Santa Out In Front

New thread is a great idea. Santa frontrunning the news again. Especially grateful to Turd and everybody else for their analysis of the situation. 

Also note that the POSX failed to rally yesterday and is falling again this morning.

Good to hear that Chavez made his withdrawal without assassination or boating accidents. Any clue about how much bullion is left in the European vaults?

Turd and Turdites...

Did anyone go to bed last night? I have such an information hangover...

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Regarding Canadian bullion dealers...

http://www.tfmetalsreport.com/forum/canadian-bullion-dealers/270

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Fried(e)

Funny for just yesterday I sent out an email to some select friends of mine with this info. So:

Having listened to the audio last night, I think Turd's summation nails the gist of Santa's message.

Some here and elsewhere discount Santa for his penchant for being extremely dramatic. And he can seem that way at first. But his dramatic, and often dire pronouncements, have a way of coming into common acceptance over time. This strikes me as another one of those instances where what now seems a little over the top will prove to be mainstream in the not-too-distant future.

Santa was talking about derivatives and their dangers well before most, if not all.

Yes, Trader Dan says if 35 falls it will be rapid to 40. Turk (who has been wrong on his timeline lots lately?) says if 37 falls we will shoot to 68-70 within months.

Perhaps both of these fine gents are correct.

When one considers the massive notional value of all the CDS policies taken out on Euro debt, one can conclude how much QE will be needed to support the stunning losses that will be taken on the owners of that debt when those policies are determined to have no value.

We haven't even began to deal with the even larger debt loads here in the US....... falling of dominoes seems an appropriate  analogy.

wondering still who eats the poo-poo sandwich?

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Its 'us' - the masses. Who else would it be - the CEO's, bankers...the elite? Isnt that the idea - for us to eat it?Its not for the big guys, but the commoner's - prepared by them... Mmmm...

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~snafu~

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Fried(e)

If and when the ISDA announce it is not a default (Greece) then all hell should break loose in the US$. This is not US$ friendly, it is loss of trust of the system. MF Global times 10!

He's being a bit hyperbolical by saying what do you call when they go to 0%. They won't go to 0%. They'll go to 1% then .1% but not 0%. Don't worry, everything is fine. /sarc

I fail to understand why the Paper aristocracy announcing QE to infinity will have any impact at all on the metals market. Anybody with a lick of sense knows already - they are printing like madmen. QE is priced in, as such this will be a textbook example of ""buy the rumor, sell the fact." 

 This planet is run by Criminals, for the benefit of criminals at the expense of the masses. Greece is but a trial balloon for future, Goodfellas style country size "bustouts".  TPTB will extract every shred of value possible from Greece & the retards who purchased their bonds - before sending them on their way - broke & in debt. 

The coming QE announcement, if there is one, will be designed to enrich TPTB, while easing the worries of the masses. Sure, it will be pitched as the solution to our ills. The end result though, the masses, via inflation will be impoverished. 

Been here for a while but sometimes I get baffled with the acronyms. CDS, CDOs, ISDA.

Don't think they're in the glossary.

Thanks!

If ISDA says it's not a default (no matter what "it" is), the BBs survive by not having to pay out on CDSs. The smaller players who can't collect on the CDSs, will be kept solvent (or book-balaned) by some FED/ECB new liquidity mechanism. This pumps in new liquidity. Bad for USD. Good for equities, PMs. Bonds? USTs will NEVER be allowed to go up in yield - even more QE. Fly in the annoint - the FED/ECB may simply "guaranty" the CDSs - as long as they never collect on them! This too can keep the "books looking good".

This event puts a rock-hard base under Santa's "QE to infinity" thesis.

Sinclair going senile? For shame! Bad Turdite! You want senile? Go listen to Bob "Cynthia McKinney would make a good VP for RP" Chapman's interviews over the past few months - there is a fine example of entropy taking charge.

Sometimes, a visit to Urban dictionary:

http://www.urbandictionary.com/define.php?term=FUBM

Boy, the "crash" is never going to come...

No, it will come, but it will be worse than we can imagine.

Two points:

1) One of the fundamental differences between Austrian economics and Keynesian economics is how market recessions or breakdowns are handled. Austrians believe that such pullbacks or recessions can strengthen the economy and are part of the normal cycle of economics. There is nothing really abnormal about a recession. They also believe that if you leave a recession alone, an economy with underlying health (even though in a recession!) will heal itself and bring a boom to follow. This can be likened to the large gains and then a period of consolidation in the metals. Consolidation is healthy, although painful to may of us.

