Wednesday, February 24, 2010

Open Forum

video

56 comments:

Aleksandar said...

Hmm, I assume making it from tungsten will be more expensive. It has a high melting point I believe.

Besides, the imprint will probably not be possible to do with a hammer by hand.

But then again, labour is cheap in the places where they do that.

If I dont forget, I will make a pic of the Au plasma from the deposition system in our lab the next time I make a sample.

wtfxgoindown said...

Tungsten rumors only make the real thing worth more, not that it needed the held anyway

costata said...

FOFOA,

Is the answer staring people in the face but they just refuse to see it?

From Jim Willie's latest public commentary:
"The faulty foundation for the Euro currency and EU economies is the crux of the current problem under the microscope,"

JW cites the following as the "faulty foundation"?
".... since no mechanism exists for a bailout of any government by the European Union, other member states, or the European Central Bank."

Perhaps that was intentional.

"Short of withdrawing (or being expelled) from the European Union, the only options for Greece are to reduce the deficit (Yes) , default on government debt (Yes), or receive a bailout (by another entity but NOT the European Union, ECB etc).

Option 4. Receivership?

Earlier in this piece JW said:
"The Euro currency has finally begun to stabilize, which will make all the more apparent a global bull market in the Gold price."

Why is it stabilising? Perhaps due to a universe of difference in the way it is managed compared to the US$.

"The Gold price in almost every major currency is rising. In the US$ it will be last."

FOFOA, isn't this straight out of A/FOA's script? A final massive blow off rise in the US$ (from whatever level it is at the time) and then a soaring US$ gold price as the US$ finds its true valuation.

Above extracts from:
"Over-Arching Sovereign Debt Crisis"
by Jim Willie, CB. Editor, Hat Trick Letter | February 23, 2010
http://www.financialsense.com/fsu/editorials/willie/2010/0223.html

costata said...

FOFOA,

Another gem from Jim Willie:

"The Gold breakout in Euro terms is possibly soon to be joined by breakouts of Gold in British Pounds, Gold in Japanese Yen, and Gold in Swiss Francs, with the Gold breakout in USDollars last."

Sounds plausible.

"When the surge is universal, Gold will be perceived as a currency in full direct competition with the tainted fiat paper currencies!"

Gold a currency, that is:
1. NOT Legal tender in most countries.

2. NOT able to be used to satisfy a contract in most legal jurisdictions around the world.

3. NOT owned by enough people to allow them to transact in gold.

JW, how about this as a possible scenario? My edit of your words in bold.

"When the surge is universal, Gold will be perceived as the best store of value while the tainted fiat paper currencies will be used only for transactions!"

GG said...

Has anyone thought about the possibility that many national governments might DISSOLVE in the chaos that's about to ensue. We know the Roman government (such as it was) did. What will that do to the "legal tender"? WORTHLESS!

GG said...

Ultimately, I think this crisis is not only about our financial system but our society and it's governing institutions as well. Today, most of them are rotten to their very core and IMHO, nature will purge the rotten stuff and cleanse both our society and money. "Why will nature do this?", you may ask. Well, survival of the fittest demands it.

Martijn said...

China might be buying

Museice said...

CHART OF THE DAY: Wall Street's Gravy Train Is About To Hit A Brick Wall

Museice said...

European investors pour money into gold

"Succinctly – gold is continuing to make one new record high after another when priced in terms of the Euro. While we here in the US are naturally focused on the Dollar price of gold, gold is performing superbly in terms of the European currencies."

Museice said...

Two Short Videos For Your Weekend Viewing Pleasure

Just a little something to watch to make you feel good about your investment.

Museice said...

and because I like to scare myself with thoughts of losing 3/4 of my wealth...

Gold Price Crash Forecast to $250 an Ounce

Aleksandar said...

Muse, that Au expressed in euro is doing well is a result of the $/eur exchange rate.

Gold is traded in dollars and that market is price- and trend-setting. The second component in the euro Au price is the $/eur forex market that is orders of magnitude greater and driven by different market forces.

Tungsten, on the other hand, can be traded in euros I believe.

Museice said...

