Saturday Summary

Just a collection of stuff to ponder over the weekend.

First, GLD lost another 9.93 metric tonnes yesterday. That brought the total withdrawal for last week alone to 35.5 metric tonnes. At 1,1233.06 metric tonnes, total "inventory" is now down 16.8% for the year. Stated differently, for every 6 bars in "inventory" back on 1/2/13, there are now 5.

The U.S. Mint reported another 14,000 ounces of gold were sold on Friday. The MTD total for April is now 167,500. This is more than the entire month of January. This is more than the combined sales for February and March. This is now the 2nd-highest moth of sales ever recorded, behind only the 231,500 from December of 2009, and there are still 11 days to go in the month. http://www.usmint.gov/mint_programs/american_eagles/?action=sales&year=2013

After this week's CoT, there are bound to be more and more voices stating that the data is fudged/nonsense/controlled/manipulated/etc. Maybe those voices are right. I mean, seriously, how would we ever know? The reason that so many will be up in arms is the uniqueness of it. FOR THE FIRST TIME EVER, A MASSIVE PRICE DECLINE OCCURRED YET THE CARTELS WERE UNABLE TO SIGNIFICANTLY COVER. In gold, they covered a little but not in silver. In fact, while silver fell over $4, The Cartel actually had to add 5,100 new naked shorts. Here's a C&P of my CoT thoughts from yesterday:

REMEMBER, THIS SURVEY WAS TAKEN ON TUESDAY, AFTER THE MASSIVE 2-DAY BEATDOWN. FOR THE CoT WEEK, GOLD FELL $200 ON AN OI DROP OF 3,400 AND SILVER FELL $4.25 ON AN OI DROP OF 4,900.

Two main things:

  1. Both the gold and silver LargeSpecs aggressively covered shorts. The gold LargeSpecs added net long 9,500 contracts. Even larger on a % of total OI basis, the silver LargeSpecs added net long 9,700.
  2. But that's not the BIG NEWS. What is truly breathtaking is that the silver commercials who are long...and gross long at a record-breaking 60,000+ contracts...and which suffered incredible losses during the reporting week...and were subjected to Tuesday's margin hike...ACTUALLY ADDED MORE LONGS. THEY WERE NOT DEFEATED OR DISSUADED. THEY ARE STEADFAST.

GOLD

For the week, the LargeSpecs added 850 longs and covered 8,650 shorts. The SmallSpecs really got burned by the drop and also felt the sting of the margin hikes. They sold 7,150 longs and compounded their future issues by adding 4,250 shorts. Yikes! This allowed the Gold Cartel to only cover 1,900 net shorts as they added 6,800 shorts while they also added 8,700 longs. (I would imagine that almost all of this Cartel activity took place on Monday.) The updated Cartel net short ratio is a still-bullish 1.98:1.

SILVER

Just as in gold, the silver Large Specs added 1,200 new longs while covering 8,500 shorts. Their updated net long ratio is 1.8:1. And the silver SmallSpecs were burned just like the gold SmallSpecs. They sold 3,100 longs and added 2,000 new shorts. Double Yikes! 

And now check this out. As mentioned above, not only did the everybody-but-JPM crowd NOT sell last week, they actually BOUGHT! They increased their already record breaking gross long position by 581 contracts to 61,641. Incredible mainly because they are subject to the margin hikes, too. Not only did they not bail...they gave JPM the finger and bought more!

This forced JPM and their two pals to issue even more naked paper. For the week, they added 5,155 new shorts, bringing their total back up to 84,139. The new Silver Cartel net short ratio is still extremely bullish at 1.36:1.

Let me state this clearly:

THIS

IS 

NOT

HOW

IT

IS

SUPPOSED

TO

WORK!!!!

On massive selloffs, whoever is long (be it the specs or some commercials) is supposed to sell. This allows JPM and their friends the ability to cover. This is how it has worked for time immemorial. Period. End of story. NOT THIS TIME! Silver fell over $4 (15+%) in two days and yet JPM had to ADD SHORTS?!?! Are you kidding me???

