was sitting on 29 skids @ 28,000 lbs of fiche which equates to aprox. 385 lbs of pure silver considering my assay on this grade of fiche was very high. 1.4 grams per 1000 grams of micro fiche. It's around 4 dollars per lb or 6000 ounces of silver. Now, I won't mention names but I was unable to setup a bullion account with this company because they don't setup accounts anymore so I can't hedge the market. The day you deliver. You get paid spot on the Comex. So I simply parked my product and waited. Now talk about a squeeze play. Would you believe that this company called me today [Friday] @ 10.50 silver and quoted me 16.00 per ounce with room to negotiate??? “
Thanks for the post, roadrunner. This says it all.
Q: Are You Printing Money? Bernanke: Not Literally
SPOOKY STATS FROM THE U.S. MINT by The Mogambo Guru
I had just gotten off the phone to find out why the silver I ordered last month has not arrived, and I get some runaround about how there is no silver to be had to fill my order. Naturally, being familiar with how the supply/demand dynamic works, I call the little clerk a lying piece of thieving garbage, because it is impossible that the market price of silver is going down in an environment of zero supply and obviously rising demand!
Well, the phone mysteriously went dead right after that, and before I could call him back and REALLY tell him off, I see where this is common right now, as Theodore Butler says that “Premiums are up and delivery delays are longer. This is something we are all witnessing for the first time.”
And James Turk at Free Market Gold & Money Report notes that it is the same thing in the gold market, too!
He says that a normal person would assume that the size of the working stock of gold held by the United State’s Mint to make the popular Gold Eagle coins and miscellaneous trinkets would vary “from month to month, just like inventory varies from month to month in any business as a result of changes in production and the ebbs and flows in sales.”
It gets spooky when he goes on to note that “indeed, the Mint’s inventory did vary monthly, up until March 2006. But according to the Treasury’s reports, the Mint’s working stock has remained exactly 2,783,218.656 ounces since April 2006. How is it possible that the Mint’s working stock has remained unchanged for 28 months?”
Instantly I was on my feet, shouting, “Because they are all a bunch of lying, corrupt scumbags exploiting a fiat currency and insane levels of fractional-reserve banking, which is the very reason why you should be buying gold and silver in the first place!”
I thought, you know, that this witty interruption of mine would impress Mr. Turk, and so I sat back down with a big smile on my face and crossed my arms in smug self-satisfaction as I waited for him to shower me with praise, and maybe offer to buy me a drink, or a pizza, or let me use his car for a couple of hours or days.
Sure enough, he immediately said, “There are an infinite number of possible answers. Maybe the Treasury does not want to part with its remaining gold at these current low prices. Maybe the Treasury does not want Americans to exchange their fiat dollars for the safe haven of gold as the central banking fiat money scheme implodes. Maybe the Mint doesn’t have any gold because the 2,783,218.656 ounces were loaned out. Maybe the Treasury doesn’t have any gold either. Of course, no one really knows because the Treasury isn’t talking.”
I sure wish these funds had to disclose what they are buying, no where is safe anymore. You'll have to click the link within this one since Market Watch all one word is considered a bad word on this site, unreal.
It's interesting that copper is continuing to drop and is now down to $3.05/ Lb. This could squeeze silver supplies pretty strongly and hold up silver prices even in a recession since most silver production is a byproduct of copper production.
There's already a squeeze on physical silver and a reduction in mining would show up pretty dramatically. While it's true that any decrease in copper price implies a slow down in economic activity, silver is used in more high tech products and somewhat less susceptible to decreas- ing demand than copper.
While silver has been pretty unimpressive lately this could change very suddenly if the economy avoids recession and copper prices continue to erode.
One imagines a lot of "industrial" silver is already being diverted to cap- ture the huge premiums on the physical market and a reduction coming from the mines could send these markets into panic buying.
<< <i>It's interesting that copper is continuing to drop and is now down to $3.05/ Lb. This could squeeze silver supplies pretty strongly and hold up silver prices even in a recession since most silver production is a byproduct of copper production.
There's already a squeeze on physical silver and a reduction in mining would show up pretty dramatically. While it's true that any decrease in copper price implies a slow down in economic activity, silver is used in more high tech products and somewhat less susceptible to decreas- ing demand than copper.
While silver has been pretty unimpressive lately this could change very suddenly if the economy avoids recession and copper prices continue to erode.
One imagines a lot of "industrial" silver is already being diverted to cap- ture the huge premiums on the physical market and a reduction coming from the mines could send these markets into panic buying. >>
my thoughts too. i have been noticing this for a few days, too...not that i know anything, but i have noticed that copper moves like a commodity not so much as a PM.
It seems this is the ultimate game of the blind leading the blind, or one might say the broke helping the busted. It is not a good idea for the FED to be broke already. This derivative unwinding has just begun and the domino’s are falling.
With so many big firms going into one type of liquidation or another we are going to see a true mark to market of trillions of dollars in derivatives within the next few months, and who will the buyers be HUM?
Sept. 17 (Bloomberg) -- The Treasury will sell more debt to enable the Federal Reserve to expand its balance sheet, a sign of the strains created by the biggest extension of central-bank credit to financial companies since the Great Depression.
The proceeds will ``provide cash for use'' by the Fed as it seeks to boost liquidity in credit markets struggling from $515 billion in writedowns and losses since the start of last year.
