Friday, June 7, 2013

The Revival: Friday Chart Porn

Gold represents wealth.  It is the staple around which everything else revolves.  Alan Greenspan agreed with this in an article he wrote in 1966. But when Greenspan was chosen as Fed chief, he turned his back on gold in favor of power and prestige and Federal Reserve notes.

From there, his career went downhill, he's now considered a sad joke. When Ben Bernanke was asked if gold was money, he dodged the question, and by omission he denied that gold was money.  This was the beginning of his troubles.  He was living a lie.
  - Richard Russel, King World News
I was going to pontificate and rant about the reports out yesterday which revealed the extent to which the Government has been invading our privacy and spying on us via our phones and computers.  But what's the point?  No one seems to care anyway.   What does amaze me is that Obama supporters are so willing to look the other way on this.  Obama was the one who specifically campaigned on a platform that included restoring all the civil liberties and Constitutional Bill of Rights destroyed by Bush:  LINK   But like every other politician - regardless of party affiliation - Obama is full of grandiose lies and hot air that he makes sound great with his incredible oratory skills, but he's a slave to the wealthy interests who have funded his position and who will make him wealthy when he leaves office.

I just can't stand the duplicity of the Obama supporters...By the way, for all of you idiots who cheered Obamacare, just wait until it kicks in.  I'm already seeing the deleterious affects of it with people I know who are small business owners or have to pay for health insurance themselves.  It's already being reported that individual premiums in California will go up 64-146% and here's a Congressional study outlining just how much more expensive insurance policies will be in various States:  LINK  He's your all's President, I have not voted since 1992 because I despise all politicians in BOTH parties.

Today's nonsense aside in the markets, I wanted to present a 13yr daily chart of gold that shouldn't need any explanation:

(13-yr daily gold - couldn't be any more bullish)

You'll note how similar the chart patterns are in the circles.  Those periods of time show the times when gold started to go parabolic and then endured a nasty price correction.  I don't know about you but I'm quite taken aback by how similar the patterns are.

What most might not realize is that a lot of other characteristics that marked the run-up/subsequent price wash-out/next-bull-move are also strikingly similar.  These characteristics include the build-up in Comex gold/silver open interest that accompanied the price run-up, followed by massive liquidation in open interest that accompanied the price drop;  massive reversals in sentiment all three times; and a deluge of Wall Street analysts and media outlets who were all too happy to proclaim the end of the bull market in precious metals.

Just like the previous times in 2006 and 2008, this precious metals market is now marking time before the next up-leg begins.  And it will be similar in scale to the up-legs that followed the 2006 and 2008 corrections.  The one huge difference is that in 2006 and 2008, China was not actively and aggressively accumulating physical gold.  Same with many of the Central Banks which are now buying - back then they were net sellers.  And no on except GATA was questioning the reliability of paper gold products.   Now the fear that the Comex and paper gold accounts are fraudulent is starting to seep into the mainstream thinking...

A little more patience is all that is required - i.e. "sit tight and be right."  Have a great weekend and try to do something fun.  I'm not sure how much longer life is going to pleasant for the large majority of Americans...

11 comments:

  1. $1 Trillion Debt Crushes Business Dreams of U.S. Students

    Sherick, 36, who contracts with a local hospital in Trinidad, Colorado, about 200 miles south of Denver, graduated in 2009 with about $140,000 of debt. That’s not counting the student loans of his wife, a pediatric oncologist, and their mortgage. He would like to hire a full-time administrator and offer more competitive salaries to entice doctors to work in the rural community.

    “It deters an entrepreneurial spirit when you already start four steps behind the starting line,” said Sherick. “The student debt increases the risk for an entrepreneur like me and makes it harder to expand new business, get loans and thus hire new people.”

    http://www.bloomberg.com/news/2013-06-06/-1-trillion-debt-crushes-business-dreams-of-u-s-students.html

    sooner or later people will understand the true difference between a debt based economy and gold.

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    Replies
    1. So he's not saying he shouldn't have taken the loan.
      He's saying it should be forgiven. Just like TBTF banks!

      I am very bullish on PMs and I'm buying, but we may see them drop another 10% I'm afraid.

      Delete
  2. there is a disconnect between what the CA person in charge of the exchanges is saying regarding cost--and what the House report says and what Forbes and others say.

    also, from what I can see the younger folks will not be buying insurance--they will wait. that is whats going to hurt numbers.

    Also, the WSJ reported in this several week sago with a chart in the on line version of wsj showing state by state increases. IBD also has illustrated this disconnect.

    But I get by the end of this year or early next this gets resolved.

    I just believe that there is no such thing as a free lunch.

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  3. Alarming and Absolutely Unacceptable

    June 6, 2013

    Sen. Bernie Sanders (I-Vt.) today criticized a secret domestic surveillance program that swept up millions of telephone records on calls by Americans who were not suspected of any wrongdoing.