Fully consider this:

  • Think about all of the physical demand, the anecdotal supply shortage info, the pace of ASE sales and the wholesale disruptions after Monday's decline.
  • Think about the Pascua Luma and Kennecott mine "issues".
  • Will either of these "situations" be exacerbated or enhanced by another steep drop in price?
  • But yet, what must JPM now consider? They only have two choices and both of them are BAD.
  1. Raid price again in the hopes that you can force the "other commercials" and specs to finally give up and sell. Into this selling you can finally cover your naked position. However, it would appear at the surface that an even-deeper discount will only worsen the already-tenuous physical supply situation.
  2. Start covering your shorts, even if its at a loss. Hope that the other commercials sell into your buying (covering) so that price doesn't go screaming higher, out of control to the upside

Alright, so now having an additional 24 hours to think about it, what if anything can we deduce. It's still hard to say because this data is so surprising.

  • First and foremost, it appears that the blame for the huge beatdowns can be laid at the doorstep of The Cartels. Why? Well, who was selling? Not the Large Specs, they were buying and covering! The SmallSpecs were selling but that was only after the pain of the price drop and the margin hikes. Nope, the blame for the initiation of the selloff clearly lies with The Cartels.
  • But they didn't accomplish anything. From time immemorial, waterfall declines have been rigged so that Specs would sell and The Cartels could cover (BUY) into the selling. Not this time! Prices dropped precipitously but the roles were reversed. Huh?
  • And, so, what happens now? More volatility, that's for sure.

But, now, here's the thing. When prices fall, speculators and retail investors/stackers are supposed to be frightened. They're supposed to be selling. INSTEAD, THEY'RE BUYING. Not just on The Comex but globally. See here:

I'll stop there but do your own Google searches and you'll find all kinds of data point "dots" that you can connect into a bigger picture of demand, premiums and shortages. 

So the question of the day is: WHAT WILL THE CARTELS DO NEXT? Crushing price again in order to create a waterfall into which they can cover may only serve to exacerbate their existing problem. If buying only continues to ramp higher on successive "discounts", what will The Forces of Darkness do? They would only be digging their hole even deeper. Perhaps this is the luxury you have when you operate with impunity because of your perceived too-big-to-fail and too-big-to-jail status. But...paper and physical price will only disconnect even further...which makes The Comex even less significant...which means The Cartel is merely shooting themselves in the proverbial foot.

At any rate, I don't have any answers for you today. I've just give you all of this to ponder. The entire Comex-controlled paper metal market seems to be FUBAR. Frankly, your only winning move at this point is to avoid it at all costs. Head down to your local coin shop (LCS) and buy some of whatever they have. Add it to your stack. Then head over thee again in a few days and buy some more. Wash, rinse and repeat.

I'm now seriously late for LT#1's track meet so I'm going to sign off right here. Have a great weekend and come back Monday, ready for more craziness.

TF

456 Comments

Carpe Argentum's picture

First?

Wow. I'm honored. Thanks for all you do, Turd. If you decide to spill the beans on the whole story... well, count me as interested.

Colonel Angus's picture

Seriously?

Could it be? I'm #2 on the Turd website. Gotta love that.

I'm about to head down to the LCS myself and hope they have something. We live in enough of an out of the way place, that my guy just might have something. There is usually this big coffee can filled with junk silver. We'll see if it is still there, what the premia are, and if he'll sell to me. I've already been down to all the usual places looking for ammo and actually found a little. The LGS had some, but Wally World even got a load in and had some to sell. This three box limit is ridiculous, but you can always circumvent that in a number of ways... 

I'm with Turd. Stack more silver. Paper stacks, but it isn't nearly as pleasing. Plus, nobody thinks to put paper in a vault most of the time. Everyone puts their silver into the vault, though.

Any more news on bank outages in the US? I'm picking up my daily ATM limit (to take to the LCS) just in case....

Spartacus Rex's picture

Maybe Thurd?

Get Busy Stacking the Physical this weekend

A.B.'s picture

4th for a change...

