The Audacity of MOPE

With the metals down again today, I thought it was time to spread some information, not misinformation or disinformation.

The common MOPE regarding the rising U.S. stock market and potential Fed "tapering" is that finally, after four years of fits and starts, the U.S. economy is recovering and growing based on the improving economic statistics and burgeoning housing recovery. So is that really the case?

Yesterday, we discussed the fallacies of the latest BLSBS data and, as any regular reader of ZeroHedge knows, over the past 90 days almost every key metric of economic activity has "disappointed". Just today we had:

And, again, that's just today. The meme is that everything is finally getting better. Really? Really?? Hmmm. Let's go back to that housing starts thingy. As discussed yesterday, there's a certain LAW called The Law of Supply and Demand. For those who failed Econ 101, think of it in terms of a chart with a vertical axis and a horizontal axis. In it's most basic form, it looks like this:

What this is showing you is that price exists at the intersection of supply and demand. If you increase the supply or decrease the demand of an item, the price equilibrium is reset lower and price falls. Conversely, decreasing supply or increasing demand has the impact of raising prices. (See, it's not complicated. Maybe if you had spent more time studying and less time at the bar, you might have had a higher GPA!)

So, what does this mean for our supposedly robust housing recovery? While admitting that this is not the be-all-end-all, these four charts should be enough to give you pause and prompt you to consider whether the mainstream media is giving you the facts or just a heaping pile of MOPE.

If you're going to build a house, an apartment complex or an office building, you need to acquire a number of things. Most of the process is summarized quite neatly by Thornton Mellon in the clip below:

For the purposes of this discussion, however, let's keep it simple. For our house, we'll need lots of lumber for construction, copper for wiring and plumbing, aluminum for all the HVAC stuff and steel for the support columns and crossbeams. Again, price is a function of supply and demand so one might expect that a "robust" housing sector would be causing increased demand for these raw materials. One might expect that but one would be wrong.

Let's see, how's that lumber market doing?

And I think we all know that ole DrC hasn't been doing too well, either...

Uh-oh. Zero for two. Maybe aluminum and steel are faring better? Nope.

Ahh, but what do I know. I'm just a dope with a MacBook (that's for Turdle wink). But it sure looks to me that there isn't much of a housing recovery going on. And if there isn't a housing recovery, then the U.S. economy isn't getting any better. And if the U.S. economy isn't getting any better, then tax revenues won't be increasing. And if tax revenues won't be increasing, then the federal deficit won't be falling. And if the deficit isn't falling, then the Fed will have to keep propping up the bond market. And if the Fed has to continue propping up the bond market, the idea of them "tapering" is simple nonsense. And if tapering is nonsense, explain to me why the metals are once again falling this week.

Well, the past three days, it's all started in London. I think I recall that Ranting Andy has a term for this action but I can't remember what it is. What I do know is that when the selling starts at 2:00 am New York time and carries on until about 7:00 am New York time, the selling is originating in London. And who's in London? Just the bullion banks, that's all, doing their dirty deeds to slant the market in the thin, pre-Comex trading, trying to set the tone for the spec momo HFT money to come charging in at the 8:20 EDT Comex open. It's not complicated and it's all right here for everyone to see:

For today, at least, their efforts have been thwarted by all the crappy economic news and we've got a bit of a bounce on our hands. (That hat is still looking tasty, though.) Maybe, just maybe, we're getting a double bottom painted onto the charts? We'll see. Time will tell.

One last thing to discuss today. You know, back in the day, over two years ago when silver was soaring, there was a lot of talk about Comex defaults and commercial signal failures. I have to admit being sucked in a bit by this back then. Obviously, it didn't happen and I've since been very wary of this kind of talk. Again, if we've learned anything these past three years or so its that the primary power held by TPTB is the power to postpone the inevitable. That said, the Comex gold inventory numbers are really beginning to capture my attention on a daily basis.

We discussed this a bit yesterday but it's worth going over again today. After JPM reclassified another 160,000 ounces of gold from Registered (able to be used to for contract delivery) to Eligible (not ready for delivery), the TOTAL Comex registered inventory fell again yesterday and it now stands at just 1,676,000 troy ounces or about 52 metric tonnes.

Recall that every Comex gold contract is for 100 ounces. This means that the Comex registered vaults only have enough gold on hand to physically settle just 16,760 contracts. Big deal, you say. So what, you mutter. And you may be right. Most likely, The Shell Game & Charade will continue through the clever reclassification of more than enough rehypothecated gold from Eligible to Registered. OK, maybe. But chew on this for a minute.

