Friday Fun

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Fri, Aug 19, 2011 - 10:25am

Looks like closing above $1818 was as significant as I suggested it would be but I doubt you're here for a history lesson. You're likely looking for insight as to where we go from here. As you might expect, I have a few thoughts. Let's get started.

I was telling Mr Hyde late last night that I didn't think Santa's next "angel" was going to offer much resistance. Anymore, the levels aren't that far apart on a percentage basis and there seems to be some history that shows every other level to be challenging. With $1849 behind us (Dec gold hit 1881 earlier today), let's wait for the next one, instead. Given that I'm expecting a short-term peak next week, probably somewhere between 1936 and 2000, the 1936 angel seems to be worthy of watching. Here's why:

Take a look at this first chart. It's a 4-hour gold. Note that the angles of ascent are steepening. This can only continue for a little while longer as, eventually, the trendline goes straight up and that's as far as it can go. It's not parabolic yet, however, and I don't expect a significant peak today...not ahead of what will be a very interesting weekend. Early next week, though, we could get our peak. It is critical to understand this, though: I'm only talking about a short-term peak, similar to nine days ago. If a dip develops, it will simply offer you an opportunity to buy. Just like last week's pullback stopped right on schedule at 1725, the next dip will do the same. IF I'm right, you'll have a choice to make:

1) Enforce some sell discipline on yourself to lock in some profits and look to buy the pullback.

2) Look the other way and wait for the market to rebound.

paper_8-19amgold4.jpg

Reinforcing this opinion is the whole "orderly vs disorderly" idea I postulated last evening. The move from the lows of last week had been orderly and calm. This type of advance is sustainable. Last night into this morning has been disorderly, like early last week. Volatility extends markets into short-term overbought or oversold territory and this is where we are headed by early next week. You can see the onset of the disorderly action on this 15-minute chart.

paper_8-19amgold15.jpg

In short, absent a margin hike or The Second Coming, I expect gold to be firm all day. There will be dips but dips will be bought. Ask yourself: Would you like to be long gold or out of gold over the weekend? Exactly. Using charts to predict headlines is challenging to say the least but these charts suggest to me that early next week will see another $50-100 advance in the price of gold. From there, maybe another 3-5% dip? We'll see. The key is to assess these eventualities so that, when they occur, you can act with discipline and not emotion.

Silver looks great, doesn't it? As background, I suggest you pause for a moment and read this from Trader Dan:

https://traderdannorcini.blogspot.com/2011/08/silver-stuff.html

As Dan says, the first key closing level today is about 41.50. A close above there will draw the 10-day moving average through the 20-day. This is a bullish crossover and would portend higher prices next week. The next number to watch is 42.30, which is the intra-day high from earlier this month. A close above there today would be bring a response Monday that is similar to today's reaction to yesterday's close. All in all, my $44 by Labor Day pick is looking pretty solid right about now. It may even be a tad conservative. Watch today's close very closely. It will be your clue for next week.

paper_8-19amsilv.jpg

Lastly, both silver and gold have moved into significant backwardation this morning. This is an extremely significant development and, if it continues, is indicative of very tight, short-term supplies. A few loyal Turdites questioned the significance of the "Venezuelan Decision" when I posted the news Wednesday evening. Let me set this straight. It is extremely significant. Why?

1) The Venezuelan gold is on deposit at the Bank of England.

2) The Bank of England supplies the gold for the GLD.

3) I believe the GLD to be an empty, fraudulent shell game of fractional bullion banking.

4) It has been speculated that there might be only 1 ounce of gold for every 100 ounces of paper gold.

5) The withdrawal of 8% of GLD's gold from the BoE would cause a massive supply squeeze.

6) This massive supply squeeze would reveal itself by backwardation in the gold market.

7) See the paragraph above.

8) IF I'm right and GLD is exposed as the scam I believe it to be....well, let's just say that gold is going a little bit higher from here.

9) Money flows out of GLD and back into the rightful place...the miners.

That's it for now. Equities are rallying and the PMs are falling as I type. This is not a surprise nor is it unexpected. The prices as of 10:20 a.m. are of no consequence. Let's see where we are at 1:30 and 4:00.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  387 Comments

redwood · Aug 19, 2011 - 8:37pm

Dr. Nancy

Nice, lucid intro your fellow offers. I look forward to hearing the rest. Thanks a million (no pun intended) for the link!

