I bought some silver coins this week and they won’t be able to ship for three weeks due to shortages. I love a good sale.
I bought some silver coins this week and they won’t be able to ship for three weeks due to shortages. I love a good sale.
Jimmy chooses the gold takedown by the shady Wall Street elite and their Federal Reserve brethren rather than the Boston Bombing Reality Show. He nails it. Trust in the financial system is waning rapidly. Fraud is rampant. Insider trading is encouraged. The barbarians have broken down the gate and are pillaging the city. Crony capitalism is in its final death throes as the psychopaths run wild. The Wall Street Too Big To Control Banks don’t have the gold or silver they proclaim to have. They can’t deliver. The charade is being uncovered by the tremendous demand for the physical metals. What desperate distraction will they attempt next?
Have you heard from CNBC that gold is up 8% in one week? I didn’t think so.
Are bubbles created when the MSM and powers that be do everything in their power to contain and suppress the price of something? Were the MSM boobs and Wall Street shysters cheering on the Dot.com stocks during the NASDAQ bubble, or were they warning people about the dangers? Were the MSM talking heads and Wall Street criminals cheering on the housing bubble, or were they warning people about the dangers?
The MSM douchebags and Wall Street big swinging dicks have never touted gold and silver. Despite 12 consecutive years of gains, these mouthpieces for the oligarchs have denigrated gold and silver. Idiots like Ritholtz and Krugman are cackling about the price decline even though they’ve been wrong for 12 consecutive years. The Wall Street criminal banks have done everything in their power to keep the price from rising. They know that rising gold and silver prices reveal that their plan to inflate away the trillions of accumulated debt is failing.
There has been no bubble in gold and silver. There has been and continues to be a bubble in debt expansion and the delusion of mainstream economists, politicians, bankers and faux business journalists. Rational holders of physical gold and silver have not sold a bar or a coin in the last couple weeks. As a response to the paper derivatives takedown of gold and silver, those who understand the long term plan of the oligarchs have responded by buying more physical gold and silver. When all of the world’s fiat paper currencies reach their intrinsic value of ZERO, those with physical gold and silver in their possession will be ready for the reset to some new currency regime.
The pigmen are going wild. It’s time to slaughter them.
This is related to the story about the shortage of bullion at the Hong Kong Exchange as reported on Bloomberg earlier today.
This was clearly not metals longs disgorging their bullion positions, but rather ‘an orchestrated panic.’ Even the speculative longs were forced in, as an examination of the action on the open interest shows.
And it is so brazen and clumsy that I doubt it was even the usual suspects gaming the markets for a quick buck. Although they just might be that arrogant, thinking they can do almost anything these days with impunity.
In order to make a big ‘market operation’ work you have to let the major players know, otherwise they complain about it as we saw in the London Whale and the Citi bond manipulation scandals. But the downside is that if you let too many greedy people know, the operation becomes harder to control, and it can get ‘over its skis.’
Let’s call this Imperial Overreach: When Pigmen Go Wild.
Still, it seems more likely that this was a quasi-political move as well as a commercial opportunity for plunder given the chiming in from the pampered pets, manservants, assorted spokesmodels, and Lord Haw-Haw’s of the Anglo-American banking cartel on cue.
And I don’t exactly expect that this means that it is over. You know what they say, ‘in for a penny, in for a pound.’ One would expect the Wall Street wiseguys and the City lords and barrow boys to run their last bluff until they hit the wall. That is how we will know it is the last.
Economic Times of India Shortage of gold bars and coins in Dubai, says World Gold Council By Sutanuka Ghosal, ET Bureau 19 Apr, 2013, 12.46PM IST
KOLKATA: World Gold Council, which has been tracking the global gold market pattern, has found that there is a shortage for bars and coins in Dubai which is creating a supply shortage.
Aram Shishmanian, CEO, World Gold Council: “It has become increasingly clear over the course of the past week that the fall in the gold price was triggered by speculative traders operating in the futures markets. Their short-term view of generating a trading profit is in stark contrast to the views of long term investors in gold, as evidenced by the massive wave of physical gold buying that began over the weekend and accelerated following Monday’s further decline.
The surge in gold purchases is spanning markets from India and China to the US, Japan and Europe. Buyers are viewing this as an opportunity to purchase gold at prices not seen in the past couple of years.”
The World Gold Council is uniquely positioned in the gold market to get immediate feedback on market patterns. “We are already seeing shortages for bars and coins in Dubai, while premiums in Mumbai are at $26/oz and $6 in Shanghai, indicating that buyers are willing to pay more than current spot prices for the metal..
