what just happened? Gold just took a leap

ttown

up $34 about double within an hour. After the election we should get a feel for the REAL ecomony.

MoneyLA

youre excited about a $34 rise in the price of gold? what about the tumble of $270 over the past few months?

57loaded

i don't think it is the election, my guess is all of that has been factored in as the markets of all types seem to be "forward thinking" yet things are so topsy turvy, maybe Mr. Sinclair is buying 100 ounce bricks?

ttown

<< <i>youre excited about a $34 rise in the price of gold? what about the tumble of $270 over the past few months? >>



Why are you even on this board? When I see all morning gold running $17 - $21 and all of a sudden it jumps wham (now over $38) someone is making a play IMO. All is good you'll be eating your words soon. Sell all you have and buy stocks since your so much smarter than anyone here.

Smittys

maybe this has something to do with it

article on precious metal

57loaded

<< <i>maybe this has something to do with it

article on precious metal >>



seems like a commodity rise in general, yet the USD index is up, too...so i'm back up with ttown (i dunno)

ttown

Just keep in mind that piece was wrote yesterday. Today oil up $4.75 bbl, dollar down 1.77. DOW up 277. Typical election day bounce in the market and the seeming stablization of the ecomony. After the election you'll see the real hourse within a few months. Do you remember 2000? What happend after the election was over? Will it repeat?

fc

<< <i>youre excited about a $34 rise in the price of gold? what about the tumble of $270 over the past few months? >>



I agree with this. These swings have been typical for the last weeks easy. Wake me when it is above 950 and pushing
past 1000.

Silver is in the same boat. When it gets past 13 we might have something interesting going on.

As for what happened... is that someone is buying and in a few days the hedge funds will dump
some more pushing the prices back down. I reckon 9 bucks an ounce with a week or two again.

unknowncomic

Speaking of oil? From the aricle that was mentioned here http://news.moneycentral.msn.com/ticker/article.aspx?Feed=AP&Date=20081103&ID=5772543&Symbol=AIG .........>>>>>> "Light, sweet crude for December delivery fell $3.90 to settle at $63.91 a barrel. Gasoline futures slipped more than 13 cents to settle at $1.36 a gallon, while heating oil futures fell 10.14 cents to settle at $1.9828 a gallon."

I am paying $2.49 a gal. in northern Calif.

edited because I still can not link stuff.

fc

<< <i>Speaking of oil? From the aricle that was mentioned here http://news.moneycentral.msn.com/ticker/article.aspx?Feed=AP&Date=20081103&ID=5772543&Symbol=AIG .........>>>>>> "Light, sweet crude for December delivery fell $3.90 to settle at $63.91 a barrel. Gasoline futures slipped more than 13 cents to settle at $1.36 a gallon, while heating oil futures fell 10.14 cents to settle at $1.9828 a gallon."

I am paying $2.49 a gal. in northern Calif.

edited because I still can not link stuff. >>



Correct me if I am wrong, but does not Cali demand special blends of gas which
are different from every other state in the Union?

If so, that could be a cause of the higher price.

RedTiger

Just a few days ago everyone wanted cash or short term treasuries--cash was king. Today, "cash is trash," because stocks, oil, gold and many other commodities are moving higher.

Sharp, short rallies are typical bear market action (for all markets not just gold), so I am not that excited either. Still feels better than another big down day though. Personally, I would like to see a confirmed low in oil, before taking a trading position long gold.

SilverBaron

Perhaps this will help explain the bump up....

News




Keep on Stack'n!!

roadrunner

youre excited about a $34 rise in the price of gold? what about the tumble of $270 over the past few months?

Unlike yourself who is expecting $300-$500 gold, many of us are of the opinion that the "tumble" you speak of was FED and PPT produced and directed, just like previous massive drops out of the blue when economic fundamentals dictated otherwise. The longer gold continues to churn in a base-building trading range above $700, the far less likely of it proceeding lower. So we'll take the $34 move above $750 as preferable to a $34 fall under $700. During the entire bull run from 2001-2008 gold NEVER sat and slowly churned lower and lower over many months. The carnage has always been over within 4-6 weeks. This is another reason why I think a fall below the 200 dma is unlikely at this point.

MoneyLA is still here so he can strut in the event gold falls much further (ie bull market dead) or take credit if it goes higher (ie above $1000-1050 on a new bull run). He's got both bases covered. In fact he's also stated gold will live in a trading range for a while ($650-$990). So in actuality he's got 3 predictions running that covers him in all eventualities.

