Surveying the damage

No critical damage in gold yet. Tomorrow is huge (and next week too).

On the daily chart, I've been saying this month that I expect the purple dotted line to be tested, and it was. So far it has held.

Weekly, the same thing: I mentioned Sunday that we've touched the top black trend line 3 times in 3 years. Is this time really different? We won't know unless the center line is tested and holds. Well, it's being tested and we're going to find out in the next few days if it holds.

This silver chart, on the other hand, looks godawful. Atrocious. It was just really important for the lower blue trend line to hold, and when it didn't, the threat of something like today was in the cards. A historically bad day in silver.

Silver seems to have fallen out of a bearish rising wedge (see below). But, if the 200 day moving average can hold, we're OK. So, once again, tomorrow is key (and next week).

The long term weekly chart also shows that we are right at a critical point. The 34-wk MA was broken, which is a bad sign, but if the trend channel can contain the price, we're ok. Otherwise, silver can easily plummet another $5 to the grey dotted line.

So grab your popcorn!


Louis Cypher said...

I'm very, very impressticated. I hope you made a few bucks on this move.

Spicy Guacamole said...

just a few thoughts: gold is still 11% above its 40-week moving average and it appears that the market is going to remove the bubble rally that took it from $1,600 to $1,900 in two months. So $1,600 seems like a good target on the downside.

Silver is now 10% below its 40-week. As a result, we are likely to see continued dumping from the systematic robot trading crowd as well as the momentum monkeys. The last time silver traded 10% under its 40-week was the 2008 collapse that took it under $10.

It is quite sad that a tremendous number of people aggressively bought silver based on lies spread by the likes of WB, ZH, Harvey Organ, Max Keiser, Turd, etcetera. Now that they have been exposed as charlatans, will they fess up and change their ways? Will they be capable of explaining to their lemming readers that there is a thing called downside risk? That maybe the manipulation story is overblown? Maybe Comex will never collapse? Maybe there isn't a silver shortage after all? Maybe the dollar will stabilize? Maybe rather than hyperinflation, there will be severe deflation?

I'm not holding my breath.

Louis Cypher said...

I'm not sure it's fair to lump them all together Brian. Some are genuinely passionate and true to their beliefs. IF I was making any bets today (which I'm not) I would say we have some upside in Silver today.

Spicy Guacamole said...

I'd agree that silver may have tremendous upside from here - it also may have tremendous downside. There's nothing wrong with having passion about something, but if that passion causes you to believe that there is no way you can be wrong or that the world will never change in a way that destroys your thesis, your passion may lead you off a cliff.

Any responsible investor is always asking himself "where could I be wrong?" and "what would happen if I am wrong?". But the silver charlatans don't do that. They act like messiahs that know everything and couldn't fathom that they could be wrong about their views. Anything that happens contrary to their views is disregarded as the work of criminals, banksters, the cartel, etc and in the end the good guys will win ("We are winning" - says Turd). And their readers lap up everything they say like the word of God. That is sad.

Louis Cypher said...

Bill Downey has similar words of wisdom of wait and see before making any decisions that would leave one locked in over the weekend.
Wait and see should be the new mantra. He says to be careful right now as Europe will be closing trading for the week shortly.

Anonymous said...

"It is quite sad that a tremendous number of people aggressively bought silver based on lies spread by the likes of WB, ZH, Harvey Organ, Max Keiser, Turd, etcetera. Now that they have been exposed as charlatans, will they fess up and change their ways?"

Wow... I don't know what to say about your logic there. The price of PM futures contracts has fallen pretty sharply for the past few days, and that is your conclusion? All those folks are spreading lies, and they are charlatans, and the price correction proves that? You're like GW standing in front of a MISSION ACCOMPLISHED banner on that aircraft carrier.

I read this blog for the exact reason you mentioned - wanting to look at all sides and not follow anyone blindly. Acting like a bag of dicks makes people not want to listen to you. People read Turd and Harvey because they are polite, inviting, and passionate, and they back up what they discuss with hard data. People don't read this blog, which actually does have some good information that helps "round out" the enthusiasm of some of the others out there, because the posters and commenters often act like bags of dicks. Work on your attitude and your message might actually find an audience. Otherwise the rage you obviously feel towards those "charlatans" will continue to be impotent.

