The setup for the big trade

11603 posts / 0 new
Last post
Tue, Jul 12, 2016 - 2:58pm (Reply to #9171)
silver66
Offline
Joined: Oct 8, 2012
3344
15594

Careful Ivars

Speaking about freegold is heresay on main street wink

by the way,I don't discount that idea

silver66

Silver66 Rage against the dying of the light

Wed, Jul 13, 2016 - 3:14am
Wy So Lo
Offline
-
OZ SA
Australia
Joined: Oct 4, 2015
1096
1807

Interesting

Ivars. But does it all add up? Central banks buying gold, in this case 8000 TONS, Russia, big buyers, China, likewise, India Pakistan and others stacking it away. Where is it coming from? Are these 8000 tons, gold certificates. Hard to imagine they would fall for that ol trick. Anyway good info for the data bank here at turdtropolis to mull over. Thanks to those that have responded to my posts, it all makes for a great community.

Wed, Jul 13, 2016 - 3:36am (Reply to #9173)
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

Wy So Lo wrote: Ivars. But

Wy So Lo wrote:

Ivars. But does it all add up? Central banks buying gold, in this case 8000 TONS, Russia, big buyers, China, likewise, India Pakistan and others stacking it away. Where is it coming from? Are these 8000 tons, gold certificates. Hard to imagine they would fall for that ol trick. Anyway good info for the data bank here at turdtropolis to mull over. Thanks to those that have responded to my posts, it all makes for a great community.

No, European CBs are not buying gold in big amounts..it is not increasing; the gold reserves backing EUR has always been there. In fact, target for EUR zone 8371 tons is almost exactly equal to German+French+Italian gold reserves ( 8267 tons now). So it seems these 3 countries hold the monetary policy in their hands. 

But CBs of EUR zone could become sellers or buyers of gold only in case the value of gold in EUR moves too much away from what they might perceive as stability anchor. And then they move gold price in USD around a bit if they can, or sell/buy EURos which they can produce in ECB. 

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Wed, Jul 13, 2016 - 3:38am
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

Silver usually (when move is

Silver usually (when move is up) predates gold moves. Currently silver stubbornness seems to signaling that soon gold will get up.

According to Central banks of EUR zone (NOT ECB) Balance sheet is fully backed by gold at current prices. The amount of gold EU countries has delegated for this purpose is:

-it started with 2691 million oz or 8371 Tons in March 1999! Surprisingly, the total amount of GOLD owned by USG Treasury (FED only has gold certificate) has been  8133 tons, so EUR has been trying to back by its currency by the little bigger amount then USG has. ECB itself has only 504,8 tons so some share of all EUR country CBs gold is devoted to this peg.

-Today its value is backed by 2636 million Oz or 8199 tons, so Gold value in EUR is almost matching initial target, and the whole exercise shows that ECB and banks of EUR totally are targeting their balance sheet PEG to gold tons, namely around average of 7633 tons.

-average has been from march 1999 2454 million Oz = 7633 tons

-minimum (which means high gold price in EUR) has been 5129 tons in August 2011.

-Maximum(which means low gold prices in EUR) has been 10353 tons in December 2008.

So it is quite difficult for them to be on target, but right now they are close

-Now EU CBs is adding to balance sheet 80 billion EUR/month (20 billion more then previously) with open end- till the end of March 2017 or more. This gives 800 billion or EUR bigger Central Banks of EUR area balance sheet which increases it by 25% ..so on average gold price in EUR has to increase on average by 25% or reach 1625 EUR/Oz by end of March 2017, OR EUR has to devaluate against USD, or both. What will be the EUR USD rate at that time? 

Here is a chart showing Central banks of EU cumulative balance in gold (billion Oz), with red line being the average. There , in the end could be a trend moving this value priced in gold down , but as we can see, short term Europe allows the peg to move above average.

There is something in all this...since one can say that long term EU monetary policy checks its actions against CB of EUR area gold reserves in the amount of 7633+-, initial target being 8371 tons; it has not changed due to financial crisis. It depends on EUR/USD rate , of course , since gold prices are set in USD. EUR/USD has dropped 30% since July 2008.

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Wed, Jul 13, 2016 - 6:15am
Byzantium
Offline
-
London
UK
Joined: Feb 20, 2012
1601
8507

German+French+Italian gold reserves

Ivars, most of that Euro gold is reportedly gone. It is nothing but a paper promise.

