Friday, November 18, 2011

Paper Gold and Silver About To Burn --- Buy Physical NOW!

Obviously charts are useless in a rigged market.  The focus should always be, and remain on, the fundamental reasons to own physical Gold and Silver.  It is all but a fools game to try and trade this rigged scenario in the paper Precious Metals markets..  However, if you believe the trend in Gold and Silver is higher long-term, then it is an excellent market to buy the Precious Metals at discounted prices whenever they are put on sale.

Nasdaq Slides 2 Percent: Investors Flee Risky Assets
Stocks dropped sharply in early afternoon trading on Thursday, with the Nasdaq down about 2 percent, as investors pulled out of risky assets.

Gold is up over 20% just this year...better dump that "risky asset".

Global Dollar Liquidity Freeze Leads To Pervasive Sell Off
From Zero Hedge
Just two charts confirming that we have entered a complete USD liquidity lock up, and that the global coordinated USD swap line rescue operation will be launched any minute: both the US FRA-OIS and the EUR Basis Swap are at multi year extremes. The entire dollar funding market is now at levels not seen since the Lehman collapse and is effectively frozen. Only this time it is much, much worse as never before has the global central bank cadre been assumed and implied to be backstopping the global liquidity cascade. Ex-out the implied backstop by the monetary authorities, and liquidity is now locked up more than ever in the history of capital markets. The liquidity crunch explains why everyone is liquidating the one asset that is performing best YTD to procure much needed dollars - gold.

DO NOT discount that the fallout from the MF Global fleecing of customer accounts is playing a very big part in the drying up of global liquidity.  This MF Global fiasco is going to prove to be a long and pervasive story.  Confidence in the "system" stands to take a huge hit because of this bankruptcy, and the SEC and CFTCs negligence in allowing it to occur.

If anybody is selling any Gold, they are selling "paper claims" against Gold.  Futures contracts and GLD maybe, but few if any would be selling physical Gold here to "raise cash".  Only a FOOL would be selling his Precious Metals in todays global financial clusterf***.

Profanity-Laced Tirade
From Turd Ferguson
Thursday, November 17, 2011 at 11:01 am

Oh, how I would like to launch into one. What we have seen recently, and what we are currently witnessing, is the most blatant and disgusting manipulation of the metals I've seen. That it is allowed to stand without question by the CFTC, the SEC and the media sickens me to the point of nausea.

However, for the sake of our none-Fbomb-loving readers and in the spirit of inclusiveness, I will do my best to avoid lacing this post with the profanity it deserves. Let's instead just simply lay it out chronologically:

(Before we start, full disclosure: I do not currently have any positions. Heck, I don't even currently have a broker. I do not have an ax to grind regarding trading losses. I'm simply disgusted by the ongoing corruption.)

1) In the wake of the S&P downgrade of U.S. credit, gold rallies from 1650 to 1920 over a period of six weeks, primarily on the back of Cartel short-covering. New longs also enter the gold market as gold and the Swissie are viewed as the only "safe havens".

2) This absence of sellers panics The Cartel. They petition their friends at the CME to raise margins.

3) Gold trades back to 1750 but then rebounds almost as quickly.

4) The rallying Swissie frightens the Swiss and unbalances the currency trade in Europe.

5) The Swiss decide to devalue their currency by 10% by pegging it to the euro. Knowing this will cause a steep rally in the only remaining "safe haven", a dastardly plan is put into place.

6) The Swiss announce their plan in the overnight (U.S.) following a U.S. bank and government holiday.

7) Five minutes before the announcement is made, the Swiss National Bank sells a massive quantity of paper gold, causing gold to drop over $50.

8) This has the desired, counter-intuitive effect of suppressing what should have been a massive gold rally on the back of the Swissie devaluation.

9) This also "saves" The Cartel from a runaway gold price that would have likely smashed through $2000.

10) The Cartel springs into action, forces the downward momentum, gets some additional margin hikes out of the CME and down goes gold, falling from 1923 to 1525 in 15 trading days. Over the same time period, JPM puts the wood to silver, taking it from 44 to 26.

11) All the while, the world geopolitical and economic landscape continues to deteriorate.

a) U.S. economy in toilet. U.S. government total debt reaches $15T. Blah, blah, blah.

b) Europe in crisis. Dexia, Greece, Italy, France. Blah, blah, blah.

c) The Middle East on the brink of war. New IAEA report shows Iran close to nuke. Blah, blah, blah.

d) Chavez repatriates 100 tonnes and other central banks are massive net buyers of gold. Blah, blah, blah.

e) Rioting, protest and insurrection is seen around the globe. Blah, blah, blah.

f) Blah, blah, blah.

