built that way!  At least, all the ones controlled by central banks.

The fact is that this is NOT natural behavior, no matter how you look at it.

Mon, 09/26/2011 - 08:42 | 1710501 itchy166
itchy166's picture

Deflation in credit/debt is the same thing as deflation in currency. (In our version of fiat currency anyway.)


Mon, 09/26/2011 - 02:37 | 1709705 CapitalistRock
CapitalistRock's picture

No sir. What you see is deleveraging. With fiat currency underneath it all we would have deflation. Instead we have Bernanke and he is up at this our with the rest of us chewing his fingernails off.

We'll get a stop-all-deflation announcement from him and it'll bounce hard off the bottom.

Don't try to catch the bottom. Just keep averaging in.

Mon, 09/26/2011 - 03:35 | 1709851 ManufacturedOpinion
ManufacturedOpinion's picture


Every day silver goes down 5% just convert another 1% of your net worth into silver.

Such a simple equation.

All the way down and halfway up the other side.

Mon, 09/26/2011 - 02:41 | 1709713 delivered
delivered's picture

Deflation will be a short-term event in the US. I would agree that deflationary forces are taking hold but deflation rewards savers and punishers debtors. And the largest debtor in the world, the USA. If deflation does take hold, the tax basis will be destroyed, receipts plummett, and servicing the US debt made impossible. Even printing by Big Ben won't solve this problem as in the end, just like an over extende consumer with too many credit cards, the US will be forced to default. With this, game over as confidence in the UST's and the USD will fail. When this happens, welcome to hyperinflation as the rebalancing of the wealth around the world will occur forcing the US to produce more, consume less, and watch their standard of living decrease. So for everyone who's on the deflation bandwagon, you may be right but be careful for what you wish for as you may get it which will enable you to pat yourself on the back and say "I told you so" but if you hold your USDs and USTs too long, watch your wealth vanish like a "Fart in the Wind"

Mon, 09/26/2011 - 02:56 | 1709759 Who is John Galt
Who is John Galt's picture

Thats it in a nutshell. Tonights events all but guarantee a new round of QE will be announced in the coming weeks.


Mon, 09/26/2011 - 03:07 | 1709787 bigkahuna
bigkahuna's picture

Um, thank you federal reserve!


I agree--we deflate and it will be a quicker death than inflation. Our casualty rate is going to go into the history books.

Mon, 09/26/2011 - 03:38 | 1709856 slewie the pi-rat
slewie the pi-rat's picture

@ sequitur Looks like the metals simply are not good deflationary hedges, even though there is some research out there to the contrary.

you're taliking, right now, of less than 3 days of admittedly, almost straight down volatility

GSR = 55:  1985 Sammy Hagar "I Can't Drive 55" (Farm Aid) - YouTube


Mon, 09/26/2011 - 02:31 | 1709690 CapitalistRock
CapitalistRock's picture

Something is rotten in silver. I just added a little more at this level and suggest others do the same.

Mon, 09/26/2011 - 02:31 | 1709693 DrStrangelove
DrStrangelove's picture

"I just died in your arms tonight... it must have been some kind of debt"


Mon, 09/26/2011 - 02:32 | 1709695 ba dum tiss
ba dum tiss's picture

Snakes and ladders, without the latter.

Mon, 09/26/2011 - 02:33 | 1709697 delivered
delivered's picture

What a ride. Let's face it, if you don't like volatility then you should never be in the PM space to begin with. No doubt the paper market is imploding as everyone is looking to sell whatever they have left that has a market to raise cash and become "liquid". But in what? The USD is today's soup du jour but its clear now that money has nowhere to go but move around the globe, looking for the latest trade, ride the wave, and hope to dear god that you don't get left holding the bag.

Each crisis is becoming more and more acute with the leveraged positions needing more and more volatility to generate gains. Keep moving from the Yen to the Euro to the USD from emerging markets to whatever is left standing. Reminds me of the final gamblers in Vegas in each working the tables in one last attempt to salvage the night. In the end, the house gets everything but the sense of urgency and panic becomes more acute.

I was always wondering when the final wave would hit and panic would become so wide spread that paper money and wealth would begin to "turnover" so fast (within different financial assets), chasing whatever was left, that it would cause the system to finally collapse. Any thoughts on whether this is the Ah Ha moment would be appreciated.