Germany's gold is largely kept with the BOE, the Fed, and some in Paris. They have had little luck in getting any of it back, and will likely never see it again, because it is almost certainly gone.

The Italian gold was leased in opaque business deals, orchestrated by (drumroll) Goldman Sachs, through LTCM, in order to qualify Italy for the Euro. Italy's expectation to get back that gold was reportedly terminated at the time of the LTCM collapse, at which crime scene Jim Rickards was able to observe first hand as some kind of consultant or participant, and which in large part, forms the basis of his understanding of the importance of gold. Not that he can talk openly though, about what he knows of LTCM as a vehicle used to rob Italy of its phys. What a sweet deal; use LTCM to take away the phys, then crash LTCM, and you have the perfect heist, all legal.

The French gold, who knows. Their leadership has been politically and intellectually weak for some time, I would not bank on them having their gold either.

And after all these years, we still don't know if India back in 2009/2010 when it bought the IMF gold at $1042, bought phys or just certificates. And since the IMF gold comes from its member states, look to some more double-counting there. Germany for example, likely still counts its IMF pledge as its own, but India thinks she owns it, and the vault is anyway empty.

It is the age old question; where is the real gold? The eurozone arguably has little or none. It can keep buying if it wants to, the Fed is surely keeping it safe for them.

Wed, Jul 13, 2016 - 7:15am (Reply to #9176)
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

I am not sure about it..at

I am not sure about it (that Europe does not have a control over their gold reserves or that they are gone); at least they must have some agreement about them with the USA in 1960-ties Europe in monetary matters were independent from USA and French pushed gold demand up and USA of the gold backing in 1968-1971....at least behavior of EUR Area Central banks balance sheet assets vs gold price indicates a willingness from EUR zone part to back EUR money 100% with gold at market rate.

Also, USD behavior in end of 70-ties up to 80 ties did not show much monetary prudence. So idea for EUR zone was made.

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Wed, Jul 13, 2016 - 4:17pm
Solsson
Offline
-
Ankeborg
Sweden
Joined: Dec 14, 2013
983
3877

This is a historical day,

This is a historical day, time has arrived. Who stated this forty months ago?

"Now I expect that interest rates will go negative before TPTB throw the towel into the PM ring. But that time is relatively close. It seems clear that the beginning of the next PM bull will be simultaneous with a rise in interest rates"

The Swedish bond yield reached a Super Cycle low today, the deflation phase is over.

We are looking forward to raising rates again. My question is, really ... what about the debt bubble, the shaky banks of Europe? I think we still have some time left before a phase shift. We need a reformation of the financial sector on a global scale and I guess such an event is going to be quite deflationary.

Edit:

The chart isn't mine, I copied it from an analyst that I follow and respect, but I am skeptical about a phaseshift at this time, it's too early, or isn't it, India is looking really good btw ...

Thu, Jul 14, 2016 - 6:56am (Reply to #9171)
Silver_Surfer
Offline
Joined: Jul 5, 2014
128
308

This is odd to me, this seems

This is odd to me, this seems to have more or less the same inflection points. But gold flowing towards the UK from Switserland (and rest of EU?) does not seem to corroborate with the ECB buying gold. Unless they are storing it at the LBMA of course. Anything you can infer from this chart?

In other news:

No idea if it means anything though. Funny coincidence if it is just that.

Looking to trade crypto on leverage? BitMex is the biggest and most liquid crypto futures exhange that offers leverage up to 100x. Click here to get a 10% fee discount during the first 6 months. Please don't wreck yourself by actually leveraging 100x. Alternatives are 1Fox & 1Broker (1Broker has forex & legacy markets also).
Thu, Jul 14, 2016 - 7:36am (Reply to #9179)
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

Silver_Surfer wrote: This is

Silver_Surfer wrote:

This is odd to me, this seems to have more or less the same inflection points. But gold flowing towards the UK from Switserland (and rest of EU?) does not seem to corroborate with the ECB buying gold. Unless they are storing it at the LBMA of course. Anything you can infer from this chart?

UK is not part of EUR, and is world gold trade center, so it is just their business to buy and sell gold. Britains reserves are small. Swiss is also NOT in EURo zone, and the net flows from Swiss again show trade flows, not CB buying or selling. 