The first "delivery" month for gold this year was February. That month, the total number of contracts standing for delivery totaled more than 13,000. This was somewhat odd in that that was nearly more than August, October and December of 2012 combined. That got my attention. Then, when April delivery rolled around, just 6,600 initially stood for delivery. Crisis passed, right? February was just a one-off. An outlier. Uhhh, nope. Over the course of the month, money continued to flow into the April contract for immediate delivery. These buyers were ponying up 100% margin and "jumping the queue" to some extent in that they were seemingly unwilling to wait for June. In the end, when it was all said and done, the Comex ended up delivering to 11,632 contracts in April.

And now here we come toward June. First Notice Day for the June contract is two weeks from tomorrow, the 31st. Again, on that day, the June13 stops trading and all contract holders must put up 100% margin in order to indicate their intent to take delivery. As of yesterday, the total open interest in the June contract was still 200,477. No doubt the vast majority of these are paper traders who, as we approach the end of this month, will sell or cover and roll into August. However, some will hold, intent upon taking delivery. (Maybe if you're Shanghai and you're currently completely cleaned out of gold in your vaults, you might take delivery of a few contracts? Hey, a guy can hope, can't he?) Of course, the question is, how many?

Again, as of this moment, The Comex only has enough Registered gold to settle 16,760 contracts. For some perspective, when we were 11 days out from FND for the April contract, the OI for April was 196,135. When we were 11 days out for the Feb13, the OI was 200,441. So, having the current June OI stand at 200,477 tells us very little. However, we must watch this very closely in the days ahead. Let's keep an eye on Comex vault changes and compare that to the daily drawdown of June open interest.

OK, that's all for today. Once again I plead with you to keep the faith and stand defiant. The laws of supply and demand are currently impacting paper metal which, in turn, impact the price of physical metal, too. This cannot and will not last forever. Hang in there.

TF

 

275 Comments

Stock_Canines's picture

@ag1969

I have been a member here since day 1. I do comprehend what is posted here. I also understand, or at least I think I do, why the equity markets are at nominal highs. I am less sure about why gold and silver are in the crapper, and even more unsure of why the entire list of bullish reasons for gold and silver have actually worked against a higher gold and silver price. Is it really so simple as free money to banks is used in part to short pm markets and hedge funds pile on for an easy predictable ride. I mean you act like it is obvious why gold and silver stink and why my investment thesis has blown up in my face, but I wonder if it so simple? No one here, that I remember, was saying 3 - 6 - 12 months ago that the likely path for gold and silver is down. I mean sure, we sit here today and see miners crushed, gold at 1380 level, silver at 23. You are absolutely positive you know the reason? You didn't expect this, did you? When my wife says, "you investment decisions have caused our net worth to decrease significantly" is the appropriate answer, "oh, it's simple honey. All the reasons we thought gold and silver should rally, QE to infinity, Yen debasement, universal rate cuts, stagnating economy, jobless recovery, etc. have actually all caused the metals to crash and the DOW to surge because the Fed is supporting the Dow and fighting the PMs with the creation of easy money?" I mean, if it is all so simple, why didn't anyone here say, "hey, the Fed wants to support the Dow for purposes of MOPE, the Fed is the entity creating 80 billion a month in free money, where do we think that money is going to go"? Every day I read intelligent people who surmise different explanations for why we are where we are and where we are likely going. But, according to you, it's a reading comprehension problem. Nice. So tell me oh wise one, where will gold be in a year.

margaritatime's picture

@northern b

that does not reflect the national avg, but yes, gas is certainly higher up there right now. http://www.twincitiesgasprices.com/Minneapolis/index.aspx

gas here is nearly a dollar cheaper  http://www.coloradogasprices.com/

now if $4.19 were the nat'l avg i would be concerned, but it looks like a regional squeeze. 

ag1969's picture

@ Stock

you said, "just trying to understand why my investment thesis has blown up in my face"

I find it hard to believe that you can't fathom why your investment thesis has blown up in your face.  Unless you believe that Gold and Silver are not criminally manipulated.  I also questioned why you would look to the Washington post and the CBO for answers as to why your investment thesis has blown up in your face.  And you take away from that that I might be the one person on earth that knows where gold will be in a year?

Cry Me A River's picture

APMEX JUNK SILVER BUY BACK PREMIUMS JUMP AGAIN--NOW AT $2.50

APMEX is proving they want that $25 per oz. junk silver price to remain stable.