Oh, yes and gold is up $88.50 just today!!!!!!!!!!!!!!!!!!!!!!!
"With so many big firms going into one type of liquidation or another we are going to see a true mark to market of trillions of dollars in derivatives within the next few months, and who will the buyers be HUM?"
Why do we need buyers? The company just becomes insolvent and seeks reorganization, toxic things go poof, life is good.
What I was really referring to was asset liquidation, many of the firms themselves will be gone. When these assets are forced to be liquidated the true values of these pieces of paper will set a market, and then EVERYONE holding them will be forced to mark to a real market.
<< <i>"With so many big firms going into one type of liquidation or another we are going to see a true mark to market of trillions of dollars in derivatives within the next few months, and who will the buyers be HUM?"
Why do we need buyers? The company just becomes insolvent and seeks reorganization, toxic things go poof, life is good. >>
"...then EVERYONE holding them will be forced to mark to a real market."
Yepper, that's going to leave a mark.
It is peculiar how gold and silver were always called speculation by all the equities people and stocks were called investment portfolios. In our current reality, stocks are the speculative instruments and gold and silver are the investment portfolio...funny how the world works.
Reminds me of..."If it walks like a duck and quacks like a duck..." We were calling this scenario two years ago here and rat holed PM's as fast as we could and everyone was calling us fools but we kept stating the realities of our pending economic situation and saying that things haven't changed, there are still issues to be reckoned with but they kept calling us fools. We said "nothing has changed and nothing has been fixed", we kept buying metal and telling people to buy metal; fools they said. Then the PPT forced the weak hands and hammered the spot and people were yelling "See...Fools you are!" Now it is hard to buy real metal, only paper etf's seems to be easily available, and the economic wolf is walking down the street, knocking on doors. If fools we be than we be safe fools and maybe a little happy too.
Now, if we can't get the metal and the etf's are taking up the slack in demand for those that can't get Physical and if apmex is BUYING because they can't fill their orders then what is supposed to happen to those etf's that have physical in place for each share ordered? Maybe they will let the etf's do a fractional reserve policy too, like the banks? The reality of what's happening is that there is a run on PM and what they have scared out of the weak hands and newbies is already sucked up and the miners are not in any big production mobilization...what do people think will happen. Lets talk about the POG, baby; let's talk about fools.
With spot and physical being decoupled as it is now because of the influence of the etf's, it should be very interesting to see what happens to spot when all this hits and even more interesting if the etf's get audited...DO IT!!! Warehoused metal
<< <i>... It is peculiar how gold and silver were always called speculation by all the equities people and stocks were called investment portfolios. In our current reality, stocks are the speculative instruments and gold and silver are the investment portfolio...funny how the world works.... >>
Wow - that is a great observation, made painfully evident in our current light.
There are some who say that there is no shortage of silver... just a shortage of the type of silver. And they always pointed out, as evidence, nearly every bullion dealer had plenty of it in the form of 1000 ounce bars. Well, 2 days ago, Tulving had 90 of those available. Guess what... today, sold out! shows me that some big money has entered the market.
There are some who say that there is no shortage of silver... just a shortage of the type of silver. And they always pointed out, as evidence, nearly every bullion dealer had plenty of it in the form of 1000 ounce bars. Well, 2 days ago, Tulving had 90 of those available. Guess what... today, sold out! shows me that some big money has entered the market.
TC
It would be interesting to compare the amount of paper money available in the world to buy the PM’S now, and the amount of PM’S available now, to those same numbers from 1980.
There has been so much paper printed and moved around the world in the last 28 years I think the physicals could be gone in just a few weeks if the panic really gets going.
At no time in the late 70”s and early 80’s was there a time that you could not buy bars or coins.
Yesterday Kitco said they were uping their bid price on coins because of shortages.
Kitco this morning:
The following products have been temporarily removed from our Precious Metal Store until further notice due to production and delivery delays that retailers are currently facing; 1 oz Gold bars, 1 oz Kitco Gold bars, 10 oz Gold bars, 1 oz Silver Eagles, 1 oz Silver Maples, 1 oz Silver Philharmonic coins, 1 oz Olympic Silver Maples, 100 oz Silver bars and 1 oz Palladium Maples.
<< <i>There are some who say that there is no shortage of silver... just a shortage of the type of silver. And they always pointed out, as evidence, nearly every bullion dealer had plenty of it in the form of 1000 ounce bars. Well, 2 days ago, Tulving had 90 of those available. Guess what... today, sold out! shows me that some big money has entered the market.
TC
It would be interesting to compare the amount of paper money available in the world to buy the PM’S now, and the amount of PM’S available now, to those same numbers from 1980.
There has been so much paper printed and moved around the world in the last 28 years I think the physicals could be gone in just a few weeks if the panic really gets going.
At no time in the late 70”s and early 80’s was there a time that you could not buy bars or coins.
Yesterday Kitco said they were uping their bid price on coins because of shortages.
Kitco this morning:
The following products have been temporarily removed from our Precious Metal Store until further notice due to production and delivery delays that retailers are currently facing; 1 oz Gold bars, 1 oz Kitco Gold bars, 10 oz Gold bars, 1 oz Silver Eagles, 1 oz Silver Maples, 1 oz Silver Philharmonic coins, 1 oz Olympic Silver Maples, 100 oz Silver bars and 1 oz Palladium Maples. >>
I wonder who bought the over 3 tons (troy)? Do you think it was one buyer? less than a handful? the US Tresury? the UAE? BTW GS, Kraft is replacing AIG on the DOW 30 effective Monday.