ScottJ · Aug 19, 2011 - 8:42pm

Forget QEIII, Fed's next move to expand US Bank Credit?

Read the full story here:

https://financeandeconomics.org/Articles%20archive/2011.08.17%20Bank%20Credit%20Repo.htm

-

And the forum topic I created here:

https://www.tfmetalsreport.com/forum/2119/forget-qe-iii-feds-next-move-e...

And, of course, the bottom line in what this means:

Importantly, it guarantees yet more price inflation down the road: bank credit expansion always has in the past, and it always will in the future. Above all, it guarantees the next leg upwards in the precious metals bull market.

stoneeh · Aug 19, 2011 - 9:03pm

"The LBMA charts, updated

"The LBMA charts, updated today at the London close, do not show gold is in backwardation. Neither is silver, although the yield curve is inverted, and has been for a long time. Where did those assertions come from?"

Exactly what I've been saying in the previous thread. Where did these assertions come from? Good question, but Zerohedge reported on gold backwardation (ofc without naming source of data). I always like it when something wrong gets copied. Immediately exposes those that don't have a clue. Gold isn't and wasn't in backwardation both on the LBMA and the COMEX.

Like Harvey Organ repeating that margin hike "news" back in the beginning of the year smackdown when it was actually only a hike on the spread contract that doesn't have much effect on trading? Funny thing back then was, you could tell him, and link him directly to the CME page where the margins are posted, and he still didn't acknowledge he was wrong and continued to mention this evil margin hike in his rants.

KC · Aug 19, 2011 - 9:04pm

Sterling, Where's the love?

I kind of miss the offer of the drink and the expensive prostitute. My man, so of us don't have a lot of pleasures left.....

stoneeh · Aug 19, 2011 - 9:20pm

"Tesla, that silver

"Tesla, that silver preliminary number is amazing! Minus 1,130 contracts...as I woke up and got to my computer, my heart soared. That kind of spike I knew indicated a short-covering rise....and those are only the PRELIM numbers! Haha, watch the finals on Monday be -3 or -4,000!

...

...let them double gold's margins too. Then there won't be any leverage advantage over silver, and both will attract a more even distribution of funds!"

There certainly has been some short covering here but I wouldn't get too ecstatic here. At least not about further OI drops. A drop of 3-4k contracts will certainly not happen here, as there might be short covering but a lot of longs will have been piled on also. At least experience says that.

Btw, I have a nice little OI fact for you that I will share with y'all when the time comes. You'll be pleasantly surprised ;).

Regarding margins, margin requirements relative to gold price are very low right now. Gold OI is near all time highs and investors are overleveraged. There is definitely some sort of mini mania going on here. A dramatic increase in margins (let's say double, like they did in silver) combined with a decent price drop (probably wouldn't need more than 50-100 bucks) would definitely wipe out a good part of the paper investors in gold right now. Long term I agree, the higher the margins, the less leverage, the more stable the market and the less successful the manipulation scheme will be.

Larry · Aug 19, 2011 - 9:27pm

GATA Coupl'a Bits...

All from LeMetCafe:

What the mainstream gold world and Planet Wall Street do not understand is that one of the reasons gold is acting like it has been is because of a Commercial Signal Failure. There were a number of players who have played the gold trading game allied with The Gold Cartel. They would short and short and then cover those shorts when The Gold Cartel attacked the price and forced spec longs to sell. This is how they made money over and over again by being short in a bull market.

Well, over the past couple of weeks the game totally changed as The Gold Cartel began to lose control of their management of the gold price, as evidenced by the breaking of the 2% Rule.

The total financial chaos in Europe and the US sent them into a panic, and instead of shorting more as the gold price rose (which they have done for so long), they became buyers (taking huge losses on their short positions), leaving The Gold Cartel to hold the fort. In other words, these commercial shorts abandoned the fort.

The Commercial Signal Failure in gold is leading to one in silver.