$18046.6/715 = $25.24 =$2.50 Over Their Silver Bid Price:

And Here's The Chart:

NonoverlappingMagicCereal's picture

RE: CBO and washington post

I also questioned why you would look to the Washington post and the CBO for answers

I don't get what's so wrong about looking at all available data and news sources, even if you think it's biased.  There do exist in the world responsible journalists and economists, even if you think they are exceedingly rare.

If there is a chance, however small, that there will be an eventual  global economic recovery that sours the all-PM strategy, you will only be aware of it by keeping your ears open to more than one perspective.  You will never hear about it from Zero Hedge, or Jim Sinclair or anyone else in that sphere.  Good news just isn't their bag.

Prize Fighter's picture

ag1969

"Unchecked Facism had created "a new, totally visible, and at times brutal, tyranny."  There Pope, I fixed it for you."

That is true.  I do think though that any system "unchecked" can morph into facism, especially capitalism because the turn of truth is so slow in the eyes of those who want to believe.  These systems are only as good as the people who run them. 

I'm not a great student of political terms and classes, so my thoughts are pretty basic on it all.  People let these terms roll off their tongues without much thought and I'm reaching for the dictionary.  My strongest talent, IMHO, is systems and spacial reasoning and not the fine points on these things.  I just recognize the Pope calling for some kind of economic change sets the stage for CB and Catholics alike.  I don't know what he envisions as a checked-market, but his followers are now spiritually ready for change.

Stock_Canines's picture

@ag1969

I wasn't turning to the CBO for answers, but a colleague sent me the article and implied that perhaps that the  contents explained in part why gold and silver 'weren't working out so well'. My response could be, "it's all BS", but after stating that refrain for 18 months, the words and the speaker begin to appear delusional. After a point, it begins to feel like the old adage, the definition of insanity is doing the same thing over and over and expecting a different result. My biggest concern is that the gold and silver bull market is dying before our eyes, and I will hold for lower and lower prices the whole time claiming that the media and the government and the world financial powers are all lying to us. I don't expect you to be the one person who knows where gold will be in a year . . .sarcasm . . .kind of like your 'reading comprehension' question . . . unless you were just being an ass.

Turd Ferguson's picture

Ripped from ZH

MODERATOR

Interesting that this "disconnect" also begins in March, coinciding with the drops on the four charts posted.

ag1969's picture

PF

We are just seeing two sides to the same coin.  IMHO, one of the things TPTB would love to blame for this mess is capitalism.  I agree with your assessment that they are very interesting comments at this time in history from a new Pope.  I just don't want to see capitalism take the fall when we have not had free and fair markets for quite some time now.  Thank you for posting that article and your compelling theory.

JY896's picture

The Bernank - crazy like a fox...?

I wanted to highlight an article posted overnight in the last thread by Bohemian -- I agree that it's VERY interesting, but cannot yet figure out whether its thesis holds water:

The Bernanke Agenda - It Isn't What You Think It Is

"As early as 2008-09 there was a renewed interest in a plan to usher in a new global monetary system. It is my opinion that Bernanke saw the merit in such a plan and may have been resolved to the idea of orchestrating events in such a way that the ultimate outcome would be a relatively painless transition to a new global monetary system.My thesis here is that everything that has taken place since then has been orchestrated to accomplish that end [...]

Consider that Bernanke has announced he won't be in attendance at Jackson Hole this year due to a scheduling conflict. One wonders what that conflict might be that would pre-empt the single biggest event of the year for a central bank head. It certainly can't be an emergency as he announced that he wouldn't attend several months before the event.

What possible reason would he have for announcing he would not attend? Maybe he plans to be pre-occupied selling Congress on the need to adopt the new system or maybe he simply plans to take the lead in introducing and selling the system to the world and the timing for this event has already been set and conflicts with Jackson Hole. I do think the stage is set and now is the time to begin the final chapter in the process of orchestrating an epic and positive shift that I see as resolving many issues that have held us captive in a secular bear market that is well into its second decade."

The downside parts of the thesis?

1) "I think there are a lot of signs emerging - and at a rather rapid rate - that suggests the Fed and Congress are about to pull the rug out from under the markets."

2) "The truth is we need a new monetary system that will correct the inherent flaws of the present system. At Bretton Woods Keynes told us the system as configured would fail.It did fail so Keynes was right. Keynes believed that a global central bank and a global non-sovereign currency was the preferred solution. Keynes proposed the bancor and his proposal became Britain's official position on the matter at Bretton Woods."

