It is difficult to judge whether the silver and gold manipulation and conspiracy theories proposed by the GATA gang is true or false.
GATA has been in existence for many years. While there are claims on manipulation, the price of gold has been going straight up since 2002.There is no mathematical correlation to the index to show that it is true.
Also, one have to admit that manipulation is part of the market reality. It is the big boys playing the small boys.
As to the claims of paper gold versus physical gold to the ratio of 100:1, I suspect that this is part of futures trading. It is a leveraged. Quite commonly, you see such ratios in future market and that's why they are extremely volatile. Look at prices of sugar, coffee, wheat, futures etc - you see big swings! A good trader can make a lot of money from futures.
The most credible claim in this saga is that of Ted Butler where he said there are concentrated positions of shorts by JP Morgan and HSBC. The figures are astounding and this could possible cause a short squeeze.
How do I deal with information or perhaps "rumors" or wild events happening like this?
Simply, I let the price actions verify itself. So far, the actions are good. So there could be some truths in all the allegations. I am sure not all are true but something is certainly cooking.
So if price of gold shoots up quick >1140 and then 1160, I should be pyramiding into my long positions.
Wednesday, April 7, 2010
Thursday, April 1, 2010
Conspiracy theory?
Do you think I am crazy to get out of gold and silver?
It is an April Fool’s joke. I hope none of you bail out of these precise metals! I am more bullish than ever. Short term, it may be trading in a range but there is no doubt it will be a lot higher by the end of the year.
I believe the market may continue bullish for a while but sooner or later a bigger crisis will hit.
I believe that inflation will catch up. US$ will fall drastically, interest rates will go up and commodities price will continue to rise. These are my investment themes for 2010.
What I had written are views thrown to the public by the media and the government. The government wants to claim credit and get elected again propagates these ideas.
I hate to believe in a theory of conspiracy but strangely the main stream medias especially CNNBC are infusing these ideas into the investment communities.
Following are some events that are very interesting.
Last week, CFTC held a hearing regarding position limits in the futures market. You can listen to the hearing. There has been a belief of manipulation notably by JP Morgan and Goldman Sachs for years. People like Ted Butler – precious metal analysts, Eric Sprott – multi billionaire and hedge fund giant focussed on gold in Canada, and GATA ( www.gata.org ) have been collecting evidence.
Gata’s founder, Bill Murphy was invited to testify at the hearing.
Something very intriguing happened. A metal trader from London, Andrew Maguire became the whistle blower giving detailed facts on how the manipulation at JP Morgan took price giving precious time and showed emails sent to CFTC on how and when it happened.
During the hearing, Jeffrey Christian of CPM Group told the group that the there are hundred times more gold paper trader deposits than actual physical gold. This is startling as it could mean the whole entire bullion market is a completed ponzi scheme and scandal of much greater multitude than Bernie Madoff. It also mean that all the ETFs like GLD and SLV are frauds as they do not have the backing of the physical metals of which JP Morgan are one of the custodians. If you ask for delivery, there would be a run on the bank and panic.
Spend time and listen to the following exciting interviews. It is worth your time.
http://www.gata.org/node/8478/
http://www.zerohedge.com/article/former-goldman-commodities-research-analyst-confirms-lmba-otc-gold-market-paper-gold-ponzi
http://www.kingworldnews.com/kingworldnews/Broadcast/Broadcast.html
http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2010/3/31_GATA.html
A number of events during and after the event support further the case for conspiracy. I find it difficult to accept that this is happening to America. It is a country that I respect for upholding the baton of freedom of free speech and democracy. What happen?? Lets present the facts:
· There were not single mainstream media coverage despite the sensational nature and newsworthiness of these events.
· Bill Murphy was contacted by major media outlets for more interviews. Within 24 hours, ALL the interviews were cancelled.
· Immediately after Maguire testified, he was run over by a car while driving down the street with his wife. The driver sped away running away other pedestrians in his haste to escape! Coincidence?
· KingWorld News is one of the alternative websites that conducted the post interviews with GATA and Maguire. Internet servers of the website were attacked and disabled yesterday from 8 to 10 am ET by very sophisticated hackers. The servers are maintained by one of the largest Internet site hosting companies in the world and they “could not figure out why this cluster of servers is being attacked”.
There were more than a few strange goings on at the hearing, one of which was that the video feed went dead just as Bill Murphy was about to detail the Maguire story for the CFTC. Here’s the video which was not available at that time, see below:
It contains details on Maguire’s charges that massive short positions by HSBC (HBC) and JP Morgan aimed out flushing out longs occur regularly and predictably, in a coordinated fashion.