The cartel has revealed they no longer possess the same kryptonite once used to kill gold rallies. The algos are telling their MIT masters they see an abyss. Gold and silver short losses are approaching catastrophic levels. With the Fed now bailing out Swiss banks they may also be making margin calls at the Crimex, assuming cronies are actually forced to meet them.

https://www.lemetropolecafe.com/Le_Menu.cfm

tyberious · Aug 19, 2011 - 9:27pm

Stu Thompson

  • What I'm telling you, here and now, is that gold stocks are going to take on a level of power that will shock the doubters. They won't be able to take action. I'm asking you to stop defending yourself against those bashing gold stocks. It is your opponents you need to defend themselves, not you.
  • Many intelligent analysts in the gold community have noticed a huge issue with the amount of gold being bought, and the amount being supplied to the market. They believe banks are secretly supplying the market with huge amounts of gold to suppress price to keep the crisis under control.
  • Close, but... WRONG. It is not the banks, but the banksters who are the sellers of that gold, and it is only a small part of their gargantuan holdings. I told my people back in the mid 1990s that the banksters were buying most of the gold sold by the central banks, sold to them by the managers of their own central banks, following bankster instruction.
  • I told them that far before the end of the bull market in bullion, the banksters would begin to sell back their gold to the central banks and to the public, at massive profit to the banksters.
  • That is what is beginning to happen now. Still, the banksters arent idiots. They designed the bull, and they know what gold is, so they aren't stupid enough to sell all their gold, or even a chunk of it, at anything but skyhigh prices.
  • The supply of gold must be made up somehow, to meet the growing demand of central bank buy programs.
  • It will be. By your mining companies. The reason Jim Sinclair talks about gold stocks becoming utilities paying monster dividends is because he understands the utility nature of an ultra long term central bank buy program.
  • You are astronauts and your gold stocks are the Star Trek Enterprise, setting up for a real outer price space experience. I'm not Mr. Pie in the Sky Gold Stocks Speculator or Newsletter Fantasizer. I understand gold revaluation, and the role of gold stocks in that long term revaluation. I turned the Fudds who laughed at me about gold in the 1990s into pathetic cowering worms.
  • I'll do the same to those who are laughing at you now, about gold stocks. See you out there, on the gold stocks gridlines...
Irene · Aug 19, 2011 - 9:31pm

@stoneeh

ZH reported today https://www.zerohedge.com/news/perfect-storm-sees-gold-silver-surge-%E2%80%93-chavez-gold-action-leads-backwardation-short-squeeze-and

There is a small degree of backwardation developing in the gold market with certain near term futures contracts now trading at higher prices than longer term contracts. The near term August ’11 contract was trading at $1871.40/oz while June ’12 contract is trading at $1,870/oz (1216 GMT). The spread between spot and longer term contracts has fallen suggesting that gold may soon join silver in backwardation. The possibility of backwardation in gold suggests that major investors are concerned about the supply of physical gold.

I think ZH was quite clear in the body of the article that backwardation iin gold was something that could be developing. No need to get snarky. They do more than a fine job over there and I'm happy to be counted as one of their most loyal readers. 

Bull cpnscarlet · Aug 19, 2011 - 9:35pm

Real Assets

Real assets remain assets despite even catastrophic circumstance.

Illusions are not assets, even in the best of times.

If the SHTF bigtime and civilization is reduced, many here and on the survivalist sites and including moi look to hit it rich with our various preps including physical AG & AU. Watch what you wish for brothers. Observe carefully your motives and morals. Are we prepping for unwanted unfortunate circumstance full of suffering for so many and brought upon we humans by the greed and ignorance of the depraved? Or are we prepping for some self righteous, secretly wished for tribulation which will prove us so superior all along?

Profit from others suffering is the theme for those wicked fools who have wrought this mess. Please look to your hearts and wish for a soft landing for humankind even if all our prep turns for naught.

I'd dance in the streets to see AG@$250 and AU@$5000. Oh yeah! Early retirement and a nice ring for my sweetheart. But I fear such a windfall can only accompany a terrible waning of civilization. I will not wish for events which would yield vast suffering despite potential monetary profit.

Prep for Mad Max if it's your thing. Self sufficiency is a beautiful ideal. Commendable. But.... 

To wish for justice, to dream of righteous men leading nations, to desire a return to values and ethics and moral standards these are real assets to appreciate.