I have no idea who the author, Joseph Stuber is, it seems he is another 'dope with a MacBook' (and I mean that in the most neutral, non-offensive way possible). But that is some intriguing hypothesis, and not necessarily contradictory to what has been circulating in this collective, group-mind of TFMR lately.

Supporting points:

- increasing proxy warfare and territorial brinksmanship

- BRI(II)CS activity / increasing coalescence in terms of currency swaps, trade union

- Asian security bloc solidified/expanded

- PM shenanigans going 'full retard'

WTFDIK. But some things I DO know:

- people who presume to know what's best for me and society, and execute policies proclaimed (by THEM) to be on our behalf an for our benefit without informed consent, buy-in or legal mandate are NOT allies or friends, and

- "It is said that if you know your enemies and know yourself, you will not be imperiled in a hundred battles; if you do not know your enemies but do know yourself, you will win one and lose one; if you do not know your enemies nor yourself, you will be imperiled in every single battle." -- Sun Tzu

- corollary: do not underestimate the enemy, its capacity to deceive or the resources at its disposal.

For a full gallery of (slightly disturbing) images like the one below, peruse williambanzai7's gallery of bearded phenomena.

PS: Short edit to point out that 'contrary' thinkers rarely if ever present data, supporting material or reasoned rationale, let alone possible AND plausible alternatives to the 'kooky', 'extreme', 'tinfoil-hat-wearing', 'batshit crazy' PM bugs, 'groupthinkers', 'doomsayers' and assorted 'freaks' on this site. They are content to stir s#!t up, attack character or style, replay endless loops of fallacy, and act all butt-hurt when their style, demeanor and lack of coherent content is attacked.

THAT is why they are considered trolls, and thus unwelcome -- NOT because of any specific argument that is bearish or contrary.

If a 'newbie' wanders onto the site and is put off by economic, social and monetary viewpoints that span the spectrum -- well, sorry, but it would appear they were not ready to open their eyes and study reality.

SilverSurfers's picture

Kaye

at KWN indicated that the "drift" up in price allows the bullion banks to sell to china, for the double profit, as we here hoped, that china is a huge buyer, and so, there is the allignment, but yours looked at the "peeps" after hours upward drift as average joes, to indicate a good sign leading into a bull mode, where his is based upon china continued buying, thus both based on continued buying, one based on lay viewing, and of late the drift has been solid, going into the smashes, and so, my after hour peep drift and Kaye's china drift, seems to be in lock step, but then Kaye no doubt has way better tools than yours, and hence a better view, but expert or decade long lay perspective, met at KWN, reaching the same ultimate conclusion as to market action, though the buying sources differed much. And that is why kaye's get paid, and your dont.

Larry's picture

MOPE and CHANGE

Could not resist using another BO inspired title. Turd, your headline and lead today is truth well told.

The thing that is confounding about being on the beat up side of MOPE is that we see nobody in the mainstream that is contradicting it. Maybe a zinger here or there, but nothing consistent or particularly noteworthy. The Ponzi's That Be write the script. The mainstream muppets read it. The puppets in Washington are aligned, obedient and well paid to get along and play along. The regulators don't regulate anything except their own wonkish distractions and excuses around workload and too-small budgets.

We all know these things, but the entitled and the busy, uniformed alike are not aware of any of it. The former are lost in free stuff  and the latter feels something is not right but can't identify why they are becoming more broke every day other than "the price of gas, food, electricity, medical and everything else is going up".

But the real problem is not the fact that free enterprise believers and freedom advocates (as well as pm investors) have been losing ground. It's that we don't have the microphone. TPTB bought it and owns it. They control it and will only allow it's use for "news" items that fall within their range of acceptable for the cause with a little pseudo verbal jousting by the politicos thrown in just to keep it seeming real. In my opinion, the whole IRS v Tea Party thing is a red herring. Same with the slap-on-wrist bank "scandals" that dole out comparative paltry fines with no guilt attached. 

We are living in times of one-way messaging from Big Brother, no honest journalism (outside of the internet, certainly not in mainstream), sleeping masses, criminal banking cartel and hardly anyone outside of the minority that sees this... nobody can grab the microphone to expose the Matrix. Even if they did, they'd better be able to be convincing and credible in a 5-minute sound bite, otherwise the complexity and learning curve required to connect the dots will go over the collective heads of the distracted and asleep ones. This is a real dilemma.