Fox News just announced the NY Atty General is starting an investigation of Wall Street Firms selling short. I can not find an article on it for details yet....
A few pundits have compared the successful dodging of the S&L bailout to today's credit crisis: "we beat it then, and today will be no different."
Here's what's different (courtesy of MinedoverMatter at GIM):
The total price tag for the entire S&L bailout converted to today's inflated dollars is $216 BILLION. Well, just this week alone the FED has tossed in over $500 BILLION at the problem and we aren't anywhere near a resolution or even uncovering the majority of the supposed "assets." In the process we "only" lost Fannie, Freddie, BSC, Lehman, and had to buy out AIG. I didn't see anything like that in the 1990's. Anyone recall losing Fannie and Freddie during the S&L mess? We're probably over $1 TRILLION "invested" into the current crisis and on our way to $10-20 TRILLION if things go fairly well. We can recover from that. If it gets to multiple of that, all bets are off. We had nothing like $1 QUAD in derivatives during the S&L crisis. This ain't your father's or your S&L crisis. That's like comparing the Dutchy of Fenwick to the USSR.
People buy PMs for several reasons... here are two: 1. As a safe harbor in times of financial crisis 2. As a hedge against inflation
As far as reason #1, the announcement of the new Resolution Trust may have boosted confidence in the financial system enough to avert the crisis and cut demand for PMs for quite a while.
As far as reason #2, yes, the Resolution Trust does look extremely inflationary as the government injects hundreds of billions into the financial system. But, with banks and investors frozen with fear and holding onto their cash, it could be months or years before we see the effects of that new monetary inflation.
I have no idea what the short term holds. But over the longer term, I think inflation is a big threat, and holding a significant percentage of your assets in physical PMs is a smart move. Finding the percentage that enables you to sleep at night is important.
From the chairman of the Senate Banking committee, Chris Dodd (D), the United States could be "days away from a complete meltdown of our financial system" and Congress is working quickly to prevent that.
From Paulson 9-19-08 1149
We have acted on a case by case basis in recent weeks...fannie, freddie, Lehman Brothers, and AIG. This morning we've taken a number of powerful tactical steps to increase confidence in the system, including the establishment of a temporary guaranty program for the US money market industry.
Despite these steps, more is needed. We must now take further, decisive action to fundamentally and comprehensively address the root cause of our financial system's stresses.
OK, great I feel much better now. Now where is that sell button.
The gov't hasn't produced two quarters of negative GDP.
Technically we aren't even in a recession.
Yet, these Sunday afternoon deals and last night's deal smells of a depression.
Who's panicking? We've been watching this slow train wreck for 4 years.
If one used the same GDP formula used in 1980 and 1990, we'd already have something like 80% negative GDP quarters going back to the end of 2006. This is BEA smoke and mirrors, not accurate charting. The GDP inflation deflator is keeping this stat right where the govt wants it. What you really should have said is that we haven't put togther 2 quarters of back to back honestly positive GDP in a couple of years. We're definitely in a recession. And without these interventionary FED tactics, we'd be in a depression.
I do not understand why we need a new RTC when we have Freddie?
Sept. 19th 2008
NEW YORK (MarketW) -- Freddie Mac's (FRE:
Freddie's cup of woes runneth over as Lehman Brothers Holdings Inc. (LEH: defaults on 1.2 billion dollar loan.
Lehman defaulted on $1.2 billion in borrowings - and interest on the loan - from the ailing mortgage finance giant, according to a filing Thursday with the Securities and Exchange Commission.
Freddie extended $1.2 billion of short-term unsecured loans to Lehman in late August, and Lehman didn't repay the borrowings when they came due on Sept. 15. Lehman is in the midst of bankruptcy proceedings that started Monday.
A Freddie spokesman said the loans were a part of Freddie's ordinary investing activities.
"One thing I am a little surprised about is that it's unsecured," said Frederick Cannon, chief equity strategist at Keefe, Bruyette & Woods Inc. "I would think most of the dealings (between Lehman and Freddie) would have mortgage securities as collateral," said Cannon. "The amount that was unsecured is somewhat surprising but these are large institutions."
The gov't hasn't produced two quarters of negative GDP.
Technically we aren't even in a recession.
Yet, these Sunday afternoon deals and last night's deal smells of a depression.
Who's panicking? We've been watching this slow train wreck for 4 years.
If one used the same GDP formula used in 1980 and 1990, we'd already have something like 80% negative GDP quarters going back to the end of 2006. This is BEA smoke and mirrors, not accurate charting. The GDP inflation deflator is keeping this stat right where the govt wants it. What you really should have said is that we haven't put togther 2 quarters of back to back positive GDP in a couple of years. We're definitely in a recession. And without these interventionary FED tactics, we'd be in a depression.
What I should've done is put one of the winky-winky's at the end. Sorry the sarcarsm wasn't apparent. I do agree that if traditional methods were adhered to we would be in a recession and probably going into a depression....which is how many quarters of negative GDP. roadrunner >>
That's the government bailout plan currently being devised for the financial meltdown. Some of the details coming out.... the government can buy up any failing financial institute it wants to for the next two years...... and any decision the Treasury department makes in regards to any bailouts, etc., will not be subject to any lawsuits. Sounds like no recourse if any of us are adversely affected by this.
