The Golden Truth: Here Is Why Dollar Bulls Are Wrong

Tuesday, January 12, 2010

Here Is Why Dollar Bulls Are Wrong

and why Dennis Gartman will end up looking like an idiot for promoting getting long the U.S. dollar. The big Wall Street banks have accumulated a record short position in the U.S. dollar - the chart is courtesy of the erudite and savy Trader Dan Norcini at http://www.jsmineset.com/:

The red line represents the big Wall Street banks and the massive size of their bet against the U.S. Dollar, the black line represents the Dennis Gartmans of the world and the institutions who are betting against the big banks; the blue line represents the small-fries who robotically trade based on what they hear on CNBC...the small fries and large funds will get fried once again by Wall Street:

US-Dollar-Chart-COT-as-of12-29-2009 -

If you follow the real money, you might make some of your own. If you listen to the shills on CNBC, you are guaranteed to end up waiting in line for Government entitlements.

9 comments:

AnonymousTuesday, 12 January, 2010
Gartman is actually only "long" the Dollar via shorting the Euro, Pound and Yen in spreads he is long Gold against...Gartman is also long the Canadian Dollar outright against the Dollar...I very much like your blog...facts when citing analysts are important though...I am a long time Gartman subscriber FYI...
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Dave in DenverTuesday, 12 January, 2010
Thanks for the feedback. Probably not a bad way to play gold but I think the dollar will go down against all of the above. Kudos to him being long the loonie - I like the Aussie too. It's still fun to take shots at him any way you add it up LOL
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Dave in DenverTuesday, 12 January, 2010
The other point to make is that when he gets on CNBC and promotes a bullish dollar trade, a lot of "small fries" will do that by getting long the dollar outright, as per the COT chart.
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JoeTuesday, 12 January, 2010
I still believe Gartman has no credibility because he is always bashing Gold and giving low-ball projections for Gold prices.

Joe M.
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Dave in DenverTuesday, 12 January, 2010
Gartman's lack of credibility with me is his lack of knowledge and understanding of the gold market and yet he pumps himself up as an expert. I don't really know how he fares with the rest of his market calls, but with gold he is terrible and silver isn't even on the map for him.

Gold went up 380% from 1/1/2000 to 12/31/2009. How did Gartman do?
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AnonymousTuesday, 12 January, 2010
So the big banks are now short the usd and gold uptill their necks, makes you wonder whats going on...
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EconomicDisconnectTuesday, 12 January, 2010
I was puzzled on th gold/silver action today. With all the info about currency issues and central bank problems (US seized Argentina's central bank holdings at the FED) I would have though a nice move up was in order.
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Dave in DenverTuesday, 12 January, 2010
the fx market is infinitely bigger than the gold market. they can use their short in the gold market to push around that market like today and make money on the short side and cap the market. when the dollar shits the bed, they'll make a lot more on that short than they lose by being short gold AND they continue to manipulate gold. that's what i think is going on.
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Dave in DenverTuesday, 12 January, 2010
@gyc: gold and silver we due for a pullback after their big run up since Jan 1. nothing goes straight up. the banks shorted a boatload of contracts yesterday - we'll see tomorrow if they covered a lot of those today.

who knows, maybe gold spiked on Sunday nite because insiders knew about the Argentine thing a day ahead of time...i know one thing for sure, and that's whenever I'm expecting a big move up in gold, it usually drops a turd LOL. i've learned to operate w/out any day-to-day expectations. my expectation is that gold will go a LOT higher by May.
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.