ECB ( or rather EUR area CBs ) do not by extra gold. They have since beginning in 1999 more than 8370 tons and my hypothesis was that they only buy and sell gold when it could help them to keep the peg Total CB of EUR zone balance sheets=8370 tons of gold and when they can not influence EUR USD exchange rate enough . I think they wanted to have as much gold behind currency as USA had in 1999.ECB does not accumulate gold nor does CBs of EUR zone countries ( now 19). They look at the peg for stability anchor in case something happens. EUR is fully gold backed by 8370 tons according to market price. 

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Thu, Jul 14, 2016 - 7:52am (Reply to #9177)
Silver_Surfer
Offline
Joined: Jul 5, 2014
128
308

ivars wrote: I am not sure

ivars wrote:

I am not sure about it (that Europe does not have a control over their gold reserves or that they are gone); at least they must have some agreement about them with the USA in 1960-ties Europe in monetary matters were independent from USA and French pushed gold demand up and USA of the gold backing in 1968-1971....at least behavior of EUR Area Central banks balance sheet assets vs gold price indicates a willingness from EUR zone part to back EUR money 100% with gold at market rate.

Also, USD behavior in end of 70-ties up to 80 ties did not show much monetary prudence. So idea for EUR zone was made.

You're right I believe. From what I hear the Bretton Woods Treaty is still valid, just temporarily suspended. Hence the Americans not adjusting for market value.

Looking to trade crypto on leverage? BitMex is the biggest and most liquid crypto futures exhange that offers leverage up to 100x. Click here to get a 10% fee discount during the first 6 months. Please don't wreck yourself by actually leveraging 100x. Alternatives are 1Fox & 1Broker (1Broker has forex & legacy markets also).
Thu, Jul 14, 2016 - 8:16am (Reply to #9181)
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

Thanks very interesting

Thanks very interesting twitter lines from VictorTheCleaner. So I am not alone:)

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Thu, Jul 14, 2016 - 9:24am
ivars
Offline
-
Riga
Latvia
Joined: Sep 26, 2011
3982
25145

Mistakes

But I am alone in the numerical mistakes I made in the whole thread about Central banks of EUR zone balance sheet, messed up big time with Oz and tons. I saw what i wanted to see...So pls forget all that bullshit I conjured out of nowhere:(;

There is no ton target; All gold reserves these banks have are marked to market every 3 months or so ;and therefore naturally balance sheet total moves in line with gold prices as they are input in balance sheet. The deviation between balance sheet and current price level is due to the fact that ECB has started to add quantitative easing assets to their total EUR system balance sheet so its total now changes not only from gold price, but also these extra purchases of assets.

Additional assets to EUR zone CB balance sheet has destroyed the nice correlation in the end of time series and , though it could be beneficial to gold price in EUR..so far has not been.

blush

At least now I know how to convert money to Oz and Oz to tons.enlightened

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Thu, Jul 14, 2016 - 9:50am
Silver_Surfer
Offline
Joined: Jul 5, 2014
128
308

Another dot

Another dot I have difficulty connecting, does anyone know how far along this process is currently? And is it significant?

CME Group says preparing to open account at the Fed

Looking to trade crypto on leverage? BitMex is the biggest and most liquid crypto futures exhange that offers leverage up to 100x. Click here to get a 10% fee discount during the first 6 months. Please don't wreck yourself by actually leveraging 100x. Alternatives are 1Fox & 1Broker (1Broker has forex & legacy markets also).
Thu, Jul 14, 2016 - 10:12am
Wy So Lo
Offline
-
OZ SA
Australia
Joined: Oct 4, 2015
1096
1807

Dots everywhere SS

Been watching DB for an early warning. As i see it Deutsche will never be allowed to crash on its own. It has the highest profile in the space and although it has the trillions of dodgy "assets" it will always be stabilized by the CB's, it has to. I disagree with A Hoffman and his adamant declaration that DB is finished. Why does any market ever have to fall while there is an UNLIMITED supply of liquidity that is totally opaque and never to be audited. How can it possibly ever fail. It can continue until forever, OR a physical commodity suddenly disappears from global market places. Realistically that is our only hope.

Thu, Jul 14, 2016 - 10:20am
Wy So Lo
Offline
-
OZ SA
Australia
Joined: Oct 4, 2015
1096
1807

I see

DB asking for Billions as a smoke screen and i suspect they have already had trillions made available. It is a thinly disguised way of saying, hey, we are fine , see, we only need a few billion.