I have mixed feelings about this bailout. While it is great to know any money I have in money market funds will now probably be safe (might not make any money, but probably won't lose any either), the thought of the markets now being controlled by the government somehow does not give me a cozy feeling. The markets in effect have been nationalized, IMO.
Welcome to the USSA.... United Socialist States of America
How will $700 BILLION cover the percentage of the $1 QUAD derivatives losses to come? That's less than a 0.1% failure rate. Does anyone believe that to be accurate? What's been the failure rate in mortgaged securities to date? I'd bet something on the order of 5-10% with the crappiest ones still buried. And OTC credit/interest rate derivatives are even riskier bets than what we have already had to dealt with. So how does this get fixed with just $700 BILL? In a nut shell, companies worth tens or hundreds of billions have liabilities "worth" trillions. The FED can't fix that with a pen or a keystroke.
If $700 BILL, or even $7 TRILL could fix this problem I'd say print it all up now, and get it over with. Unfortunately, that's still a drop in the bucket. What the $700 BILL really is, is the bailout money for September and October. Paulson will be back very shortly.
<< <i>PM's are going to be needed now. The inflation that this causes will bring the $ way down and PM's way up. >>
That's my thought also. However, I do not have a good feeling about it. At the rate that the government is taking over these businesses, I have no doubt they will also make whatever rules they want concerning gold and silver. Read that as....... seizing as they determine necessary..... or making it extremely difficult for individuals to make transactions concerning the metals, by prohibitive taxation, etc.
AND.... I do not for a moment believe that 'collectible' coins will be safe if this happens. Just because in the 1930's, they allowed 'collectible' coins to be exempt... does not mean that will be allowed now. To put your trust in this belief may bring a surpise to you. The government intervention we are seeing is unprecedented..... it can be argued as to whether it is 'legal' or not, but what is one to do about it? It is happening whether we like it or not.
Is it possible that the banks know there is further potential problems with other derivatives and will be working their way out of them over the next few years?
With all that has happened over the past 6 month, the performance of PMs and other assets---except the US dollar!!!---has been quite dismal. As is most usually the case, it is better to take the other side of a crowded trade.
Is it possible that the banks know there is further potential problems with other derivatives and will be working their way out of them over the next few years?
No. It is not possible for all banks to work their way "out of it" even over several decades. The numbers are too huge. The majority of the top 10-20 banks with the majority of derivatives are toast, no matter if you "hide" worthless assets in a RTC or in Fort Knox. Several hundred to thousands of other smaller banks will follow them down the hill as the "beneficiary" of their counter-party risks. When any derivative-linked entity go bankrupt, the value of the derivative goes to notional value. It gets very expensive considering the full notional value out there is $1,140,000,000,000. Just a 1% failure rate gets you to $11 TRILLION owed or the same if 1% of the total banking/financial assets going bust.
With all that has happened over the past 6 month, the performance of PMs and other assets---except the US dollar!!!---has been quite dismal. As is most usually the case, it is better to take the other side of a crowded trade.
So how do you explain the flight to US dollar safety? Seems a bit contrived and manufactured if you ask me. Funny that the last 3 major financial catastrophes have been dealt with on a weekend when the foreign FED buddies can get into the action early Sunday night. If just one of these occurred mid-week I might loosen up just a smidge on the manipulation theory. Just as gold was under humongous demand in early July with supplies running low, the rug was pulled out on July 15. Hard to avoid the takedown theory when basic economic laws of supply and demand don't get met. What's next, the price of SUV's doubling by election day with lowering demand?
The more hundreds of billions that gets created, the stronger the dollar seems to get....well at least not in the past week. Keynes would be impressed and Mises would have to add another chapter to his text books to explain this! At some point, even the dullest knife in the drawer will start to scoff at the umpteenth bailout that is in our own best interest.
<< <i>Economic Socialism in the name of "we are doing it for you. If we did not, things would be worse for you and your family- Trust us" >>
Well, socialism is an "economic" theory so that part makes sense.
It's also an immoral and failed economic theory but one that strips power away from the individual, by force, and that's what politicians EVERYWHERE are all about.
While it's human nature to want someone else to pay, someone else to take responsibility, it does not make sense to see how many people, particularly in the US , whine, snivel and cry for MORE socialism when it IS in fact a failed and immoral economic theory.
However even if you are one of the tiny percentages of people who can actually identify what is and what isn't socialism, there's definitely nothing you can do about it (as it's been proven this election without a doubt), except learn how to, and take whatever actions possible to avoid these bas ards who either don't know how to differentiate between socialism, thereby being part of the problem, or who are actively engage in the enlarging of socialism.
Which is becoming tougher and tougher all the time as even if you are extremely savvy in doing so you are still being affected by it thru your kids who are continually being dumbed down by their school, and at the very least by the ever increasing cost of living which is a natural by product of a society which continues it's march into communism.
Comments
of fiche which equates to aprox. 385 lbs
of pure silver considering my assay on
this grade of fiche was very high.
1.4 grams per 1000 grams of micro fiche.