Top ten top ten top ten......wink

s1lverbullet's picture

6th

Yeehaw!

Bollocks's picture

My sons are innocent, this is a setup

Sorry if already posted.

onealpha's picture

On we go

Ebay sent me a 10% coupon just in time.  Relieved Apmex of some gold. 

silver66's picture

top ten

Just heading out to top up supplies

57goldtop and I got together for lunch yesterday and compared notes on our preps/plans and life . I am ahead on H2O and he is ahead on food and fuel. 

Time to implement some of his suggestions.

Silver66

FleetFeet's picture

Freedom Girl Light

As much as I love the SBSS Freedom Girl design, I have some disappointment about the coins I bought.  On average, they weigh 0.3 gram less than my ASE's.  It's not a great amount, but it adds up for the manufacturer if everybody's coins have been pre-shaved.   

I have a $10 battery-powered scale -- nothing professional.  There are always variations in weight of coins, but what caught my attention was that all 10 of the Freedom Girls showed definite underweight, whereas some ASE's were slightly under and others were slightly over.   

A handful of ASE's average out on my scales at 0.01 grams over:  = 31.11 gms. 

My Freedom Girls average out at 0.29 grams under:  = 30.81 gms.  The heaviest Freedom Girl is 30.85, not even close to 31.1.    

I'm not a golfer, but I know what a mulligan is.  (FYI:  the coins were made by the Mulligan Mint.)  I'd be interested in knowing if I just got a light batch, or if others find the same discrepancy.  

A.B.'s picture

My HO...

It is clear that the physical market is back firing and there is a gap between the paper and the physical market. More importantly the gap is widening.

In addition, the paper market is in their controll.
In MHO, soon the prices will be coming up again in the paper market because of the shortages of the physical markets popping here and there all over the globe. 
If this will not happen, then I am afraid there will be no paper market left but more important than that, there will be much more serious things like war and so on...
Personally, I rather see the market manipulation time to time than to see a big war concerning the globe. Last time it took a while to stop it, not to mention the lives.
For the cartel, it is important to keep their power via an established market. In order to keep it they have to allow the price to up soon. Upto what level? I am not sure. I do not see 50k or something but at least a 2.5k is in order. After that I am sure they will force it back to 1.7k areas and so on. 
SHOW MUST GO ON. 
Hypersonic14's picture

Another Possibility?

Forgive me if my comments sound simplistic but....could this current round of silver/gold price drops really be about acquiring  the means of production? Miners are in distress and there is talk of closures or at least going idle. Local supplies of PM's are very low or gone. Goldman/JPM would be interested in picking up mining operations for pennies on the dollar. Comments?

A.B.'s picture

@ another possibility?

Good conclusion but these bankers will not be allowed to acquire the miners. I am sure there are other companies being readied for that operation. They would not make it obvious for people to see it clearly.
However, "all ships must be sailing in the same direction"

billhilly's picture

Entrance exam...just for fun

Turd and Turdites,

It has been a challenging and stressful week so I thought I'd put this little (silly) piece together just for some fun.  It is not to be taken seriously, I just hope it'll provoke some good natured, witty responses. 

My thought is that with the recent troll and shill attacks this past week that Turd might consider instituting a more active approach in controlling their access to the comment section of the site.  My idea is that he institute an "entrance exam".

I, and many others I believe, consider this site one of the, if not THE, premier PM sites on the web.  It truly is an Ivy League caliber, "Institution of Higher Learning".  Therefore, like any advanced learning center, there should be certain minimum standards established to ensure an ongoing, and ever increasing, caliber of intellectual exchange.

The exam could be akin to the ACT exams.  We could even call it the Acceptance to the Community of Turdites exam.  It should be based upon some basic knowledge of current/historical events, PM's, politics/finance, and of course familiarity with some "Turd Lore". Using this test as a pre-qualification for access as a "full standing" member it should help control the Troll population and also reduce the need for "moderation"...a benefit for all.

