Gone...For Good?
For weeks, I and others have been telling you about massive sovereign and central bank demand for physical metal at the current paper price. From this demand alone, we can infer quite a few things. Today, I can take it one step further.
First, some background. Members of "Turd's Army" become subscribers to Andrew Maguire's "DayTrades" and "MetalsTrades" service. This service allows traders to follow Andy's actions, thereby learning how and when Andy affects trades in the gold and silver markets. In it's own right, the service is very effective at producing consistent, monthly returns for his clients and the "Army". However, subscribers also have access to Andy's weekly "Market Commentary", which he posts every weekend. This commentary is always informative and provides subscribers with a sort "insider's perspective" which simply cannot be found anywhere else on the internet. No one has more experience, more wisdom and more contacts than Andy and, without question, subscribers benefit from the access he provides.
Similarly, I like to think that everyone here in Turdville benefits from the access that I am able to provide. I receive a lot of on-the-record and off-the-record information and I try to pass along as much of it as I can. Some of it is just speculation and some of it is the sort of "inside baseball" stuff that I attempt to further refine into nuggets that can help you plan for the future.
All of that said, what we now know is this. Beginning some time ago, but continuing today at an accelerating pace, physical metal is being purchased in London and then delivered out of the system. Under "normal" circumstances, this is not necessarily unusual. The bullion banks simply expect this metal to return to them at some point, where it can be re-leased, re-hypothecated and re-delivered in the future. This is how it has worked for decades. However, this time it's different.
What I have learned and have since been able to confirm via a second source is this: London Good Delivery bars are being delivered to Eastern buyers. Instead of being vaulted inside the LBMA system, these bars are being sent directly to refiners. The bars are then being melted and recast in 1 kilogram sizes. The new bars are then being stamped with official, government insignia and sent on to vaults outside of the LBMA system and points east, never to return again.
What does this mean and why is this important? Quite clearly this information, if accurate, has several significant ramifications:
- The Chinese and others are preparing for a new system. Whether it's simply a new gold pricing and delivery system to replace the LBMA/Comex or whether it's a new global trade settlement system that is guaranteed with gold is impossible to say, at this point.
- The physical gold supply of the LBMA and secondarily the Comex, much of which has been acquired/supplied through leasing, is being rapidly depleted and will not be coming back.
- The bullion banks, which have profited for years from leasing, trading, vaulting and the like, are about to feel the rather dramatic effects of this supply depletion.
As this pertains to the banks, last week I wrote this ( http://www.tfmetalsreport.com/blog/3893/still-pounding-away) and I think the auto dealer analogy is still a good one here. IF China and others are buying gold in London and IF the bullion banks are delivering to them leased and rehypothecated gold and IF the Chinese are taking this gold and melting it and IF they are then recasting it into non-LBMA, 1-kg bars, then the bullion banks have a serious problem on their hands. The delivered gold isn't coming back into "the system". It is no longer in "London Good Delivery" form. It's gone. For good.
My advice to you today is to ponder this information and its implications. Ask yourself these questions:
- If you vault gold within the current system, do you really own it?
- If the banks begin to scramble for physical metal, will paper price trade higher or lower?
- If the Chinese and others are planning for a new, international trade settlement system to supplant the U.S. dollar as reserve currency, what does that mean for the future value of the dollar? What would that mean for the future value of all fiat currency? What would that mean for the future value of gold and silver?
Perhaps now would be a good time to go back and review this post, too. (http://www.tfmetalsreport.com/blog/3885/last-desperate-acts) At 34,000+ views, most of you have already read it. Maybe it's time to read it again.
Think. Look around. Trust your instincts. Prepare accordingly.
TF
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Comments
@ CL
Thank you for your reply.
I doubt this has anything to do with King Obummer. I doubt it is his agenda. He is just the public face.
The problem appears to be the American mentality. You see we (the west and now more) are shown that if you have lots of money you can have all the trappings of kings of old. Food, holidays, women, status, hero worship etc. You name it.