It's around 4 dollars per lb or 6000 ounces
of silver.
Now, I won't mention names but I was unable to setup a bullion account with this company because they don't setup accounts anymore so I can't hedge the market.
The day you deliver. You get paid spot on the Comex.
So I simply parked my product and waited. Now talk about a squeeze play. Would you believe that this company called me today [Friday] @ 10.50 silver and quoted me 16.00 per ounce with room to negotiate??? “
Thanks for the post, roadrunner. This says it all.
I knew it would happen.
57 Loaded, great link Thanks
maybe APMEX @ $2.5 over aint that bad? ...oh yeah delivery.....
by The Mogambo Guru
I had just gotten off the phone to find out why the silver I ordered last month has not arrived, and I get some runaround about how there is no silver to be had to fill my order. Naturally, being familiar with how the supply/demand dynamic works, I call the little clerk a lying piece of thieving garbage, because it is impossible that the market price of silver is going down in an environment of zero supply and obviously rising demand!
Well, the phone mysteriously went dead right after that, and before I could call him back and REALLY tell him off, I see where this is common right now, as Theodore Butler says that “Premiums are up and delivery delays are longer. This is something we are all witnessing for the first time.”
And James Turk at Free Market Gold & Money Report notes that it is the same thing in the gold market, too!
He says that a normal person would assume that the size of the working stock of gold held by the United State’s Mint to make the popular Gold Eagle coins and miscellaneous trinkets would vary “from month to month, just like inventory varies from month to month in any business as a result of changes in production and the ebbs and flows in sales.”
It gets spooky when he goes on to note that “indeed, the Mint’s inventory did vary monthly, up until March 2006. But according to the Treasury’s reports, the Mint’s working stock has remained exactly 2,783,218.656 ounces since April 2006. How is it possible that the Mint’s working stock has remained unchanged for 28 months?”
Instantly I was on my feet, shouting, “Because they are all a bunch of lying, corrupt scumbags exploiting a fiat currency and insane levels of fractional-reserve banking, which is the very reason why you should be buying gold and silver in the first place!”
I thought, you know, that this witty interruption of mine would impress Mr. Turk, and so I sat back down with a big smile on my face and crossed my arms in smug self-satisfaction as I waited for him to shower me with praise, and maybe offer to buy me a drink, or a pizza, or let me use his car for a couple of hours or days.
Sure enough, he immediately said, “There are an infinite number of possible answers. Maybe the Treasury does not want to part with its remaining gold at these current low prices. Maybe the Treasury does not want Americans to exchange their fiat dollars for the safe haven of gold as the central banking fiat money scheme implodes. Maybe the Mint doesn’t have any gold because the 2,783,218.656 ounces were loaned out. Maybe the Treasury doesn’t have any gold either. Of course, no one really knows because the Treasury isn’t talking.”
glossary
Large Money Market Fund Freezes Redemptions
to $3.05/ Lb. This could squeeze silver supplies pretty strongly and
hold up silver prices even in a recession since most silver production
is a byproduct of copper production.
There's already a squeeze on physical silver and a reduction in mining
would show up pretty dramatically. While it's true that any decrease
in copper price implies a slow down in economic activity, silver is used
in more high tech products and somewhat less susceptible to decreas-
ing demand than copper.
While silver has been pretty unimpressive lately this could change very
suddenly if the economy avoids recession and copper prices continue
to erode.
One imagines a lot of "industrial" silver is already being diverted to cap-
ture the huge premiums on the physical market and a reduction coming
from the mines could send these markets into panic buying.
<< <i>HA!!! I finally ran across a definition for LIBOR. This list is from UK but maybe there will be something you are looking for.
glossary >>
the rate shot up like a nuclear bomb.
those who did the OTC derivatives created the anti-neutron bomb..."destroys" everything, but leaves people "unharmed"
<< <i>It's interesting that copper is continuing to drop and is now down
to $3.05/ Lb. This could squeeze silver supplies pretty strongly and
hold up silver prices even in a recession since most silver production
is a byproduct of copper production.
There's already a squeeze on physical silver and a reduction in mining
would show up pretty dramatically. While it's true that any decrease
in copper price implies a slow down in economic activity, silver is used
in more high tech products and somewhat less susceptible to decreas-
ing demand than copper.
While silver has been pretty unimpressive lately this could change very
suddenly if the economy avoids recession and copper prices continue
to erode.
One imagines a lot of "industrial" silver is already being diverted to cap-
ture the huge premiums on the physical market and a reduction coming
from the mines could send these markets into panic buying. >>
my thoughts too. i have been noticing this for a few days, too...not that i know anything, but i have noticed that copper moves like a commodity not so much as a PM.
It seems this is the ultimate game of the blind leading the blind, or one might say the broke helping the busted. It is not a good idea for the FED to be broke already. This derivative unwinding has just begun and the domino’s are falling.
With so many big firms going into one type of liquidation or another we are going to see a true mark to market of trillions of dollars in derivatives within the next few months, and who will the buyers be HUM?
Sept. 17 (Bloomberg) -- The Treasury will sell more debt to enable the Federal Reserve to expand its balance sheet, a sign of the strains created by the biggest extension of central-bank credit to financial companies since the Great Depression.
The proceeds will ``provide cash for use'' by the Fed as it seeks to boost liquidity in credit markets struggling from $515 billion in writedowns and losses since the start of last year.