How We Get Out of a Deflationary Debt Spiral

"First is a super-sovereign currency a la the Euro, whether on a Western basis (i.e. something along the lines of the Amero but with a different name) or via something from the IMF. The second possibility is a coup by one or more of the emerging economies of the world, who could introduce a hard asset-backed currency in an act of economic warfare. Such a plan could help explain why China is the first country using a paper debt-backed monetary system in a long, long time (ever?) to openly encourage its citizens to buy silver and Gold.

Finally, there is the possibility of the paper masters of the world fostering a Gold bubble. As Soros said, the ultimate asset bubble is Gold. By encouraging Gold prices to go higher, the declining value of paper money is overtly exposed to market participants and can become self-sustaining."

costata said...

Hi All,

Re: Silver

The latest post by Harvey Organ reports that around 4.6 m/oz of silver has been removed from Comex inventory recently. He also reports that the number of silver contracts potentially standing for delivery Feb/March is enough to clean out the dealer inventory at Comex.

I am wondering if this is a metal raid or an attempt to collect a 25% premium in currency? (as rumoured about some recent settlements on gold deliveries)

If this is a "game of chicken" I hope no-one makes a mistake and causes a default. Wouldn't it be a huge irony if silver blew up the paper gold market instead of gold?

floydian slip said...

Headline for the Friday (newspaper) Edition of USA Today...

"Last Chance For Gold"

Its really about the olympics, but... You know how the TPTB like irony :)

costata said...

All,

If TomB drops in please draw his attention to this extract from FOA.

Re: Belgium's gold reserves

"Euro/BIS group just stands there and allow this to happen. The fact is that they (Euroland) have the gold in the BIS system (never really sold it outside) and do not care what happens to the prices of contract gold expressed by the US or LBMA marketplace." (My emphasis)

http://www.usagold.com/goldtrail/archives/goldtrailone.html

FOA (4/15/2000; 14:31:21MT - usagold.com msg#16)
The trail is getting rough!

Michal said...

Zerohedge notices gold and dollar rise simulataneously, just as A/FOA predicted more than 10 years ago.

greyfox said...

Very interesting article considering what others are saying about Comex delivery/inventory in March.


Per Adrian Douglas

https://marketforceanalysis.com/index_assets/COMEX%20Inventory%20Shows%20Alarming%20Trend.pdf

Investors should make sure they own physical bullion and not a paper substitute. When the music stops, and it looks like it could be soon, paper promises will not be honored with bullion. When a shortage becomes obvious to investors the price of bullion will be multiples of its current price. But those holding paper promises will not benefit. At best they will be paid in fiat currency and probably after months or years of legal wrangles, and most likely at the price on the day of default, not at the price on the day of settlement. Why accept anything but physical bullion?

I estimate that as much as 50,000 tonnes of gold has been sold that does not exist. That is equivalent to all the gold reserves in the world that are yet to be mined, or put another way, 25 years of gold production. That is the grand-daddy of all short positions! As physical market shortages lead inevitably to exposing this scandal there will be the grand-daddy of all short squeezes and the granddaddy of a bull market in precious metals….

Jimmy said...

The recession is over, Steve Sjuggerud


Hmmm...

allen said...

To : Fofoa, or anyone else.

Has anyone bought gold from USAGold.com and if so, do you recommend them?

Museice said...

SOVEREIGN ALCHEMY WILL FAIL

"So the last 100 years will be seen in history as an extraordinary period when governments thought that they had invented a new economic miracle based on unlimited credit and money printing. But sadly this miracle will be seen by future historians as another failed delusional economic theory dreamed up by politicians."

"Governments have suppressed the gold price in the last 30 years by both overt operations (official gold sales) and covert operations (manipulations in the paper gold market and unofficial sales). Central banks are supposedly holding 30,000 tons of gold but credible estimates suggest that this figure is around 15,000 which means that 15,000 tons of central bank gold has been sold covertly to depress the price. But the effect of manipulation of any market has a limited time span, especially if it is done in connection with a total mismanagement of the economy. Central banks have now stopped official sales and China, India, Russia and many other countries are major buyers. Production is falling steadily and investment demand is soaring. With the fundamentals so much in gold’s favour, it should have no problem to reach the 1980 inflation adjusted high of $ 6,400. With inflation or hyperinflation gold will go a lot higher than that."

S said...

jimmy..

That guy re the yiled curve is an idiot..

Jeff said...