Spicy Guacamole said...
This comment has been removed by the author.
Spicy Guacamole said...

and my apologies to the other writers on this site - as they most definitely would not agree with my comments. They have been skeptical and have debunked many things coming out of the silver misinformation camp, but probably would not share my disdain for the perps.

That is, they probably view them as good people fighting for a cause, whereas I view them more as opportunists abusing their positions and looking to make a buck spreading misinformation that they know (or should know) is not true.

Spicy Guacamole said...

Let me repost the above, edited for tone.

the price action is irrelevant - the lies are clear to all those who have the ability to understand how the markets really work. Funny that you mention Harvey, as about 90% of the "information" presented on his site are flat out lies or misinformation. Same for Zero Hedge and all the others. There is no hard data backing their assertions - the put out a datapoint and spin and misinterpret it beyond belief to fit their predetermined conclusions. How polite is Harvey when he calls for the execution of the SEC Chairman? Sure Harvey and Turd, every decline is due to an evil cartel raid and every rise is good old patriotic buying. Yes, the evil cartel will go down and all us silver owners will be rich! We are winning!!! Death to the banksters! Bring on the apocalypse! We are winning!!!

I really don't care about an audience. I do have a conscience though, something that is sorely lacking in the blogging world. And I am disgusted by the tactics used by the silver charlatans. But I've said my peace and my conscience is now clear. If the recent days don't open your eyes, nothing will.

GM Jenkins said...

Louis, my trading account has indeed been growing nicely. Unfortunately, that account is nearly empty since I expanded my core position going into the fall. In short, i've been hammered (Shit, GDXJ is where it was when I bought it in October 2009.)

Brian, I agree with you that guys like Turd speak with a certainty that should make anyone on the same side of their trades cringe. That said, I think you go too far when you call guys Turd and the Metropole Cafe crowd liars and, e.g. charlatans, which implies a deceptive intent that i'm quite sure is not there. (Someone like Sprott might be a different story)

PianoRacer: to echo Brian, we don't care about an audience here. We'd be fine just posting for each other and the sundry bags of dicks who, their dickfulness notwithstanding, can offer objections in comments more substantive than calling us bags of dicks. That said, if you can refrain from such pejoratives and stick to actual arguments (i like your "mission accomplished" analogy), you too can join the ranks of the bags of dicks who add value here.

Louis Cypher said...

Yeah, I took a beating like Rodney King as guest speaker at a Klan meeting this week.
Looking at the Gold:Silver ratio has me thinking of jumping onto Silver though in the physical dept. What are your thoughts guys? I usually don't do any trading except on Mondays but I might make an exception this week.

Louis Cypher said...

I'm sorry Jeanne. I know you had plans. I could throw out some bullshit about health and all that but you have time to rebuild.

Anonymous said...

So you ban me, simply for using my favorite phrase, "bag of dicks"? Wow. I offered plenty of substantive concepts besides noting the dick-baggishness. In fact, you pointed out that you liked one of them, contradicting yourself. I was really enjoying the discussion and had a two-post response written to the responses I received, but I suppose it is a moot point since you obviously do not have any interest in actual discussion. Such a tragedy; enjoy the echo chamber.

And apparently the massive trading losses (I only invest the product of my labor in physical items).

And the bags.

(of dicks)

"They act like messiahs that know everything and couldn't fathom that they could be wrong about their views."

Anonymous said...


No-one has banned you. If your posts were removed, it would say 'this post has been removed by an administrator'. If your posts aren't appearing, it's because Google Blogspot is eating them. Long posts often get eaten. Break them down into smaller posts and try them again.

And go easy on the paranoia.

PianoRacer said...

It wasn't the size of the post, although that was my issue initially; after I broke it down, I got a message saying that the google account I was using was not allowed to do what I was trying to do.

If this posts successfully, then this time I did not receive that message. The error did happen, but if I was not banned, I will be relieved and retract my previous comments.

Anonymous said...

The problem with TF and also with many of the original GATA members is that they come from non-precious metals commodities trading. They are used to looking at charts, volume, OI, supply and demand etc and trading on that basis.