The longer gold hangs and builds, the better the chance that the dollar will be recongized for what it is, and the more likely that gold will head back up.

roadrunner

Cladiator

Are you guys looking to liquidate your gold holdings anytime soon? Retiring maybe? If not, why do you want the prices to go up? Myself, I'd like to see them keep going down as it will allow me to buy at a lower price and buy more quantity. Unless you're looking to sell now I see no reason to be glad about rising spot prices.

ttown

For me it's called insurance. No ones wanting the economy to tank in their right minds no matter how much PM's you've got. To me this discussion is more about what's going on in these strange times when none of the rules are holding, seems to me their more behind the scenes that the public isn't suppose to see and it worries me. If it went down I'd add to my $20 Saint/Lib collection.

Now to some when you say worry they want you to put on the "tin foil hat" to attempt to discredit your views but really during my divorce case seeking custody of my kids I lived on $400 a month so I know I'm okay. Your just a little warmer/colder and you hunt and fish for food. I'm more pissed than anything about the elite greedy people destroying the middle class, here soon we'll be like the rest of the world with two classes just like the elites "do what we say not as we do" want. Power, Control, Wealth over the masses it's a nice job if you can get it.

57loaded

<< <i>

<< <i>Speaking of oil? From the aricle that was mentioned here http://news.moneycentral.msn.com/ticker/article.aspx?Feed=AP&Date=20081103&ID=5772543&Symbol=AIG .........>>>>>> "Light, sweet crude for December delivery fell $3.90 to settle at $63.91 a barrel. Gasoline futures slipped more than 13 cents to settle at $1.36 a gallon, while heating oil futures fell 10.14 cents to settle at $1.9828 a gallon."

I am paying $2.49 a gal. in northern Calif.

edited because I still can not link stuff. >>



Correct me if I am wrong, but does not Cali demand special blends of gas which
are different from every other state in the Union?

If so, that could be a cause of the higher price. >>



C.A.R.B. fuel info

another area of State government where a few good things happen, yet the bureaucracy is so laden that they are spending more and more to get less and less....the economies of scale are working against the CARB, yet they will spend more money each year to find a way to get another .001% "cleaner air". (shoot form the hip example) if it cost $500B to make a 97% difference it takes another $500B to get another 1/2 a percent....

most of the air pollution is motro driven vehicles, then powerplants.....off-gassing from solvent and lacquer is way at the bottom, yet a huge project at the ARB.... your tax dollars at work, of course!

renman95

I think the market is looking at the next jockey to ride the Donkey into the sunset and sees another inflational straw put on JSP's back.

Ren

MoneyLA

roqdrunner.... I do not make predictions, I just report what the charts are showing.

I made it very clear that if gold breaks below $650 it could tumble several hundred dollars more. I never said it will do that.

I made it very clear that gold would have to top $1,000 an ounce for a new bull run. I never said that will happen either.

I made it very clear that gold was in a trading range for a few months of $800 to $950 and said that when gold fell below the low end of the trading range that there was danger that gold could challenge the $650 support level.

All of this is based on reading the charts. None of it is wishful thinking, or hoping to influence the market, or hoping to bail out my position.

As far as my own position? As you know I sold my gold at around $945. I will let you know when I regret my decision.

best of luck to you.

mhammerman

Well, methinks that if any CB, maybe Russia, asks Comex for delivery then the ppt, paperboys, hedge managers, BS artists, all the kings men and all the kings horses will not be able to hold gold on the floor like this. It seems inevitable that if paper gold is worth x and physical is worth x+30% then it's just a matter of time before some big fella walks into the Comex and asks for his physical...as in "Where is my money?" So if the Comex has the metal then all is good but if Comex doesn't have the metal then, we're rich!

Edited to add: A simple act like this would instantly wipe out all the shorts and all the paper accounts and there is no way they would ever see it coming...sweet!

fc

<< <i>Well, methinks that if any CB, maybe Russia, asks Comex for delivery then the ppt, paperboys, hedge managers, BS artists, all the kings men and all the kings horses will not be able to hold gold on the floor like this. It seems inevitable that if paper gold is worth x and physical is worth x+30% then it's just a matter of time before some big fella walks into the Comex and asks for his physical...as in "Where is my money?" So if the Comex has the metal then all is good but if Comex doesn't have the metal then, we're rich! >>



i think the problem with this scenario is that the premiums only hold
true for small amounts.

for example...

buy 10000 ounces.
if you sell 10000 ounces you would be LUCKY to get 12 an ounce... if that.

More likely you will move that much metal and probably be estatic to
make 10000 dollars gross. Then add up your total costs and your net
will probably be somewhere between not worth it and a waste of time.

