Tuesday, July 20, 2010

Gartman Remains Perfect As A Contrarian Indicator In Gold; Problems On The Comex?

Dennis Gartman was on CNBC yesterday explaining with his unique brand of arrogant stupidity that the trend in gold has changed (to down). Contrary to DG's ignorance, I've been telling colleagues that the current period of time is strikingly similar to the period from July/Aug 2005 to May 2006, when gold staged a 35% move and silver nearly tripled. I vividly recall, literally about 2 or 3 days before gold started a massive move from $550, Gartman grandly pontificated for all to hear that he was out of gold and would reload below $500. He never had that opportunity. He missed the entire move. Remember: those who can, do - those who can't, sell newsletters.

Dennis does not follow or understand the physical market. He's too blinded by his own self-proclaimed market expertise. The fact is that he has his head up his ass when it comes to the precious metals market.

The key to the precious metals Kingdom at this stage of the game is to follow and understand what is happening in the physical market. Pay no attention to reports of IMF selling, BIS wife-swapping and Wall Street misdirection. The fact of the matter is that Asia, Russia, India, Turkey and the Middle East are buying up as much physical gold and silver as they can and the Western Central Banks are running out of gold to sell.

Here is the information you need to know about the physical market, which is contained in the "JB" gold market report posted every night a www.lemetropolecafe.com in the Midas report on the James Joyce Table (I honestly do not know how anyone can invest/trade this market without reading Midas every night):

"Demand is extremely good from Indonesia and Thailand. There's also good buying from local buyers

See http://in.reuters.com/article/domesticNews/idINSGE66J0AD20100720
The bulliondesk.com reports:

Premiums for gold bars in Tokyo rose to 50 cents this week from 25 cents last week, according to one source. They had stood at 50 cents during the first week of July but had been in negative territory in the preceding months...

"[Gold] has started to see quite good demand overall from Asian sector, Far East and India," a Switzerland-based trader said. "At these levels there has been some good demand and activity there and this should lend some good support to the gold market."

"Even in the Middle East we are starting to see some more demand coming in... overall, we’re starting to see some more interest because the market is trying to consolidate," he added

In Europe, requests for kilobars have picked up...

As per JB's report, the import premium in Viet Nam has kicked up to $26 over spot gold. This means Viet Nam is buying aggressively. Same with Shanghai ($3.50 over world gold, a relatively high premium for that market). People, this means demand is running hot vs. supply in those markets.

In addition, the Russian Central Bank reports adding another 6 tonnes of gold during June. The ECB did not sell any gold once again last week AND, this is the first time I have seen this in a very long time, one bank actually added 1 million ounces in coin.

(Did Gartman happen to mention any of this on CNBC yesterday LOL).

As we are now seeing with delivery delays and massive silver withdrawals recently from the Comex, the paper game that has been played by the big bullion banks in London and New York is finally being understood for what it is by big U.S. investors (see Greenlight Capital's announcement a year ago that it dumped its large GLD position and replaced it with physical gold that is safekeeps privately). 

If you don't pay attention to and understand the dynamics of the global physical market, you leave yourself exposed to the mercy of the financial media frauds and fabricators.  If you need some "soul food," watch for Stewart Thomson's posts on http://www.321gold.com/.  Here's his latest:  LINK

"Destroyers seize gold and leave to its owners a counterfeit pile of paper. This paper is a mortgage on wealth that does not exist...by legal looters" (Atlas Shrugged)

Please don't let the Dennis Gartman's, JP Morgans and Goldman Sachs' of the world legally steal your gold/silver.


  1. We have a long way to go Dave.



  2. Dave, great post. Your blog is excellent and you hit it out of the park with almost every article. Keep up the good work!

  3. "Remember: those who can, do - those who can't, sell newsletters."

    LMAO. Dude, that's the quote of the month so far!

    Even if the price of gold were to collapse to say, $850 tomorrow, I bet the premium you'd have to pay for one physical ounce of gold would still be a significant margin over spot.

  4. Anonymous: thanks for the feedback. i really appreciate it!

    LOL Rodd. The premium to spot %-wise would probably go up if gold gets bashed down in price.

    thanks for the link Bill.

  5. LOL, those silver chicks were funny. Couldn't even give one away for a quarter.

  6. @Bill

    No, Bill,
    wrong conclusion. These people asked to buy silver will NEVER buy anything else but i-shit. They know nothing about economics and finance so why bother?
    And actually I wouldn't buy it myself when asked by such persons. Otherwise this is a plagiarism of M. Dice without great completely irrelevant.

  7. Figures they were in Harvard Square Boston, lefties up here have no idea what silver is, too funny!

    I run contests from time to time on my site and a prize is always a silver ounce. Nobody ever wants it if they win! Some bubble, I can't give it away either!

  8. Hi Dave,

    In India for last 6 to 12 months we are seeing many advertisement on TV & Newspaper about loaning Rupees against Gold. There is noting new about this but I am trying to analysis this in current context. Intensity of such ads are much much higher for last six months or so. This is by big Non Banking Finance Companies in India. Is there any possibilities that this Gold is routed to Bullion Bank for hefty premiums?
    Though India is a net importer of Gold for many years but after reading all about Bookkeeping entries & leasing everything is possible.

    Or I am missing something?

  9. Wow that's a good question. You have to wonder if the entity lending rupees for gold is hoping the person who does the "swap" will spend the rupees and either not ask to resetlte the loan back the other way or outright default.

    Hard to say for sure, but I'm sure it's some kind of scheme to try and "suck" gold out of the system and divert it to the banks.

  10. "In addition, the Russian Central Bank reports adding another 6 tonnes of gold during June."

    Do you have a link for the information posted above?


  11. "Hard to say for sure, but I'm sure it's some kind of scheme to try and "suck" gold out of the system and divert it to the banks."


    Yes Kind of like the Government sponsored " Cash for Gold " commercials here in the states.

    Doh! did I say Government sponsored...shit the cats out of the bag. /snark/

  12. Bank of Russia link:


  13. Sofa King would like to know if that Russian Central Bank gold addition includes the gold that was found to be rusting?


  14. Hi
    Like your writings.
    Now there is Roubini coming out with a gold negative opinion.
    Like to hear your thoughts on it.

  15. SK you never fail to make me chuckle! That's funny.

    Thanks for the feedback Anonymous. Here's my thought on Roubini: don't put too much thought into anything he says. He is clueless about gold. In fact, I'd love to know just what his area of expertise is in economics, the topic of his doctoral thesis, and why he has a chair in the NYU economics dept (although NYU is not exactly considered a powerhouse in economics or business).

    He doesn't understand gold, monetary theory or much else. He does understand how to promote himself and create a lot of noise. That's about all I have to say about him. I wrote him off 5 years ago when I was screaming that housing would drop eventually by at least 75% and he was saying maybe 20%. Now I believe we'll see 90% top to bottom in many markets.