Still no sign of greek bailout or mention of gold. In fact the Germans and Greeks are at each others' throats. Greeks brought up nazi past and have begun to boycott German products. Germans photoshopped a Greek statue with a raised middle finger as their response to bailout request.

Meanwhile, jim rogers says the british pound could collapse in weeks:

http://www.digitaljournal.com/article/288143

allen said...

Jimmy,

Interesting article, but the problem with that analysis is that there hasn't been QE before. How does that play into the formula?

GG said...

From the Telegraph:

"Twisting the knife further, he [Theodoros Pangalos, Greece's deputy prime minister] said the current crop of EU leaders were of "very poor quality" and had botched this month's crisis summit in Brussels. "The people who are managing the fortunes of Europe were not up to the task," he said."

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/7309861/Greek-rescue-in-danger-as-deputy-prime-minister-attacks-Nazi-Germany.html

Given the present sorry state of both the Euro and EU - not to mention the [so far] botched attempt at becoming an alternate reserve/oil-transaction currency - I'm having a hard time disagreeing with Mr.Pangalos.

S said...

FOFOA,

Any thoughts on why the Mint outsources the minting of American Eagles...they have canceled as you know all Mint produced coins but as I read it are still distributing the bullion coins through the dealer netowrk? I wonder technically if they have a legal liability given this distribution mechanism?

Thoughts on this?



"Aside from the proof version, the United States Mint does not sell American Eagle Bullion coins directly to the public. Instead, the Mint distributes uncirculated Bullion coins through a network of wholesalers, brokerage companies, precious metal firms, coin dealers, and participating banks, a network known as Authorized Purchasers."

Aleksandar said...

Jeff, yes they mention gold (Greece against the Germans). Here. Scary to drag WW2 atrocities at this point. Very scary.

The above, together with that Spanish minister stating Spain's secret service is examining speculators from the Anglo-Saxon world for unlawful financial pravtices, and now also the counter-attack against Soros is really worrying stuff.

This is no film, or something that is playing the TV screens people!

costata said...

GG,

"The people who are managing the fortunes of Europe were not up to the task," he said."

IMHO none of these politicians are there to "manage" anything. They have been put in place to follow the orders handed down to them by the faction of the Giants that ultimately pulls their strings. The EU President etc were not elected. They were appointed.

In relation to the Euro consider the possibility that things are on track despite appearances.

A/FOA and FOFOA have made it clear that the architects of the Euro were not trying to replace the US$ as THE single reserve currency. The Euro is accepted as A reserve currency. Perhaps that is a "mission accomplished".

Provided the price of oil isn't going ballistic a lower Euro exchange rate is good for Germany and other heavyweight exporters in the EU.

According to Wikipedia the quantity of Euro (notes and coins) in circulation around the world surpassed the US$ by October, 2009.

A/FOA indicated that the switchover from US$ oil to Euro oil could be sudden. FOFOA has also pointed out that no-one wants to be seen to be responsible for breaking the US$/oil nexus.

Lastly, the vampire squid and their ilk are making a killing as they harvest the wealth of their selected victims through these volatile markets.

Would it surprise you if they slaughtered the Euro shorts later on this year by crashing the US$ again?

One day the game ends (in its present form) but while some factions of the Giants are making a fortune from the volatility IMHO they will prolong it for as long as they can. Perhaps this is part of the pay off for their co-operation and assistance.

Museice said...

Why China’s Rumored IMF Gold Purchase, If True, Would Be of Huge Significance

"One, such a purchase would give more validity to the theory that China, with a vested interest in the price of gold today, is willing to intercede and support gold prices whenever they are being attacked by the US Federal Reserve and Bank of England through their manipulation of fraudulent gold futures markets in London and New York."

"Two, it would further support exposing the gold futures markets in London and New York as nothing more than a gold fractional reserve playground that allows the western banking cartel to manipulate gold prices."

"Three, if this story is later confirmed to be true, only an inside Chinese source could have leaked this story. No inside source would have leaked this story unless the deal had already been sealed as such pre-sale information would be very detrimental to China as it would lead to a higher purchase price."

"Finally, if this story were confirmed, then this event would likely allow gold as well as mining stocks to form a bottom in preparation for a move higher."

costata said...

Hi FOFOA,

Re: SDRs (for others the IMF Special Drawing Rights)

I mention this topic because you may have wondered why this simpleton could have taken so long to come to grips with the concept of Freegold. As you will see I had to overcome a few hurdles with your help and some instruction from A/FOA.

