March 24 – Gold $1191.70 up $3.70 - Silver $16.97 up 9 cents
Out Of Tricks?
"I make my practices real hard because if a player is a quitter, I want him to quit in practice, not in a game." … Bear Bryant, legendary Alabama football coach
GO GATA!
It is totally understandable why followers of this commentary have become sick and tired of hearing about The Gold Cartel and the misery they have delivered. It has affected everyone in the gold/silver industry. Basically, investing in the gold/silver shares has been a waste of time and money for the last 17 years. If you had told me that when The Café opened for business in September of 1998, I would have said, "No Way!" … especially since gold went from below $300 back then to $1900+ and silver was below $4, and would rise to $49+.. The other day the XAU was lower than in September of 1998. To me it is more than mindboggling. There have been some really big winners along the way, but they have been dwarfed by the failures … and those failures have been run by some of the finest guys/gals I have ever met. This has been a nightmare.
That said, we were warned by one of the best of the best in our camp, the legendary Bob Bishop of the heralded Gold Mining Stock Report. Bob was the "gold man" in his day and a good friend to GATA. His wife also went to the same high school as me in Glen Ridge, New Jersey. When GATA held our third conference right outside of Washington, D.C., we had a last minute cancellation from one of our speakers. On the spur of the moment Bob agreed to make a presentation. In that presentation he said he was exiting from the gold/silver shares.
Golly, that was 7 years ago, soon to be to the day. I wish I had listened to THE MAN. I did not. So as not to make more Café readers run away. That is the bad news. The good news is that what we have coming in the shares will be one of the most historic market moves in history … and we all need to be there after this cacophony of dismal affairs these past years. Same drill: Newton’s Law about equal and opposite reactions. As bad as it has been, the better it will be in the years ahead. The shares will go bonkers as in a mania rarely ever seen before.
This is not a 'woe is us' story. Anyone who paid attention around 2000 has cleaned up with their bullion purchases … big time so … which means we have a lot of happy camper Café members, who will be even happier down the road.
OK, back to the day. Gold made it to $1195, while silver took out $17 to upside for a brief period of time. Enter Gold Cartel and that was all she wrote. What else is there to say? It is all about the bums and their "allowances"...
From MIDAS following the Fed’s surrender last Wednesday…
Today was somewhat abysmal in that we clearly saw how entrenched The Gold Cartel remains with their control over the precious metals prices. It is hard to remember a time when gold rallied $20 and that rally has me madder than before we got it. As the day wore on today, the euro, DOW and crude oil all made NEW daily highs by substantial margins, while gold was not allowed to do so. Actually, both made modest new highs later and then were nailed again … even as those outside markets mentioned kept on going.
That said, there is some serious daylight here in that the con job over the true state of the U.S. economy ought to be soon running its course. Even the Fed can’t "bull" their way around it anymore. Our economy is in big trouble after ALL the QE and money printing they have done … and they know it. This is a main reason why The Gold Cartel has gone all out to take gold and silver into the dumpster … to defuse the truth barometers.
Well, while THEY are still huffing and puffing, today brought us a lot closer to the day when this charade is going to end. That day shouldn’t be too far off. When The Tipping Point is finally reached, the precious metals are going to go bonkers and the bums won’t be able to do anything about it.
IF we are close to that point, we ought to get a rare follow-through tomorrow and gold should be knocking on its $1200 door by weekend.
To end on a POSITIVE note, gold is last at $1173, while silver is $16.05 ... which means they are back close to their highs of the day. That is constructive and suggests The Gold Cartel might really have their hands full for a change.
CRUD, I take that back. In the last 15 minutes, gold was taken down to $1167 and silver to $15.89. NOTHING has changed!
***
Well, something has changed in terms of upward price movement, controlled as it is.
Now for some fun. Obviously, we are thrilled to have Bob Bishop in our camp, big GATA supporter and superb thinker that he is. We are also extremely fortunate to have James McShirley with us. James was a featured speaker at GATA’s London conference in August of 2011. What a spectacular event that was!
James checked in today with some comments on the way the gold/silver world really is, in contrast to the mumbo jumbo garbage put out by the precious metals nincompoop pundits…
Lest we forget the 26th & 31st = cartel shenanigan days
Bill,
As always it is important to remember Thursday the 26th is option expiration day for April gold, with a week from today being first notice day. These two events have always been an opportunity for the cartel to impose iron lids anywhere near a big option number. Until this Comex charade is over blasting through $1200 seems remote. If gold does somehow defy its cartel masters it will be a very welcome development.
It seems silver has broken out above, and fell below $17 at least 50 times in the past week. This is SO unnatural, as typically even a couple consecutive breakouts above previous stiff resistance would get shorts covering in a hurry. The shorts in this instance aren’t worried in the least. Their agenda is capping and thwarting any and all breakouts rather than utilizing normal trading rules.
Note too how lumber went limit up this morning in a nanosecond on the rumor of China buying from a major Canadian mill. Lumber not only anticipated higher prices, but went limit up on a rumor. How quaint. Panicked shorts and mills pulling bids translate to higher prices in a hurry. This is how gold and silver should trade if there wasn’t a constant presence capping all rallies. We’ll never know how many gold rallies which were capped at 1% could have risen 5% or even 10% had price discovery been allowed. Some day price discovery will return with a vengeance, and +10% will be low volatility. Until then we wait for the lockdown to run its course.
JMc
What fun! Was thinking about James this morning re his commentary last week…
John paid a nice complement to James Mc and had a question for him…
Thanks for passing along. Give JB my best.
Regarding JB’s question regarding lumber: $270 must hold as a bottom or else it’s an elevator ride to hell. Canadian mills are still profitable here, yielding closer to $340 after factoring the Loonie/Dollar exchange rate. U.S. mills however are hemorrhaging badly. So far mills are only taking minor counters. Overproduction however is still evident. How quickly it gets cleaned up is the question. DC’s and wholesalers will be key if/when it does get cleaned up. Lumber is notorious for going on a tear out of nowhere and it wouldn’t take much to ignite a rip-roaring rally. FWIW I hedged our operation’s entire year here at these levels. Owning wood in the $270’s might look pretty good once hurricane season kicks off.
***
You don’t have to be a futures trader to "get" these markets, but surely the experience helps. As a former limit position trader at one point in my career, I know something about it all. It made my day this morning getting back to James about his lumber call and hedge bet. He came back with…
It tickled me to see lumber limit up as everybody and his brother-in-law was so hugely bearish. My lumber broker said his three dumbest traders who always lose money got short yesterday, and that’s when he knew limit up was right around the corner. Anybody shorting a 25 year low deserves to get lit up. Can’t wait for it to happen to the cartel.
JMc
The AM Fix was $1193.25. The PM Fix fell to $1191.50.
Oh my gosh … the gold open interest rose a steep 11,094 contracts to 447,773, which means the gold OI is as high as it has been in a long time. The silver open interest fell 1527 contracts to 174,123.
The ideal here would be for the specs to pour into the gold market, as the technicals are SO good, while the perennial mega silver shorts RUN FOR THE HILLS.
Bill Murphy