Oh, yes and gold is up $88.50 just today!!!!!!!!!!!!!!!!!!!!!!!
Why do we need buyers? The company just becomes insolvent and seeks reorganization, toxic things go poof, life is good.
that the Treasury is unable to sell enough bonds to
insure liquidity and financial market operations? We still
have 70 trillion dollars in questionable instruments that have
unknown values."Oh what a web we weave when we practice to
deceive".
Camelot
What I was really referring to was asset liquidation, many of the firms themselves will be gone. When these assets are forced to be liquidated the true values of these pieces of paper will set a market, and then EVERYONE holding them will be forced to mark to a real market.
<< <i>"With so many big firms going into one type of liquidation or another we are going to see a true mark to market of trillions of dollars in derivatives within the next few months, and who will the buyers be HUM?"
Why do we need buyers? The company just becomes insolvent and seeks reorganization, toxic things go poof, life is good. >>
you ALWAYS need buyers....even for this cr$p
even garbage has a price (to get ride of it)
Yepper, that's going to leave a mark.
It is peculiar how gold and silver were always called speculation by all the equities people and stocks were called investment portfolios. In our current reality, stocks are the speculative instruments and gold and silver are the investment portfolio...funny how the world works.
Reminds me of..."If it walks like a duck and quacks like a duck..." We were calling this scenario two years ago here and rat holed PM's as fast as we could and everyone was calling us fools but we kept stating the realities of our pending economic situation and saying that things haven't changed, there are still issues to be reckoned with but they kept calling us fools. We said "nothing has changed and nothing has been fixed", we kept buying metal and telling people to buy metal; fools they said. Then the PPT forced the weak hands and hammered the spot and people were yelling "See...Fools you are!" Now it is hard to buy real metal, only paper etf's seems to be easily available, and the economic wolf is walking down the street, knocking on doors. If fools we be than we be safe fools and maybe a little happy too.
Now, if we can't get the metal and the etf's are taking up the slack in demand for those that can't get Physical and if apmex is BUYING because they can't fill their orders then what is supposed to happen to those etf's that have physical in place for each share ordered? Maybe they will let the etf's do a fractional reserve policy too, like the banks? The reality of what's happening is that there is a run on PM and what they have scared out of the weak hands and newbies is already sucked up and the miners are not in any big production mobilization...what do people think will happen. Lets talk about the POG, baby; let's talk about fools.
With spot and physical being decoupled as it is now because of the influence of the etf's, it should be very interesting to see what happens to spot when all this hits and even more interesting if the etf's get audited...DO IT!!! Warehoused metal
<< <i>...
It is peculiar how gold and silver were always called speculation by all the equities people and stocks were called investment portfolios. In our current reality, stocks are the speculative instruments and gold and silver are the investment portfolio...funny how the world works.... >>
Wow - that is a great observation, made painfully evident in our current light.
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CNN.Money's 70 Best mutual funds money can buy
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There are some who say that there is no shortage of silver... just a shortage of the type of silver. And they always pointed out, as evidence, nearly every bullion dealer had plenty of it in the form of 1000 ounce bars. Well, 2 days ago, Tulving had 90 of those available. Guess what... today, sold out! shows me that some big money has entered the market.
Even wilder times ahead....
TC
It would be interesting to compare the amount of paper money available in the world to buy the PM’S now, and the amount of PM’S available now, to those same numbers from 1980.
There has been so much paper printed and moved around the world in the last 28 years I think the physicals could be gone in just a few weeks if the panic really gets going.
At no time in the late 70”s and early 80’s was there a time that you could not buy bars or coins.
Yesterday Kitco said they were uping their bid price on coins because of shortages.
Kitco this morning:
The following products have been temporarily removed from our Precious Metal Store until further notice due to production and delivery delays that retailers are currently facing; 1 oz Gold bars, 1 oz Kitco Gold bars, 10 oz Gold bars, 1 oz Silver Eagles, 1 oz Silver Maples, 1 oz Silver Philharmonic coins, 1 oz Olympic Silver Maples, 100 oz Silver bars and 1 oz Palladium Maples.
<< <i>There are some who say that there is no shortage of silver... just a shortage of the type of silver. And they always pointed out, as evidence, nearly every bullion dealer had plenty of it in the form of 1000 ounce bars. Well, 2 days ago, Tulving had 90 of those available. Guess what... today, sold out! shows me that some big money has entered the market.
TC
It would be interesting to compare the amount of paper money available in the world to buy the PM’S now, and the amount of PM’S available now, to those same numbers from 1980.
There has been so much paper printed and moved around the world in the last 28 years I think the physicals could be gone in just a few weeks if the panic really gets going.
At no time in the late 70”s and early 80’s was there a time that you could not buy bars or coins.
Yesterday Kitco said they were uping their bid price on coins because of shortages.
Kitco this morning:
The following products have been temporarily removed from our Precious Metal Store until further notice due to production and delivery delays that retailers are currently facing; 1 oz Gold bars, 1 oz Kitco Gold bars, 10 oz Gold bars, 1 oz Silver Eagles, 1 oz Silver Maples, 1 oz Silver Philharmonic coins, 1 oz Olympic Silver Maples, 100 oz Silver bars and 1 oz Palladium Maples. >>
I wonder who bought the over 3 tons (troy)? Do you think it was one buyer? less than a handful? the US Tresury? the UAE?
BTW GS, Kraft is replacing AIG on the DOW 30 effective Monday.
Time to buy the coming "bump up" in the Dow.
roadrunner
The DOW could hit 11500 tomorrow. That will put gold back under 800. So much for my idea of loading up on gold.
I should've put my $30K in blue-chippers. Then all you tax-payers would make sure I get my 8%!
Here's what's different (courtesy of MinedoverMatter at GIM):
The total price tag for the entire S&L bailout converted to today's inflated dollars is $216 BILLION. Well, just this week alone the FED has tossed in over $500 BILLION at the problem and we aren't anywhere near a resolution or even uncovering the majority of the supposed "assets." In the process we "only" lost Fannie, Freddie, BSC, Lehman, and had to buy out AIG. I didn't see anything like that in the 1990's. Anyone recall losing Fannie and Freddie during the S&L mess? We're probably over $1 TRILLION "invested" into the current crisis and on our way to $10-20 TRILLION if things go fairly well. We can recover from that. If it gets to multiple of that, all bets are off. We had nothing like $1 QUAD in derivatives during the S&L crisis. This ain't your father's or your S&L crisis. That's like comparing the Dutchy of Fenwick to the USSR.
roadrunner
Gold predictions from the CME floor
The gov't hasn't produced two quarters of negative GDP.
Technically we aren't even in a recession.
Yet, these Sunday afternoon deals and last night's deal smells of a depression.
Ren
People buy PMs for several reasons... here are two:
1. As a safe harbor in times of financial crisis
2. As a hedge against inflation
As far as reason #1, the announcement of the new Resolution Trust may have boosted confidence in the financial system enough to avert the crisis and cut demand for PMs for quite a while.
As far as reason #2, yes, the Resolution Trust does look extremely inflationary as the government injects hundreds of billions into the financial system. But, with banks and investors frozen with fear and holding onto their cash, it could be months or years before we see the effects of that new monetary inflation.
I have no idea what the short term holds. But over the longer term, I think inflation is a big threat, and holding a significant percentage of your assets in physical PMs is a smart move. Finding the percentage that enables you to sleep at night is important.
From Paulson 9-19-08 1149
We have acted on a case by case basis in recent weeks...fannie, freddie, Lehman Brothers, and AIG. This morning we've taken a number of powerful tactical steps to increase confidence in the system, including the establishment of a temporary guaranty program for the US money market industry.
Despite these steps, more is needed. We must now take further, decisive action to fundamentally and comprehensively address the root cause of our financial system's stresses.
OK, great I feel much better now. Now where is that sell button.
Ren
The gov't hasn't produced two quarters of negative GDP.
Technically we aren't even in a recession.
Yet, these Sunday afternoon deals and last night's deal smells of a depression.
Who's panicking? We've been watching this slow train wreck for 4 years.
If one used the same GDP formula used in 1980 and 1990, we'd already have something like 80% negative GDP quarters going back to the end of 2006. This is BEA smoke and mirrors, not accurate charting. The GDP inflation deflator is keeping this stat right where the govt wants it. What you really should have said is that we haven't put togther 2 quarters of back to back honestly positive GDP in a couple of years. We're definitely in a recession. And without these interventionary FED tactics, we'd be in a depression.
roadrunner
<< <i>Poppy Harlow...someone needs to check her for ticks.
Gold predictions from the CME floor >>
i thinnk you saw the two words Poppy and Lust and got lost....
Sept. 19th 2008
NEW YORK (MarketW) -- Freddie Mac's (FRE:
Freddie's cup of woes runneth over as Lehman Brothers Holdings Inc. (LEH: defaults on 1.2 billion dollar loan.
Lehman defaulted on $1.2 billion in borrowings - and interest on the loan - from the ailing mortgage finance giant, according to a filing Thursday with the Securities and Exchange Commission.
Freddie extended $1.2 billion of short-term unsecured loans to Lehman in late August, and Lehman didn't repay the borrowings when they came due on Sept. 15. Lehman is in the midst of bankruptcy proceedings that started Monday.
A Freddie spokesman said the loans were a part of Freddie's ordinary investing activities.
"One thing I am a little surprised about is that it's unsecured," said Frederick Cannon, chief equity strategist at Keefe, Bruyette & Woods Inc.
"I would think most of the dealings (between Lehman and Freddie) would have mortgage securities as collateral," said Cannon. "The amount that was unsecured is somewhat surprising but these are large institutions."
<< <i>Why all the panic?
The gov't hasn't produced two quarters of negative GDP.
Technically we aren't even in a recession.
Yet, these Sunday afternoon deals and last night's deal smells of a depression.
Who's panicking? We've been watching this slow train wreck for 4 years.
If one used the same GDP formula used in 1980 and 1990, we'd already have something like 80% negative GDP quarters going back to the end of 2006. This is BEA smoke and mirrors, not accurate charting. The GDP inflation deflator is keeping this stat right where the govt wants it. What you really should have said is that we haven't put togther 2 quarters of back to back positive GDP in a couple of years.
We're definitely in a recession. And without these interventionary FED tactics, we'd be in a depression.