For change to happen in our economy, we need a change in our culture. We need to simplify and return to the truth in God's Word, then until His Kingdom is established on earth as in heaven, we should reapply the Constitution, which is imperfect but far better than anything else in this system of things in governments and nations today. Both of these movements will be fought tooth and nail by the ones I've already mentioned. It will also be fought by lobbyists, lawyers, CPA's, brokerage firms and insurance companies who require complexity to do their thing. As Turd says, "that's a lot".

But for starters, we just need some articulate and credible someone to take hold of the mass-media microphone and speak the truth, not in a harsh way as they do in Washington or shout loudest as they do on the talk/opinion shows, but in a loving, caring, firmly confident, peaceful, powerful, intelligent manner. Does that person even exist in politics or business today? Or have they gone the way of John Galt?

edit: had to return and add a most major element to the next-to-last paragraph that I left out in my haste. 

Howard Roark's picture

Galt´s words and philosophical reasons on the new normal

Consider the last thirty days.

Consider the amount of messages here at the community that reflect anxiety and frustration regarding what as been happening to our precious monies (either warm as the sun or bright as the moon).

Consider the technical analysis that have been posted (that had collided with the EE action). All the arguments and so on.

And now read this:

"You did not care to compete in terms of intelligence  - you are now competing in terms of brutality. You did not care to allow rewards to be won by successful production – you are now running a race in which rewards are won by successful plunder. You called it selfish and cruel that men should trade value for value – you have now established an unselfish society where they trade extortion for extortion. Your system is a legal civil war, where men gang up on one another and struggle for possession of the law, which they use as a club over rivals, till another gang wrests it from their clutch and clubs them with it in their turn, all of them clamoring protestations of service to an unnamed public´s unspecified good. You had said that you saw no difference between economic and political power, between the power of money and the power of guns – no difference between reward and punishment, no difference between purchase and plunder, no difference between pleasure and fear, no differece between life and death.”

This piece is directed at MOPE, MSM and EE (plus governments), and it fits like a glove.

So the reality (the new normal) cannot be understanded rationally. I´m not saying that the TA are futile, not a bit. But we should understand the cognitive dissonance operating in MSM and the message that it conveys. The TA and discussions on what is being happening to our metals (or the economy for that matter) should be supported on our ideas, on our philosophical reasons to hold the portions of sun and moon. Those didn´t change. Not a millimeter, not a nanometer. In fact they are just right, regardless of the value measured in currencies of our objective expressions of value (aka portions of sun and moon).

We are philosophical right. Even if we face some hard choices along the way (Socrates was put to death remember?). The Thugs chose the path of decay and death. Period.

But, if we are in the metals for the right philosophical  reasons, the new normal narrative is BS. Just that. Not a test to our reasons, just a test to our resolve.

Salut to the Community (especially to those that face hard choices regarding solvency)

Howard Roark

ag1969's picture

Stock

I have just been to KWN.  Gold will be at 943,000 dollars/oz in one year.  It is scary, wondering if you are right all the time about holding real money vs. Ponzi Coupons.  Hope your wife cheers up Stock!  My wife is a prepper and a stacker, I guess I am lucky in that regard.

Stock_Canines's picture

ag1969

She is patient and of stacker mentality, but she worries a lot. A little high strung, but a lovely woman. Having a 2 and 5 year old only adds to her stress. All the best. I look forward to 943,000.

Cry Me A River's picture

Potential Silver Standing For Delivery Has Increased To 39.5%

Even though some of those standing has declined by 8 contracts yesterday, those standing as a percentage of Comex silver registered inventories has increased. This is due to the drop in the registered category by over 1.1 million oz. in the last two days.

Prize Fighter's picture

Larry, that's spot on.  I

Larry, that's spot on.  I said a couple of years ago on ZH, "If a country goes bankrupt in a forest and nobody admits it, is it?"  It takes two sides to be bankrupt right?  Who can collect?

Facts or prima facie evidence of default does not matter as long as perception is truth.  Back to the soundless forest of Acorns and nuts.

Howard Roark's picture

@MOPE and change

I didn´t read your comment but it sure looks like it. Mentioning Galt and all.

Salut,

HR

Larry's picture

Howard Roark

Just now finished yours (after tweaking mine) and noticed how similar our message or subject was almost at the same time. Enjoyed yours. Where is Galt anyway? And will he return?

ForWhomTheTollBuilds's picture

@Stock_Canines

Thanks for sharing your process.  Im going through a similar crisis though I only have "significant small" amounts tied up in PMs and am still ahead in Bernanke-Fun-Bucks.  That said, watching PMs vs S&P is worse than any money loss could ever be.