With gold and silver, however, this cannot work. This is because the main market for bullion is the OTC FOREX market between the bullion banks (LBMA). COMEX is tiny compared with that. If you look at the published COMEX data, you see at most 5% of the actual market. Now think about what COMEX OI tells you about LBMA. Nothing, of course. When you trade copper, you have mining and recycling on the one hand and industrial consumers on the other. Nobody warehouses copper for decades as an investment and then suddenly trades a few thousand tons of it on a single day. Also, LBMA trades both physical gold and gold denominated credit. The latter cannot be seen at the COMEX at all because COMEX settlement is in terms of allocated physical only.

So these people notice that everything they know about copper and crude oil and which made them succesful traders in that area, does no longer work with gold and silver. So they call it manipulation.

They are COMEX fixated in an almost insane way. That's kind of an availability bias because COMEX trading is transparent and everyone can easily watch the data feed and the charts whereas LBMA is extremely opaque - deliberately so.

(It is true that the central banks do manage the London price of gold. It just happens in a way quite different from what the standard conspiracy theorists understand)


PianoRacer said...

The whole point I was trying to make, which was admittedly undermined by the hypocrisy of resorting to the same tactics that I was complaining about (i.e. the term "bag of dicks"), is this:

You have some good, original information that is of value, but often the presentation and attitude get in the way of the data, at least for me. Judging by the fairly thin comments, I would presume that you do not have a wide audience, which I think dramatically limits the richness of the discussion. I also think it is a shame because, like I said, you DO have some original and valuable information. And I even AGREE that there needs to be a counterbalance to the ZH/TF sites out there, who are obviously often overzealous in their commentaries.

It comes down to this: there are a lot of people out there like me, people who thought that all they needed to know about the dollar was what you could get for it, and that the best way to prepare for the future and be responsible was to follow the herd and let an adviser manage a 401k/IRA portfolio. Thanks to the truly unprecedented medium of communication that we just recently invented called the Internet, those people are empowered for the first time, and to a greater degree than ever before in history, and in larger numbers than ever before in history, to uncover the truth of things for themselves.

Those people are looking for answers, something TF, for example, obviously understands, and those answers are not coming from the New York Times. Sites like ZH and TF are obviously not perfect, but they're far, far superior to the the MSM when it comes to attempting to explain the why of things and be ready for what is coming in the future, whatever that may be. They make predictions that either come true or do not, and when they do not they must account for them. The way TF comports himself when his predictions go awry is one of the things that keeps me coming back. I agree that it will be interesting to see his (and everyone else's) response to the recent price action, but nothing so far has proven anyone to be a charlatan or a liar.

TF, ZH, etc. are about a paradigm, not about a theory or a prediction, and that paradigm seems to enrage people Brian O for some reason that I'll never understand. If gold goes to $500 and silver to $10, does that mean that TF is "wrong"? Or FOFOA (an admittedly ridiculous moniker)? Or me?


PianoRacer said...

(cont.) I don't think so; Because we value things like gold and silver (and food, and energy, and peace and quiet) more than we will ever value a number in a computer or a piece of cotton/linen with the scribblings of a horribly corrupt empire on it.

But we need balance. As much wonderful information and insightful commentary there is out there, nobody is perfect, nobody has all of the answers, and at the end of the day they are all fallible human beings. And yes, there are charlatans and liars out there too.

TF and Tyler Durden and Harvey Organ and the rest are not charlatans or liars. Even though he does a great job of presenting timely, salient information, SGS might be (another Dickbag, IMO); I learned that from this blog. We need this blog, and others like it, to help give us perspective and remind us not to fall back into that warm fuzzy embrace of turning off the critical thought and just accepting as fact that which spouts from the voice of authority that so many succumb to, typically at the hands of the MSM. But - sorry, I just don't know of another way to say, it and frankly I just really like the word at this point - the dickbaggishness really gets in the way of that.

At least for me.

"They act like messiahs that know everything and couldn't fathom that they could be wrong about their views."

I agree that TF and ESPECIALLY Tyler Durden have done this. But, well.. Pot, meet kettle. If Brian has compelling arguments for why Tyler and Turd are charlatans and liars, I haven't seen them. I'll be interested in that post, Brian, if and when you get around to it. They're humans, yes they likely have their own agendas - but don't we all? Don't you?

