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Thread: possible of explanation of what's going on with gold and silver

  1. #1

    Default possible of explanation of what's going on with gold and silver

    I'm sure a lot of you have been watching, but it seems to be befuddling that the price of silver and gold is plummeting yet there are all these announcements of limited supplies and the mint suspending production of gold eagles. Here's a good article that may explain what is going on:

    http://seekingalpha.com/article/9135...s?source=yahoo

    There is a huge demand for both gold and silver right now in India and North America. North American shops are completely bare of silver. Indian shops are empty of both silver and gold. Even the Indian banks don't have any gold or silver. The big western bullion banks, based in New York and London, control both the gold and silver trade. Reports from India are that they are refusing to extend Indian bank lines of credit, forcing the small banks to deliver to clients, collect money, and pay down lines of credit, before being allowed to take delivery of another gold or silver shipment. This is very abnormal. Normally, if a banker’s bank knows that its customer-bank has firm orders, it would extend the smaller bank a bigger line of credit. Not now.

    By refusing to extend lines of credit, the big bullion banks are essentially rationing a very thin supply. Most physical silver, for example, is being reserved for industrial and fabrication use, and investors are simply not able to get any, without waiting for months. Investor oriented shops are bare, and the U.S. Mint has suspended coin production. All available supply seems to be reserved for industrial users. You cannot substitute paper claims for real silver, in industrial use, because paper doesn’t have the physical properties of silver. So, it seems that all available supply is being diverted to industrial users, and, to a lesser extent, aside from the squeeze on lines of credit, also to jewelry fabricators. But, investors are left out in the cold. They can accept paper claims, or nothing. The most interesting mistake that the manipulators have made is in not supplying the U.S. Mint, which has run out of silver, proving that there is a severe shortage.

    Meanwhile, by refusing to extend Indian bank lines of credit, Indian jewelry demand for both gold and silver is being stymied. India is not being allowed to drain away precious metals, in the amounts that are warranted, given the low prices and the numbers of unfilled orders that are sitting on desks in India. World bullion banks, in other words, are managing deliveries of physical gold and silver to artificially reduce the quantities delivered, under the excuse that the “Indians have run down their credit lines.”

    The happiest fact of bullion bankers’ lives is that western markets are, with the exception of some fabrication and industrial demand, almost 90% paper based. The huge COMEX futures market almost never sees an ounce of real silver or gold ever change hands. It is all paper, shuffled back and forth. These paper markets are being flooded with paper based "claims" to alleged gold and silver, supposedly being held in big bank vaults in London and New York City. The market is overwhelmed with paper claims, and the big bullion banks (maybe, with the Federal Reserve providing the money?) are paying big bucks to secondary derivatives dealers to get them to lease this artificially created “gold and silver.” In a normal market, one who leases a thing of value must pay for it. But, now, derivatives dealers are being paid to lease both gold and silver. Then again, it may not be a thing of value, if it is fake…

    That being said, the paper claims may have a lot of value, whether or not they are fake. Derivatives dealers can write futures contracts, options, etc., according to CFTC rules, because paper "claims" to vault-stored silver and gold can be used as the legally mandated "cover" for futures contracts. To understand the nature of paper claims, we must travel back in time, for a moment, to a class action against Morgan Stanley (MS). According to the complaint, Morgan Stanley claimed that it bought physical silver, on behalf of various clients, and was storing it, in safe-keeping, in its vault in New York. Allegedly, Morgan Stanley defrauded its clients from Feb. 19, 1986, and Jan. 10, 2007. According to the complaint, it never bought any silver, but, all the while, continued to charge clients big fees for storing the imaginary metal. Morgan Stanley is one of the biggest investment banks in the world. It is one of the major players in precious metals. Yet, according to the lawsuit, the paper claims to vaulted silver it issued to clients was nothing more than a lie. One of Morgan Stanley’s defenses, interestingly enough, was that everything it did simply followed “standard industry practices.” For more information, see here.

    Apparently, it is standard Wall Street industry practice to send people monthly statements promising that the firm is storing physical precious metals in a vault, charge for the storage, but really never buy or store any real metal. Morgan Stanley eventually settled the case for many millions of dollars in damages, rather than going to trial. That tends to indicate that they were guilty, as charged. I believe, with good reason, as you shall soon see, that most of the paper claims to silver and gold, now floating about, and collapsing prices, are cousins to the Morgan Stanley silver claims.