In my book the only thing that really matters is what is real. If you can buy physical assets at these prices then in the infamous words of David Starsky from Starksy and Hutch "Do It!". As for the paper markets, prepared to be cleaned out by the insiders as the fraud has become so blatent (e.g., last Friday's action in PMs with the inside group already knowing margins were going to be raised) and rampant that anyone that still believes the markets are freely functioning and operating in a fashion to deploy capital in the most efficient manner possible, please raise your hand. If nothing else, the CEO/CFO of the BK solar company taking the fifth last week should have put the final nail in the coffin.

As for my final statement (I'm sure to be censored by Big Ben and the Fed), I would like to note that I've never been prouder to be an American (based on the founding principals of this country) but never more embarrassed or humiliated to be a United States Citizen.

Mon, 09/26/2011 - 02:33 | 1709700 SunBlaster
SunBlaster's picture

Well it's clear that sell off was triggered by "NO IMMIDIATE PRINTING" announcment, is there anything coming this week that might change the course? Just trying to time the bottom.

Mon, 09/26/2011 - 02:37 | 1709704 lolmaster
lolmaster's picture

Two options:

1) JPM liquidating Greece
2) JPM liquidating JP

Mon, 09/26/2011 - 02:44 | 1709725 Istanbear
Istanbear's picture

3 ) France liquidating JPM

Mon, 09/26/2011 - 02:42 | 1709718 Mr_Wonderful
Mr_Wonderful's picture

Here is what October Put Options that Bet Against the S&P 500 look like for October, 2011: 

Open Interest:     Strike Price:

12,467                   500   17,893                   650 67,816                   750 116,406                 800 51,789                   850 27,742                   875 64,123                   900 20,392                   925 52,737                   950 26,701                   975 90,031                   1,000 117,902                 1,100 127,798                 1,150 127,036                 1,200

Obviously this predicts a major crash.



Mon, 09/26/2011 - 02:42 | 1709719 Rusty Shorts
Rusty Shorts's picture

Wet Willie - Keep On Smiling

Mon, 09/26/2011 - 02:44 | 1709726 SunBlaster
SunBlaster's picture

Basanov song was great, got 4 of his title downloads alrdy

Mon, 09/26/2011 - 02:42 | 1709720 RagnarDanneskjold
RagnarDanneskjold's picture

Deflation, bitches. Shit just got real.

Mon, 09/26/2011 - 02:43 | 1709724 Missiondweller
Missiondweller's picture

This is likely a coordinated central bank attack on PM's to flush out investors from PM's back into either cash (T-Bills) or stocks. Monetary stimulus doesn't work so well when people put their wealth in the alternative non-national currencies (PM's). It may be seen as a pre-requisite for QE3.

Mon, 09/26/2011 - 02:45 | 1709728 abalone
abalone's picture

Oh how the mighty has fallen. Excuses, excuses, excuses

Mon, 09/26/2011 - 02:48 | 1709729 SunBlaster
SunBlaster's picture

Going back down to $25, gold is @ $1549!

Mon, 09/26/2011 - 02:47 | 1709735 Mr_Wonderful
Mr_Wonderful's picture

Sorry about the formatting.

There are 900,000 October Put Options Contracts against the S&P 500.

The buyers are banks and hedge funds (probability of loss approximately zero). The sellers are mutual funds with holdings indexed to the S&P 500 (probability of loss approximately 100%).


Mon, 09/26/2011 - 02:49 | 1709738 SunBlaster
SunBlaster's picture

This is a no brainer, GREECE DEFAULT = MARKET crash, where is the story?

Mon, 09/26/2011 - 02:50 | 1709740 skrapinbeachbum
skrapinbeachbum's picture

I've been trying to buy from kitco since $26.50, but have not been able to get through for about 45 minutes now. The time to stack is now, not today. I have a feeling the local coin shops will be worthless for getting much of anything from in the morning, i hope im wrong.

Mon, 09/26/2011 - 02:53 | 1709747 tmosley
tmosley's picture

APMEX stil has lots of inventory if you are willing to buy the less popular products.  The popular stuff is already all gone.

Mon, 09/26/2011 - 03:12 | 1709803 bigkahuna
bigkahuna's picture

site is down completely............


Mon, 09/26/2011 - 03:24 | 1709828 Threeggg
Threeggg's picture

So is

Something SMELLS !

Do NOT follow this link or you will be banned from the site!