A follow on post from below.
However, the depleting inventories story was sleight of hand back then. The bankers used the Hunt Bros as patsies and fed the story until they were ready to pull the rug. It was a movement of inventory from one place to another that created the "shortage". The Hunt bros and the public bought more as it confirmed their theory and then lo and behold the bankers changed the rules mid game and the price collapsed. Martin Armstrong mentioned all this in one of his essays.
Remember all those ships full of oil parked creating an oil spike? Same idea. Just google... lot's of links
Sprott used it recently to great effect so much so that his "fully backed" silver ETF was 20% above market value. If you think about that statement then what it means is his silver fund was not fully backed by Silver unless you were willing to pay 20% more for your bullion than it was worth.
Is someone paying ZH?
His three month delays in receiving his Silver fed the story of Silver shortages which Warren duly exposed as probable hyperbole
With the ETF's etc. co-mingling bars in a single vault they can disappear from view (inventory list) for periods of time without physically moving and without an available public daily inventory listing it allows the banks to position themselves for a run in front of news like this. However, if you track the bars (see Warren's detailed analysis ) then you notice previous "outflows" seem to come home. If anything GLD has more gold than they tell us. So what I am saying is this is possibly a bull trap. It doesn't matter in the short term if it is but just be aware they just might be parked somewhere waiting for the price to go up just like those oil tankers. Except in this case by "parked" they are just not listed in inventory and haven't moved a millimeter. Caution.
27 comments:
you don't even have to go back as far as the hunt brothers...
you just have to go to the last time Zerohedge hyped the depleting silver inventories...
May 2011:
http://www.zerohedge.com/article/and-so-it-continues-another-92-thousand-ounces-physical-silver-withdrawn-comex-despite-histo
"demand for physical inexplicably persists"
June 2011
http://www.zerohedge.com/article/comex-physical-silver-drops-fresh-all-time-low-288-million-ounces-3-drop-overnight-30-drop-s
" At this rate of withdrawal and "adjustment", there will be no physical silver left in the entire Comex in about 5 months. At that point, even one delivery intention will send the price of silver to previously unseen levels."
and then read the comments on those posts... hmmm... sounds familiar?
True dat. I like to point out the Hunt bros scenario because Armstrong wrote about it. His word carries a lot more weight than what the average journalist or blogger can comment on. He invented some of these games.
Do you collect all these ZH headlines in a little bag so that you can whip them out on demand? :)
Hah!
I just joined the KD club and got kicked off ZH. I challenged Tyler to a put up or shut up bet so he deleted my post and cancelled my account.
There is a lot of nonsense being sprouted by mainly US based commentators. As the market goes against them they don't stop and consider whether they are missing some key pieces of information, they just shout louder and attack those who disagree with them, per your experience Louis. One threatened to banish me the other day for a sharp comment I made, (but true), saying I would have to hang out with the Screwloose crowd. Naturally, a threat like that has to be taken seriously so I apologised. Touchy times.
Being kicked-off sites is probably a badge of honour. I notice that people are "disappeared" from sites such as FOFOA and many others I must also mention KD's site is not against banning people. As soon as you see a "controversial" comment you never see that person again. If you go against the "hero-worship" and fawning consensus you are "disappeared".
Sort Pinochet style.
I've been "disappeared" from FOFOA. I take it as quite an accolade.
Having said the above I would also like to say that I take my hat off to people like FOFOA and as I've mentioned KD, to him as well. They make a lot of sense (most of the time).
I could never write a blog. It would take take up too much of my time that is normally spent sitting in the sun and drinking wine.
BUT if I was to pump up my ego and decide to enlighten the World I would not ban anyone (except foul language). I would just ignore the comment if I didn't agree and let it stay. If you ignore people they soon get the message. To ban comments is to agree with the curtailment of free-speech.
Another thing, whilst I'm on a roll. I really object to the term Troll. I think it trips of the keyboard too easily and is a catch all term for anyone that doesn't agree with the consensus. People who use the word Troll are normally reflecting on their inability to handle argument.
duggo -
it's really hard to get banned from my blog. I think my "banned" list is like 5 people long. 1 was an ignorant silverbug from several years ago, one was a guy who went out of his way to argue with each and every single thing i wrote, without substance, and 1 was recently where I banned the guy who suggested that the marathon bombing was faked.