    Logic tells us that the so-called metal must be imaginary, and I will soon tell you why. Yet, for some reason, in spite of class actions like the one described above, no one demands to see it. The majority assumes that banks, like Morgan Stanley, are honest, and would not issue fake paper claims. But, if they did it before, they are probably doing it again. That could be the key to precious metal market manipulation.

    If you are a huge bank, with hundreds of billions of dollars worth of short positions, and you know the price is going to explode, you can do one of two things. You can be honest, like most individual and institutional short sellers must be, and cover your short position by buying back at market prices even though you may take losses to do so. Or, you can be dishonest. The majority of banks and hedge funds don’t have the option of being dishonest, even if they want to be.

    However, what if you happen to be a primary dealer of the Federal Reserve, or the ECB, or the Bank of England, or all three? If you are, then you happen to have overwhelming knowledge and control of the marketplace, because your divisions are deeply enmeshed in the global financial trading system, and your powerful computers allow you to analyze all markets in a matter of minutes or even seconds. You have an ownership stake in all the big markets like the New York Stock Exchange, Nasdaq, COMEX, NYMEX, and the London Metals Exchange.

    Unlike a small or medium sized institutional investor, you are in a position to be dishonest, if you choose to be, and in a position to profit from your dishonesty. Because all orders flow, at one point or another, through your firm or one of a handful of other big wire houses, you will know where the stop-loss triggers of non-affiliated long and short sellers are. With this in hand, you are ready to manipulate any market, especially small commodity markets like gold and silver.

    The first thing you need to do is issue large numbers of false paper claims to allegedly stored gold and silver in your vault. This gold and silver really doesn’t exist, but it doesn’t matter because you are a big prestigious bank, and no one questions you when you say it is in your vault. You offer these claims for “lease” to any secondary dealer willing to take you up on it. You don’t want to sell them outright, because then you might eventually be faced with a demand for the real metal, as Morgan Stanley was. You don’t actually have enough real metal to cover these claims, so, you want to make sure that the operation takes place in a limited time frame. That’s why you “lease” the claims for a term of months. If you find that small dealers are afraid to lease such claims, you encourage them by subsidizing the leases with a negative interest rate. In other words, you pay them to accept your alleged gold and silver.

    This is exactly what is happening in the precious metals market, right now. Gold and, especially, silver leases are being subsidized. As of a week ago, if you are a dealer, and you lease gold or silver, from the bullion banks, incredibly enough, THEY WILL PAY YOU! At the end of this article, I have attached a chart, showing the current negative lease rates for the various metals. Dealers who lease claims to fake metal, are able to issue futures contracts and other derivatives. The fact that they hold contractual claims to metal means they will have fulfilled the “cover” requirement imposed by their federal regulator, CFTC. The CFTC has never bothered to audit a vault to see if the gold or silver is really there, so you’ve got nothing to worry about. You’re a big bank! You say it is there. Everyone believes you, just like Morgan Stanley’s customers believed them. You might even be Morgan Stanley.

    At any rate, you initially issue a lot of claims to fake metal, and so many futures contracts are written, in a very short time period, that they flood the market on exchanges like COMEX and the London Metals Exchange, where almost all the transactions are on paper, and real metal rarely changes hands. Meanwhile, if you are the big bullion bank, you know what you are doing. You issue just enough subsidized precious metal paper to automatically trigger stop-loss orders. The price starts going down as the sell orders are filled. That triggers yet more stop-loss orders, and the process becomes one of dominos, falling one after another, until the price collapses. If the operation is successful, and the collapse is big enough, market confidence is destroyed, on a wide scale.

    The destruction of market sentiment won’t last forever. You can’t fool all the people all of the time. But, temporarily, having been burned badly, investors refuse to buy. Buying may still be happening on the real market, as it is, in both America and India, in gold shops. True physical metal will still be in severe shortage, so the metal will disappear quickly, as the price goes down below where true market forces should be bringing it to reach equilibrium between supply and demand. But, real market buyers look to the COMEX and the London Metals Exchange, because they think they are honest exchanges, even though they may not be.

    Prices on those exchanges will determine prices charged in shops, and when the price goes down deeply, there isn’t enough product to go around, because everyone buys it. In other words, supply and demand go into disequilibrium, there isn’t enough supply to meet the demand at such low price points, so delays in delivery, as well as outright shortages result. That is what is happening, right now, in the physical gold and silver market. Not only to retail investors, but, also, even to the U.S. Mint, which has suspended production of gold coins, and is rationing silver coins.

    At any rate, when market confidence is damaged sufficiently, we can move in. We unwind our new short positions in the futures market, by buying back huge number of long positions at very low prices on the COMEX. We also unwind an exponentially larger number of positions inside the shadow world of "dark pools", which are little known secretive private exchanges, controlled by the big banks. It ended up costing us some money, but not a lot compared to the money we’ve avoided losing. We’ve paid subsidies on the leases, but we’ve never actually had to buy the gold or silver, because there isn’t any available, and none in our vault. This is the way that a group of big bullion banks could induce a price collapse to unwind hundreds of billions of dollars worth of potential losses, or position themselves to go long on hundreds of billions of dollars worth of potential profits.

    Contrary to the pundits at CNBC, Bloomberg, etc., the price of gold really has nothing to do with the value of the dollar or the value of oil. It doesn’t matter what the dollar is worth, in relation to euros, pounds sterling or Zimbabwee money. It only matters what supply and demand factors exist for gold. Yes, the demand will fall a bit if the price goes up, for example, in euros, because the euro has depreciated. But, what really counts is not what the euro, yen or dollar price is, but, rather, whether or not there is enough demand to soak up the available supply.

    Gold is priced in dollars, but, so long as people holding either dollars, euros, yen, yuan or Zimbabwean money, are willing to pay whatever price gold is selling for, in an honest market, the price should rise. Obviously, enough people are willing to pay for gold and silver, at the previous $978 and $19.50 per troy ounce price, because the U.S. Mint could not source enough metal at those price, and had to suspend coin production.

    This proves that people are more than willing to fork over, in whatever currency they are using, the previous prices for gold and silver, in such quantities, that a shortage was already existing, before the price collapse, especially in the silver market. It is true that people in poorer countries like India, might have back on their consumption.

    But, while they were cutting back, demand and consumption of gold in North America, including Canada and the USA, was soaring. For example, before it suspended production of bullion coins, due to shortages, the U.S. Mint’s statistics show that it was printing 2.5 times as many gold coins, and almost 4 times as many silver bullion coins, this year, compared to last year. Gold and silver bullion, in bar form, was also flying off North American retail shelves.

    Bottom line: Enough people were buying, when the price was high, to exhaust the supply. Basic economics says that, in a free market, this means the price must rise.

    But we don’t live in a world of free markets. Instead, we are living in an Orwellian 1984 double-speak world. Welcome to the world of Fed/PPT, where 2+2=5, blue is yellow, and black is white. All things are as they say they are, rather than as they really must be. Welcome to the world of a controlled business media, where the pundits will do anything and say everything to convince you to forget your math, and your eyesight. No, they tell you. It really isn’t so. What you’re seeing isn’t the way it is. Believe, instead, what we tell you. We can do it! We have special skills. There is a new world order. We can make 2+2=5. Just give us your money, and we’ll show you how!

    But, let’s return to reality. Right now, virtually no North American precious metals dealer can give you a firm delivery date on large quantities of silver. They have no stock to sell. This means demand is robust. On Friday, as the COMEX gold price was collapsing, the U.S. Mint suspended gold bullion coin production because it cannot source enough gold bullion! That could not happen if bullion banks were selling claims to real physical metal into the marketplace. Indeed, the Mint began rationing silver bullion coins two months ago, when it started having trouble sourcing silver bullion. Word from the Perth Mint in Australia is that it is taking weeks or months to take physical delivery of gold and silver, even though investors are already supposed to own that metal. Supposedly, it is simply being kept in the Mint's vault for safe storage. But, it is getting harder to take it out of “storage”. Meanwhile, as previously stated, Indian gold and silver dealers, wholesalers and banks all have empty vaults. None of this can happen if demand is down, and supply is abundant.

    We have a disconnect between reality markets and fantasy markets. The COMEX and London Metals Exchange are fantasy markets controlled by the big bullion banks. They must be engaged in market manipulation, because nothing can explain a big price collapse, in the midst of widespread shortages and robust demand. A group of big financial institutions, deeply enmeshed in the global trading system, and heavily involved in the gold and silver market, must be deliberately inducing temporary panic, for their own purposes. These malevolent characters will eventually be able to buy back their short positions at low prices, and, possibly, also, even collect a significant long position. The process is a continuing one, and hasn’t stopped yet. On Friday, for example, the subsidy for leasing gold and silver was raised to very high levels.

    It is obvious what they are doing. More important, however, is why? What does it mean? Well, the PPT bank executives are generally “people in the know” about financial events, before they actually happen, sue to close relations with regulators like the Federal Reserve, and FDIC. They folks are so desperate to cover short positions, that they are willing to spend a billion or so dollars, subsidize precious metal leases, to collapse the market, and destroy investor confidence. But, why? We know that the Federal Reserve, like other central banks, sees gold as a rival to the dollar. But, that’s not enough, because they’ve never attacked precious metals with such ferocity as now, and, if the Fed were directly involved, they could probably supply real metal.

    If something terrible is about to happen in the financial world, the losses that big banks would take on their precious metal short positions would put most of them into bankruptcy. Remember the words of Warren Buffett. Derivatives are the financial world’s weapons of mass destruction. Precious metals futures short positions are highly leveraged transactions that could cost hundreds of billions if the price of gold were to suddenly explode.

    We can guess that the main players here are big powerful Wall Street and/or High Street investment banks who work closely with the Federal Reserve, the ECB, and the Bank of England. These people are privy to the information needed to carry out a massive manipulation as described above. No one else is. Since most of the collapse happens on the COMEX, we can assume that most of the manipulation is being done by New York based investment banks.

    Wall Street’s investment banks control most of the world's gold and silver markets. They are also entrenched in the overall mesh of all financial markets. Making matters worse, because of the 1987 President’s Executive Order on Working Markets, they are authorized to work together, and in conjunction with the U.S. Treasury and the Federal Reserve, to manipulate markets without fear of criminal prosecution. They know exactly where the stop-loss orders are, and how much flooding of paper claims for gold and silver would be needed to trigger them. They are, therefore, perfectly positioned to carry out the nefarious scheme I have outlines. The ultimate aim, of course, would be to destroy investor confidence, by collapsing the price for a few weeks. This would allow them to unload their own exposure at a very low cost, while the majority of market participants are temporarily shell-shocked, and in retreat.

    As noted above, they are not using real gold or silver to do this. That implies that this particular attack on gold was not authorized by the Federal Reserve. They’ve never had any real silver and have used paper claims for years to manipulate that market. But, gold has often been supplied out of the U.S. hoards at Fort Knox, West Point, or the NY Fed. I suspect all three have had their gold hoard so heavily loaned and swapped out, that there is little or no physical gold left to play with. That’s why the Federal Reserve has been pushing for the IMF gold sales. The vaults are probably already filled with IOUs from the likes of Goldman Sachs, JP Morgan, etc. Perhaps, that is why the Treasury Department lists total U.S. gold holdings as "gold and gold swaps", and refuses to disclose details how much consists of real gold and how much consists of swap IOUs (loaned out gold). But, anyway, the lack of physical gold probably implies that the Federal Reserve is not involved directly, because they probably still have enough to flood the market for a week or two.

    But, it’s not cheap to manipulate markets. It will probably cost over a billion dollars to subsidize the negative lease rates. The only logical reason to spend such a huge amount of money, is if you are going to get an even bigger benefit from doing so. They must be very worried about losing far more. Once again, that implies that some VERY bad economic news is about to be released. Skeptical? How much worse can the economy get? It can get much worse! So, what’s in store? A series of huge bank failures, maybe? IndyMac collapsed two weeks ago. Are we going to see the collapse of Washington Mutual (WM)? National City Bank (NCC)? Someone else?

    I don’t know. But, I do know this. The FDIC will not have enough cash to make good on its insurance pledges, if they fail. The FDIC only has $37 billion left in its trust fund, after paying off IndyMac depositors. Between its two major divisions, WaMu has total deposits of about $204 billion. National City has about $101 billion. Could FDIC turn to the Federal Reserve for a quick loan? Not a chance! The Fed has its own problems. It has already polluted its balance sheet with some $450 billion in low value and absolutely worthless mortgage paper that its client banks wanted to get rid of.

    Depositors might wait months for their money, while Congress is petitioned to approve the sale of more Treasury bills. This delay would be likely to cause other depositors to make a run on other banks, creating a domino effect. Then, more banks might fail. More bank failures will require yet more dollars, and cause more delays in making depositors whole. At the very least, the sudden issuance of $300 billion new dollars would stimulate massive inflation. Under such circumstances, gold could be expected to explode to the $2 - $3,000 per troy ounce range, within a matter of a few weeks or months.



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  3. #2

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    Thanks for the article. It seems very plausible this is what is happening.

  4. #3

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    Damn good article and quite detailed in his assessment of what is going on behind the curtain.

  5. #4

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    here's another explanation:

    "Where's The Kaboom?"

    Take your pick last night. Right after the market closed, the dollar started strengthening again. A lot.

    Then, suddenly, the floor dropped out of Gold, and the S&P 500 Futures spiked HARD, with over 2,000 contracts bought at the market.

    A few hours later, it happened again. And at 4:30, once more!

    What in the Sam Hell is going on?

    Simple, really. See, there are what - 8,000 hedge funds? Well, for 7,999 of them (up until the last few days anyway) they have all been in one trade, more or less - short dollar, long energy, short financials.

    Nice, if and when it works.

    But now that trade has been unraveling at a frightening rate. As the dollar has gotten stronger it has squeezed people. Hard. See, these guys are not just investing the money they get from rich folks all over the world - they are taking that money and borrowing, then investing that.

    So when these bets go bad - oil falls, the dollar goes higher, or any of the "parameters" they've been working get the rug pulled out from under them, they have a huge problem, all at once, and they have a very bad hair day.

    That's happening. In spades.

    This is where the "recovery" has come from in the stock market the last month or so - you kick the shorts in the nuts and they cover, then the lemmings rushing in, once again listening to the idiotic calls of "the bottom is in" from media outlets like CNBC that will shove a microphone under the snout of anyone who toes that line.

    This trade started unwinding slowly, but in the last week or two it has gotten very disorderly and so have the markets.

    As credit has continued to deteriorate the weaker hands get flushed and forced out. This causes them to have to buy back their short dollar trade, which spikes the DX. THAT in turn spooks someone else, who then covers a big futures short, which in turn freaks out someone in the gold market, and they dump a big long.

    Rinse, repeat, and continue until the dead bodies are all piled on the floor and only the cockroaches are left scurrying around.

    Oh, and those very same Hedgies are some of the guys "guaranteeing" the credit in these default swaps, which means as they go down, credit continues to blow wide, never mind the actual deterioration which is far worse than claimed because these so-called "guarantors" can't actually pay.

    What you need to understand is that there is nothing that can be done to stop this. Not by the government, not Bernanke, not The Fed, nobody. The overly-geared will die, one by one, until there is nobody left who has too much gearing on for the trade and credit risk they took.

    What's worse is that some of our "big institutions", sensing this - that credit quality is deteriorating very, very rapidly, are looking for someone, anyone, to offload the bag to. Over the last few months they've found a few people they can try to throw the bag at - maybe those with poor risk controls, with automated trading systems that aren't actually verifying anything, and perhaps there's a bit of a pollyanna view at a few of them too?

    If you can't find those folks because there aren't any of that sort buying the debt you're desperate to unload (since you know its going to go "boom!") then the next move is to "sell" that debt to some private equity guy but carry back the financing (in some cases on a non-recourse basis!), as several folks have done recently, which makes it look like you got 20 cents on the dollar when in fact you only got 5. For the Hedgie or P/E guy who makes the bet, its not a bad deal - they have a defined risk trade, like a CALL option. For you, the writeoff is real but its 75% less than it should have been, with the rest sitting out in limbo pending the truth being discovered in the fullness of time (when the deal blows up and your "non-recourse" deal comes back at you like a boomerang.)

    How many of those folks will die, and what impact will it have on the credit markets in general? I can't quantify it accurately - I don't think anyone can. But what is obvious from the magnitude of these "little tremors", and the rapidly increasing rate at which they are coming, is that:

    1. Its very bad.
    2. Its getting worse, at an increasing rate.
    3. A number of supposed "liquidity providers" have either been gamed (and this has not been recognized and reported to the public) or they're "buying" this debt with carried-back loans, making their actual risk of loss tiny compared to the nominal "value" transferred. In other words and to put it in terms "Joe Q Public" can understand, everyone is still lying!
    4. There is a "supercritical" point where all asset values will get hit at once, unless the process runs to exhaustion first, and I don't think there is a snowball's chance in Hell that it will.

    I may be wrong about the impending supercriticality, but if I'm not, well, it would be a good idea to be sure you are in safe places with your money.

    Equities and debt other than treasuries would be in the "not" column on the list of safe instruments, and note carefully the very specific constraint on exactly what sort of debt is safe - all other, and I do mean all, is not.

    Comport yourself accordingly.
    source: http://market-ticker.denninger.net/a...he-Kaboom.html

  6. #5

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    Damn straight they are manipulating the market with paper backed by nothing. There's no damned difference between a paper promise for precious metals vs a federal reserve note. And for Peter Schiff to recently urge his people to buy into Perth Mint, makes me think he's also going to cash in big time on this.
    Maxed out to ALL of Ron Paul's campaigns.

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  7. #6

    Default Regarding the U.S. Mint

    Minting coins to present demand is the way the US Mint has operated, and still operates. As long, that is, as their suppliers can supply them with sufficient inventories of gold coin blanks to meet such demand. When they can't, the Mint has to suspend sales to primary distributors/wholesalers, while their coin blank inventories are being replenished. Once that happens, striking of the coins resumes, and so do sales to the market. NONE of this implies that the US Mint HAS STOPPED the coin programme, or will not resume.

    Obviously, since the Mint does not produce coins in advance, without gauging how many or how few it can sell (and it has had some lean years on record to be sure) and produces coins to demand, there will always be the possibility of such lags. They can and do contract coin blanking to the outside world. However, please realize that melting, forming, blanking, weighing, striking, packaging and shipping the equivalent of 5,000 coins per hour is (based on recent monthly sales figures) not an insignificant task for any of the Mint's suppliers, or the Mint itself.

    This is exactly what happened last week. when, after strong primary dealer demand but insufficient coin blank supplies on hand, the Mint decided to temporarily suspend the sales of the American Eagle Gold Bullion One Ounce Coins. The Mint is in the process of building up its inventory of one ounce coin blanks and struck coins, before resuming. No exact timetable for that has yet been offered. In the meantime, other 22 karat and 24 karat bullion coin product options remain available for the moment.

    As for the American Eagle Silver Bullion Coin Program, it is a legislated/mandated programme. The proof ("numismatic") versions of those coins are NOT legislatively mandated. Accordingly, with demand exceeding their contracted suppliers' abilities to provide a sufficient quantity of silver bullion blanks, it was decided that the Mint should not be diverting silver blanks from a legislatively required program (bullion) to produce the proof or non-legislatively required coin.

    Accordingly, it was announced back in June that the US Mint would not divert anymore silver blanks away from the bullion program to produce proof Silver Eagle Coins. After that announcement, they continued to sell American Eagle Silver Proof coins until existing inventories were depleted which occurred a couple weeks ago. True their announcement sent out last June, the Mint has no plans to produce any additional Silver Eagle Proof Coins until inventories of silver bullion coins can be replenished to a level that meets demand (i.e. get back to levels that allow them to sell these in a non-allocated unrestricted fashion).

    All of this will pass, and things will return to normal. There is NO shortage of the raw materials required to make coin blanks or coins from (i.e. 400 ounce gold bars, 1000 ounce silver bars). A shortage of adequate supplies of coin blanks is not the same thing as a shortage of gold or silver bullion in the marketplace. Or of a 'huge' disconnect between futures and physicals, or of some other nefarious activity. However, various forums and newsletter writers have chosen to hype the situation and have called it anything from the precursor to confiscation, to a mass stampede into bullion by the public, to the end of the world as we know it. They could not be more wrong. Customers who understand the above, and who wish to buy the products that are slow in coming, should not hesitate to place orders and lock in prices (if they like the current levels) and simply and patiently wait for their bullion dealer to receive their coins and to ship same to them. Of course, if they simply cannot or will not wait, bullion dealers can offer them alternatives which are currently in stock. Shop around. You do not have to start with Kitco.
    http://www.kitco.com/ind/nadler/aug182008B.html
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  8. #7

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    Quote Originally Posted by LibertyEagle View Post
    i dunno that article i posted was just trying to explain why prices were plummeting yet demand still seems to be high, which you at least must agree doesn't quite add up?

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    Methinks it is time to sell the ETFs and start building up the physical hoard...

  10. #9

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    Quote Originally Posted by Thrashertm View Post
    Methinks it is time to sell the ETFs and start building up the physical hoard...
    Good luck. It sounds like we're reduced to buying jewelry at the pawn shop to me...
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  11. #10

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    Quote Originally Posted by Thrashertm View Post
    Methinks it is time to sell the ETFs and start building up the physical hoard...
    going to let the IB's shake out your weak hand?
    No more Mr. Bad guy

  12. #11

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    Contrary to the pundits at CNBC, Bloomberg, etc., the price of gold really has nothing to do with the value of the dollar or the value of oil. It doesn’t matter what the dollar is worth, in relation to euros, pounds sterling or Zimbabwee money.
    This is what I've always said. My youngest brother (who passed away recently, very unexpectedly) used to call me all the time to exclaim, "They're hammering gold again, did you see it?".

    I always told him the same thing: The price of gold is irrelevant. It's not a fiat currency and can't be valued against one. It's not a commodity and can't be valued against one. It's THE standard of value. Everything else is valued against gold.

    The NY banks exist because of the gold in their vaults. Whether it's really there or not doesn't matter (as long as it's never audited). Take away the gold and they cease to exist.

    The system of credit they created 300 years ago was based on gold in the vault. That fact has never changed, nor will it change as long as the present system exists.

    They use gold to issue credit to steal hard assets, to finance wars and to gain control over a country's laws for worthless paper.

    When the crap hits the fan, gold will be what it has always been: THE standard of value.

    Gold is mentioned in the Bible 437 times, always as a standard of value (excluding 'golden', 'goldsmith(s)' and 'goldwork').

    There is no possible scenario that better depicts the crap hitting the fan than the day of God's wrath. "Neither their silver nor their gold will be able to deliver them in the day of God's wrath..." Zephaniah 1:18.

    Some have misinterpreted this to be telling us that silver and gold will be of no value as the system unwinds, but it clearly tells me that "they" will certainly believe that it will be of ultimate value, otherwise it has no relevance to the Scripture.

    In the 20s, when the German fiat currency became utterly worthless through inflation (4.2 trillion Marks to a dollar), you could buy a whole block of homes for 50 grams of gold. 80 years later, do I believe it has fallen in value against some newly created fiat currency or oil? No way.

    Bosso

  13. #12

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    Quote Originally Posted by Bossobass View Post

    In the 20s, when the German fiat currency became utterly worthless through inflation (4.2 trillion Marks to a dollar), you could buy a whole block of homes for 50 grams of gold.
    Where did you get that nice little bit of trivia?

  14. #13

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    Quote Originally Posted by Paul.Bearer.of.Injustice View Post
    going to let the IB's shake out your weak hand?
    What does IB mean? International bank? How does selling the ETF and buying the physical metal constitute defeat?

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    Well certainly it is best to be diversified, but I emphasis stocks of the mining companies that produce the gold. That's where you want to put your money in my opinion.

  16. #15

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    Quote Originally Posted by Arklatex View Post
    Well certainly it is best to be diversified, but I emphasis stocks of the mining companies that produce the gold. That's where you want to put your money in my opinion.
    What are some mining companies. I'd like to invest SOME money cause I usually end up wasting it on crap. Least if I lose it I can say I tried to do something good with it and the end result is the same LOL.
    "Anarchists oppose the State because it has its very being in such aggression, namely, the expropriation of private property through taxation, the coercive exclusion of other providers of defense service from its territory, and all of the other depredations and coercions that are built upon these twin foci of invasions of individual rights." -Murray Rothbard

  17. #16

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    Quote Originally Posted by noxagol View Post
    What are some mining companies.
    IAG is one I own, it's a small medium sized miner , a bigger one is Barrick Gold ABX. Ron Paul owns both of those BTW and there's a ton of smaller ones out there. I love mining stocks! AUY is popular and I've seen Taskeo recommended on these boards.

    My best advice is to just put your money in GDX, it's an index of many major miners including some of the ones I mentioned.





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