Anonymous said...

OK - I don't want to get too much into the weeds of this argument, as it's not really my argument to have. But let me make a few points:

1. This site is not monolithic. At the moment we have six writers, who encompass pretty much the full spectrum of sensible thought on PMs. I don't think any of us have ever 100% agreed with the others on anything we write - and we like it like that.

2. This is not a dedicated TF-, ZH, or Harvey-bashing site. We examine what they write and submit it to our analysis. We do the same for the perma-bears (Louis and I, and I think GM, are on record with our criticisms of Nadler et al). But we all think it important that no-one is immune from scrutiny.

3. We like to debunk. Recently we've debunked SGS, Trinity B, WB, and Sprott's silver delivery. Just because those we've debunked all (apart, perhaps, from TB) fall into the 'bull' camp, doesn't mean we have anything against bullish sentiment. It just means that their particular brand of nonsense is the easiest to debunk.

4. If gold goes to $500 and silver to $10 then, yes, I'm afraid that does mean TF (to use your example) is 'wrong' in his analysis (or his 'paradigm', to use your semantics). I think that's obvious, and I think he'd probably be the first to admit it. It wouldn't, of course, mean he was wrong in his motivations or his sentiment.

5. Both silver and gold will rebound over the next six months, and most losses will be recouped. By the end of this period, many of us will have learnt the value of 'patience' and the danger of 'greed'. That can only be a good thing.


PianoRacer said...

Re: Jeanne

1. I agree, and in fact appreciate the diversity of this blog. I'm not asking you all to agree, I am simply asking you all to be civil towards your brothers in arms (TF/ZH/Harvey/etc.) When TF bashes the bankers and the politicians, he is bashing people who are demonstrably partially culpable for the pain and suffering for many of the readers of his blog are experiencing. When Brian calls TF/ZH liars and charlatans, it deeply offends those whose paradigms were changed by these people. Offended people don't listen very well, and frankly, Brian O's comments on your excellent posts, being a "peer" (co-poster), hurts YOUR credibility. That may not be fair, but it's the way people's brains work. And what I am trying to say is that what you are doing is too important to let people like Brian prevent it from being more widely disseminated. As was posted above, it appears as though that is not a concern of yours, and you are happy with your own, small community, and that is certainly your right. I happen to think that if you're going to go through the trouble of doing this important work, you ought to do what you can to use it to help as many people as possible. The best way of accomplishing that, in my opinion, is to remove the element that I originally in-eloquently described as a "bag of dicks", which seems to be pretty heavily concentrated in one Brian O.

2. 100% agree, and apologize if what I wrote indicated that that is what I think. More scrutiny is exactly what I want.

3. I think there is a world of difference between the debunking you've done (which was great, BTW, and the reason I read this blog) and what Brian is saying in these comments and in his posts. Even Sprott's shenanigans don't make him a charlatan IMO, though it certainly lowered my opinion of him, and made me wonder why, with so many great reasons to buy silver, he felt the need to make one up?

4. You are right, and I mistyped - he will be wrong. But I don't think that he will be a charlatan, or even necessarily a liar, which is the point I was trying to make but biffed.

5. Amen - hope you are right. But, like you say - we are learning patience. I know I am, in any event.

And since I haven't said it for some reason yet... love the site and the work that you do (mostly).

PianoRacer said...

One more thing (feel free to skip my rants, I realize they are getting long):

SGS is shady, and he clearly has his own agenda (with his stock pushing and "new site"), but does he provide value? I would argue that he does. He posts links to interviews or articles that I find interesting, and often in a very timely manner. I don't find his opinions add much value, but there is some value for me.

Sprott stretched the truth / lied. I am definitely curious as to why; my guess is that it has something to do with money (that was meant to be ironic). All part of the mystery. But even given that, does his fund provide value? Is he a fraudster? Is there no metal to back it up, and should he be trusted as little as JPM? Does his crime imply all of that? I'm not so sure, and thus I would argue that "debunking" Sprott's claim provides less value than, for example, the SLV bar list project.

Frankly, I don't really care if people like Sprott and SGS use dishonesty and deceit to enrich themselves if the end result is that they're getting people to buy gold and silver which, presumably, is capital taken away from the corrupt and immoral banking/money system. I'd prefer that they stick to the truth, but I'd argue that the biggest loser are souls of the tellers of the lies, because anyone who is "duped" into buying physical gold or silver will, I think, end up very very glad that they were.

PianoRacer said...

Turd is wrong in that he sees every price drop as manipulation, but he is right there there is a substantial amount of manipulation in the market. He is right to blame the bankers and the politicians, but as a result he sometimes attributes things to them that are in fact caused by the herd, or a combination of both. Today's action, for example, makes a certain amount of sense. Gold didn't really drop all that much, and frankly I do believe gold's decline is due mainly to manipulation, and partly to liquidation by "troubled" entities who need to raise cash. It also makes sense that silver would decline more than gold in response to the Bernanke's scary remarks vis a vis the economy this week. If the economy is "officially" slowing, and since silver is used so widely in industry, the anticipation of lower demand could cause a sell off. Obviously silver didn't drop due to liquidation, since nobody holds any silver as a financial asset. But it doesn't make any sense that fear of a slower economy alone would cause the degree of decline as we've seen today. So what other explanation is there than manipulation?

Brian O blames the PM bloggers themselves, a concept I find ludicrous. Look at the pageviews of Zero Hedge and TF and Harvey O and the rest. Compare that to the pageviews of,,,, etc. Do you really think that these blogs are having any impact on the metals prices whatsoever? If they do, I have to imagine that it is minimal compared to the bullion banks.

The game is rigged, people. Play it at your own peril.

PianoRacer said...

"It is quite sad that a tremendous number of people aggressively bought silver based on lies spread by the likes of WB, ZH, Harvey Organ, Max Keiser, Turd, etcetera."

What specifically were the lies, out of curiosity? If you're going to claim that a bunch of people are telling lies, a grievous accusation in my book, it seems only fair that you go to the trouble of being more specific. And in any event, what is sad about it? If they bought physical, they still have their physical, and it is still going to rise dramatically in value, this "correction" notwithstanding. If they are playing the paper game, well, I don't think any of the people you mentioned have ever claimed anything other than that the paper game is played at one's own peril.

"Now that they have been exposed as charlatans, will they fess up and change their ways? Will they be capable of explaining to their lemming readers that there is a thing called downside risk?"

I don't think you understand the degree to which the readers and commenters of those "charlatans" have a very, very clear understanding of a thing called "downside risk". Many of them have lost their homes and their jobs, and follow the bloggers precisely because of their appreciation of downside risk.

"That maybe the manipulation story is overblown?"
How does this price action to do anything other than REINFORCE the perception that manipulation is rampant?

"Maybe Comex will never collapse?"

Well I think the jury's rather still out on that one:

"Maybe there isn't a silver shortage after all?"

Who says there is a silver shortage? How can you go "short" of something that doesn't actually exist (paper silver)? There won't be an actual silver shortage until either the above graph reaches 0, or the herd finally realizes that paper and physical assets are not equivalent.

"Maybe the dollar will stabilize?"

What is you definition of "stabilize"? From where I am standing, there has been a ton of volatility. What does this change about that?

"Maybe rather than hyperinflation, there will be severe deflation?"

False dichotomy, sir. Of course there will be both, but the amount of deflation is entirely up to those running the printing press. Will they value their currency more than their population? That's really the crux of the matter, isn't it? Either way, nobody is saying that there can't possibly be any deflation, it just doesn't seem to make a whole lot of sense when you look at the track record of the government. Maybe they'll suddenly decide to pay back that $15T by means OTHER than printing, but I just don't see it.

Cut him loose, guys. Brian is a liability to your credibility.

PianoRacer said...

Oh what the hell, I'm on a roll here.

Ok so this is a perfect example of a misperception I've seen often on PM blogs that I don't understand. The CME just raised margins on gold and silver (info that I got, by the way, from ZH. Is this a lie? Is the CME not hiking margins?)

Ok so the PM blogs always say how fraudulent it is to raise margins. And the way I see it they're half right and half wrong.

Of course margins have to go up to keep pace with the value of a contract if its price is rising, and if the margins otherwise stay static. But because margin hikes invariably affect the price of the item being traded (since it affects the cost of a contract for that item), knowing about them in advance would give one a HUGE trading advantage. Why don't the stupid margins rise with the price, automatically? Why are they defined in fixed dollars, rather than as a percent of the cost of a contract?

So, if you control when the margins are raised, you've got a neat "circuit breaker", because in a bull market, rising prices of an asset (i.e. gold and silver) make each subsequent purchased contract "cheaper", because the cost is the same but the value is higher which, I would think, would incentivize even more buying (possibly creating a feedback loop?) So, you have rise rise rise until you get really out of whack, and then if you're on the "inside" you get the heads up ahead of time as to when the margin is going to "catch up". So you start selling, knowing that the price is going down once the margin is raised.

So the bloggers are wrong that a margin hike, by itself, is manipulation. It's the fact that they control when the change in margin occurs at all that is the problem; that, and insiders knowing about it before everyone else.

I'd be very curious to know precisely when the margin hike decision was made, when it was released, and compare that to the recent selloff. And, frankly, data on ALL margin hikes and when selloffs that were attributed to them occurred.

Sounds like a job for the fine folks at Screwtape Files...

Like you say, there is a lot of disinformation out there. You guys should be like the MythBusters of the PM world. That's we need. We also need to know when the "myths" are correct, like margin hikes and manipulation. Or does GATA serve that role? (I am not terribly familiar with them as an organization).

Anonymous said...

Allowing ourselves to be challenged by alternative perspectives, including the polemic, is the defining feature of this blog. We ask all readers to consider and challenge all of the contributors' views. In return, we commit to providing a forum for diverse opinion.

You will therefore understand why, far from 'cutting [Brian] loose' we will continue to value his opinion and his contribution to this blog. If you don't want to see his views, then I suggest you scroll past his comments and don't click on his articles. It'll be your loss.

PianoRacer said...

I agree that the focus on the Comex is excessive, though it certainly is interesting. In the bigger picture, the price discovery mechanism for PMs is obviously horribly, horribly broken. It doesn't even really make sense (entities borrowing money to purchase a contract for future delivery of an item automatically sets the price for all transactions worldwide for that item? With no position limits?The two don't seem remotely equivalent...) Ultimately it seems that as long as those contractually obligated to deliver physical gold and silver are able to do so, they will - the question is how much they really have. Hopefully they haven't been secretly accumulating a Rhode Island-sized hunk of metal that they chip a piece off of occasionally to quell those crazies who actually want physical possession. What I wonder is, does it end when they literally run out, or does it end when they "decide" that they don't want to sell any more? If the latter, I wonder what factors they would consider when making that decision? I suspect that the system is too opaque to really have any idea. Either way, if physical delivery continues or, as I expect, accelerates, one day in the future the exchanges are going to have a problem, and hopefully we can come up with a better price discovery mechanism. That will need to happen for gold and silver to truly become money again, because it is their STABILITY that has historically given them their VALUE! If you break the stability of the price by breaking the price discovery mechanism, you destroy a big part (but not the only part) of the point of owning gold (and to a lesser extent silver - crazy multi-purpose metal)

PianoRacer said...

I often do, Jeanne. And my appeal was not so much for myself. But I understand, though I disagree.

Spicy Guacamole said...

I believe Turd said Comex was going bust last June. Harvey said it would collapse last April (though he's said that pretty much every cycle for more than two years now). Zero Hedge parroted the same language at the silver peak - just one more ounce and BAM! Comex will fail.

I missed the posts where they admitted they were wrong.

I and others such as Kid Dynamite, the Metal Augmenter, Bron, Screwtape and many others have documented over and over the misinformation posted daily on those sites. I have written in the comments on those sites, on my own site and in private emails with many people. Zero Hedge banned me. Harvey and his followers could only post incoherent responses that made intelligent discussion impossible. I only commented a few times on Turd and was met with the same hostility exhibited by Mr. Piano Racer, so I stopped.

If you want to debate with me, Mr. Piano Racer, I am here. Pick a topic, any topic and I will clearly and logically lay out my arguments for you. I will do it with out appealing to emotion, attacking made up enemies, using unfounded rumor, or appealing to authority. I also won't call for the death of public officials or root for the failure of this country. I also will show a little humility by acknowledging and respecting the other side of the argument and will always admit when I am wrong. Can your bloggers do that?

Louis Cypher said...

Always, Always make a copy before you hit that submit button.
Just to reiterate what Jeanne said we rarely see eye to eye on everything. The common thread between us all is we just want the damn truth. We don't necessarily want to make this our job so everyone here is a part time contributor. No pressure to produce and no flapping of the gums for the sake of making a post.
We don't have all the answers or even claim to. We go off the reservation occasionally with conspiracy theories (well I do) You may not like what we say. We may piss you off. Hell, we piss each other off. We do try and be civil to each other and guests but we are human with agendas.

Kid Dynamite said...

as you guys banter back and forth, i want to point to Victor's 4:34pm comment above - which is ESSENTIAL to the (non)-understanding of every silver-bug minion of the blogs Brian bashed and CANNOT get lost in this discussion... Brian wrote a post about it too, many months ago, called "You see what they want you to see" - Brian, hit us with the link...

Spicy Guacamole said...

On Comex inventories: you see what they want you to see.

PianoRacer said...

"[I] was met with the same hostility exhibited by Mr. Piano Racer, so I stopped. "

Other than accurately (if not in a literal sense) referring to you as a bag of dicks, and characterizing you as a liability to the other bloggers on this site, I have not been hostile at all; in fact, I posted a line-by-line takedown of your nonsense above, and if you'd like to have a conversation, I'd appreciate the same line-by-line response.

The reason nobody has been receptive to your message is because, like I said, you act like a bag of dicks. Whatever salient points, if you actually have any, get lost in the dickbaggery. If you are merely attempting to be an agent of truth and to "save" those poor souls from the evil "charlatan / liar" bloggers, the way you conduct yourself does not convey that in any way whatsoever. The reactions you receive are to the delivery of your arguments, not the content, though the content is easily refuted as I have done above.

KD: It sounds like your only dispute is on the timing of events, because the COMEX may have far more silver than is officially reported? That I can agree with. As I mentioned above, how could we possibly know how much physical metal they really have? Even if it's not in the COMEX now, if they really really want to keep the game going, they can sell their physical, sort of like eating the seed corn... unless/until there is a truly global run on physical (which is what I believe it will take). It all comes down to internal decisions that we will never be privy to, thus making timing the collapse impossible.

That's why I stack physical and have very, very long time horizons, even though I strongly believe that in a sane universe where people did their own research instead of blindly accepting what they are told by those in positions of authority, the collapse would have happened long, long ago.

Warren James said...

@pianoracer - yes apt point regarding the unofficial inventory. I believe the only window into this data is in the bullion bar lists - over time we hope it will reveal 'the dark pool'.

It's your prerogative to say whatever you like here (and actually we're glad for your input), but ultimately you must address whether the silver blogs are doing a disservice to the community by perpetuating memes like 'they don't have the silver 100:1"?. Should the line defining their culpability (and liability) simply rest with what they define?

The key is that there are a larger number of folk searching for the way out of this financial mess that has come about. They have different investment time frames (to you), and most of the hordes are new and unsuspecting. That makes the burden of responsibility for the leadership all the greater. [our approach --> Friend or Foe?.]

Kid Dynamite said...

@PianoRacer - the COMEX doesn't "buy" or "sell" anything. It's an exchange. The metal traded on the COMEX is an odd lot in the grand scheme of things (As Victor pointed out). Of course, the "silver bloggers" don't understand that at all either, so they propagate bad info, which spreads via the miracle of confirmation bias in the silver community...

see, i would use your exact words with a different conclusion: "I strongly believe that in a sane universe where people did their own research instead of blindly accepting what they are told by those in positions of authority" that the poor silverbugs who have been fed a complete load of crap by random bloggers who lack an ounce of expertise, that they wouldn't be buying metal and burying it in their backyards, convinced that they were part of some grand revolution against the evil bankers.