I have started a short list of potential exam questions.  I encourage any/all Turdites to offer any other questions.  Please remember, this is just for fun.

Questions:

1.  Name the (foolhardy) President who allowed The Federal Reserve to be created.  _________

2.  Whose picture is this ?       ________________________

3.What are the chemical symbols for the following elements:

     Gold _____  Silver ______  Platinum ______     Extra credit for their atomic numbers.

4.  Briefly describe what is meant by the term "Force Manure".  (note; constipation is an UNacceptable answer)

5.  Which Turdites'  friend are baby goats ?   (hint:  smileysmileysmiley).  _______________

6.  Name the head janitor at each of the following institutions: 

     GS ________  JPM _________  CFTC _________  FED________

7.  Write out the meanings of the following Turdisms.      BTFD, TITS, EE, POSX, FUBM.

8.  Gold and Silver are:  A.  Money    B.  Price manipulated    C.  Hedges against inflation and idiots    D.  Found at the bottom of lakes   E.  All of the above.

9.  Name 2 items found at the Turd Store.   ______________________

10.  Which of the following coins weighs more?  A.  1 Oz. Gold American Eagle   B.  1 Oz. Silver Maple   C. Both   D.  Neither

Ok, hopefully this will help to lighten our stress from a long week.  Have some fun here if you choose.  I look forward to reading your witty responses.

The Watchman's picture

Government Data

government-lies.jpg

Maryann's picture

exam question...

What meat do Turdites love to eat?

Thanks Billhilly : )

Louie's picture

Holy Premiums Batman!

Tulving- $4.99 per ounce over spot for 90%.

BUYING junk for $1.70/ounce over spot. 

dropout's picture

Secrets That Are Hidden

Mike Maloney;

Hidden Secrets of Money - Currency Vs. Money

the_circle's picture

Possession

The comex was created principally to control the price of physical gold and silver using cash contracts. The fed and dollar mafia know that we are happy to use unbacked fiat, and have done since 1971.

The 80s and 90s gave way to easy credit and cheap, unbacked 'money', and everyone was getting wealthy on the expanding economy. The virtual wealth held in real estate and in the Dow today, and especially the bond market, will flood into gold whenever this collapses. 

There has been no price inflation in the US yet, because you have been able to export it all in return for TVs and iphones. Foreign goods entering the US at cheap prices, competing with locally made goods and keeping prices controlled. The money goes to foreign producers like China, and they buy bonds. The bond market is the most expensive it has ever been. And the only buyer is the fed.

Whereas Japan has had low interest and local sovereign bond buying for many years, they export and they have not inflated their currency like the US has since gold was removed. All these dollars will be coming home now, and the fed will have to print even more billions per month to keep asset values from plunging. 

We are very lucky in the sense that we stack. All the credit gold and silver leverage will end up in physical metal, as will all the wealth generated in the Dow and the bond market. The thing is, the comex is likely to fall lower before it defaults, because it is cheaper for the banks to settle contracts at lower prices. 

I like what Turd says about the cartel unable to buy at these low prices because no-one is selling. Remember, these guys have no intention of fulfilling expiring contracts with metal. They will drag this shit out as long as they can. The dollar is their only intention. We are part of the 1% who know this, and in time all leverage will wind up in gold. Jim Sinclair's 50,000 isn't outlandish in the slightest. But it will never reach that on the comex.

Sometimes you just have to sit and wait. Do nothing as Santa also said! 

silverwood's picture

Market Psycologist looking for work

Resume;.......................................

Previous employment;

10 year @ JPM in management of perception/ specialty precious metals

Education;

PHD in Market Psychology

Salary desired;

willing to work for food!