    A court order demanding the records be turned over was obtained under a controversial interpretation of a provision in the so-called Patriot Act, which Sanders voted against when it was first enacted in 2001 and when it was reauthorized in 2006 and 2011.

    “As one of the few members of Congress who consistently voted against the Patriot Act, I expressed concern at the time of passage that it gave the government far too much power to spy on innocent United State citizens and provided for very little oversight or disclosure. Unfortunately, what I said turned out to be exactly true.

    “The United States should not be accumulating phone records on tens of millions of innocent Americans. That is not what democracy is about. That is not what freedom is about. Congress must address this issue and protect the constitutional rights of the American people,” Sanders added.

    “While we must aggressively pursue international terrorists and all of those who would do us harm, we must do it in a way that protects the Constitution and the civil liberties which make us proud to be Americans,” Sanders said.

    The Obama administration did not dispute a report, first published yesterday by the Guardian, that a classified court order required Verizon to turn over massive phone records to the National Security Agency.

    http://www.sanders.senate.gov/newsroom/news/?id=19030978-95D7-4C3A-94CA-03ED1D1185B7

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  4. Michael JacksonFriday, 07 June, 2013

    I would have quitted voting except I still feel the need on the State level. Last election, ballot had a item up where, instead of the people, the (whoever is)Governor was going to elect all the judges from here on out. The arguement was that it was costing the Judges too much time and money to run for office and was taking them away from their duties (like golfing). I couldn't believe the people who I talked to who was so clueless of where this would lead. They aren't interested in history or even looking at current countries to see what the results are. They only want to have fun, fun, fun.

    Great Chart, Dave! It is definitely repeating itself. The truth cannot be denied but I'm not one looking forward to the consequences. Not pleasant at all.

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  5. Michael JacksonFriday, 07 June, 2013

    JPMorgan Accounts For 99.3% Of The COMEX Gold Sales In The Last Three Months
    04/26/2013

    Excerpts:
    "When just one firm accounts for 99.3% of the physical gold sales at the COMEX in the last three months it’s not what most of us on this side of the rainbow would consider “broad-based” selling. Of course discovering this kind of relevant information requires an internet connection, 2nd grade math and reading skills, and the desire to do a teeny-weeny bit of reporting.

    Sadly they’ve wandered so far down the rabbit hole that the concept of “physical demand” (i.e. people actually wanting to take possession of the stuff) is puzzling to them because the vast majority of the world’s so-called “gold-trading” takes place in the realm of make believe (which is their natural habitat). It’s all fun and games until somebody loses their metal and “somebody” has lost one hell of a lot of metal in the last 90 days.

    This is the CME Group’s COMEX metals issues and stops year-to-date report, which can be found here everyday for free (http://www.cmegroup.com/delivery_reports/MetalsIssuesAndStopsYTDReport.pdf).

    It chronicles the physical delivery notices of various metals, including gold.

    Despite Goldman’s much ballyhooed “Gold Sucks!” call a few weeks ago, the squid has not parted with any yellow metal whatsoever in 2013. Hmmm.

    What nobody seems to appreciate is that every share of GLD is allowed to be sold TWICE.

    Gold continues to be pulled from the GLD (which really means people want their coats back) and still no one’s concerned about the number doubled-owned shares. Worse yet, the responsibility for sorting this unholy mess out falls to SEC chief Mary Jo White."

    http://www.zerohedge.com/news/2013-04-26/jpmorgan-accounts-993-comex-gold-sales-last-three-months

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  6. http://www.reuters.com/article/2013/06/07/shanghai-gold-bourse-idUSB9N0B802120130607
    Major bourse to have night session starting July 7

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  7. Sorry, that's July 5 for gold and silver:
    "The Shanghai Futures Exchange (ShFE) will start after-hours trading for its gold and silver contracts from July 5... It is also preparing to launch crude oil futures."

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    Replies
    1. Very interesting, thanks for sharing.
      I wonder what will that do to AM smackdowns

      Delete
  8. President Obama’s Dragnet

    The administration has now lost all credibility on this issue. Mr. Obama is proving the truism that the executive branch will use any power it is given and very likely abuse it. That is one reason we have long argued that the Patriot Act, enacted in the heat of fear after the Sept. 11, 2001, attacks by members of Congress who mostly had not even read it, was reckless in its assignment of unnecessary and overbroad surveillance powers.

    http://www.nytimes.com/2013/06/07/opinion/president-obamas-dragnet.html?

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  9. I think equally as important, is the scale or proportional size increases within each circle. It's easy to see that each is twice as large in sheer size as the one before it. To me that means the surge coming could easily be twice the scale of the last one. My 9 year old daughter likes to use the word "epic" a lot. Look at this chart. Epic indeed!

    ReplyDelete