So the person buying better have a mint in their basement to pound
out small bars and rounds... otherwise with that much metal they
are COMEX like... and the premiums will be nil.

MoneyLA

fc... I think you analysis of the premiums related to volume of the metal is 100% correct. good job.

mhammerman

So, who said they were going for the premiums? A run on the Comex stash by any big guy would certainly call their hand; do they have the gold or not. If not then all the sudden the Comex is going to have to cover a lot of money as in cash to buy gold on the open market, kind of like a megamargincall. Let's see what unfolds...

fc

<< <i>So, who said they were going for the premiums? A run on the Comex stash by any big guy would certainly call their hand; do they have the gold or not. If not then all the sudden the Comex is going to have to cover a lot of money as in cash to buy gold on the open market, kind of like a megamargincall. Let's see what unfolds... >>



I see what you mean. Any idea how much cash it would take to do
such a thing? 100 million? 500 million? 1 billion?

If you were that mega wealthy or knew of several people who were
that rich willing to play the game.... would you seriously consider the
idea?

I wonder how many people who are mega wealthly actually have that
type of cash just sitting in an account, ready to be played with...
50? 100? 250?

I am just throwing out numbers. I am sure I could come up with better
ones given some time... but it seems a fantastical idea that goes back
to the Hunt Family... and we know how that turned out don't we?

MoneyLA

fc, your point is valid. why would anyone want to cause a panic in the market, especially someone who has enough money to control a market.... those people want order. without order, their fortunes are worthless.

besides, the commodity market is a zero sum game. and I believe that means there must be the gold to back up each and every contract, unlike bank loans which can be made by creating money.

you cannot create commodities. if I am wrong, tell me.

mhammerman

"you cannot create commodities."

True, commodities are a finite asset regardless of class. Although you can not create commodities, you can sell more contracts than exist in physical. It's all good until someone wants their physical and there isn't enough to go around. We've had these discussions before now but that was before the decoupling.

Good comment regarding the desire for stability but the Hunt brothers had the money and had the silver and had no interest at all in stability. In disorder there are exceptional opportunities. While everything tends towards stability in nature, chaos or change is the precursor of evolution.

"...and we know how that turned out don't we?" Yes, if they hadn't gotten so greedy they could have left the game with huge fortunes and let the chips fall where they fall.

Metalsman

<< <i>fc, your point is valid. why would anyone want to cause a panic in the market, especially someone who has enough money to control a market.... those people want order. without order, their fortunes are worthless.

besides, the commodity market is a zero sum game. and I believe that means there must be the gold to back up each and every contract, unlike bank loans which can be made by creating money.

you cannot create commodities. if I am wrong, tell me. >>



I'd say you are wrong.. Thats why they call them futures contracts.. promise to deliver and backed by a "PROMISE" to deliver but not backed by physical. No different than a "PROMISE" to pay a bank loan.

RedTiger

<< <i>fc, your point is valid. why would anyone want to cause a panic in the market, especially someone who has enough money to control a market.... those people want order. without order, their fortunes are worthless.

besides, the commodity market is a zero sum game. and I believe that means there must be the gold to back up each and every contract, unlike bank loans which can be made by creating money.

you cannot create commodities. if I am wrong, tell me. >>



It is a bit stunning that you have this wrong. I do not have a commodities account. However, I know that this is not correct--there are many more contracts than there is physical gold. On the London Metals exchange the contracts assume physical delivery. In the US, if a company wants physical delivery, they must ask for that well ahead of the close of the contract. The vast majority of US contracts are settled in cash.

It is true that commodities are a zero sum game. However, there was the recent incident concerning the LME nickel default in 2006. So while rare, there are often short term problems. Two years after the default, the price of nickel is back to pre-default levels. The price chart is something to keep in mind if the silver or gold experiences a similar extraordinary situation due to overwhelming physical demand or an attempt to corner the market.

5-year Nickel chart (default was in 2006):

MoneyLA

thank you for setting me straight. I appreciate the info. I will stay out of commodities futures (which Ive never touched before, anyway).

ttown

<< <i>So, who said they were going for the premiums? A run on the Comex stash by any big guy would certainly call their hand; do they have the gold or not. If not then all the sudden the Comex is going to have to cover a lot of money as in cash to buy gold on the open market, kind of like a megamargincall. Let's see what unfolds... >>



I posted a piece on COMEX a while back and they had 10% of the gold and maybe 12% of the silver so if there's a run they are gone.

Comex Gold Continues to Slump Despite Soaring Demand for Physical Gold