Before I explain further let's hear FOA's thoughts on one of these obstacles, the SDR:

"At the right time the Euro Zone will withdraw from the IMF, leaving the US and its factions as the only support for dollar credit assets held overseas. Then the evolution of SDR use our guide knows so well will be complete."

"This will leave the SDR interpretation open to only one avenue to finding support: it's basket currency function dissolved, gold will have to flow from American based stocks. With most of the present official credit gold leverage built upon IMF protocols, the US will find itself shipping ever higher priced gold to defend an ever lower valuation of dollar exchange rates."

http://www.usagold.com/goldtrail/archives/goldtrailfive.html
FOA (08/24/01; 10:54:30MT - usagold.com msg#101)
Part 2

(As an aside, these are intriguing words: "the evolution of SDR use our guide knows so well". Another? How does he know it "so well"?)

This could explain why the SDR is still central to many discussions and plans of the political elite. Perhaps it is being kept alive on the pretext of being a possible solution to the "GFC" until (while?) the Euro faction of the Giants implement their hidden agenda for the SDR - prompting the "swapping out" of the USA political gold.

As I said above there were obstacles to overcome in accepting Freegold. One of the major hurdles was cleared once I understood that fiat currencies would continue and be totally unbacked by gold. Their issuers would be disciplined, to some extent, by their currency's valuation in gold and hence to other fiat currencies.

I firmly believe that the politicians and bankers will never willingly give up the core of their power - the ability to issue fiat currency. So the architecture of the Euro removed this concern for me.

I understood quite quickly that the store of value function could be removed from fiat currency by Freegold. Leaving fiat currency to function purely as a medium of exchange. I wondered: Could the SDR challenge Freegold for this role? I gradually realised that my answer had to be NO.

While the SDR basket has a heavy weighting toward the US$ it carries a terminal cancer. If the weighting of the US$ was dramatically reduced it would not serve the interests of the sponsors of the US$ hegemony. Checkmate.

Finally I contemplated Freegold's impact on the Forex market. FOFOA, as you know this is the biggest market in the world. Together with the debt market it is so vast that even Giants can deploy trillions in capital without leaving tracks. So I wondered: Does Freegold threaten the Forex market?

Again my answer was NO. There are so many factors that impact on the Forex market. The opportunity for speculation would still exist after Freegold came into being provided pure fiat currencies were still issued.

Jimmy said...

@S and Allen: I know, it was a funny shocking title when I received it in my mailbox...

@Aleksandar: The problem is the hedgefunds who owns CDS-derivatives: they get the insurance-money (a gigantic amount money to win) if Greece default, and they're attacking Greece to default it... It's an economic war on this moment...

@costata: Very interesting analysis of FOA.

1) Would it surprise you if they slaughtered the Euro shorts later on this year by crashing the US$ again? No, it wouldn't be surprising to me...

2) factions of the Giants are making a fortune from the volatility Yeah, if they know the future (manipulation and frauding) and read "the volatility machine of Michael Pettis" But it's very difficult book to read it...

3) A/FOA indicated that the switchover from US$ oil to Euro oil could be sudden. Never, Saddam is killed for this... Saddam H. would be payed out in Euro's for oil. Then America invaded Iraq... And FOFOA is right with his remark, nobody would be responsible for breaking the US$/oil nexus.

4) the US will find itself shipping ever higher priced gold to defend an ever lower valuation of dollar exchange rates. Only if China would agree devaluation or depreciation. Or 'the nuclear option of FOFOA' is a possibility... Who knows...

5) I firmly believe that the politicians and bankers will never willingly give up the core of their power - the ability to issue fiat currency. I believe it too, if I own the counterfeinter. I would defend it with my life, till the last moment of usage, with building up my 'private' physical goldpositions or raw commodities...

6) If the weighting of the US$ was dramatically reduced it would not serve the interests of the sponsors of the US$ hegemony. Checkmate. Yes, then NWO-game is beginning...

Jimmy said...