12) Gold and silver rebound. Gold back to 1800 and silver back to 35.

13) MFing Global blows itself up, effectively removing, seizing and/or freezing thousands of futures traders accounts. This destroys confidence in paper markets and removes potential buyers.

14) MFing Global assets seized and stolen by JPM to be liquidated and confiscated for their own use.

15) As we approach the December option expiry, JPM and other Cartel members begin to actively sell and suppress gold and silver. Despite increasingly strong fundamentals, the PMs are pressed lower, perhaps to the point of collapse.

Will they collapse? That is the question, now isn't it. It certainly looks like they might.

I'm on record as looking for a November high in gold between 1780 and 1840. I split the difference and called it 1810. The high, so far is 1805. That may be as close as we get. With all of the uncertainty today...crude over $100, the impending failure of the "super committee", the future of the euro, just to name is down another $30. It is obvious that there is currently a deliberate and intentional manipulative event taking place. Where it stops, nobody knows.

Could paper gold and silver go lower from here? Heck yes they can! The evil C/C/C has:

1) Raised margins to nearly untenable levels.

2) Destroyed trader confidence and trust by closing MF and stealing clients asstes.

This leaves us with way, way more sellers than buyers and.....down she goes, regardless of the fundamentals.

So, what do you do. You definitely DO NOT trade on the LBMA or the Comex. These disgustingly-manipulated playgrounds of The Cartel will continue to be entirely manipulated against regular investors. They will continue in this manner until they finally collapse from the weight of their sins. WHEN they collapse, the value of physical gold and silver will skyrocket. Therefore, take this time to continue to add physical metal. Speed the demise of The Cartel by using their suppression against them. Take delivery. Add to your stack. Hold your metal in your own two hands. Only by physical possession can you be certain that you truly own it. Only by physical possession will we ever be able to crush the evil, soulless banking cartel. And I want to crush them so fucking badly that I can hardly see straight.


(at least I made it all the way to the end before unleashing the Fbomb)

Silver Plunge Explained: Shanghai Hikes Silver Margins From 15% to 18%
From Zero Hedge
We wonder if the collapse in silver price yesterday may have been due to just a tiiiiiiny leak of the fact that overnight, the SGE announced an imminent margin hike. From Reuters: "The Shanghai Gold Exchange said it will raise margins on silver forwards to 18 percent from 15 percent from Monday if the silver contract hits its daily trade limit on settlement on Friday. The exchange said it would lift daily trade limits on silver forward contracts to 15 percent from 12 percent if the contract hits limit up or down on settlement on Friday."

JP Morgan has made a MASSIVE adjustment of PHYSICAL SILVER into its REGISTERED VAULTS, moving over 1 MILLION OUNCES from eligible into REGISTERED OVERNIGHT!

For those inquiring as to the significance of an inventory adjustment from eligible to registered vaults, please see The Doc's explanation of registered vs. eligible COMEX categories for a full understanding of the implications.

*Brink's received a deposit of 81,297 ounces into eligible vaults
*Brink's also had a withdrawal of 76,253 ounces out of eligible vaults

*The Delaware Depository adjusted 2 ounces out of eligible vaults

*No Changes for HSBC

*JP Morgan adjusted 1,103,280 ounces out of eligible vaults, and into registered vaults.

JPM's registered inventories TRIPLED from 557,265 ounces to 1,660,545 ounces on Tuesday!

Is The Morgue preparing for substantial delivery demands for December?
The similarity between the 1.1 million ounce adjustment into registered by The Morgue and the 1.4 million ounces of registered silver that remain not eligible for delivery due to the MF Global fiasco is striking.

Perhaps The Morgue is moving to prevent a COMEX default due to the 1.4 M ounces of registered phyzz being unavailable for delivery, and Blythe is receiving massive amounts of notices of intents to stand for delivery as everyone realizes they do not want to end up like Gerald Celente.
This could be the sign of massive loss of confidence in the paper COMEX market, triggered by the theft of client assets at MF Global. Once confidence is lost in the paper market, that's all she wrote for the silver manipulation.

*Scotia Mocatta also adjusted 5,258 ounces out of eligible and into registered vaults
*Scotia also had a withdrawal of 10,400 ounces out of eligible vaults

*TOTAL REGISTERED COMEX SILVER INVENTORIES increased a net 1,108,538 ounces to 33,194,595 ounces
*TOTAL ELIGIBLE COMEX SILVER INVENTORIES declined to 73,901,153 ounces
*TOTAL COMEX SILVER INVENTORIES declined to 107,095,748 ounces

*Registered ounces of metal currently not available for delivery as of
11/4/11 due to MFGI bankruptcy. Included in above totals.