Thu, Jul 14, 2016 - 12:48pm (Reply to #9175)
Silver_Surfer
Offline
Joined: Jul 5, 2014
128
308

Silver

ivars wrote:

Silver usually (when move is up) predates gold moves. Currently silver stubbornness seems to signaling that soon gold will get up.

You think so? From my perspective silver's failure to break out (see charts I posted here) implies that it's probably about to retrace to $18 or so. On the other hand...

I guess all depends on the next few days.

Looking to trade crypto on leverage? BitMex is the biggest and most liquid crypto futures exhange that offers leverage up to 100x. Click here to get a 10% fee discount during the first 6 months. Please don't wreck yourself by actually leveraging 100x. Alternatives are 1Fox & 1Broker (1Broker has forex & legacy markets also).
Thu, Jul 14, 2016 - 2:46pm
Offline
-
Dublin
Ireland
Joined: Jan 20, 2013
3638
24405

Tomorrow is a most important

Tomorrow is a most important birthday.

A birthday of a major market low.

On 8 July 1932, the Dow Jones Average bottomed at 41.2 after a gruelling fall which lasted 3 years and wiped out 90% of market valuations. 

And now we are exactly one wave of a very very long cycle has passed by since that important day.

We should see important things happening in the markets about now. Things like record highs, breakouts, euphoria or resignation. Look around, feel inside, make a judgment of the situation.

The leading stock averages, dominated by financials fill the role nicely. Gold is not at lows, but is at the upper side of a long bottoming consolidation which includes lows at the leading edge of a five year decline. We need to find out what assets are at top and what is at bottom.

The secondary and tertiary indices are lagging, not confirming the breakout in Dow, SPX.

If in secondaries, or tertiaries exercise care - tops may already be in (probably are) - and be reluctant to absorb pullbacks. In financials the last hurrah is on. There could be a weird insanity (financial) phase, wild things are possible for a while. Careful planning from now on, time is getting short, in the timescales used in setup.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Fri, Jul 15, 2016 - 6:12am
Solsson
Offline
-
Ankeborg
Sweden
Joined: Dec 14, 2013
983
3877

Great post AM and a little

Great post AM and a little bird whispered in my ear yesterday, google translated:

"US goes well fundamentally now - with the Fed does not raise interest rates, though they logically should, of course - it gives a very strong BEAR market rally of US indices - but everything that goes up by artificial means going down .... can be a real bang ala -29 - but right now it looks like on up, so it's all about the time horizon to wires. Just surfing the waves :-) - when the Nasdaq made a row. Fifth wave is the time to listen up properly, is China where alsp up on the levels of fib50 or a little higher, we have a historic location - we are not there yet in my opinion, the US B-wave can go high, especially if the Fed consider the Brexit is a risk and therefore kicks off new QE"

European banks looks horrible, Japan banks not much better. Mr Abe is about to give orders to fire up the printing press again. 

Have a nice weekend folks, I am on VACATION yessmiley

Fri, Jul 15, 2016 - 10:53am
Offline
-
Dublin
Ireland
Joined: Jan 20, 2013
3638
24405

Long cycle arrives, leading

Long cycle arrives, leading stock markets breakout, secondary indices trail lagging leaders, gold holds, very sad news from France of many violent deaths of (demographically less politicized and anti war ) women and also many children.

Truck attacker kills 84 celebrating France's Bastille Day

Apparently he zig-zagged at speed along the promenade.

... in other connected news Citi reported beating expectations with enhanced trading contribution (right side in Brexit bet assumed) to mitigate reduced earnings: Citigroup's profit falls less than expected; trading helps

Such is the way of these special days when humanity faces confrontations on many fronts and issues during compressed time.

I now have the material prepared for the next webinar. Really big ideas about global stocks. It will feel odd to strategize during summer vacation time in the financial markets.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Fri, Jul 15, 2016 - 11:36am
Offline
-
Dublin
Ireland
Joined: Jan 20, 2013
3638
24405

Next RNP webinar is pencilled

Next RNP webinar is pencilled in for Monday 25 July.

Geopolitical Situation Report, Trends & Capital Swings, Main Topic - Global Stocks & The Big Wave, Gold, Silver, other PMs, Favourite Stocks, Requests, Q&A.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets