We have watched the paper prices of gold and silver get crushed last Friday and again on Monday. Both days saw huge volumes of paper contracts dumped in “all or none” fashion in very tight time frames that had the effect of crashing price. We know through plain old common sense that “intent” was involved because no real holder of gold or silver would ever sell in this fashion and depress the value of what they’d walk away from the sale with. We also know that other than central banks there are no entities that hold “supposedly” an amount of gold in the 1,000+ ton range except for the ETF GLD. So who was it? The CFTC says, “We’re working on it.” We should not hold our collective breaths as they have been investigating the silver market for going on 5 years yet still nothing but crickets can be heard. The paper trails left behind are so obvious that Mr. Magoo would have needed only one day to come to a “guilty of manipulation” conclusion AND fingered the perpetrators. They are not fooling anyone.
However, for any action there are always unintended (or in this case “unavoidable”) consequences. As I’ve written about all week, physical demand has exploded, premiums have risen and inventories eaten away at. The US Mint sold more Gold Eagles yesterday than any previous day in its history. They are also on pace to sell more gold than any previous month in its history as we are barely more than half way through April and they are near the previous record month, January of this year). Does that make sense? 2 of the previous 4 months were record volumes yet price has dropped slowly over those 4 months culminated by the largest price drop in 30 years?
The recent selloff was conducted under the “Bob Rubin platform;” do whatever you have to do to buy 6 months’ time and kick the can down the road. Hopefully something, somehow someway will turn up and the problem fixed… but the real world doesn’t work this way. “Hope is the vestige of fools.” What they have now accomplished is that basically a “run” by the American public on metal and visible shortages in silver. NOTHING creates more demand on anything than a “shortage.” When you tell someone that they cannot have something they will want it even more… As I’ve said, Mother Nature does work and will not be denied in the physical markets. Demand since last Thursday has MORE than doubled. I am not talking about “demand” in the US (though it has). I am talking about demand everywhere on the planet. I have seen reports out of Switzerland, Japan and most importantly India (who regularly purchases better than a third of global production) that physical cash and carry buyers have come out of the woodwork and demand has basically doubled this week.
Many of us who do the play by play writings have said all along that it would be the physical markets that would blow up the paper game. Last Friday and Monday have shown you just how close we must have been to default to elicit as blatant a response as selling (on paper) close to half of the world’s global gold production in 48 hours. The process of physical metal running out has been sped up, whether or not the May delivery month is passed without a default I do not know. It doesn’t matter. The cartel showed their hand and the “free press” portrayed what happened last Friday and Monday as a “selling panic.” They were correct 100% in their assertion… what they didn’t do was tell you who was doing the selling and who was doing the panicking. It surely was not the public… everywhere on the planet, because they were buyers to begin with, now they are bigger buyers! Talk about shooting oneself in the foot!
Bill,
I think the Fed miscalculted on Friday and Monday’s smash of gold and silver.
The main stream media was correct that everyone was selling their gold, however the forgot to tell the sheeple that it was ONLY paper gold being sold.
This miscalculation has set off a world wide buying spree of physical silver and gold. Yes, there are many non-sheeple in the world that actually get it and are backing up the truck on this smash down.
I wonder what the Fed’s next move will be now that the smash down has backfired big time?
By the way I am a big believer in prayer. Today I have started a daily prayer asking the Lord to bring down the evil bankers to their knees fast (all evil bankers world wide). I invite any one else that believes in prayer to join me. The Lord does answer prayers !!! I pray for honest and sound financial systems to replace all of our manipulated ones.
Amen
I absolutely agree in prayer that the good lord will bring all the evil bankers world wide down!!! Amen !
One should look into the options market for ETFs and miners for activity prior to Friday like was done with the Heinz purchase. I think we will find a GS connection there
Like I said, this is so easy that Mr. Magoo could solve this one.
TPTB seem to be all-powerful and omnipotent, winning at every turn. Occupy Wall Str, for example, never had a chance. Therefore it has been hard to wrap my head around the fact that their best strategy for keeping metals out of people’s hands is to lower the price.
I sure wish the bankers would start naked short-selling ammo now to get the price down.
…and shooting themselves in the feet.
The head of the CFTC, Gary Gensler, is a former Goldman Sachs guy. His marching orders are to sit on any investigation because our beloved government is in collusion with the bullion banks to engage in naked shorting to suppress the price. Bix Weir thinks this situation is finally coming to a head because of the overwhelming PHYZZ demand we a witnessing which will overwhelm the COMEX and LBMA. I sure hope he is right! Bill, you are the best writer in the Precious Metals space!
Thanks, if Bix is not right now…he will be correct at a later date. It’s pure math and only a matter of time.
GSacs maybe right when they say they are doing Gods work. For it is written that Almighty created everything for his for his pleasure, even the wicked for the days of evil. So GS is another pawn being played by the Master himself. Anyone who does not load up now on PHYZZ will get Cyprused. I am thankful to Almighty for allowing these criminals to be exposed and give me an understanding why I must protect myself. I am also thankful for people like Bill H for his understanding and warning the sheeple. A prudent man forseeth danger and hides himself, but the simple pass on and are punished. Let your life be simple but never your mind.
Bill, it is now clearly evident that the Fed, along with the bankers, is rigging the market big time, and have been doing so for a long time. Evidence that a deaf, dumb, and blind man could easily see has no effect on the intentionally ignorant CFTC. The CFTC couldn’t find Central Park if they wondered around Manhattan for a year. I now know what CFTC stands for, “Can’t Find The Criminals.” Joe F
correct Joe