I do take offense to the suggestion that "As soon as you see a "controversial" comment you never see that person again." That's simply not true at my blog.
but anyway, my point here is that you don't have to trust me or listen to me - the history is all there, free to read, on the interwebs...
just like during the PSLV premium hype, the suckers could have read all they wanted to about how ZH and its commenters said the EXACT same thing the year before about PHYS...
I think if you read the comments (And the content) of the posts above, only one word can come to mind.... "Warning"...
It is certainly not just Sprott, KWN and ZH who are pointing out the exploding premiums for silver and gold coins, the US and Canadian mints selling out, or all the anecdotal evidence of a PM buying turning into a frenzy overseas. Just check tulving.com.
Personally, I haven't been putting new cash into gold based on Sprott, KWN or ZH sensationalism. But MF global, Peregrine and Cyprus have clarified in my mind the difference between physical possession and promises of security from financial institutions and governments. This week I made a big step by sacrificing electronic nanosecond liquidity and moving to physical security. I simultaneously sold my ZKB gold ETF shares and bought physical. Far more than the default of a Swiss or any other ETF sponsor, I fear a government edict concerning gold supposedly held in my name by financial institutions, even in a safety deposit box.
So you guys can scoff all you want at these other gold bugs and pretend that no large banks, CB's or government agencies are manipulating the markets or surreptitiously mining ETF gold. In the end I am convinced that Sprott et al will be proven right and you all will look like a bunch of leaf eating sloths hanging upside down from limbs who misunderstood the significance of all that activity going on forest floor below.
This is what I wrote ... not verbatim because I didn't copy it at the time. No foul language no disparaging remarks. Just a bet.
I quoted him first:
"
What happened to the commercial gold vaulted with JPM, and what was the reason for the historic drawdown?
Gold, unlike fiat, is not created out of thin air, nor can it be shred or deleted. Where did the gold leaving the JPM warehouse end up (especially since registered JPM and total Comex gold has been relatively flat over the same period)?
Did any of this gold make its way across the street, and end up at the vault of the building located at 33 Liberty street?
What happens if and/or when the JPM vault is empty of commercial gold, and JPM receives a delivery notice?
Incidentally, JPM now has just under a paltry 5 tons of eligible gold left in storage. We hope this is also the maximum exposure it faces for imminent delivery requests, because if tomorrow it receives withdrawal requests for 141,581.5 ounces +1, then things get really interesting."
I have heard this song before so spit it out Tyler.
Do you expect a default and/or settlement in paper?
Do you think the gold left the vault to parts unknown? China or bankers getting theirs before TSHTF
I will bet you a ounces of the precious if any of these scenarios play out this month or even this year.
@KD,
This is worth a read, for anyone that doesn't entertain the possibility of 'false flags'. Historical evidence (official sources) shows that it pays to keep an open mind:
http://www.washingtonsblog.com/2013/04/forget-boston-911-and-oklahoma-city-is-false-flag-terrorism-even-a-real-concept.html
As America dives towards martial law, it will pay to remember events like 9/11 and Boston.
No one can say they weren't warned.
@LC, I have been banned twice at ZH, both times for highlighting their hypocrisy in criticising the FED/BoJ/BoE for endless QE, whilst also criticising the ECB for a market-based approach, whilst not funding governments with QE.
It is a credit to STF that it allows free speech,whilst casting light on many of the shenanigans in the gold and silver world.
Bull Trap ahead. I like that. Sort of reminds me of seeing a road sign that says "slippery road ahead" that you see on a sunny day after the snow has gone. You think I'll ignore that as you hit the diesel spill and slide off the road.
I have my own personal trap called the Duggo Deep Thought Trap. I can usually guarantee that after I've really thought things through and decide to buy Gold the price plummets. When I sell it goes through the roof. I've tried being contrarian but that doesn't work either. I now just buy when I have the money and try not to beat myself up. I now just hang onto the stuff and never sell. So far I'm well ahead.
I've never quite understood the reason for buying Sprott Gold and Silver. Why pay more for something. Am I missing something? I have an uneasy feeling about all of these "high-profile" people that are continually popping up on King World News. They remind me of the guy who used to walk along Oxford Street in London with a placard saying "The End of the World is Nigh". He eventually died of old age.