Look within first and be careful what you wish for.

Peace.

¤ · Aug 19, 2011 - 9:40pm

And if this keeps up?

Israel: Gaza violence escalates as Egypt is drawn into conflict

Israel and Palestinian militants in Gaza exchanged fire on Friday as a string of attacks on civilians in the south of the country threatened to escalate into a major confrontation.

Wounded Israeli soldiers are treated at the site of a shooting along the border with Egypt.

Wounded Israeli soldiers are treated at the site of a shooting along the border with Egypt. Photo: AP

6:22PM BST 19 Aug 2011

As Israeli jets bombed Gaza, Egypt was also drawn into the conflict. Cairo lodged a protest against the deaths of at least three policemen and two other Egyptians caught in the crossfire as Israeli troops pursued the attackers in Thursday’s raid across the border between the two states.

The Egyptian chief of staff, Gen Sami Enan, headed to the Sinai to investigate personally.

At least eight Palestinians were killed in a bombing yesterday – six said to be leaders of the militant group Israel has held responsible for the attacks, the Popular Resistance Committees, but two said by local officials to be children aged three and 13. The first was son of the group’s leader.

The attacks on Thursday claimed the lives of six Israeli civilians, a soldier and a policeman, while six of the attackers were also killed and a seventh blew himself up as they fled back over the border with the Egyptian Sinai.

In Israel itself, ten people were injured, one critically, when a grad missile fired from Gaza in response to the bombing raids hit a temporary building being used as a synagogue outside a yeshiva or religious school in the Israeli port city of Ashdod....

https://www.telegraph.co.uk/news/worldnews/middleeast/israel/8711632/Isr...

redwood · Aug 19, 2011 - 9:41pm

DPH

Was SLW kind to you today?

¤ · Aug 19, 2011 - 9:44pm

Experts urge China to trim US T-bond holdings

Experts urge China to trim US T-bond holdings

Updated: 2011-08-19 07:59

By Li Xiang and Wei Tian (China Daily)

BEIJING - China should reduce its holdings of US Treasury bonds to protect the value of its massive foreign exchange reserves despite reassurances from US Vice-President Joe Biden, analysts said on Thursday.

"China should move progressively to cut its holdings of US Treasury bonds and use it as leverage to ask Washington to further open its markets, including the high-technology sector, to Chinese investment," Xiang Songzuo, deputy director of the Center for International Monetary Research at Renmin University of China, said at a forum.

"Washington should provide a guarantee on the safety of China's assets," while it is creating global inflationary pressure through quantitative easing to stimulate its economy, Xiang said.

Biden said in a magazine interview before his visit that the US administration "is deeply committed to maintaining the fundamentals of the US economy" to "ensure the safety, liquidity and value of US Treasury obligations for all of its investors".

Biden said that the fundamental competitiveness of the US economy, such as flexibility and innovation, remain strong, and that President Barack Obama will adopt more measures to stimulate employment and consolidate the recovery.

"But there is very little room left for the US government to revitalize its economy," said Wei Liang, a researcher with the China Institutes of Contemporary International Relations.

Interest rates are at record low levels, and spending cuts have been made across the board. Even further quantitative easing could backfire, Wei said.

"Low growth and high unemployment will be regular features of the US economy in the future," Wei said.

Zhu Chao, assistant dean of the School of Finance at the Capital University of Economics and Business, said Biden's promises were more symbolic than meaningful.

Analysts said that the long-term strategy for China to reduce dollar asset risks is to boost the global profile of the yuan.

"China needs to find an alternative for the US dollar, which means that it must promote the internationalization of the yuan," Xiang said. But he added that China needs to have a freely convertible yuan, market-based interest rates and an open financial market in order to achieve that goal.

Zhu also advised that China should take active measures to shift away from US Treasury related risk. "For example, China and Russia could hold each other's currencies as reserves, and use more yuan in the settlement of bilateral trade," Zhu said.

Stephen Roach, the non-executive chairman of Morgan Stanley Asia, said that the US debt crisis has shaken China's confidence in Washington but the pro-consumption shift in its economic structure will help reduce the pace of its foreign-exchange accumulation.