If you want to understand what really happened in the great depression: British Financial Warfare: 1929; 1931-33; How The City Of London Created The Great Depression, Webster Tarpley

The complete book online

S said...

fofoa,

provided the path to freegold is the ultimate end, would not a closet industrial policy dictate that the US multinationals use their currency rapidly to consolidate up peers and position before a paradigm reset. It is in this contexxt that we entered the year with GS saying that there would be huge waves of M/A under the guise that corproate balance sheets are robust. ZH did a good article on the way in whcih this cash is accruing: namely by comapnies trimming working capital and cutting investment. back on topic, one thing I am acutely aware of and looking for is not so much donestic m/a rather cross border flows. There has been virtually none. The US attack on Toyota is the canary in the coal mine in regards to non tarriff barriers. That said, if you belive the path leads to a much devalued dollar then the path for tose holding them is clear: deploy them for real asets as quickly as possible. But if everyone else knows this to be the case, then you get a stillborn cross border market. I noticed last week that Monsanto lost a bid in India to sell gen modified seeds. As a sidebar check out Buffet's little parable in his letter about using stock to do deals. it is instructive if only becasue he ironically puts the other bookend to Greenspan's comment that rising equity prices are "real" wealth. Real wealth to those who can employ it to consolidate up real assetrs. The problem is outside the US there are no sellers. Something to consider.

costata said...

S,

Thanks for your observations on M&A. IMHO in most key sectors the Giants took their positions a long time ago. Now they wait for the market to come to them.

Fortunately, little people like me can still pick up some of the opportunities that were too small to be of interest to them.

Jimmy,

"3) A/FOA indicated that the switchover from US$ oil to Euro oil could be sudden. Never, Saddam is killed for this... Saddam H. would be payed out in Euro's for oil. Then America invaded Iraq... And FOFOA is right with his remark, nobody would be responsible for breaking the US$/oil nexus."

Saddam made a unilateral decision to switch exclusively to Euro. He blackmailed the administrators of the UN run oil for food scheme to approve it. He threatened to shut off the supply of Iraq oil.

Oil must at some point switch to Euros (and other currencies?), war or no war. Once the US ceases to be the dominant Internatiuonal trade currency the oil producers will have no choice.

FOFOA said "nobody wants to be HELD or SEEN to be responsible" for breaking the US$/oil nexus. As A/FOA explain the whole Euro Freegold project is an attempt to create a replacement system for the time when the US$ inevitably failed. Doing nothing wasn't an option.

Look at this graph of the US Dollar Index since 1983. This is one sick puppy.

http://www.amergold.com/email2/GMU_11-06_dollar_logo.gif

Museice said...

COMEX INVENTORY DATA REVEAL AN ALARMING TREND


"But what is more important is that the data reveals a very shocking trend. That is that the registered (dealer) inventory is being drawn down at a phenomenal rate. In silver the inventory has dropped by 24% in 6 months while in gold it has dropped an eye-popping 41% in 6 months! The withdrawal to deposit ratio for registered silver is 14:1 and in gold it is 5:1. If this rate of drawdown continues the registered inventory of silver will be exhausted in 18.8 months and in just 8.5 months for gold!

This inventory drawdown is very revealing. Over the same period the open interest in gold increased 15% while in silver it increased 19%. By way of an analogy one would not expect a company with increasing orders to decrease its stock levels! Why would the inventory not be replenished when Open Interest is increasing? The most likely reason is a growing shortage of bullion."

"I estimate that as much as 50,000 tonnes of gold has been sold that does not exist. That is equivalent to all the gold reserves in the world that are yet to be mined, or put another way, 25 years of gold production. That is the grand-daddy of all short positions! As physical market shortages lead inevitably to exposing this scandal there will be the grand-daddy of all short squeezes and the grand-daddy of a bull market in precious metals….but only in REAL physical precious metals and quality mining equities, not in paper promises for physical metals. It would be a tragedy for an investor to have correctly identified the huge investment potential to wind up with nothing. It would be like winning the lottery only to discover that someone sold you a counterfeit lottery ticket!"

costata said...

ATTN ALL NEWBIES,

I urge you to click on the link to Harvey Organ's blog today. (The link is on the right hand side of your screen.)

IMHO his latest post is a MUST READ. He includes analysis of the current action in Comex gold and silver. It is startling.

There is commentary by Adrian Douglas and a brilliant crash course in the workings of the CDS market by Jim Rickards. The Rickards piece is easy to read and a standout.

Harvey Organ also presents a couple of very short articles that completely debunk any nonsense about a recovery in the USA.