Source: Economic Times of India
Hong Kong’s Chinese Gold & Silver Exchange Society has been in operations for over a century, and it’s President Haywood Cheung was interviewed by Bloomberg news earlier today. Whoever orchestrated the attack on gold and silver in the last week or so has gravely miscalculated, since the response to the drop has been surging demand for physical gold and silver. While I tend to be skeptical when I hear about silver shortages since these reports have been so exaggerated in the past, the lack of silver coin availability and premiums are the most extreme I have seen since the financial and economic meltdown of 2008. Now we discover that the Chinese Gold & Silver Exchange Society has essentially sold out of gold bullion, and must wait until Wednesday for shipments to arrive from Switzerland and London.
For those not paying attention, we have entered a global deflationary depression. The nutjobs running the world’s central banks and the moronic politicians elected by the sheep have tried Keynesian fiscal pork, zero interest rates, fraudulent accounting, printing money at hyper-speed, propaganda, austerity for the peasants, bonuses for the criminal bankers and crony capitalism for the super rich. It is five years later and it hasn’t worked. The grand experiment has failed. Bernanke and Krugman’s theories have been discredited. The world is on the edge. Bad shit is happening. Behind the scenes, the oligarchs are panicked and scrambling to retain their wealth and power. They are criminally inept. Their solution will be to accelerate what has already failed. This is how deflationary depressions turn into hyper-inflationary collapses. The massive buying of physical gold and silver by individuals and Far East countries is rational and prudent. The oligarchs won the battle in the past week. They may win a few more battles, because they have many weapons, but they will lose the war. This Fourth Turning is about to get really interesting.
7:22PM BST 17 Apr 2013
It is becoming ever clearer that the roaring boom in global equities since last summer has priced in an economic recovery that does not in fact exist. The International Monetary Fund has had to nurse down its global growth forecasts yet again. We are still stuck in an old-fashioned trade depression, with pervasive over-capacity in manufacturing plant and a record global savings rate of 25pc of GDP.
German car sales fell 17pc in March. That should puncture the last illusions that Germany is about to pull Europe out of a self-inflicted slump.
As you can see from the chart below, the divergence between stock markets and the Deutsche Bank index of raw materials is astonishing to behold, so like the pattern in early 1929.
Steel has fallen 31pc this year. Brent crude is off 17pc since early February, and copper 15pc.
You have to be careful reading too much into commodities, distorted by China. The time-honoured cycle is a surge of investment that comes on stream at once with a lag. America’s shale drive has turned the gas market upside down, diverting liquefied natural gas to Europe and Asia. Copper output in Chile rose 7pc last year. The crash in the Baltic Dry Index for shipping rates is partly a tale of too many ships.
Yet excess supply does not explain the collapse in gold over the past week. Cyprus may have been an incidental trigger. If the EU-IMF Troika is determined to strong-arm the Cypriots into selling most of their pint-sized holding of 14 tonnes, it may do the same to Portugal when the time comes, and then you are talking about the world’s 14th biggest holding of 382 tonnes.
Bank of America says the gold crash since Friday has already discounted sales of the entire Cypriot, Portuguese and Greek gold reserves combined. “As we believe additional gold selling in the European periphery is highly unlikely, we find it hard to fully justify the sell-off,” it said.
The central banks of China and the emerging powers bought 535 tonnes last year to escape dollars and euros, the biggest wave of state purchases since 1964. Their strategy is to buy the dips, and they are no fools. The head of China’s reserve manager “SAFE” used to run a US hedge fund.
They won’t try to catch a “falling knife”, prefering to wait until the dust settles. The upward trend of the great bull market has been broken. The technical damage is brutal. Bank of America expects a further drop to $1,200. Be patient.
My view is that the US Federal Reserve and the Bank of Japan “caused” the gold crash. The rest is noise. The Fed assault began in February when it published a paper warning that the longer quantitative easing continues, the harder it will be for the bank to extricate itself.
The report was co-written by former Fed governor Frederic Mishkin, often deemed Ben Bernanke’s “alter ego”. It said the Fed’s capital base could be wiped out “several times” once borrowing costs climb. The window will start shutting by 2014, with trouble then compounding at a “dramatic” pace.
This was a shock. It suggested that the Fed has lost its nerve, and will think long and hard before launching a fresh blitz of money if growth falters.
Then came last week’s Fed Minutes, with hints of tapering off QE earlier that expected. That was the next shock. What they seemed to be saying is that the US economy is groping it way back to normality, that the era of silly money is over, that the dollar will stand tall again.
If that were the case, gold should fall. But it is not the case. The US economy is growing below the Fed’s own “stall speed” indicator. Half a million people fell out of the workforce in March. Retail sales fell in March. So did manufacturing.
The US faces fiscal tightening of 2.5pc of GDP this year, the most since 1946. Ex-labour secretary Robert Reich said the effects have been disguised so far, but a “stealth sequester” is just starting: $51m of grant cuts to Brandeis university; $1m for schools in Syracuse; and so on, the reverse of the stealth stimulus before.
My guess is that the Fed will be forced to row back smartly from its exit talk, but first we must look deflation in the eyes.
As for the Bank of Japan, it had been assumed that the colossal monetary stimulus of Haruhiko Kuroda would revive the yen-carry trade, leaking $1 trillion into world asset markets. But the early evidence is the opposite. Japanese investors brought money home last week.
“Mrs Watanabe” is selling her Kiwi and Aussie bonds to bet on stocks and property at home. And she is selling gold like never before. That too is a shock.
Japan’s “Abenomics” may prove a net drag on the world over coming months. It is exporting deflation through trade effects. This already visible in Korea and China, where soaring wages have eroded competitiveness. “Investors may have forgotten that yen weakness was one of the immediate causes of the 1997 Asian currency crisis and Asia’s subsequent economic collapse,” said Albert Edwards from Societe Generale.
China’s growth rate fell to 7.7pc in the first quarter. It will fall further, though the catch-up boom in the hinterland cities of Chengdu, Chonquing, Changsa and Xi’an may have further to run.
Fitch Ratings says credit has surged from €9 trillion to €23 trillion over the past four years, a rise equal to the entire US banking system. Beijing pumped up loans yet again after its recession scare in the summer, but is gaining less traction. The GDP growth effect of credit has halved. It is the classic sign of an economy sated on debt. China too will have to deleverage.
The world is still in a contained depression. Sliding commodities tell us global money is if anything too tight. “There is a threat of deflation almost everywhere. A lot of central banks will have to follow the Bank of Japan, whatever they say now,” said Lars Christensen form Danske Bank
The era of money printing is young yet. Gold will have its day again.
Jesse is an extremely methodical, non-dogmatic thinker. He understands the markets. He also understands the manipulation and corruption that is rampant on Wall Street. I believe his suspicions are correct. Something wicked this way comes. The takedown of gold and silver was a coordinated effort by the powers that be to cover-up their criminality. JP Morgan and one or more of the Too Big to Trust criminal banks are in trouble. They can’t deliver physical gold or silver because they don’t have it. Their derivatives shenanigans are blowing up. Trust has been lost. The criminal banks are losing faith in each other. The Ponzi scheme is collapsing. This is not over. The worst is yet to come.
Many are still sorting through the data to try and figure out what happened, but it is hard to look at the available data and the market action and conclude that the recent ‘flash crash’ in gold was anything but a calculated takedown.
Some big players had been trying to work the market price of bullion down in stair step fashion for some time. Their tracks on the tape were big enough to be hard to miss, and any number of people who watch the market structure as it develops were seeing them, and a few were reporting what they saw.
But it just wasn’t enough. The pressures were building, and something had to be done.
A plan for a market operation to relieve the pressure was made, and then executed ahead of the upcoming option expiration on the Comex on April 25th. The word was quietly spread so the important monied interests would not make a fuss about losses when the time came, as in the case of MF Global and Cyprus.
And then Goldman gave the signal to the market with their ‘short gold’ call.
As I said at the time, I was not sure if this was done to try and avert a disaster, or to cover up some longer term corruption. Or perhaps a bit of both. Motives are never easy to discern where leverage and opaque trading pools are involved.
This could be in advance of a major announcement out of Europe with regard to the Eurozone and also their monetary policy following along the lines of Japan. Perhaps it is even something regarding US policy. Obviously one has to have an open mind about that.
But there were persistent rumours of a potential default situation at both the LBMA and the Comex. Well, one has to take those with a skeptical eye. But there are some data that point to the LBMA in particular, although the drawdown of bullion from the two exchanges could have been more general.
Linked just below is a report that includes more data and it well worth reading. It tends to concentrate on the Comex.
How the Gold Market Was Crashed.
It seems that the word has gone out to the media and the stories are being spun to protect the system. And the parrots dutifully pick up the chatter, without knowing why.
The story being spun that there was a speculative excess in gold being held by pension funds that panicked. Foolish people, outsiders really, got over their heads and caused this regrettable incident.
There is probably a grain of truth in that, but I think it is more likely that they were forced out of their positions by a market operation designed to do just that. And market insider knew exactly what they were holding.
Price declines caused by legitimate selling and panicked longs are not marked by increasing open interest. That is the hallmark of short selling with a purpose.
This is a big deal, and it was writ large across the media. And that suggests that there is an equally big problem that had to be dealt with quickly and brutally. Ordinarily market operations are more adept and protracted.
Something was close to breaking, and it most likely still is.
And if it broke, it would prove to be embarrassing to quite a few very important people. At least, that is what this situation suggests to me.
Even the endlessly levitating stock markets seem a bit ‘edgy’ with a tension on the tape.
I cannot possibly know what is at the root of this. Can’t find Germany’s gold, and can’t buy enough at the LBMA to deliver it, because the market is leveraged 100 to 1?
Maybe not that but something of that magnitude. A major TBTF tottering on the brink of a derivatives domino collapse? There are rumours out of Switzerland about Italy and France.
Most eyes are on the States, but how quickly we forget that ABN/Amro declared a force majeure and stopped all physical delivery of bullion, forcing settlement in cash. The soft default of a major bullion bank is no joke, especially when it appears they could not obtain suitable goods at any price.
This tends to point towards problems in Europe and the LBMA. And one of the big sources of LBMA 400 oz. qualified gold is the big SPDR Gold ETF, GLD which is stored by HSBC in London. I have included a chart of who tends to use 400 oz. bars below. The COMEX does not.
As you may recall, Andrew Maguire reported early on that there were indications of problems on the LBMA with regard to gold inventory. It is said to be leveraged 100 to 1.
“Entities went to the LBMA and said, ‘We don’t trust anybody anymore. We want our physical metal.’ They were told they would be cash settled instead by a bullion bank. The Western governments have been trying to plug holes, and the reason for it has to do with the default that was taking place at the LBMA.
This is why this smash has been orchestrated because of the run that has been taking place on physical metal. So Western governments had to do this because of an imminent run on the unallocated LBMA system. The LBMA bullion banks had become so mismatched at one point on their trading positions vs real world demand that they had to orchestrate this smash.”
The ‘entities’ in question are again just rumour, but they are most likely to be from the Mideast or Asia. They could be a central bank, or even an ETF for that matter. But the size was said to have been substantial, and untenable for withdrawal without a severe market disruption given the leverage on which the LBMA operates. 100 to 1 leverage is no joke when the drawdown is physical and available supplies are tight.
If you have not picked it up, the implication in this theory is that the big price declines allowed some non-allocated repositories, like GLD for example, to disgorge delivery ready bullion to the LBMA for delivery to the entity that had demanded delivery.
And something like this might not be a singular event. People talk, and if one entity got nervous and took delivery that information cannot be kept from other sizable players in the same circles. And so others step up and ask, and there is the threat of a run. And it could be happening in more than one place, ie not just the LBMA. Hence the decline in inventories at the Comex referenced above.
JP Morgan holds enormous derivatives positions in the precious metals not reported anywhere in detail except occasionally in the OCC report. If something were to perturb the markets, it would almost certainly affect them.
And recall that the outrageous excesses of the ‘London Whale’ were not uncovered by regulators, but rather by market participants who reported JPM to be distorting the market because of the size of their position. And the OCC is having a bit of recent notoriety from overlooking irregularities (some say crimes) to protect the banks. So keep that in mind.
Changing the subject, if you wish to get a bit more baroque, gold may have been a necessary misdirection with the real target being silver, which hardly anyone is talking about, even the house economists and spokesmodels for the status quo.
Keep an eye on stocks and the markets. The big money always moves first, because they get to know what is happening first.
But I have to remind you, your guess is as good as mine. It is an opaque market, and it has gotten worse and not better, despite all the show of ‘reform.’
When the tide goes out, you not only get to see who is naked, you see who they are naked with. And so the smokescreens go up.
I suspect that this is going to get ugly.
Related: Update to the Update: The Attack On Gold – Paul Craig Roberts (this gets more into the general government-business-as-usual theory rather than something that was incidentally related, ie a major impending default. As I pointed out I think those sort of antics tend to be a more elegantly executed and gradual. The recent gold/silver smack down was sheer brute force. Could have been shock and awe but it really was over the top and probably called far too much attention to itself to have been a ‘policy thing.’)
Everyone assumes America must play the leading role in crafting some settlement or compromise between the Israelis and the Palestinians. But Jefferson, Madison, and Washington explicitly warned against involving ourselves in foreign conflicts. — Ron Paul