Friday, September 23, 2011

Quickie Today

Rick Perry:  I can't be bought for $5,000
Dave in Denver:  Now we've established that you can be bought, what is your price then?

Quote of the Week:  "Treasuries are getting bought to insanity"  - friend and colleague, "Jesse"

He's right.  Most of the Treasury curve is yielding close to zero.  That means that the prices of Treasuries can't go much higher.  But there sure is a lot of downside.  If you are "parking" your cash in bonds because they are "safe," you are taking on what will end being a tragic amount of risk.  It's time to sell.

My thought for the week would be that something really really bad is coming our way.  The last time the metals were taken down in a two-stage process like this current period was 2008 - March/July vs April/Sept this year.  The big take-down in 2008 was followed by the de facto collapse of our banking system and the roll out of the massive money printing injection by the Fed and debt-fueled fiscal "stimulus" by the Government.  Both actions merely effected the massive transfer of wealth from the Taxpayers to the financial and political elite.  They still have more wealth to confiscate before this over so expect more of the same - this time with a different color of lipstick shmeared all over the cancer and HIV-infested pig of a system.

HAVING SAID THAT, if you merely only held your gold/silver from their peak prices in 2008 until now/today, you would have achieved a 66% increase in your real wealth in gold ($1020 to $1700) and a 57% increase in silver ($21 to $33).  Got any other part of your portfolio that has performed like that?  No way.  So, are you top-ticking the market it you buy some more today?  I don't know short term.  But I would be willing to bet that a year from now that gold and silver will be much higher than where they are today.  Hold tight and be right. 

Here's an excellent excerpt of an interview with Marc Faber.  I often disagree with him on how to play the market but he is someone whose macro analysis is worth looking at.  He clearly horrifies the Fox Business retards with his vision, but - unfortunately - I am 100% he's correct:

Have a great weekend and please try to enjoy what you can, as much as you can, for as long as you can.


  1. I'm doing all I can to support the price of silver! :)

  2. I agree with Faber that the Nank's recent moves are the correct ones to make publicly visible, despite all baked in expectations flattening like a ruined souffle.

    But in a world saturated in US Dollar debt, which cannot be repaid in real productive terms, paper must be printed to maintain the debt expansion market to model.

    The farce that debt can be extinguished with ever more expanding debt has become the enabler of democratic socialism (the happy mask of global fascism) and the faith of debt slaves to pin their fate to debt.

    What is really really bad, coming our way, is the global Lehman moment, where, like Lehman, the vast majority of the formerly too big to fail banks will fall, their bailout mechanisms insolvent, shareholders will be wiped out and the faith in paper debt shaken beyond any form of recovery familiar to the current status quo.

    Then the bullion bank run will accelerate, and the paper hyperinflation (yesterday's Armageddon) over years of monetary base expansion will become the "serious problem" of today.

    As debt defaults globally, debt paper will no longer bid for anything of real value, and the BIS will then audit sovereign gold holdings in an effort to settle the imbalance between East and West.

    The value of gold priced in debt is irrelevant as of this moment in time, as those movements are merely a function of the grossly expanded debt paper universe.

    When all confidence in the paper, including bonds, collapses, we will see the true value of gold in its historical settlement function. Some surprises await, not so much the value of the gold as the paradigm shifts, but who has custodianship of it, as well as possession.

  3. Wil (and Dave),

    So what does this all mean for the mining share prices going forward?

    Dave, you say that you're willing to bet that a year from today, gold and silver will be much higher than they are today.

    Does that belief apply equally to the quality mining shares?

  4. We should be so lucky....

    S. Korea bank chief found dead in apparent suicide

    The head of a major South Korean savings bank was found dead Friday in an apparent suicide after investigators raided his office as part of a probe into illegal dealings at several banks, police said.

    "We are focusing on confiscating materials on excessive loan extensions, improper lending to shareholders and unhealthy loans, which the banks were accused of issuing," an unnamed investigator told Yonhap news agency.

    Prosecutors seized accounting books, transaction statements and computer hard disks, it said.

    Financial regulators at the weekend suspended the seven banks for six months because of their poor financial condition caused by reckless investment in risky property projects.

  5. Hi Dave,

    I think today is your Birthday. So Best wishes for the same.

    What a day!!!

    Can you guide about Silver Delivery situation at Comex? So according to you this big crisis will lead to QE3?

  6. (Dave)

    Thanks for the birthday wish! I don't know for sure what was going on at the Comex. I have a colleague who reads everything he can on that situation and he's pretty confident that the Comex was runing into delivery issues and that was part of this takedown.

    Regardless of the motive, and I think there were a lot of motives, we've seen brutal takedowns in the past like this and they don't last. If the Govt/Fed could completely control gold and silver, gold would have never gotten over $300 and silver over $5.

    I don't know when Asia/India will start buying again. If I were them, as a trader, I'd step back and see how silly to the downside this gets and then try to buy as much metal as I could.

    Wil, at some point we'll get a big recovery in this stuff and the mining stocks will follow.

    At this point I'm more curious to see what big problem is going to hit that caused them to put a hit on the metals like this. Something really ugly is looming in the background...

  7. The msm is all smiles today...Bernanke wants a slow down...then everybody should try to help him..convert some fiat to silver/ gold and halt your spending!

    Why has Bernanke Invited Crisis.

  8. Dave -
    Hope you are cracking a bottle of Harlan Estate for the bday.

    Quickly - I am sure you have noticed, but the premiums on ALL the physical metals NAVs are rising, silver SBT.UN and PSLV over 20% and GTU, PHYS and CEF middling around 5%. Not what you would expect in this downdraft, NAV compression w/ decline in price. Do you think people are beginning to catch onto GLD/COMEX Bullsh*T?

    What I wouldn't do to stack 20 MM in physical gold and short 20 MM on Comex/GLD and just sit and wait...

  9. Some things to ponder over the weekend...

    The heart of the issue is that the existing monetary and financial system is becoming increasingly arbitrary and corrupt. A relatively small group of interconnected crony capitalists wish to create a digital money out of nothing, and distribute it increasingly as they will, to whom they will.

    Market Violence Will Create Large Bear Trap

    don't let the ivory tower white shoe corrupt pussies force you out of your positions

  10. (Dave)

    It's always paid off following Sinclair's wisdom - it will this time too. We're at the point in this system that it is corrupt beyond reckoning, right down the Chicago-style political thug in the White House. Geithner has been laughed at and ridiculed all week in Europe. He has no shame because I would have gotten the hell out there already.

    We've seen this this violent action before and it scares that shit out of everyone but those who hold always come out ahead and those who add to positions come out even more ahead.

    The more desperate they get, the more volatile the metals become. But remember, volatility works both ways. Even if you top-ticked the market in both gold and silver in March 2008, you are still roughly 65% better off than you were in at the end of that brutal selloff if you just simply held on to your positions.

    Yes more people in this oountry are on to the scam but even more significant - the Chinese will play this for every ounce they can.