FWIW I think Harvey deserves a medal for the information aggregation service he is providing.

costata said...

Museice et al,

Re: Adrian Douglas, Harvey O etc

This looks to me like the paper is about to burn. Are you seeing the same thing?

BTW my enquiries about the HSBC repository in New York disclosed that they can store around 130 m/t of metal. It is reportedly the largest privately owned facility of this type in the USA.

I wasn't able to determine how much space they gained by evicting the retail clients.

The custody division of HSBC has expanded rapidly in the past 10 years. It is global in reach.

Glenda said...

My son is trapped in a 401-K which allows a 50% individual stock investment. I would like to ask what anyone thinks about the Central Fund of Canada as a gold stock option? What would happen to these stock certificates if we have a Freegold scenario? Thanks...

costata said...

From Doug Noland's Credit Bubble Bulletin

Extract
"'I can only reject the idea of raising inflation rates permanently,’ ECB Executive Board member Juergen Stark said"

"Bundesbank President Axel Weber wrote in a newspaper column today that the Washington-based lender is ‘playing with fire.’"

Translation: Nein! Keine Chance! Pissen Sie ab!

http://prudentbear.com/index.php/creditbubblebulletinview?art_id=10345

Central Bank Watch:

February 25 – Bloomberg (Simon Kennedy and Jana Randow): “European Central Bank officials dismissed a proposal by International Monetary Fund economists that monetary-policy makers increase inflation targets to 4%, arguing that such a shift would damage economies. 'I can only reject the idea of raising inflation rates permanently,’ ECB Executive Board member Juergen Stark said… Bundesbank President Axel Weber wrote in a newspaper column today that the Washington-based lender is ‘playing with fire.’ The criticisms suggest the… ECB will ignore this month’s suggestion by IMF economists led by Olivier Blanchard that central banks raise their inflation targets so that they have more scope to react to shocks such as the recent financial crisis…” (My emphasis)

oldinvestor said...

Glenda,

I was recently talking to a good friend of mine who I have known for many years, both him and his parents. He had recently married a wonderful woman.

We were talking about gold investing, which both he and his family have done for some time. They are an old real estate well-established family.

He said that his new wife, who had a considerable 401 K investment, had closed it out, paid the full penalty, and invested in physical bullion on her in-law’s and husband’s advice. He said that she was “ecstatic” about her decision.

Jimmy said...

@Costata: Thank you for the link!

Wow, strong article about COMEX...

frycook said...

looks like the ball is in full play now with the notion of "similar to but distinctly different from ..."

http://www.nytimes.com/aponline/2010/02/26/us/politics/AP-US-US-IMF-Reserve-Currency.html

frycook said...

How much clearer could it be when one substitutes a simple four-letter word in two obvious spots of this quote by Strauss-Kahn?

''The challenge ahead is to find ways to limit the tension arising from the high demand for precautionary reserves on the one hand and the narrow supply of reserves on the other,'' he said.

It's like he's saying - "now, now, settle down boys. We're going to manage this thing like the gentlemen that we are. Just look, we're talking about it openly in the New York Times."

Museice said...

It has looked like 'Paper' is going to burn for the past couple months. However, if you have played 'Paper' and are ready to get out but the COMEX offers you a 25% bonus to stay in for another cycle I'm sure it is difficult to refuse the 'Paper' and go for Physical. A 25% instant profit on top of what you already made is a great incentive to stay in the game for one more play. And if that doesn't work COMEX can then offer 30% or 50% to stay in the game. It's just paper.

But, and this is the moment we wait for, at some point, someone will say 'NO'. I want physical.

Then the game is over. And yes, I feel the frustration and lack of confidence in the dollar (or any paper) is progressing at a faster rate than many are willing to admit.

IRA's and 401k's are worthless as paper. My opinion. So taking my own advise they no longer exist in my reality.

Museice said...

Anybody have more info on this?

From WSJ:
"CME To Change Comex Gold, Silver Settlement Procedure Friday "

Museice said...