The Situation Developing With Comex Silver Could Get Interesting...
From The Golden Truth
The volatility in silver trading is ramping up this week and with good reason: JP Morgan (this name keeps popping up in connection with fraud and corruption - just coincidence I guess - it's a good thing JP Morgan has an ex-director in the White House advising Obama daily in order to make sure JP Morgan receives proper treatment from the authorities) - JPM is hopelessly short Comex silver futures and by the explicit admission of one of the CFTC directors, JP Morgan manipulates the silver market illegally.

Interestingly, JP Morgan recently decided to make itself one of the Comex custodians for Comex silver and opened up a vault for that purpose. The Comex inventory of gold and silver is reported on a daily basis and breaks out the inventory between "eligible," which is metal being "safekept" at the Comex by investors who have taken delivery, and "registered," which is the metal that has been certified by the Comex to meet its delivery standards and is being held for the purposes of delivery.

Yesterday, in a move which raised eyebrows throughout the precious metals trading community, JP Morgan moved 1.1 million ounces of silver from the the "eligible" bin and into the "registered" bin. This amount represents nearly 50% of JPM's "eligible" silver. (Please note: this commentary will not address questions about the verifiability and validity of the reported Comex inventory of gold and silver, as there have been many questions raised about this, it is not audited independently and, as we have seen with MF Global, et al, Wall Street tends to invent its own accounting standards).

Having said that, in studying the Comex open interest and inventories for nearly 10 years, I can say that the outright size of this inventory move by JP Morgan is unusually large and would suggest that JP Morgan is anticipating the probabilty of having to deliver a lot of silver for the December delivery month, of which JP Morgan is likely short at least 17k of the current 34k open interest, or 85 million ounces. Please note that there are still 9 trading days until the "first notice" day, November 30th, for December silver and I expect that the open interest will decline substantially between now and then. However - remember I like to look at the truth behind "however" - in order for the December open interest to get down to a level which represents just the total amount of registered silver - roughly 33 million ounces - the December open interest will have to bleed down to 6600 contracts. This is a big liquidation in just 9 days. I would suggest that JP Morgan's inventory behavior implies that delivery supply could get very tight this month.

I would also suggest that JP Morgan is making a very aggressive effort to manipulate the market lower. Make no mistake about it, every unusually large price-spike down in the intra-day trading is irrefutably JP Morgan traders manipulating the market for the purpose of trying to create selling by the funds who are long silver futures and thereby alleviate any delivery stress and accountability on JP Morgan and its CTFC certified illegal market activity. Oh ya, and ultimately accomplishes the ultimate Wall Street goal of taking money from your pocket and putting it in their own pocket.

The key here is to understand that the action between now and first notice day for December delivery has nothing to do with market fundamentals or outright global demand for silver and everything to do with JP Morgan's ability to try and force the silver market lower to protect its short position AND the unwillingness of our Government to enforce the laws in place to prevent this kind of market manipulation. Furthermore, the key to trading and investing in silver when the market goes through phases like this is to either hold what you got and don't watch the intra-day volatility or buy the down-spikes aggressively and take some profits on the rebound, but make sure you take full advantage of this market inefficiency and wealth-enhancing opportunity and increase your overall holdings.

One of these days the market is going to blow up in JP Morgan's face because they won't have enough physical supply of silver to meet delivery demands and we'll be reading about JP Morgan the same way we are reading about MF Global, only it will be many multiples more severe. It will potentially be catastrophic to the U.S. dollar and any remaining faith thereof. You want to make sure you have as much of your paper money moved into gold and silver because when the market does blow up like that, the end-game will be near and gold and silver will undergo a breathtaking move higher. I would suggest that behavior like we are seeing by JP Morgan this week indicates that the "blow up" event is getting closer.
Posted by Dave in Denver

Gold is going to go above $2000, and Silver over $'s ONLY a matter of time now.  It is not a matter of "if"...ONLY WHEN.  The "ifs" have been fully accounted for.  There are more "ifs" than I can count that add up to Gold going over $2000.  And not just hitting $2000, but soaring past it.  It is going to happen, of that there can be no doubt.

Need more reasons The Precious Metals are going to soar?