Lately I have been trying to put together a good explanation for why PMs are falling.  I probably dont have time to really hash it out here but here are a few disjointed points which I will argue as if I believe them even if I'm unsure:

- The new bail-in regime will heavily supplement QE and (almost) replace it.  They will still need to print to fund the deficit but the real money needed by big financial institutions will now come from whoever needs to be reclassified as the institution's "investors".  TPTB know that sufficient funds exist to balance the books of the big players in this way or they wouldn't go to the trouble of changing the rules on a worldwide basis and risking bank runs.

- The current rate of money printing while ferocious, is not quite enough to offset the money being destroyed by defaults or not being created because of a lack of new lending and general economic activity.  Thus real interest rates are not necessarily as negative as we think they are.

-We assume that "they" will never let deflation take hold, and I agree that they would never allow a 2008 style collapse to go unchecked.  But thats only because it would hurt the banks that own the fed.  Would they *really* stop deflation at all costs if they rewrote the laws to make depositors into "investors" and then moved those investors below everything  else in a bankruptcy (like they did with derivatives).   What if they could "fail" while ending up owning all the real assets in the end?  Bankruptcy only sounds horrible to you and I as individuals but to a firm, it is a simple reorganization, and even "a firm" doesn't have interests, only the small number of individuals controlling it do.  The above is not at all thought out, but I am attempting a little lateral thinking.  According to the Creature From Jekyl island, the Bank of the United States once engineered a depression just to unseat Andrew Jackson who was their political enemy.  

The sickest irony of all is that if all of the above is true, what are you going to do?  hold money in a bank or brokerage account?  The bail in regime makes clear what will happen when the S&P gets volatile and someone's derivative book explodes.  Hold paper currency?  Printing is still printing...  Stocks at all time highs?  CDS that won't payout when the default is ruled not to be a default by the people who issued the CDS?  Bitcoins when they can cut off your ability to convert back into the currency of the realm?

I don't know, all of the above makes me glad to own some phys.  I get the feeling some people here went in BIG. Bigger than Santa, or Kyle Bass or anyone else told them to go.  They have the money loss to worry about too.  For me its just "mental anguish".  Luckily I am very busy these days or I would have to dwell on it even more.

Ccanuck's picture

Lapper

Name a few of them "journalists"....do you mean msm whores? the ones now trying to sell that "recovery" ???

Do you know Million Dollar Bonus, from Zerohedge?? I find you almost as entertaining, you still need some work though.

Try going 3/4 sarcastic 'retard' and 1/4 'I'm not a troll, just trying to ask questions retard' ....

Your game is gett'n old....give us something new...It will help get you off some of the ignore lists!!!

Thats how you get paid..right? By how many responses you get??? ...lol

Just Try'n to Help

Ccanuck

P.S  Hey Gold Dog you got a raffle or something brewing?

realitybiter's picture

Hmmmm

A couple of q's from the 'biter:

1)  What really got discussed at Obamas banker meeting on the 11th of April?

2)  If Bernank can't make the JH meeting why not reschedule?  Skype?  Sat-link?

3)  Nearly every great bull market in the last decade has been an opportunity to "hang ten".  Get all your toes on the end of the board just before the "wipeout".  Dotcom bubble.  Real estate bubble.  PMs in 2011?  Stocks today?  Stick with me on the PMs....PMs were never widely owned, but politically, the 'nank had to bitch slap us hard....think about the Bear Stearns event...that was March 2008....coincided with the silver collapse down to single digits....kind of weird.  PMs should be safe haven, no?  That was BS 1.0...today? 2011-13 in PM BS 2.0....not terminal, but a slappin' none the less.

And now the equity markets...suck em all in (margin debts are tipping the scales....) and in 6 months they will be crying for their momma....

If you are a PM bear than all of this is meaningless.  If you are a bull, then you have watch the bottom process.  First the positive divergence will happen (now?  maybe????).  Then the look to the left old highs will start to give away with impressive force....we shall see..

as they say in Japan:

Erect Weiner Holder 2016

ancientmoney's picture

@JY896 re: the Bernank-crazy like a fox? . . .

Orange and Bohemian posted the link earlier, and I agree, it should be read.  I think he is very close to the truth.  A conclusional snippet:

"Concluding thoughts

I concede that my thesis is conjecture at this point but it makes sense to me. Here is what I see happening. The Fed withdraws market support, the market crashes in a shocking and rapid descent back to the 2009 lows, the eurozone recession worsens, China's slowdown worsens, Japan's last ditch effort back fires and the world plunges into recession.

In short order a solution is offered - a new monetary system that promises to resolve our problems. The system has the added benefit of a partially gold backed re-set of all sovereign currencies - in effect monetizing the debts of troubled nations once and for all and allowing debt-to-GDP ratios to move back in line with historic norms.

Thereafter, economies start to improve as confidence is restored and the perception of value is evident in all asset classes. Excess reserves rapidly shrink as money lending resumes and investments increase - again based in part on the perception of real value and also the confidence in the new monetary system. In other words, the next secular bull market begins.

As banks lend M2 will expand rapidly and inflation will be the short-term consequence. And yes, the gold bugs will be proven right as inflation will push gold sharply higher and that will also be of benefit to sovereigns who now hold gold as a partial backing of their own currencies. Bonds will fall and yields will rise once again rewarding the prudent amongst us who will benefit from normalized rates. In fact, higher interest rates will be necessary to keep inflation in check.

What might be the most surprising aspect of this whole scenario is the incredibly rapid pace of the events. Here too we may have a clue on timing. Consider that Bernanke has announced he won't be in attendance at Jackson Hole this year due to a scheduling conflict. One wonders what that conflict might be that would pre-empt the single biggest event of the year for a central bank head. It certainly can't be an emergency as he announced that he wouldn't attend several months before the event.

What possible reason would he have for announcing he would not attend? Maybe he plans to be pre-occupied selling Congress on the need to adopt the new system or maybe he simply plans to take the lead in introducing and selling the system to the world and the timing for this event has already been set and conflicts with Jackson Hole. I do think the stage is set and now is the time to begin the final chapter in the process of orchestrating an epic and positive shift that I see as resolving many issues that have held us captive in a secular bear market that is well into its second decade."

---------------------------------------------------------------------------------

Notes:

1.  I agree that QE into bonds will continue.  However, this author says stock market support by Fed will be pulled away.  Crash!!

2.  The Jackson Hole conference is August 29-31, 2013.  Bernank excused himself from it already in April.

3.  The current system of "QE forever!" is unsustainable.  Cyprus Steal announced that fact to the world.

4.  Since Cyprus event, physical gold stockpiles are nosediving across the world, while EVERYONE who is "big money" is selling their paper gold--which is the result we are allowed to see.

5.  Ted Butler surmises that JPM is taking the GLD gold.  As JPM=Fed, this makes good sense.  Maybe some of it goes to Germany, and others, so all nations receive the "proper level of gold reserves" needed for the new financial system.

6.  New C-note with gold embellishments to arrive October 2013.  Just in time to introduce the new system?

There is a-whole-lot-a-shakin'-goin-on behind the scenes, as governments and the banking system prepares for what comes next.  I think it'll still be the west vs. the orient, though, as they no longer trust the western bankers.  they are establishing their own system, likely with gold backing of some sort.  So, the west needs to be ready to compete by doing the same.

 
Howard Roark's picture

@Larry

I´m in a hurry all I can say is that in a sense we are all "JGalts".

Potentialy, I mean. 

A big hug.

HR

GoldistheFuture's picture

SOROS IS BACK!

Well it looks like gold equities might be coming to a bottom.  Soros just loaded up the boat and he seems to be pretty good at sensing bottoms and tops in the gold market.  Soros even loaded up on Juniors!! Read this article!
http://bullmarketthinking.com/soros-reports-over-239mm-in-gold-positions-buys-25mm-in-call-options-on-juniors/

silverwood's picture

seeking alpha article

Thanks Orange for reposting that article from seeking alpha http://seekingalpha.com/article/1437121-the-bernanke-agenda-it-isn-t-what-you-think-it-is?source=email_portfolio&ifp=0

I find it quite interesting and quite plausible. I also was involved in a conversation recently regarding the new $100 bill which is slated to be finally released this fall, more clues? Anyway I want to second what Orange has said in that all of us should read this article. This guy who wrote it may have been privy( via the universal mind/consciousness) what the boyz are up to!

Southern Cross's picture

Possible False Flag - FYI - 50K Scouts Expected

National Scout Jamboree 2013 False Flag Insider Warning. Nevada Governor 2014 David Lory VanDerBeek

Wednesday, May 15, 2013 14:15
Story originally posted at nevadagovernor2014.com.