Keynesians believe that recessions should be avoided and therefore liquidity injected into the market to reverse any downtrends. This never allows the market to heal itself and only prolongs the illness. Our central banks have "fixed" many recessions as of late, and that means that each coming recession will be deeper and longer than the next. They will reach a point where they cannot "fix" them any longer and we will see the crash of major depression that Turdites are prepping for.

Had they simply allowed the recessions to play out, without bailing out any companies, the ship would have righted over time. So while it may feel that the crash will never come, don't be fooled by that. Each time you have that feeling you need to use it for good and realize that the crash will be deeper than you can imagine. Prep accordingly.

2) In medicine, we have discovered that when patients have a terminal disease and are nearing the end of their time, they actually are happier and more comfortable when we let nature take its course and allow them to live at home, or in hospice care, surrounded by their loved ones and things that make them happy. This is in lieu of pumping them full of drugs that are designed to prolong their lives. Most of the regimens DO prolong their lives, but what the patient really gets is another month or two of cloudy mental status and more and more drugs to counteract the ones initially given.

It's similar to the markets. Austrians know we should simply let things play out rather than tinker with the system and prop it up. The fall will be that much greater.

LOL@ the 60 cent silver drop in 20 minutes. Schizo NY market.

And not just the LOL that we all type when things are slightly humerous. Just got finished with a patient, opened the spot chart, and did an audible laugh. Ridiculous movement.

It's similar to the markets. Austrians know we should simply let things play out rather than tinker with the system and prop it up. The fall will be that much greater.

Agreed. It doesn´t make sense....unless you think, like i do, that these people are not morons but highly intelligent people with a plan, the plan to ruin the markets for their own purposes.

160 tons of gold to Venezuela! Looks like they are the first to take a seat in this very serious game of  musical chairs. Genius in its simplicity. Isn't that what we are all doing here stacking PMs,  changing our fiat into real currency while we still can. Maybe Chavez reads Turd's blog? Maybe he is actually one of us? Maybe I should relocate my family to Venezuela. You know, I could probably tolerate communism if it was not so corrupt. I bet it is rife with banksters and other greedy entrepreneurs who fleece the sheep and pull the strings of the puppet government, supported by the muscle of the military... wait... that sounds like the US where I live now???

Hmmm. I wonder what it is really like in these South American countries?

Decisions, decisions.

Edit: I thought he might look better with a hat!

FYI....

Today Egon von Greyerz told King World News that central bank balance sheets are expanding at a dangerous rate and this is a recipe for an explosion in gold and silver prices. Egon von Greyerz is founder and managing partner at Matterhorn Asset Management out of Switzerland. Here is what von Greyerz had to say about central bank activity and how it will impact gold and silver prices: “I’ve been looking at the explosion of the balance sheets of the central banks and it’s just astonishing to see how much money they are printing and how their balance sheets are expanding. We have the absolute perfect recipe for hyperinflation and thus a massive increase in the price of gold and silver.”

January 30, 2012

Egon von Greyerz continues:

“It’s not just the ECB balance sheet that’s gone up in the last six months or even the last three months by hundreds of billions of dollars. It’s the same with the Fed, Bank of Japan, The Bank of England and the Swiss National Bank, they are all exploding. This can lead to only one thing and the market seems to be totally ignorant of this.

The repercussions are going to come very soon. As I said, this can only lead to one thing, an explosion higher in gold and silver prices and the beginning of the massive inflation, which will lead to hyperinflation.”

When asked about the Fed announcement last week, von Greyerz replied, “The Fed action is totally consistent with what we’ve said for some time. The Fed knows they have to continue to print money and they will print unlimited amounts of money. On top of this, the US is not taking any measures whatsoever to cut down on spending.

“Every year the Fed is printing between $1.5 trillion and $2 trillion. As you know, just during President Obama’s term the debt in the US has gone up by about $4.5 trillion. This is about 30% of total borrowing in the US. It’s just incredible and it’s accelerating.

But they are not the only central bank doing this. The ECB is in the same mess. The ECB is meeting again, but I would be surprised if they come to any decision. Greece will probably default because they won’t accept the EU having control over their finances. The EU doesn’t want Greece to default because it would be bad for the other European countries, so they will probably come up with a package. I don’t expect that package will be now, but at some point in the future.”

When asked about the action in gold and silver, von Greyerz responded, “The move in gold, so far, looks extremely good. I’m always pleased that we don’t have a straight move up, although I do think we will have faster moves higher in the not too distant future. This is strong action with small corrections.