Even Dennis Gartman who is a sceptic on Bill Murphy and Gata’s activities is starting to acknowledge that there could be truth in the findings.
http://watch.bnn.ca/clip283224#clip283224
If these guys are right, we are in for some fireworks in the physical silver and gold market!
It is an April Fool’s joke. I hope none of you bail out of these precise metals! I am more bullish than ever. Short term, it may be trading in a range but there is no doubt it will be a lot higher by the end of the year.
I believe the market may continue bullish for a while but sooner or later a bigger crisis will hit.
I believe that inflation will catch up. US$ will fall drastically, interest rates will go up and commodities price will continue to rise. These are my investment themes for 2010.
What I had written are views thrown to the public by the media and the government. The government wants to claim credit and get elected again propagates these ideas.
I hate to believe in a theory of conspiracy but strangely the main stream medias especially CNNBC are infusing these ideas into the investment communities.
Following are some events that are very interesting.
Last week, CFTC held a hearing regarding position limits in the futures market. You can listen to the hearing. There has been a belief of manipulation notably by JP Morgan and Goldman Sachs for years. People like Ted Butler – precious metal analysts, Eric Sprott – multi billionaire and hedge fund giant focussed on gold in Canada, and GATA ( www.gata.org ) have been collecting evidence.
Gata’s founder, Bill Murphy was invited to testify at the hearing.
Something very intriguing happened. A metal trader from London, Andrew Maguire became the whistle blower giving detailed facts on how the manipulation at JP Morgan took price giving precious time and showed emails sent to CFTC on how and when it happened.
During the hearing, Jeffrey Christian of CPM Group told the group that the there are hundred times more gold paper trader deposits than actual physical gold. This is startling as it could mean the whole entire bullion market is a completed ponzi scheme and scandal of much greater multitude than Bernie Madoff. It also mean that all the ETFs like GLD and SLV are frauds as they do not have the backing of the physical metals of which JP Morgan are one of the custodians. If you ask for delivery, there would be a run on the bank and panic.
Spend time and listen to the following exciting interviews. It is worth your time.
http://www.gata.org/node/8478/
http://www.zerohedge.com/article/former-goldman-commodities-research-analyst-confirms-lmba-otc-gold-market-paper-gold-ponzi
http://www.kingworldnews.com/kingworldnews/Broadcast/Broadcast.html
http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2010/3/31_GATA.html
A number of events during and after the event support further the case for conspiracy. I find it difficult to accept that this is happening to America. It is a country that I respect for upholding the baton of freedom of free speech and democracy. What happen?? Lets present the facts:
· There were not single mainstream media coverage despite the sensational nature and newsworthiness of these events.
· Bill Murphy was contacted by major media outlets for more interviews. Within 24 hours, ALL the interviews were cancelled.
· Immediately after Maguire testified, he was run over by a car while driving down the street with his wife. The driver sped away running away other pedestrians in his haste to escape! Coincidence?
· KingWorld News is one of the alternative websites that conducted the post interviews with GATA and Maguire. Internet servers of the website were attacked and disabled yesterday from 8 to 10 am ET by very sophisticated hackers. The servers are maintained by one of the largest Internet site hosting companies in the world and they “could not figure out why this cluster of servers is being attacked”.
There were more than a few strange goings on at the hearing, one of which was that the video feed went dead just as Bill Murphy was about to detail the Maguire story for the CFTC. Here’s the video which was not available at that time, see below:
It contains details on Maguire’s charges that massive short positions by HSBC (HBC) and JP Morgan aimed out flushing out longs occur regularly and predictably, in a coordinated fashion.
Even Dennis Gartman who is a sceptic on Bill Murphy and Gata’s activities is starting to acknowledge that there could be truth in the findings.
http://watch.bnn.ca/clip283224#clip283224
If these guys are right, we are in for some fireworks in the physical silver and gold market!
I am bearish on Gold and Silver – GET OUT!!
I have been bullish on gold/silver now for many years. Starting in early 2005, I started to buy gold and precious metal stocks including juniors.
I have remained consistently bullish on gold/silver and never wavered … until now. Today, I officially am a bear on gold/silver. I have to agree with Roubini that Gold is a barbaric relics and price will soon crash. He has good credibility as he correctly predicted the sub prime crisis and is a professor of the prestigious Stern School of Business at New York University.
There is nothing really special about gold and silver. You can’t eat it. You can’t even go to the store and buy anything with it. I cannot imagine why we go back in civilization and back to bartering with gold and silver. This is the era of paper currency where central banks can control crisis through monetary supply via the printing press. Central bankers are very well connected globally and thus a crisis like the Great Depression will never recur again. It is soundly based on the theory from a famous economist John Maynard Keynes who solved the problem of the Great Depression through interventionist economic policy to mitigate the adverse effects of a crisis.