We are taught to worship/covert money and the trappings of it. Congress, media, police - you name it - all get rich, very rich, for keeping the rich, rich.
Folk sponsoring presidential candidates for millions, lobbyists, kick backs to congress. It is a club for the rich and we are not in it.
The founding fathers risked their lives for no financial reward. They did what they knew to be right - yet they already had good lives. They were willing to make the ultimate sacrifice for freedom.
We need to get money out of politics and media. Yes advertisers have sway (read corporations). At the moment, politics motives are not to serve you, they are to serve themselves via a form of moral prostitution so that they can live their American dream whilst plunging the rest into a nightmare.
Were are the idealists of old?
The love of money is the root of all evil. Reminds me of a modern day Rome with the vomitorium. It too shall pass. I too am restless.
B
Gone...For Good?
I stacked some Au today that is definitely "Gone...For Good!"
@ bugz and CA L
Here's a good article that dovetails what you guys are talking about. There is a ludicrous disconnect between sentiment and reality among the American populace. I think this cultural disconnect is what is most frustrating about the situation at hand.
http://www.sovereignman.com/expat/sentiment-vs-reality-total-disconnect/
Absolutely nothing new in there, just the point that the people are still wearing blinders. And that for me is the hardest part.
Global economy: reasons to be
Global economy: reasons to be fearful
Monetary and fiscal authorities are running out of policy bullets or, more cynically, policy rabbits to pull out of their hats
http://www.guardian.co.uk/business/2012/jun/18/global-economy-perfect-storm
Moment of 'levity' from Mike Krieger - pic of the day
"Hu is just sitting there thinking, are these idiots really going to keep selling me their gold?"
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Outstanding posts, Cali Lawyer. Agreed 100% about the blatant nature of the overreach/powergrab on the immigration issue -- it's almost as if 'they' are rubbing our faces in it -- but hey, after the loss of other fundamental constitutional protections, this seems like small potatoes by comparison. As was noted earlier:
The revision of the enforcement and/or suspension of all other federal laws and Articles and Amendments of the United States Constitution is underway by a select panel of experts. The Residents will be notified of further policy changes as and if deemed appropriate by the Office of the Executive.
________________________________________________________________
Turdland Jobs Forum
Prez on TV...
....and the clock just started officially ticking on Assad and Syria.
He's laying the ground work and rationale for it right now post G20. I think this starts to move relatively quick from here.
Fascist type control
Yes, thanks bam - I get his daily via e-mail.
Fear: the Nazi's ruled by fear. Do what we tell you or you will be shot or sent to the front or whatever. (yes some believed in their superiority) - we deserve it because we are........fill in the blank.
Today is; do what we tell you, report what we want, pass the laws we want or else - we will take away your way of life - we turn off your easy money spigot and you will be forever destitute. Or they may even be told that it is for the greater good and the master plan!
B
by vaultuing Turd do you
by vaultuing Turd do you think Bullion Vault and Goldmoney bars are being depleted?
Who are the bullion banks?
Isn't there another possible reason why the gold is being melted
If you were the chinese, and you have figured out that there are as many as 100 claimants for each bar of gold that you're taking out of the corrupt Anglo-American system, don't you want to sidestep those claims when the SHTF?
Imagine that it's October 2013 and the New York and London axis banking system is imploding. For several months, the prices of precious metals have skyrocketed. And for just a few months less than that, they've been almost impossible to buy anywhere.
Now the lawsuits are flying. First, there were the stories of owners of unallocated accounts finding that they somehow own nothing, the gold and silver is gone. Stolen. Then, stories spread like wildfire that allocated account owners and even swiss bank customers have tried to claim their precious metals and been put off and then told that the metal was somehow gone.
You're a large chinese bank and you've bought 400 ounce gold bar #987123. Do you really want to have to bother with 100 different rich american, english, swiss, german, saudi and other investors who all say that they are the true owners of bar #987123 that has been traced to you? Even if their lawsuits can't extract it from china, melting the bar down gives you the neat little side benefit of seeing to it that bar #987123 doesn't even exist any more to be claimed by anyone?
Fred
@Gramp
this guy in his 60's was talking about what a mess the economy is blah blah blah. He summed it up by saying,
"I'm sure glad I'm not in my 30's right now and be handed this mess for my later years!"
As I AM... it was all i could do to not growl at this 'Gentleman'
You shouldn't growl, you should be thankful that you are much younger, and can still adjust to the changing world, prepare for what's coming and hopefully survive and maybe even prosper. It's old people who are going to be hit really hard, unless they are very savvy and well prepared, which this "gentleman" doesn't sound like he is :) In hard times people like him end up having to rammage through garbage bins and choose between food, medicines and heating. It's pretty unpleasant but it's what happens.
yabs
click on turdisms on black banner top of page.
the east is not buying from our local suppliers for the most part....esp. PBoC....they buy and take delivery from LBMA.
and its not official or traceable or published.
@ SRS....RETAIL INVESTORS ARE FICKLE...
i really appreciate all the analysis you do here i wish could contribute something here for the group. anyway from my perspective the economy is forcing my hand. my pay is down, job is shaky this year, my house value is underwater and i am very low on dry powder. i may have drawn down too much stacking too early. anyway i think there are plenty here that are feeling the same way, a little over extended. so now i am stacking but at a slower rate. i love the price but have to be careful not to get into a position where i have no choice but to liquidate. i also have moved more to 90% as opposed to the ASE maples and philharmonics and maybe other have done so also, (as part of a learning curve to lower one's premium?)
i think what is needed is for us to increase the base of people who are aware of PMs versus the fiat alternatives. only a very small percentage of the population actually stack and it isn't really that hard. just keep working those family and friends, it is the right thing to do. just keep them from making the same mistakes the we/you made, whatever they may have been. good luck to all
stack stack stack they will crack
BIS: The inmates run the CB asylum with a mandate
Committee on the Global Financial System
The Committee on the Global Financial System (CGFS), which is chaired by William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, monitors developments in global financial markets for central bank Governors.
The Committee has a mandate to identify and assess potential sources of stress in global financial markets, to further the understanding of the structural underpinnings of financial markets, and to promote improvements to the functioning and stability of these markets. It fulfils this mandate by way of regular monitoring discussions among CGFS members, through coordinated longer-term efforts, including working groups involving central bank staff, and through the various reports that the CGFS publishes. The CGFS also oversees the collection of the BIS international banking and financial statistics.
The CGFS, formerly known as the Euro-currency Standing Committee, was established in 1971 (IS7: Nixon Gold Window shut) with a mandate to monitor international banking markets. Its initial focus was on the monetary policy implications of the rapid growth of off-shore deposit and lending markets, but attention increasingly shifted to financial stability questions and to broader issues related to structural change in the financial system. Reflecting this change in focus, the G10 Governors decided on 8 February 1999 to rename the Committee and to revise its mandate. As of January 2010, the Chairman of the CGFS reports to the Global Economy Meeting, which comprises a group of 31 central bank Governors as members.
http://www.bis.org/index.htm
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
MANDATE
Committee on the Global Financial System: mandate
As approved by the Governors of the G10 central banks on 8 February 1999
The Committee on the Global Financial System is a central bank forum for the monitoring and examination of broad issues relating to financial markets and systems with a view to elaborating appropriate policy recommendations to support the central banks in the fulfilment of their responsibilities for monetary and financial stability. In carrying out this task, the Committee will place particular emphasis on assisting the Governors in recognising, analysing and responding to threats to the stability of financial markets and the global financial system. More specifically, the Committee's primary objectives will be the following:
In its analysis, the Committee should pay particular attention to the nexus between monetary and financial stability, to the linkages between institutions, infrastructures and markets, to the actual and potential changes in financial intermediation and to the incentive structures built into markets and systems. The Committee should seek to increase the transparency of financial markets and systems by promoting the design, production and publication of statistics and other information by central banks - including through the BIS - and by recommending the adoption of appropriate disclosure standards by both the official and private sectors. Where relevant, the Committee should also contribute to the development of an international consensus on sound principles and norms.
The Committee is encouraged to co-operate with other national, supranational and international institutions with responsibilities for pursuing related objectives. In particular, it shall co-ordinate its activities with other Basel-based committees, such as the Basel Committee on Banking Supervision and the Committee on Payment and Settlement Systems, in order to strengthen the overall effectiveness of the process.
Obviously MA is not up to
Obviously MA is not up to speed on the PAGE story as we all realise this is history. Very interesting aspect though about Balance of Payments... There is plenty more in the article & reckon it is worth reading in it's entirety.
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No, he is definitely not up to speed. Hell, PAGE doesn't even exist anymore after the wrong people found out and successfully took it down. There is another one taking its place, and assuming it doesn't get fucked over before it even gets started, it's supposed to start mid-summer.
...somebody better tell Mr.
...somebody better tell Mr. Armstrong that PAGE has been canceled for quite some time now...
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Easy, easy now... The man got out of prison. Give him time to get caught up. (snicker)
So to answer your question,
So to answer your question, as long as Crimex is in control, the spot price will have no direct relation to the available amount of physical metal. But when the Crimex fails, the spot price will act as a rubber band and shoot to where it should be based on fundamentals (one of which is most definitely supply of metal).
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So... Dr. G... What can we do to collapse Crimex? NOW?? Collapse it now, and things will be kinda bad. Collapse it 3-5 years from now, and things will be much worse, and you will be dealing with UN on every street corner, guns will be illegal, and Terminators from Japan will be roaming the US.
Don't make me come find you because you didn't do something to help break this. It has become evident over the last several months that a strike team will be the only answer to solving our problems.
another bad boating aCCident today
http://hosted.ap.org/dynamic/stories/U/US_SEA_SMUGGLING?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-06-19-14-57-43
not quite as bad as metal overboard. but close. at least this stuFF floats. dueces
@Yabs
Bullion Vault and Gold Money hold their gold in private vaults (eg VIAMAT) OUTSIDE the banking system. Banks don't have access to these vaults, as they are private companies.
How they must chortle and
How they must chortle and guffaw between clinking glasses when recalling his often stated belief that gold's trading range in 2012 would be $1,700 to $2,111.
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Holy sshhiiiieeeee-yyoooot?! Really?! He said that? Santa said that? I must have missed that forecast because that would have run up a red flag with me, just like James Turk did. Now, both of them are on my "kick-off list," which is a revolving list of people who start to lose it and get things way wrong. By the way, I have Bix Weir on the list as well. He claims that silver will take off real soon and that Ron Paul will become president. The only way that will happen is if something politically bad happens to Romney or he get assassinated. I don't even think Ron Paul will get to be his running mate. It looks like pretty soon, I will be sending all three and other invitations to get the fuck off my list. The people in control of the COMEX situation include CFTC, SEC, the financial companies, and the US Government. Who the fuck are you kidding? I wish for once that I would be in a position to grovel and ask for an invitation to their party instead (HINT, I'm FUCKING WRONG! I'd LOVE TO BE FUCKING WRONG JUST ONCE).
I CANNOT believe that Santa said that... Even I fucking know that silver is very likely to not go over $40 until Nov.-Dec. at the EARLIEST, and maybe go over $50 by April 2013 at the EARLIEST, which greater probability of it happening by April 2014. These guys must be counting on something, causing airborne fans to catch something shitty in the air.
Unfortunately, Turd is right about the Asians et al getting ready to take control from the US, and it's going to be nasty. I remember reading years ago that if you have gold and silver, that would be all the Chinese you would need to learn. That was about 5 years ago, I think.
LBMA is a done deal?
shouldn't there be an accounting of the book to physical? any holes should be exposed in the data rooms doing diligence. no?
then melt and recast
prolly wont be any tungsten added there
Hi Bam thanks so by this
Hi Bam
thanks so by this development bullion vault and goldmoney should be ok?
Its just that with Goldmoney they say you can withdraw bars of 100 grams
When I tried this they said service is unavailable...
400oz vs Kilo bars
The conversion of 400oz bars into Kilo bars is not unusual of itself and occurs if there is a lot of demand from India/Asia as they prefer Kilo bars. However, the reason that market prefers Kilo bars is because that is what is used in the jewellery trade for the following reasons:
1. Kilo bars are usually supplied as 99.99 or 99.50 and consistent, whereas 400oz bars not only have varying weights but also varying purities. It is therefore a lot easier to alloy down Kilo bars into lower carat jewellery than trying to deal with differing purities of 400oz bars.
2. Easier to handle and melt a Kilo (32oz) bar rather than a 400oz brick.
Because of the extra cost of making Kilo bars (and potential for discount if you are trying to sell them back in volume), they would not be the preferred way of acquiring and holding by Central Banks or other large investors. Therefore Kilo bar demand is generally indicative of end jewellery demand (which will not be returning - although high scrap volumes over the past few years says to some extent otherwise) and not so much pure investment.
Therefore the recasting itself is not so much news. The question I have is was it explicitly stated by the source that the kilo bars were NOT being stamped with the mark of the refiner or was that inferred/assumed. Bars without an LBMA accredited mark trade at a discount, so asking a LBMA accredited refiner to stamp with some other brand is unusual.
Gawd, I hope this is our Woodward & Bernstein moment
If this is true, my heart is broken. How the hell did we end up like this?
The planned re-election of Obama, revolutionary style
http://homelandsecurityus.com/archives/5923
According to my source, there is talk among the highest levels of the uppermost echelon of the Department of Homeland Security, which he describes as effectively under the control of Barack Hussein Obama. During this call, he said that the DHS is actively preparing for massive social unrest inside the United States. He then corrected himself, stating that “a civil war” is the more appropriate term. Certain elements of the government are not only expecting and preparing for it, they are actually facilitating it,” stated my source.
More from DHS insider
http://homelandsecurityus.com/archives/6170
It’s the economy, stupid
“Before we get into the grit, I want to make sure you’re clear about what we talked about before, especially about the economy. You know there’s talk at the highest levels about a coming financial meltdown. When I say the highest levels, I mean the highest. But certain information is being compartmentalized, and almost no information is being sent to out-of-the-loop law enforcement agencies about why things are about to get ugly. They’re getting bigger and better equipment and loving it – not questioning it beyond what they’re told. But here’s what you need to make sure everyone understands when you write about our talks: Despite the fact our economy is on life support, DHS will be budgeting another trillion dollars in surveillance measures and equipment for police state tactics for two reasons. The first is to protect the politicians and the elite who are concerned about their physical safety, and rightfully so. This is why you hear no meaningful objections from either party, because both sides are benefiting, at different levels, from the controlled economic meltdown. They are all in the pockets of the big banks, along with the regulators, and so on. They are paranoid. Even the few who aren’t neck deep in graft – just knee deep. When everything starts to unravel, they will be exposed as complicit, so they have been reminded not to object to the increase in police state tactics,” said my source.
China and the US
I'm afraid we (the US) aren't mature enough to do something so realistic; too many doing too many drugs - pharm and tv and consuming - to be able to see the benefits of accepting inevitable reality.
Change gracefully or change painfully but change we will; change you can believe in. LOL
".......there's a very delicate dance going on right now between China and the US -- each nation is dependent on the other, even though one is trying to supplant the other and the other is trying with increasing desperation not to be supplanted. One possible future, though the odds against it seem fairly long just now, would see a declining US in desperation cut the same sort of deal with China that Britain cut with the US in 1945, allowing China to take over as global hegemon while the US maintains some scraps of its dignity and its current empire. if it comes to war between the two of them -- even proxy war, which seems far and away the most likely outcome -- it's going to be a much rougher future."
From the comments on this last weeks post "The Parting of the Ways"
http://thearchdruidreport.blogspot.com/
@yabs
Unfortunately, I have no earthly idea if they will "be fine" or not. Mainly because I don't know what WILL be fine. I don't know that people stacking at their homes will be fine either. I just can't say. There's too many unknown variables. Each method of gold storage has its plusses and minuses. The key to BV and GM is that their gold is held in PRIVATE vaults (allocated) outside of the banking system. They do not lease gold, they do not have any derivative exposure, they don't have any third party claims to that gold. So no one can touch it, unless all property rights become forfeit.
You should still be able to get your 100gm bars. They just melt down good delivery bars and make the 100gm ones. Last time I checked it was still up and running.
Did you give them a call?
No call as of yet still not
No call as of yet
still not decided what is the best option
stacking at home raises the question of who to sell to when the time comes
Maybe as you say its better to be a vault like in GM or BV but who knows
If the internet goes down and you cannot log in, then what?
stacking at home though raises a load of other problems.
I'm just sick of waiting for the collapse and all the bullshit that prevents it and ultimately makes the result worse.
Its good to be omn a forum of like minded people
discuss this with many others and you are considered a nut job
the sheep really believe that THEY will not let the collpase happen
Head East
It's hard to believe that the West doesn't realize what's going on or why it's happening, so to that end the question to me is why are they allowing it and more importantly, what are they going to do about it at some point?
Ok...I just deleted a very long post based on 3 speculative scenario's why or how the West is letting this happen. I'll keep it really short.
I'm expecting something very dramatic at some point regarding all of this gold maneuvering/leveraging and an equally important pre-emptive currency/gold move by the West before the East has a chance to launch their plan regarding monetization of gld/silver in China and the entire Asian region eventually with the yuan being the basis for most trade over there. That will happen over there eventually.
Were in a currency war right? And gold is a currency so I expect some bigger and more serious moves going forward in this game of chess they're playing. Something has to give and maybe more importantly, someone is going to react strongly depending on what the other Govt. does and what card they play.
The US is not going to just roll over on the USD without some extreme reaction or turbulence before it happens. If they're about to stare down and launch and operation in Syria against Russian equipment and troops does sit seem like they'll blink about doing something against China as it relates to the currency status or gold itself by less forceful means?
The US policy of an aggressive, unpredictable reaction to seemingly benign events can't be ignored.
As we've seen, they don't need a real good reason to do what they know they can accomplish.
Storage Options
I have come up with a relatively cheap storage option for those of you who may not trust the commercial vaults and banks. Just send your stack to me. I'll bury it somewhere and send you the GPS coordinates as well as a map on how to get there and a negotiable receipt for your "deposit." My rates are reasonable, and your stack will be safely stored underground too deep for any of those metal detectors to find them. Now keep in mind that this is a top secret operation, so I am unable to provide insurance as I don't want the word to leak out as to what I'm digging all those post holes out in the middle of the field for. Just call me at BR549 for additional information on my affordable storage option plan.
Hat tipped Ca Lawyer every time I could...
Could not have said it better. Now my rant... Been feeling low lately since it all seems outside of my control. Wondering if my stacking is the right thing. I just want to provide for my family but having my doubts. This could go on "forever".
Am I weird for not seeing the joy in the power that the PTTB have over most of the population? I don't want that. I just want to be beneficial to society and make my kids proud of me (and wife :-). I feel like some kind of joke since I don't want "more".
Hell, even coaching Little League baseball, parents get pissed at me when I try to teach and correct the kids, in a positive way. It's like everyone has to be the alpha male and there kids can do no wrong. Everyone attacks, even more viciously when they know they are wrong. Just like the politicians. It nauseates me. Cheers and thanks for letting me vent.
Turd, you do have a great site. Please keep it going. I contribute when I can, which ain't much.