"The US debt crisis has taken a serious toll on China's confidence in Washington's economic stewardship," Roach said in a research note.

"China is no longer willing to risk financial and economic stability on the basis of Washington's hollow promises and tarnished economic stewardship."

By raising the consumption share of its GDP, China will absorb much of its surplus saving and that will sharply reduce the pace of foreign-exchange accumulation and cut into China's open-ended demand for dollar-denominated assets, Roach said.

China Daily......https://usa.chinadaily.com.cn/us/2011biden/2011-08/19/content_13146676.htm

(China Daily 08/19/2011 page11)

Irene · Aug 19, 2011 - 9:44pm

@Bull

"But I fear such a windfall can only accompany a terrible waning of civilization."

It was the terrible waning of civilization that caused this situation in the first place. People who are "civilized" don't eat their children.

stoneeh · Aug 19, 2011 - 9:47pm

Awake

I agree. They're giving gold a free ride. Possibly their first priority is to draw away attention from silver. I have been making this statement a couple of weeks ago already.

stoneeh · Aug 19, 2011 - 9:52pm

Irene

The two nearest contracts 1, 2, 3 dollars cheaper with every following contract getting more expensive and the the farthest out contract over 2000$ is NOT backwardation :). Anyway, if there was backwardation on the COMEX, it wouldn't be important since the COMEX is not a physical market.

¤ · Aug 19, 2011 - 9:57pm

Eh, kind of

Hi RedWood

My calls went up in value and I still have them going forward. Too far underwater to sell off yet and I have time (jan 12). I'm sure some people must have made a tidy sun today on the straight shares or options today.

Looks like you called yesterdays late afternoon action translating into todays run. It seemed that way to me also but after all the tampering and head fakes going on it's a bit hard to trust what you see at times and think it looks like this trend or that trend etc. from weeks or months ago. I hope the Thursday/Friday carryover action starts up again like it was earlier this spring

GoldCorp is the one I'm really keeping my eye on. At some point it has to pop up bigtime. It will catch up at some point soon. (jan 12' also) I can't really compalin. The call contracts I have are starting to rise a bit so it's getting back up there slow and steady.

I'm encouraged to see my USO calls show signs of life today and the buying is back on in those calls as of today. (jan 12' also)

I suspect the bottom in oil is in and the EE and their friends know it and are getting ready for the wild swing that will happen once Israel and the whole region start up again. (looks like it's inevitable and headed there right now, again)

redwood · Aug 19, 2011 - 10:06pm

I sure appreciate your

I sure appreciate your posts. They have depth, breadth and a wealth of info. You and many others on this site are impressive. I have a hunch that the early part of next week will be strong, but Friday is expiration day, so I expect some weakening then. We sure live in extraordinary times.

cpnscarlet · Aug 19, 2011 - 10:14pm

@Bull - thin line to walk

WARNING: The following is NON-PC and somewhat preachy:

As children, we were taught the hard truth of the Little Red Hen and of the Ant and the Grasshopper. However, our culture has tried to prove that "those who don't work still can eat". And the reason this has worked for so long is because technology has made it very easy for anyone to find 2000 calories a day with very little effort. But even that little effort must be expended and a person must be productive to earn their bread. I can store and prep with the best of them, but I won't and can't provide for more people beyond my immediate family if the need arises. If I have to watch some starve while I eat, it will be a bitter life, but the result of a lesson not learned when people had the chance. It's for hard days that lie ahead that out parents taught us a certain set of morals and many of us took them to heart. We can work and hope the future won't be catastrophic, but if it is, I go to it knowing I did what I could to prepare for it AND warn others. I hate to be so blunt, but as I have "spoken truth to the masses" over the years, few listened and many ridiculed me. If those scoffers come to me for help, turning them away will be sad, but necessary. Even God has marked a day when his Grace will run out. A person starving in the street because my grace had run out may see the spiritual truth behind it and use his last strength to ask God for His Grace. 

Irene · Aug 19, 2011 - 10:16pm

@stoneeh

Whether "technically" gold has gone into or is approaching backwardation, I think we'd both agree that gold is signaling that we are entering a very, very dangerous financial period. I just wish more people understood this. Every time I go out in NYC and see what's going on on in the streets, I come home discouraged. Plain discouraged.