What I should've done is put one of the winky-winky's at the end. Sorry the sarcarsm wasn't apparent. I do agree that if traditional methods were adhered to we would be in a recession and probably going into a depression....which is how many quarters of negative GDP.
roadrunner >>
That's the government bailout plan currently being devised for the financial meltdown. Some of the details coming out.... the government can buy up any failing financial institute it wants to for the next two years...... and any decision the Treasury department makes in regards to any bailouts, etc., will not be subject to any lawsuits. Sounds like no recourse if any of us are adversely affected by this.
I have mixed feelings about this bailout. While it is great to know any money I have in money market funds will now probably be safe (might not make any money, but probably won't lose any either), the thought of the markets now being controlled by the government somehow does not give me a cozy feeling. The markets in effect have been nationalized, IMO.
Welcome to the USSA.... United Socialist States of America
If $700 BILL, or even $7 TRILL could fix this problem I'd say print it all up now, and get it over with. Unfortunately, that's still a drop in the bucket. What the $700 BILL really is, is the bailout money for September and October. Paulson will be back very shortly.
roadrunner
<< <i>PM's are going to be needed now. The inflation that this causes will bring the $ way down and PM's way up.
That's my thought also. However, I do not have a good feeling about it. At the rate that the government is taking over these businesses, I have no doubt they will also make whatever rules they want concerning gold and silver. Read that as....... seizing as they determine necessary..... or making it extremely difficult for individuals to make transactions concerning the metals, by prohibitive taxation, etc.
AND.... I do not for a moment believe that 'collectible' coins will be safe if this happens. Just because in the 1930's, they allowed 'collectible' coins to be exempt... does not mean that will be allowed now. To put your trust in this belief may bring a surpise to you. The government intervention we are seeing is unprecedented..... it can be argued as to whether it is 'legal' or not, but what is one to do about it? It is happening whether we like it or not.
the election. Then, all hell will break loose.
Once the bank runs start, it will take a bank
holiday of some period of time to slow it down.
Non of us benefited from all of the excessive wages
and bonuses and golden parachutes from all of the
billions of dollars of financial excesses, however
we can expect to be the full beneficiaries of all the debt
necessary to bail out all of the pigs that swilled themselves
at the money trough. It's kinda sad but that is always the way
of things.
Camelot
With all that has happened over the past 6 month, the performance of PMs and other assets---except the US dollar!!!---has been quite dismal. As is most usually the case, it is better to take the other side of a crowded trade.
Knowledge is the enemy of fear
No. It is not possible for all banks to work their way "out of it" even over several decades. The numbers are too huge. The majority of the top 10-20 banks with the majority of derivatives are toast, no matter if you "hide" worthless assets in a RTC or in Fort Knox. Several hundred to thousands of other smaller banks will follow them down the hill as the "beneficiary" of their counter-party risks. When any derivative-linked entity go bankrupt, the value of the derivative goes to notional value. It gets very expensive considering the full notional value out there is $1,140,000,000,000. Just a 1% failure rate gets you to $11 TRILLION owed or the same if 1% of the total banking/financial assets going bust.
With all that has happened over the past 6 month, the performance of PMs and other assets---except the US dollar!!!---has been quite dismal. As is most usually the case, it is better to take the other side of a crowded trade.
So how do you explain the flight to US dollar safety? Seems a bit contrived and manufactured if you ask me. Funny that the last 3 major financial catastrophes have been dealt with on a weekend when the foreign FED buddies can get into the action early Sunday night. If just one of these occurred mid-week I might loosen up just a smidge on the manipulation theory. Just as gold was under humongous demand in early July with supplies running low, the rug was pulled out on July 15. Hard to avoid the takedown theory when basic economic laws of supply and demand don't get met. What's next, the price of SUV's doubling by election day with lowering demand?
The more hundreds of billions that gets created, the stronger the dollar seems to get....well at least not in the past week. Keynes would be impressed and Mises would have to add another chapter to his text books to explain this! At some point, even the dullest knife in the drawer will start to scoff at the umpteenth bailout that is in our own best interest.
roadrunner
R
Where are all the folks who dismissed the prescient folks in this thread for the last few years as "tinfoil hat wearers"?
Where are they now? Do they still back their previous positions?
<< <i>PM's are going to be needed now. The inflation that this causes will bring the $ way down and PM's way up.
IMVHO Not tomorrow though
<< <i>Economic Socialism in the name of "we are doing it for you. If we did not, things would be worse for you and your family- Trust us" >>
Well, socialism is an "economic" theory so that part makes sense.
It's also an immoral and failed economic theory but one that strips power away from the individual, by force, and that's what politicians EVERYWHERE are all about.
While it's human nature to want someone else to pay, someone else to take responsibility, it does not make sense to see how many people, particularly in the US , whine, snivel and cry for MORE socialism when it IS in fact a failed and immoral economic theory.
However even if you are one of the tiny percentages of people who can actually identify what is and what isn't socialism, there's definitely nothing you can do about it (as it's been proven this election without a doubt), except learn how to, and take whatever actions possible to avoid these bas ards who either don't know how to differentiate between socialism, thereby being part of the problem, or who are actively engage in the enlarging of socialism.
Which is becoming tougher and tougher all the time as even if you are extremely savvy in doing so you are still being affected by it thru your kids who are continually being dumbed down by their school, and at the very least by the ever increasing cost of living which is a natural by product of a society which continues it's march into communism.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870