A2A with Jim Comiskey

105

Legendary commodity broker Jim Comiskey joined us today for the first A2A of the new year.

In this 45-minute call, Jim addresses:

  • the current, historic move in crude oil
  • falling natural gas prices
  • how he's consistently profiting trading currencies
  • why he prefers futures options to futures
  • the outlook for the dollar, the euro and ECBQE
  • and much, much more...

I think you'll find this discussion very helpful and a great start to the 2015 A2A season.

TF

  105 Comments

SS121
Jan 9, 2015 - 2:26am

forcing moves

in chess, players move their pieces where they want. but sometimes one player moves a piece and that forces the other player to either make a specific move or lose valuable position or pieces. the second player is still in control of moving his pieces, but given the position he finds himself in, he is forced to make a specific move.

and so it is with tptb-

they are still in control of their fake charts, but they're getting ragdolled on the board.

--

(forcing move) think about the silver chart, they could move it anywhere from 2 cents to 2 million in the next 10 minutes if they wanted to. but public demand is forcing (forcing move) them into a very narrow range. the silver chart is trapped. (similar to a trapped chess piece)

--

where do you want to be positioned when this ends? In the paper market of tptb??...or in Silver (and Gold)??

SearchG-Rod
Jan 9, 2015 - 2:39am

G-Rod

Define "they"

Just cause the PBOC says they have 1054 that does not mean "they" have only 1054.

BTW, SAR = Nice

G-Rod
Jan 9, 2015 - 3:43am

SAR

Yes - Up 8.77% today, The XGD (ASX Gold miners Index) was up 3.9% today, so SAR more than doubled the average local industry gains.

Officially "They" had 1054 tonnes in 2009. What they have now is anyones guess. They will tell us a new number this year.

Cheers G-Rod.

bookers126
Jan 9, 2015 - 7:38am

Marshall Swing Predicts

Marshall predicts that from now until September/October silver will not break $18, then it will crash in price, then it will rise in price. Seems to me he is just making up stuff at this point.

DeaconBenjamin
Jan 9, 2015 - 7:49am

Market Report: A steady start for 2015--By Alasdair Macleod

Gold and silver started the year at a muted point, with gold at $1168 and silver at $15.50, from which modest rallies have developed, with gold up 4% and silver 6%. These rises were against a background of high volatility in equity markets, a strong US dollar and very weak oil prices.

The firmly entrenched bearish opinions in recent months for the outlook for gold and silver have backed off from recent extremes. There is confusion in dealers' minds, brought about by the threat of deflation and the collapse in oil prices. Whereas hedge funds would automatically sell gold whenever they detected dollar strength, this is no longer the case. Precious metals now seem to be responding more to the threat of global financial instability triggered by a strong dollar, and fund managers are selling other commodities instead. Indeed, it is remarkable that despite the USD hitting new highs against nearly all currencies, gold has not only held its ground but is actually rising.

In reviewing last year, we note that the establishment was bearish of gold with forecasts down to $850. Remember that it was described by one major house as a slam-dunk sell. In the event, gold was more or less unchanged in USD, but rose in nearly all other currencies: 4% in sterling, 11% in euros and 15% in yen. In emerging market currencies the rise was even greater, for example doubling against the Russian Ruble. Silver, in common with most industrial metals, weakened from mid-year onwards, losing significantly over the year.

The current market is mildly encouraging for precious metals so far, as the following two charts of Comex open interest illustrate.

Gold's open interest has perked up this week after the sharp fall in November as shown in the chart above, indicating buyers returning to the market. A similar pattern is developing in silver as shown in the next chart.

Over the holidays the gold open forward rate (GOFO) stayed negative, signalling a continuing shortage of physical gold in the market. The pattern of GOFO has been to go more negative on dips below $1200, which suggests that physical buyers have been accumulating bullion at that level.

In the three trading days between Christmas and New Year the Shanghai Gold Exchange delivered a further 28.96 tonnes, giving a total delivered into Chinese wholesale markets for the year of 2,102.36 tonnes, compared with 2,194.99 tonnes in 2013. This is a remarkable figure, and with a revival in Indian demand following relaxation of import restrictions, China and India are officially absorbing the world's mine supply between them, given that there is strong evidence that China's domestic mine output is quietly absorbed by the State.

https://www.goldmoney.com/research/updates/market-report-a-steady-start-...

DeaconBenjamin
Jan 9, 2015 - 7:54am

Entire oil complex slips into contango for first time since 2009

By Jane Xie SINGAPORE, Jan 9 (Reuters) - For the first time since 2009, a contract to buy crude oil or any sort of refined product costs less if it's for immediate delivery than for future shipment, giving traders more reason to buy now than later. This phenomenon motivates traders to purchase oil now, store it in tanks and sell it for a profit when prompt demand recovers. But whether the contango - or when spot prices are at a discount to future prices - would help lift the market remains to be seen. Benchmark Brent crude prices have fallen over 50 percent since August.

The entire oil complex slipped into contango on Wednesday as a deluge of cargoes triggered by the rise of U.S. shale oil and refinery expansions earlier in the decade struggle to find takers due to slowing economic growth, especially in Asia and Europe. The prompt February Brent crude contract is at a discount of more than a barrel to the February 2017 equivalent.

"For crude, there's a structural change, going from fairly balanced to an oversupply," said Richard Gorry, managing director of Vienna-headquartered energy consultancy JBC Energy. "For products...demand has not collapsed, (it's) just a tendency of oversupply of refining capacity and slower demand than had hoped for." The last time the entire oil complex fell into contango was in the final quarter of 2009 when markets were emerging from the height of the 2008-2009 financial crisis.

https://en-maktoob.news.yahoo.com/entire-oil-complex-slips-contango-firs...

DeaconBenjamin
Jan 9, 2015 - 8:12am

Big banks park beat-up energy sector bonds in U.S. money funds

BOSTON (Reuters) - Big European and American banks have found a productive place to park the energy sector's most distressed debt: the $2.7 trillion U.S. money market industry. Barclays Bank plc, Credit Suisse and Wells Fargo and others get overnight and short-term loans from companies that run money market mutual funds such as Fidelity Investments, BlackRock Inc, American Beacon and others. The banks use the money to fund long positions in securities or to cover short positions. For collateral, the funds are accepting the junk-rated bonds of beat-up energy companies.

Even though the value of the bonds are in free fall as oil prices plummet, the money funds readily accept the debt, because it's a way to generate above-market yields in an industry hurt by near-zero interest rates. In 2014, the average yield for taxable money fund investors was a paltry 0.01 percent. Banks currently have about $90 billion outstanding in short-term and overnight loans backed by riskier assets that include corporate debt and equities.

The exact amount of junk-rated energy debt used as collateral was not available. But more than a dozen of the sector's mostly highly distressed issuers, including QuickSilver Resources, Black Elk Energy, Halcon Resources, Samson Investment and Sidewinder Drilling Inc, have had their bonds used as collateral, according to recent fund disclosures. These so-called "other repurchase agreements" generate above-market yields for the funds, ranging anywhere from 20 basis points to 50 basis points. In contrast, repo loans backed by safe U.S. Treasuries can generate yields of about 10 basis points and less, according to recent fund disclosures.

Money funds downplay the risk in the repo transactions backed by the junk-rated collateral. They say their ultimate backstop is the bank on the other side of the deal. Fidelity, the largest money fund operator in the industry, declined to comment on any specific transaction. In a statement, the company said, "We make an independent assessment on the counter-party credit quality in all repurchase agreements to ensure the counter-party represents minimal credit risk."

https://en-maktoob.news.yahoo.com/big-banks-park-beat-energy-sector-bond...

usk
Jan 9, 2015 - 8:27am

2 deads in Porte de Vincennes (Paris) in a new attack

We are on the verge of a civil war in Paris. Things do accelerate down here.

2nd shooting in Paris. French media say one person injured and at least one hostage taken at Jewish shop Porte de Vincennes area.

Jan 9, 2015 - 8:35am

BLSBS

As the goons on CNBS celebrate how close they might have been in guessing the imaginary number, several things jump out:

  • decline in hourly earnings
  • another drop in participation rate

Should be very interesting to get the truth and actual analysis from ZH in a bit.

In the meantime, the metals are UP just a bit....which they should be. In a "traditional" sense, this sounds like a gold bullish BLSBS.

usk
Jan 9, 2015 - 8:36am

With all of the angry "youth"

With all of the angry "youth" in the Muslim "slums", I fear you are correct. Please keep us posted.

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