We have failed as a civilization because the majority of our people do not understand what is happening. And that is the primary role of every society. You must pass on truth and knowledge to continue. Instead, we passed on lies, debt and ignorance.

Starving Artist · Aug 19, 2011 - 10:16pm

Chemtrails?  Really?   This

Chemtrails? Really?

This stuff discredits the entire metals argument

/facepalm

Irene · Aug 19, 2011 - 10:21pm

@cpnscarlet

I leave my apartment each day in Manhattan only to see more and more homeless, hungry people. They sit on a bench next to my building. They occupy many benches in the park down the street. They squat on the sidewalks, or lay in the middle of them. Before Giuliani was elected, this was also the norm. Now, it looks like we are in for much, much worse.

But I tell you, brother, it is a hard heart that can walk by them, day after day, and not be moved.

¤ · Aug 19, 2011 - 10:30pm
Larry · Aug 19, 2011 - 10:38pm

Spray the zombies. They don't look up.

HAVEFAITH – you commented on the topic of Chemtrails in the last day or so.

I’ve been researching this (and have posted this some time ago…maybe the original Turdblog). I first became aware of this quite a while back from one of Uncle Harry’s newsletters.

The legendary investor, “Uncle” Harry Schultz has been beating the Chemtrail drum for years. After looking into it, and seeing them with my own eyes for several years, appearing like spider webs, criss-crossing non-stop in the skies above my home and city, I tell you that I am very concerned. The vapor-like trails float ever so slowly across and down to earth, breaking up slowly as they blanket large areas of ground.

Think it’s hard to convince some people that the dollar is doomed, buy pm’s and prep? Try telling them about Chemtrails. Blank stare. I believe the ones I’ve told think I’m crazy as a loon with all this (on top of my zeal about prepping and pm’s), but they have at least been respectful as they trail off into, “Oh, I’ll look into it” or they’ll change the topic of conversation. Is this fear or lack of curiosity?

Come to think of it, I don’t think my post on this board even got so much as a “huh?”

Anyway, Chemtrails is a tough sell, not that I care to “sell” it. People don’t seem to want to know. Since there is already an ‘ambulance on the scene’ with very credible scientists, authors and truth-tellers that are making people aware of the situation and building awareness - as well as lobbying the government to come clean (highly improbable), I’ve become a silent ‘watcher’.

It is a serious and frightful, poisonous, toxic situation. Along with everything else discussed on this board… along with EE, corrupt governments, droughts, crime, wars and famine… this list along with secret, government chemical releases over our cities and farmland it seems we are fast approaching a biblical occurrence that people are completely blind to.

One thing I found out as I tried to turn people on to this is, most people are so busy with their lives (inside a car, office or home), they don’t even see the sky any longer. They don’t look up. Strange to consider… like a bad sci-fi movie after an invasion of body snatchers or something. A sleepwalking public allows incredible stuff.

I’ve linked below the best, most credible information I can find on Chemtrails, in a 7-Part professionally done series produced by G. Edward Griffin, who wrote The Creature of Jekyll Island (acclaimed birth of the Fed book). For all that want to know what is going on in your world that is or will affect you, please watch all 7 parts. Then you’ll know.

https://www.youtube.com/watch?v=-K9rXydMmfw&feature=related

Jim H · Aug 19, 2011 - 10:40pm

Chemtrails?

There is a fine line between whacky conspiracy theory, and reality..... and this one really strains credulity. I am a chemist in semiconductor manufacturing... and I call Bullshit. There are enough real conspiracies to deal with like those perpetuated by the bullion bankers.. we don't need this crap infesting the boards here. You are looking at water vapor. 

https://en.wikipedia.org/wiki/Chemtrail_conspiracy_theory

Irene · Aug 19, 2011 - 10:44pm

dph

dph,

I'm going to tell Ginger the CIA has driven you out of your mind! Happy Friday. ;)

redwood · Aug 19, 2011 - 10:45pm

from Dr. Nancy presented by Mike Dillard

Seven stage financial life cycle of an empire (summary) written by Michael Maloney and presented by Mike Dillard.