We are at $1,730 today and I think within the next couple of months we will certainly be touching $1,900 and continuing higher from there. I don’t think $1,900 will be a stopping point for very long.

I really like the action of silver. Silver still hasn’t broken out like gold has, but as I said to you last time, I expect that to happen soon. It will break out around the $37 level. That’s going to happen very quickly because the gold/silver ratio is moving down nicely, but I think it will soon accelerate lower and silver will move a lot faster to the upside than gold.

So I can see $37 being taken out within the next 30 days and then we will just start flying from there. It won’t take long to get up to $50 again.”

When asked about the mining shares, von Greyerz stated, “I like them here. We’ve started buying them. We prefer physical bullion, but we’ve now started buying mining shares because they are massively undervalued and they will move a lot faster than the metals.

As I said, I like them now and I think it’s the right time for investors to buy them or add to positions because I think an acceleration higher in the mining shares is coming.”

31st January

Gold Switzerland - Matterhorn Asset Management
 

(OTC) derivatives are contracts that are traded (and privately negotiated) directly between two parties, without going through an exchange or other intermediary. Products such as swaps, forward rate agreements, exotic options - and other exotic derivatives - are almost always traded in this way. The OTC derivative market is the largest market for derivatives, and is largely unregulated with respect to disclosure of information between the parties, since the OTC market is made up of banks and other highly sophisticated parties, such as hedge funds. Reporting of OTC amounts are difficult because trades can occur in private, without activity being visible on any exchange. According to the Bank for International Settlements, the total outstanding notional amount is US$708 trillion (as of June 2011)

that picture is killing me!!! The best laugh I have had in a while.

If the market really believed that  a tidal wave was going to hit five banks there would be ten times the volume in FAZ. jmo

ISDA will defend it's membership and participants.

The question about who holds ISDA accountable is pertinent.

The Congressional Budget Office (CBO) already investigated this issue and reported that the oversight over securities and derivatives was lacking.  I recall seeing that they released the report about 10 days ago.  I have not read the report, but it was being reported on by MSM.  Most people miss the significance of CBO activity and reporting.  They are one of the most authoritative sources of non-partisan information in Washington DC.

Sinclair's comments are far from the accusatory and irrational position that some individuals attempted to portray during the overnight thread.  Jim Sinclair has teeth in the game and has been biting that monetary meal for longer than most of this blog's contributors have been alive.  Therefore, we can not dismiss him by prejudice of age or communication style.

ISDA is regulated by the defaulting parties and the banks owning the ISDA are directly dependent on those governments for their corporate lives.  Why would the banks put the noose around their own neck?  Of course they would reach a mutual decision with the finance ministers to displace the rope to another party.  That other party is the holder of the sovereign debt instrument.

So, who are these holders and who are the countries involved?

http://www.bbc.co.uk/news/business-13798000

According to BIS Quarterly Review (cited in the BBC story above) - France and Germany are the most exposed nations.

As a person living in North America, the real question here is how long would the financial tsunami take to cross the Atlantic?  Is it 18 hours or  18 months?

This is the real question we need to consider from the standpoint of the US and Canada.  Dimon was on CNBC last week claiming that his bank has no Greek debt exposure.  However, his bank likely does have exposure to the French and German counterparties.  This may be why Blythe Masters is going to her new position.  I would like to suggest that she is needed to help write the new derivatives that will be needed to prop up the German economy over the next ten years.  Having already excoriated our nation, she is being sent to Germany to help "them" instead of "us".  May she eat the best schnitzel and weiners in the EU.

With the unraveling of the Case-Shiller this morning, it is clear that the North American depression is continuing and will do so until real productivity can be restored.

The time is near. The moment we have been waiting for. The time metals take their true price and place in society.

Man is it going to be wild.

Mr Sinclair is a jolly good fellow (a lot of these guys like Embry, Hathaway et al seem really nice people bless em, not the baddies for sure!) and Lord knows, being a face (a Chevy as we say in London) of the whole crusade against the nefarious and callous financial system must be exhausting... I'm just an ant and it tires me out no end. So I do feel a bit sorry about alluding to the slightly tedious nature of the interview last night, and JS said he'd had a hell of a day ( I wasn't the 'senile' guy btw lol), and as TF said the interviewer was a bit of di*k. It was fun to share the news 2gether :)

Anyway it's canned ham for all here (not me tho) and I think the odiferous nasty sandwich should be force-fed to Ben, Jamie, Lloyd,....