Something Very Strange Is Happening With Treasuries

Permaculture said...

glenda, i too, talked to my best friend about these options a little more than a year ago (actually well before, but she only came back for advice after losing some 70% in her 401k. i told her if it were me, i'd pay the penalty (it was in nov or dec...can't remember which) and buy physical.

she wavered about waiting until the new year, but decided to pull out in '08. i made the call for her and got her in at $744 )which was the very bottom of that cycle. so she's since added some 50% in notional value to that liquidation while paying much less than that in taxes.

so i'm in agreement with oldinvestor. you never know which way it's going in the short-term, but you have a good sense of what's going on in the longer-term.

good luck.

Martijn said...

It has looked like 'Paper' is going to burn for the past couple months. However, if you have played 'Paper' and are ready to get out but the COMEX offers you a 25% bonus to stay in for another cycle I'm sure it is difficult to refuse the 'Paper' and go for Physical. A 25% instant profit on top of what you already made is a great incentive to stay in the game for one more play. And if that doesn't work COMEX can then offer 30% or 50% to stay in the game. It's just paper.

I second. Although we all know it really might happen someday soon, it has been called for many times already while so far nothing has happened. The only party to break the system is the party accurately positioned for the reality that will arise once the comex breaks. Now who would really want to do that?

costata said...

frycook,

Re: Strauss-Kahn's reported remarks

I have to laugh when I read some of the posts and comments popping up in the blogosphere along the lines of:

"This is it. SDR to be new global reserve currency. One World Currency here we come. IMF to be new blah blah".

frycook, I recalled reading some reports from the Times Online after the London G20 (April, 2009) that support your perspective on the above. Extracts below.

"Bargaining fails to break deadlock over IMF"

"A split also erupted between the United States and Europe over a call by Washington for a far-reaching shake-up of the IMF that would give a much bigger say in its operations to emerging market countries, led by China, at the expense of Europe." (My emphasis)

US invites China, Brazil and India to take a bigger share of .... Europe's share. No doubt to protect the US veto over IMF operations and hand the US/UK control over the replacement reserve currency for the US$.

"Guido Mantega, the Brazilian Finance Minister, underlined the pressure for change. “The IMF has repented from many of its past sins, but it still has to address the original sin — its democratic deficit,” he said."

Is this a misquote? Should "many" read "any"?

"European countries that would have to sacrifice voting power to make way for emerging powers signalled their opposition to rapid change. “For the moment the representation around the table is attractive,” Didier Reynders, the Belgian Finance Minister, said. “European countries are having to finance the fund very strongly.”

....... and when we leave it will be even more attractive for us!

http://business.timesonline.co.uk/tol/business/economics/article6175076.ece

M A M said...

German tv report showing production of gold bars, at the end the production manager mentions fakes and shows a tungsten filled bar found by a worker who didn`t like it and so they cut it and voila.. (bought from a bank). So they are real!

http://www.youtube.com/watch?v=ZKczs-7BFRI

Good luck I am not rich enough for bars ;)

costata said...

Martijn,

Perhaps the action in the silver comex is a "black swan" event. The bullion banks are used to fleecing industrial users, speculators and investors. What if a NEW speculator has joined the game?

Consider this scenario: A speculator is reliably informed that gold players have recently picked up 25% premiums accepting cash settlements instead of delivery.

Said speculator has looked at the structure of the silver market and positioning of the various players. He notes that the gold and silver shorts are ..... the same people. Perhaps they will fork out a 25% cash premium on silver as well?

The shorts start phoning people to try to find out who is chasing all of this metal. Some of their industrial users think WTF will I be able to get my METAL? So they increase their delivery demands as well.

Possible resolution:
Mr Fan I would like to introduce you to Mr S*#t. Mr S*#T please meet Mr Fan.

Martijn said...

@M A M

That is news!!!


@Costata

Perhaps. As I said: we have been here before, and yes, every time we get here it might indeed happen.

Jeff said...

A credit card that lets you settle your debts with gold:

http://www.thegoldbullioncard.com/

Mike said...

wow ever zerohedge has that tungsten story on the front page.....things are heating up now.

http://www.zerohedge.com/article/german-prosieben-tv-channel-finds-500-gram-tungsten-bar-wcheraeus-gold-foundary-bank-origin

S said...

FOFOA,

A year plus ago I think you posted a clip of a camera crew in the oval office for a run through and Summers takes a call and proceeds to shut the show and tell down saying we have a problem with the Germans. Do you recall...could link to it?

FOFOA said...

S,

Is this what you are looking for?

Post a Comment