Fed Now Largest Owner of U.S. Gov’t Debt—Surpassing China
By Terence P. Jeffrey
November 16, 2011
( – At the close of business on Tuesday, the debt of the federal government exceeded $15 trillion for the first time–with the largest single owner of the publicly held portion of that debt being the Federal Reserve.

Over the past year, as the Federal Reserve massively increased its holdings of U.S. Treasury securities and entities in China marginally decreased theirs, the Fed surpassed the Chinese as the top owner of publicly held U.S. government debt.

In its latest monthly report, the Federal Reserve said that as of Sept. 28, it owned $1.665 trillion in U.S. Treasury securities. That was more than double the $812 billion in U.S. Treasury securities the Fed said it owned as of Sept. 29, 2010.

Meanwhile, as of the end of this September, entities in mainland China owned $1.1483 trillion in U.S. Treasury securities, according to data published today by the U.S. Treasury Department. That was down slightly from the $1.1519 trillion in U.S. Treasury securities the Chinese owned as of the end of September 2010, according to the same Treasury Department report.

Thus, at the end of September 2010, the Chinese owned about $339.9 billion more in U.S. Treasury securities than the Fed owned at that time. By the end of September 2011, the Fed owned about $516.7 billion more in U.S. Treasury securities than the Chinese owned.

EU Gold Investment Demand Surges 135% - World Demand Up 6% in Q3 2011
From Zero Hedge
Gold Demand Trends (Q3 2011) released today by the World Gold Council (see commentary) shows that investment and central bank demand for gold were key drivers of total gold demand last quarter. Third quarter gold demand increased 6% year on year to 1,053.9 tonnes with investment demand rising a significant 33% y/y to 468.1T. Virtually all markets saw strong double-digit growth in demand for gold bars and coins. Investment demand in Europe surged 135% due to the deepening sovereign debt crisis. Significantly, 390.5 tonnes of the 468.1 tonnes of investment demand went into physical bullion in the form of bars and coins. ETF demand was 77 tonnes and nearly 50% of that was from European investors and institutions. The increase in overall investment demand was quiet impressive considering the higher average price in the quarter and the price correction in September but not surprising given the scale of the global economic crisis. A huge and paradigm shifting change in the gold market is central bank buying which rose 556% to 148.4T from 22.6T in Q3 last year. For the past 15 years there has been net selling of around 400 tonnes per annum from central banks. Importantly, the World Gold Council can only identify about 40 to 50 tonnes of the 148.4 tonnes bought by central banks.

Gold soars to new ALL-TIME HIGH in INDIA as wedding season gets underway
And how about that. Gold is nearly $200 off its August high, despite SURGING global demand, including a 135% increase in buying from hyperinflation-fearing Europeans...

Central banks step up gold purchases
* The FT noted that a World Gold Council quarterly report showed that central banks made their largest purchases of gold in decades in Q3, taking advantage of a sharp drop in prices during September.

* The paper pointed out that while the WGC did not reveal the identity of the central banks that purchased 148.4 tonnes of gold on a net basis last quarter, it did note that "a slew of new entrants emerged wishing to bolster gold holdings".

* The WGC said that central banks are set to buy more gold this year than at any time since the collapse of the Bretton Woods system 40 years ago, led by emerging markets looking to diversify their growing foreign exchange reserves.

DJ Institutions To Drive Next Wave Of Gold Buying - McGuire NEW YORK (Dow Jones)--Gold is on the verge of being re-incorporated into the financial system as large financial institutions boost their allocations of the asset, said Shayne McGuire, head of global research and portfolio manager at Teacher Retirement System of Texas.

"We are the first generation to hold a negligible position in gold" when compared to total global assets, McGuire said, speaking at the Commodities Week USA conference in New York.

Gold represents a tiny fraction of global financial assets today, compared with 3% in 1980 and 5% in 1968, he said.

Gold as an asset class fell out of favor with large investors like pension funds in the 1980s and '90s as strong economic growth and falling inflation stamped out the need to hold haven assets like gold, McGuire said.

Gold was "pushed out" of the financial system, McGuire said.

But this trend is due to reverse as the market environment has shifted to favor gold in the past 10 years and large institutions are likely to return to holding gold soon, although the process will be slow, he said.

Pension funds have "virtually nothing" invested in gold, he said. Most pension funds have about 3% of their assets invested in commodities as a whole, of which gold represents 5%. This means only around 0.15% of the $300 trillion managed by pension funds is in gold, he said.

The initial leg of the current gold rally was driven primarily by individual investors, "people who can decide to invest at the click of a mouse," he said.

By contrast, investment decisions at large financial institutions take much longer to make. At the Teacher Retirement System of Texas, it took about two years to decide to invest in gold, McGuire said.

It is the dramatic change in allocation strategies at large funds that will drive the next part of the gold rally, McGuire said.

He added that while some notable market participants have been sellers of gold this year, market conditions are much different from the last time gold prices peaked in the late 1970s. Star investment fund manager George Soros had said the gold market had become a "bubble" and sold his holdings of SPDR Gold Trust (GLD), a physical gold-backed exchange-traded fund, earlier this year. More recently, funds managed by gold bull John Paulson reported reducing their gold holdings.

However, the last gold-price peak occurred when interest rates were high and inflation was high and falling, whereas today interest rates are low and inflation is low and rising, McGuire said. Such market conditions make a gold peak unlikely, he added.

Gold & Whirlwind Crisis
By: Jim Willie CB,
Witness the middle stage of the collapse of the COMEX, which has lost all trust as segregated client cash accounts vanished in a vast ongoing commingling campaign. One must conclude that JPMorgan must have really needed the money. The thought of a Madoff Redux comes to mind to the alert but weary. The MF Global vanished funds will eventually be measured over $3 billion. The actual Madoff pilfered funds totaled $150 billion, triple the more palatable figure often quoted. The locations of the missing funds have commonality, the ruling untouchable syndicate. Gold smells the destruction of the monetary and banking systems, aggravated by Western recession.
Gold smells new application of debt to repair old failed debt structures, where central bankers chase their tails.
Gold smells the vast reconstruction project for the giant Western banks, not too big to die of internal rot, only too big to let fail by a gavel. The twisted bizarre attempt to control commodity prices by presiding over a series of negligent policies is coming to an end. The Western recession is too much for the insolvent banks to bear. The US banks have real estate debt rot, but the European banks have both real estate debt rot and PIIGS debt rot. In truth, the US banks share great risk from across the pond.


The CME has advised that 1.42 million ounces of registered COMEX silver inventory is unavailable for delivery due to MF Global bankruptcy, as well as 16,645 registered ounces of gold also unavailable for delivery. That is a lot of bullion in breach of contract. The lawyers will be lined up very quickly to carve the metals exchanges into pieces. The COMEX is totally broken, unable to honor basic contracts, unable to deliver from committed legal contracts, unable to even protect client funds from commingling grabs. But during a period when investors cannot protect themselves, an ambush could easily come in the next week to push down the Gold price in the usual manner, via naked shorting. As the grandiose destinations become clear for vast new monetary creation, the Gold & Silver prices will run higher. The big immediate questions center on how much dithering the banker elite that run our governments will permit with malignant motive before the decisions are made, and how much economic deterioration will be permitted to contain commodity prices before the decisions are made. The destinations are bank bailouts for toxic sovereign bonds, recapitalization of the big Western banks, coverage of new USGovt debt, and economic stimulus. A few $trillion will be needed, as estimates by well-informed veterans mount like a stack of white papers. The economic damage is being done, even though the crude oil price has finally zipped above the $100 mark.

PRESS RELEASE: Fitch: Eurozone Contagion Poses Threat to U.S. Bank Rating Outlook

Wed Nov 16 15:06:38 2011 EST
The following is a press release from Fitch Ratings:

Fitch Ratings-New York-16 November 2011: U.S. banks have manageable direct exposures to the stressed European markets (Greece, Ireland, Italy, Portugal and Spain), but further contagion poses a serious risk, according to a Fitch Ratings report.

Fitch believes that unless the Eurozone debt crisis is resolved in a timely and orderly manner, the broad credit outlook for the U.S. banking industry could worsen. Fitch’s current outlook for the industry is stable, reflecting improved fundamentals at most banks combined with ratings lower than at pre-crisis levels. However, risks of a negative shock are rising and could alter this outlook.

U.S. banks have reduced direct exposure to stressed European markets considerably over the past year in Fitch’s view. Direct exposures appear manageable in the context of banks’ capital positions and diverse earnings streams. Public disclosure of direct exposures has generally improved recently but varies from bank to bank.

The full report ‘U.S. Banks – European Exposure’ is available on the Fitch web site ‘’. Specific country exposures for the large U.S. banks are provided in the report.

There is just one question we must all ask ourselves:

"Is our money safer 'in the system' sitting in an account somewhere, or it safer outside the system held tightly as phsysical Gold and Silver?

1 comment:

  1. Gold is something that not every can purchase. However, once there's that chance to Buy Gold Assets, then they will make sure to buy what they need.