1. Good Money - every major empire starts out with good money, either gold or backed by gold.

2. Social Programs - as a country develops economicall/socially, takes on more public works, adding layer upon layer

3. Military Spending - as a nation's affluence grows, so does it's political influence and spends massively on the military

4. War - nation puts military to use and expenditures explode and nations go to war

5. Fiat Currency - to fund the war, the costliest endeavors, nations starts to steal wealth of its citizens by replacing their money with fiat currency (value decreed by gov't and not backed by nothing). This occurs either at the outbreak of war, or previous ravages of war.

6. Inflation - wealth transfer is experienced as hyperinflation. Results in riots eg. Egypt. Price of all commodities and goods go through the roof.

7. Wealth Transfer- final stage, in mass movement, nation moves out of the currency and into the precious metals and other tangible assets. The currency collapses. This results in massive wealth transfer to those who had the foresight to position themselves in the right asset class in advance.

We're are between stage 6 and 7. This transition is just beginning. This move represents the largest transfer of wealth in the history of mankind. People will either end in poverty, or wealth, depending on whether we prepare NOW. This cycle is predictable as for eg. Roman Empire.

NW VIEW cpnscarlet · Aug 19, 2011 - 10:50pm

@ cpnscarlet

Lets hope if and when that day comes when the food is in short supply, that there will be those with His Grace and His Faith who will again pray over a few fishes and they will multiply. That's the cave I want to be found in. Thanks for your post.

¤ · Aug 19, 2011 - 10:50pm

"I don't mind stealing bread..."

Temple of the Dog Soundgarden & Pearl Jam Music Video Hunger Strike
cpnscarlet Irene · Aug 19, 2011 - 10:50pm

@Irene - funny you should

@Irene - funny you should mention NYC - my hometown. The bums/junkies/homeless/panhandlers (depending on what decade you were born) were there during the admins of Lindsey, Beam, Koch, Dinkens.... There is nothing new under the sun. There were people of one kind or another on the streets during the good days and the bad. I had to step over them during HS fire drills, delivering securities to brokerage firms, commuting on the subway, etc etc.

What I have learned about them first hand is that there are some poor people on the streets through no fault of their own. And they are the ones who eventually figure a way out and are thankful for the help they receive. But most are definitely 1) mentally ill, 2) drug addicts, and 3) professional panhandlers. For the first two groups, either they have not been brought in yet for some medical help or they refuse that help. For the third group, they are the grifters and con men who will always be with us. Did I become callous about them over the years - yep. For one thing, I couldn't give 1 and 2 the help they really needed and you can't tell the difference between the first 2 and the 3rd. Did I do nothing? No - when I had it to give, I gave money to the groups that really knew how to help those who needed it and were savvy enough to tell the grifters to take a hike. It is that simple I think, but it does mean having to turn away and keep walking. Better decide how to deal with it, it's probably going to get worse.

Vypuero · Aug 19, 2011 - 10:52pm

There will be chaos but no collapse

Chaos will not be good but there will be a re-balance at the end of it that will allow the world to cleanse this miasma of fiat and start again. Physical Gold will be universally recognized as savings and worth a LOT more. Even if I am wrong on that, it will hold its value as everything else inflates or deflates away, and those who brave through it will have some fantastic opportunities, both for investment as well as rebuilding our hollowed out manufacturing. It has happened many times before and will happen again.

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Key Economic Events week of 12/10

12/11 8:30 ET Producer Price Index
12/12 8:30 ET Consumer Price Index
12/13 8:30 ET Import Price Index
12/14 8:30 ET Retail Sales
12/14 9:15 ET Industrial Prod. and Cap. Utilization
12/14 10:00 ET Business Inventories

Key Economic Events week of 11/26

11/27 9:00 ET Case-Schiller home prices
11/27 10:00 ET Consumer Confidence
11/28 8:30 ET Q3 GDP 2nd guess
11/28 10:00 ET New home sales
11/29 8:30 ET Personal Income and Spending
11/29 10:00 ET Pending home sales
11/29 2:00 ET November FOMC minutes

Key Economic Events week of 11/19

11/20 8:30 ET Housing Starts
11/21 8:30 ET Durable Goods
11/21 10:00 ET UMich Sentiment
11/21 10:00 ET LEIII
11/21 10:00 ET Existing Home Sales

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