القراع عصفور's picture

exam question

how can you tell Bernanke, Chilton, Christian, et al, are lying?

another possibility subject...  i am also wondering if the miners haven't been a trap.  at what point to the CEO's/BOD's address the issue of manipulation?  are the miners already in the pocket of the banks?  will the miners ever show a profit - what if SRS is correct, and he most likely is - will the price of energy increase at the same or a higher rate than the metals?  what about labor cost, taxes, and the threat of nationalization? 

how many of you have been waiting to take profits in the miners, and use the proceeds to buy physical?  i have been waiting for years.  i would have 3-4 times as much physical right now had i bought metal in the first place.

and then there is Exeter's pyramid...

exeter-pyramid.jpg?w=500&h=367

as confidence is lost in the economy, and especially in paper money, follow the arrows.  highest confidence, therefore highest risk at the top.  a deflationary collapse or a hyperinflation, if you believe in this chart, both are good for gold.  but not for the miners.

not trying to scare anyone.  it is just that i am deeply questioning my strategy up to the present, and going forward.

GLTA

edit: exactly right circle!

jaw777's picture

FleetFeet

Compare your Freedom Girl to a Canadian Mapleleaf. I believe the ASEs weigh more because they have an alloy added to the one ounce of silver. Your Freedom Girl is probably .999 fine. Your scale may be off because 1 troy oz. should be 31.1 grams.

Mudsharkbytes's picture

Just out of curiosity…

…I don't have any really accurate scales, but if anybody else here that has some freedom girls, or slave queens, or any of the SBSS silver coins also has some accurate, calibrated scales, it might be interesting to see if their scales verify or contradict FleetFeet's observations. 

This day & age I wouldn't put anything past anybody.  Any way to save a buck (or an ounce) they can get away with, they'll try to do.

القراع عصفور's picture

freedom girls

ASE's are three nines, and Maples are four.  so the difference in weight between them would be negligible - and not significant enough to be picked up using your electronic scale.  if the freedom girls are supposed to be pure silver, 1/3 of a gram is significant - especially since you claim that you weighed a bunch of them. interesting.  i'd like to hear more.  i unfortunately don't have any SBSS's to weigh.

Turd Ferguson's picture

Not just for Bollocks. For everyone:

MODERATOR

Normally, "innocent" people don't compound their problems by 

  • Running/hiding
  • carjacking
  • Killing a campus cop
  • shootout with police
  • hiding in boat while injured

Unless, of course, that was all just a setup, too.

Come on, people. At some point you must admit that not everything is a "false flag".

There are bad, evil and dangerous people in the world. The blame for everything cannot always be laid at the feet of the CIA or some other shadowy government agency. To consistently do so makes you look silly.

pourty's picture

SBSS weights

I will take some more measurements this afternoon and report back.  But here is what I know:

A single Freedom Girl proof I weighed on my high end reloading scale (RCBS 1500) was 481 grains.  There are 480 grains in a Troy ounce.

the SBSS bullion coins I've weighed in the past on my cheapo 2000 gram scale all came in at 1.05 Troy ounces.  I don't trust this measurement as much as the one above.

ill report back more data in a few hours.

القراع عصفور's picture

besides, there's a forum for this!

we need to go light on the main page to attract the skeptical public to the blog as much as possible.  remember, we goldbugs already are considered to be the nut-jobs by the sheeple.  so all the conspiracy stuff that is not directly related to metals suppression should go to the forums, even if there is truth to much of it.  i started off here as one of the skeptics on many of these forum topics myself.  not so much any more.  but i never would have given these opinions a chance, had i not already have been hooked initially by the gold suppression story.  no offense meant to anyone, and my opinion of course.

FleetFeet's picture

Jaw777 --  your comments

Jaw777 --  your comments don't really make sense.  Here's the US Mint description of an Eagle:    The American Eagle Silver Proof Coin contains 99.9 percent silver. The one ounce coin has a $1 face value and is 1.598 inches in diameter, contains 0.999 silver troy ounce and weighs 1.0000 troy ounce. 

If you'll notice, I used the gram weight in my post:  31.1 grams.  OK, technically it's 31.103 grams -- doesn't matter. 

Freedom Girl is stamped the same .999 fine.  In other words, both coins may contain 0.001 gram of alloy or impurities.  The question I raised is still unchanged. 

NonoverlappingMagicCereal's picture

RE: Not just for Bollocks. For everyone:

Hear, hear.

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