FEMA JULY DRILL

I have been on the phone with two reliable sources connected with military and a well known private investigative network. The military source decided to come forward because of the Boston bombing and the evidence that it was staged by the FBI.  The source provided information regarding a July FEMA mass casualty terror drill that has been kept a secret from the public. As I’ve previously said, it is not the announced FEMA/DHS/FBI terror drills that concern me, it is the unannounced drills that go live like Boston that concern me because real people can and do die. The source indicated that we need to scrutinize the National Scout Jamboree 2013 for a possible mass government staged false flag attack. https://summit.scouting.org/en/Jamboree2013/Pages/default.aspx The leaders of the event are changing the location of the event for the first time in 30 years. Governor Earl Ray Tomblin of West Virginia has signed an executive order giving DHS, FEMA, and the national guard martial law police power over the event. “Thousands” of national guard soldiers will be there. http://www.register-herald.com/local/x2063990347/State-s-Division-of-Homeland-Security-to-coordinate-Jamboree Governor “Tomblin said he expects several thousand National Guard from West Virginia and across the country on the ground during the Jamboree “in case of an attack … or health crisis.”” There will be 50,000 scouts there with their families. The source provided notes from a government source that FEMA is preparing an unannounced disease outbreak drill caused by conventional and unconventional terrorism in July with 4:1 ratio of mental and “sick” and believes this drill could be held at the Jamboree. Unconventional terrorism is chemical and germ weapons. There will be kill and wounded family members involving sociogenic illness which means that a medical condition will be shared by a mass of people. They will have multiple unexplained physical symptoms. There will be no clear start or stop to the event that will be long term inciting panic and mistrust of public officials. Being at this reserve, the scouts would be in the perfect location to rationalize a quarantine. Rioting/”breaking quarantine”, “noncompliance with vaccination and medical orders” as well as “resisting travel restrictions” are addressed in this powerpoint by the man named as the FEMA expert Steven M. Crimando overseeing the drill scenario http://www.njeha.org/pdf/Steven%20Crimando%20-%20Psychology%20Disaster.pptx.pdf If you look at his bio slide, he was a responder to both terrorist attacks on the WTC 1993 and 9/11 and Anthrax threat. In other words, this man is an expert in what would be the 9/11 scale of bio/chemical terrorist attacks.

WHO IS BECHTEL?

But this is not all. We need to compare the old long standing location of the National Scout jamboree to the new one, but first I wanted to know about who owns the new location. The previous location for the last 30 years is Fort A.P. Hill, Virginia, an active military base near D.C. I would like to know who made the decision to change the location and why. The new location is The Summit: Bechtel Family National Scout Reserve. Who is the Bechtel family? Google: “Bechtel corruption” They’re bad. Think of it this way: If the Rothschilds are the bankers of global government, Bechtel = the engineering company of global government. Remember the company that provided the poisonous mobile homes at Katrina? Think Bechtel. They have had construction contracts all over the Middle East = war profiteering. Remember all that waste in rebuilding after the first Iraq war? Think Bechtel. $680 for just a year and a half of work at the beginning of the war that blossomed into billions for them even though their works was a failure over and over. I did a search at usaspending.gov for the recipient “Bechtel” from and got back $53,760,324,263 in awarded contracts between 1999 and now. These are also the bastards that privatized Bolivia’s water supply raising the cost of water %50. After they were kicked out of the country due to the people rioting, Bechtel sued them for $50 million and received 30 cents because of international pressure. Remember the story about the corporation who first made the collection of rain water illegal? Think Bechtel. Bechtel = Blood for Water (see their logo below: bloody water/water wars) Here are their contributions http://influenceexplorer.com/organization/bechtel-

A.B.'s picture

Regarding the inflation...

I think that there is a great inflation going on however it is been sucked up by the stocks. After all it is the only place where the easily created money can funnel into without making a terrible effect and residue to the real economy. Soaring prices are not effecting anything in the real economy. 

It is a genius way to hide the inflation. 

What a big farce... When it will blow it will really smell very bad for a long time.

Turd tx for the post and the effort as always.

Spartacus Rex's picture

TF: "just a dope with a MacBook" WTH?

Oh NO, Holy Crap! I must be dyslexic.

I thought TF was a Mac with the Dope Book!

Oh well, as long as the targeted PM keep stackin higher and faster each week, no matter, REPEAT!

Semper Phyz!

foxenburg's picture

wondering

I am starting to wonder if the only reason gold did so well for ten years is because all these ETF paper-players whipped up such a storm of interest.

Rodney's economics class

 
0

What was the movie that this video clip comes from?ool

Back to School (1986)

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