Finally Jim Sinclair is almost beside himself shouting that Gold will be $50000 an ounce this time next week or next month. I've jus worked out that by relying on Jim I could soon buy my own tropical island paradise.
Duggo,
FOFOA banned you? Really? I find that very hard to believe. The comments are on unmoderate right now (as long as Art stops being a psycho). Go post there and see if it goes through. I am signed up to get emails every time someone posts, and I can never recall seeing your comments deleted (like Art's do) when I get a duggo email from FOFOA blog.
Milamber
Hi Milamber
I was revelling in my notoriety. Don't ruin my self-importance by telling me it's just a glitch. Each time I've made a comment it's just disappeared.
Duggo,
Either it's in your own head or you are having computer problems (or you are intentionally lying). You are not banned from posting at FOFOA's blog and never have been.
I wonder if any financial blogger would show people how they trade with something similar to a Facebook Fantasy stock app.
Dear Aaron,
I try not to intentionally lie but maybe I unintentionally lie. But if it was unintentional then it wouldn't be lie. Would it?
The trouble I find with the comments section is I feel like a naughty child. There are all of these serious in-depth prognostications and examining of the Free-Gold entrails that I have to keep stifling a need to poke fun. I can resist the image of a Life of Brian. All the acolytes sitting around waiting for the next message from the Messiah.
I have an IMac and it doesn't seem to have problems posting my nonsense to any other site.
Maybe it's my bad baritone ukulele playing that gave the site indigestion.
Perhaps I'll pass by and give it another go but I have a feeling I must hurry up because if Freegold is just around the corner there will be no need for the blog anymore.
Gavin,
@KeithMcCullough on Twitter, I follow him to get the gold bear's perspective. He is very active in US equities and treats Twitter as the new tape.
S Procheimian has been detailing my trades after the fact (no App), but his column seems most popular when I'm dusting off large piles of cash. Go figure.
btw, I've now made it all back, but that little rat won't write it up.
Gavin,
Further to your point, I think it should be obligatory for ALL precious metals bloggers to trade, and the more hyperbolic and out-there their commentary is, the larger they should trade, on margin.
In the interests of accountability, Taleb style, this would be the most efficient way to either a) remove bloggers who are ill-informed and just plain wrong from the pundit-pool; or b) force them to re-evaluate the examination of only factual information in order to avoid going broke.
@S Roche
it should be obligatory for ALL precious metals bloggers to trade, and the more hyperbolic and out-there their commentary is, the larger they should trade, on margin
I could not agree more. I am fed up of the usual suspects 'calling' bottoms with impunity. If it's a bottom: show us your trades...
A particular culprit is Jesse, who always reports the perfect trade... one week after the event...
I hope at least that someone - you, actually, S Roche - will confirm my short trades on silver and gold over the last few months.
As it happens, I did promise the STF readers that I would tell them when I did eventually buy gold. For the record: I haven't yet. $1,335 wasn't tempting enough for me.
JdA
Jd'A,
To stop you buzzing our tent-city repeatedly in your private jet, driving the point home in what you headily imagine is a humorous way, I will confirm (from my detailed records of our correspondence)that you were short at opportune moments, as you say.
But, (did you really think there wouldn't be a "but"?), as Ben Hogan always said: "the most important shot in golf is the next one" and with that in mind, I note your comfort level in gold has not been reached so I trust that you continue to be mindful of GM Jenkins Fundamental Law:
http://screwtapefiles.blogspot.com.au/2012/11/gm-jenkins-fundamental-law-of-21st.html#more
See GVZ today? Looks like there could be big moves next week.
"it should be obligatory for ALL precious metals bloggers to trade"
That wouldn't work SR. They would have to put their money where their mouth is.
Anyway the purpose of most PM blogs is to flog Gold and Silver coins plus earn from ads.
Sad news. Duggo's infallible buying system has broken down.
Bought 2 Gold Mexican 50 Pesos and they immediately went up in value.
Can't understand where I went wrong.
The slanging match between duggo and jojo was essentially just mutual abuse. I have removed it as it adds no value whatsoever to the discussion.
A reminder that free speech reigns supreme at Screwtape, but a certain chivalry and politeness is also expected.
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