And, although you didn't accuse me of dickbaggery (yet), I have been accused of it in the past, so let me explain: there are people who have an idea what they are talking about: me and brian for example. there are people who don't have the first foggy clue about financial markets, futures trading, etfs, etc: Harvey Organ for example. That doesn't stop Harvey from making stuff up, completely miseducating hundreds of thousands of readers on a weekly basis, and simply creating lies and confusion, which, thanks to the miracle of the internet you noted above, propagates like a virus. Then, these new, false informed "soldiers" come and try to argue with me about something they know nothing about. Surely you'll forgive me for responding in a hostile tone when I'm assaulted by ignoramuses?

I have (as has Brian) spent a large amount of time detailing in simple, impossible to misunderstand English the falsehoods held by the silver community. It's all there for free, for people to read. The main reason the message doesn't get through is simple: CONFIRMATION BIAS. Silverbugs would rather read that they are part of some team that will take down JP Morgan than read the truth....

if you want to discuss any of this with me, you can email me on my blog. I'm nog doing comment thread debates on other people's blogs anymore.

Kid Dynamite said...

also, PianoRacer, I strongly suggest you take Brian up on his offer:

"If you want to debate with me, Mr. Piano Racer, I am here. Pick a topic, any topic and I will clearly and logically lay out my arguments for you. I will do it with out appealing to emotion, attacking made up enemies, using unfounded rumor, or appealing to authority. I also won't call for the death of public officials or root for the failure of this country. I also will show a little humility by acknowledging and respecting the other side of the argument and will always admit when I am wrong. Can your bloggers do that? "

it can only broaden your understanding.

Anonymous said...

Oh Kid, the bits and bytes of this conversation take up very little space, and if you haven't noticed, nobody else really comments on these boards besides the posters (see my previous comments on potential reasons as to that). I'm sure the authors wont mind; it adds to the conversation! Brian can respond, if he wants, to my post above, line by line.

The particulars of the Comex/Globex/etc. don't concern me overmuch, because it is a broken price discovery mechanism. The charade will work until it doesn't. Look at what happened in the physical market these past days when the price was smashed.

Answer me this question: if these EEEEVIL, misleading, horrible PM bloggers like Harvey O are committing the terrible crime of TRICKING these poor "ignoramuses" into buying physical silver and falsely accusing the poor, defenseless bankers:

1. What is their motivation? Cui Bono? Is Harvey getting rich? Is it just blog traffic / donations? I can't imagine that the time put in by these posters pays that well in AdSense...
2. Do you agree that silver is undervalued or is this part of the "complete load of crap" that "silverbugs" have been "fed"? If so, it seems like a good investment regardless of the motivation for buying, so, whats the harm? If not, why not?

I make it a point not to argue with haughty bloggers / commenters who toss around terms like "liar/ignoramuses/charlatans" (much more offensive than dickbag in my book) and who don't respond to my exact words/questions, but if you (or Brian) have a mind to, you can do so right here or via e-mail. You've both responded with generalities and really haven't added much to my understanding thus far; very disappointing, but not entirely unexpected.

Kid Dynamite said...

Pianoracer - the reason I don't like to have discussions on other people's blogs is that 1) i refuse to "subscribe" to comments, and thus 2) I have no idea when you have replied.

You wondered why this blog doesn't have as many comments as the blind silver blogs? I wrote a blog post on that multiple times - it's called Confirmation Bias

I've also debunked the nonsense that you read from Harvey and others on a daily basis, over and over again in both posts and comments, which is why I don't want to do it in the comments here.

here's a start for you (the URL should give you a topic hint):


Warren James said...


When I first looked into silver I had the misfortune of reading a Jason Hommel article. Then I read about the silver shortage story. I thought I did sufficient due diligence - a year later, turns out not.

The authors of those articles fully believe what they wrote so their motivations are good and healthy. No problem there.

But where does the line defining their culpability and liability, rest?

And as far as we go - in the course of our research, Louis has spoken with Harvey personally on the phone so we know 100% he is a good guy, but that doesn't validate Harvey's wrong assessment on the Japan-earthquake-banking-meltdown-scenario.

And personally I have lost big listening to Zero Hedge ... I now just use them as a contrarian indicator.