We owe a lot to Bernanke, Greenspan, Paulson and Geithner did an amazing job at solving the financial crisis of 2008. We should be very thankful to these maestros who managed to get us out an economy spirally out of control and to the point of no return. We salute them. Bernanke deserves to be Times man of the year and Greenspan was rightly knighted by the British Empire in 2002.
They exhibited rare vision, brilliance and courage to take actions contrary to logic by solving a debt crisis with more debt or like giving heroin to a marijuana addicts. Actually it works! It took courage from Paulson and Geithner to bailout “too-big-to-fail” corporations like Citigroup, GE, GM, Bank of America, Fannie Mae, Freddie Mac, AIG and JP Morgan. Do not worry about the $1.4 Trillion deficit this year, $14 Trillion debt and >$53 Trillion total unfulfilled liability in the balance sheet. It will be paid when the recovery comes. After all, America still has the most creative people and best technology in the world. They will create a new era of productivity through technologies like what they did with the Internet. Look at the best of global businesses and fundamental research today. They are still dominated by all the best universities and companies like Wal-Mart, Microsoft, Disneyland, Boeing, Intel, IBM, Cisco, L-3, Caterpillar, Exxon, etc. The best of the best in businesses and ground breaking ideas are still in America. They lead the world by a big gap.
Do not worry about unemployment. It is about 9.7% now. If you take out part time waiting for a full time job, the figure is more like 16%. But this is a lagging indicator. Employment will catch up with the road to recovery.
The stock market has gone up >70% since March 2009. The largest 500 companies
( excluding financial companies ) hold almost $1.2 Trillion in cash or > 10% of assets – the largest since 1960s. These cash can be used for increased dividends or acquiring weaker competitors if the market pulls back. Interest rates are record low. Companies can borrow at next to nothing and invest in cheap assets. The government still have 2/3 of its $787 billion stimulus money to spend over the next 18 months. The employed are working hard than ever. People are scared of getting laid off. So they work more hours for no additional pay. These have resulted in higher output, fixed costs and increased productivity. Inventory levels are low. Since the overbuilding of inventory in 2007 and 2008, inventory levels fell by 70% for some companies. M & A activities are increasing. Companies are increasing their dividends.
We are on a road towards recovery!!
We think we are bad. But look at Portugal, Ireland, Italy, Greece, Spain and Britain. They are worst than us. If we think we are in a bubble, China looks worst. Jim Chanos commented that China bubble is 1000 times of what happened in Dubai! But China is still growing at 9-10% per year on GDP.
I am sure the Chinese will continue propping up the U.S. dollar forever because they need Americans to consume their goods. They cannot allow the US$ to collapse as they are holding a trillion dollar of our currency. If US$ defaults or devalue, they will suffer greatly. So they will continue to buy our treasury, sell us their cheaply manufactured goods and US will continue to spend and live in luxury. It is a win-win proposition. Where are the markets the Chinese can export their products except US. The whole world is in a mess. Japanese is in a deeper recession with debt to GDP far worst than US. European Union is breaking down with all the troubles in Greece spreading to Portugal, Spain, Italy and Ireland. Britain is a fallen great empire and the British pounds looks like collapsing soon. US consumers are the only willing to continue to spend despite unemployment and foreclosures. Our consumers are still spending healthily and happily. All consumers stocks are up especially those selling luxuries!
The U.S. dollar will always remain the world’s reserve currency. Forget about gold and silver.
Obama is taking steps to freeze government spending and debt will decline. Trust the government and they will get the job done or they will not be elected again. Bernanke will mop up the excess liquidity before inflation hits the economy. There are absolutely no signs of inflation and interest rate will remain low. If there is anything to fear, it is deflation and it will depress the price of gold especially junior just like the credit crisis in 2008.
With gold up $13, it is a perfect time to exit. Take profit and run.
I have remained consistently bullish on gold/silver and never wavered … until now. Today, I officially am a bear on gold/silver. I have to agree with Roubini that Gold is a barbaric relics and price will soon crash. He has good credibility as he correctly predicted the sub prime crisis and is a professor of the prestigious Stern School of Business at New York University.
There is nothing really special about gold and silver. You can’t eat it. You can’t even go to the store and buy anything with it. I cannot imagine why we go back in civilization and back to bartering with gold and silver. This is the era of paper currency where central banks can control crisis through monetary supply via the printing press. Central bankers are very well connected globally and thus a crisis like the Great Depression will never recur again. It is soundly based on the theory from a famous economist John Maynard Keynes who solved the problem of the Great Depression through interventionist economic policy to mitigate the adverse effects of a crisis.
We owe a lot to Bernanke, Greenspan, Paulson and Geithner did an amazing job at solving the financial crisis of 2008. We should be very thankful to these maestros who managed to get us out an economy spirally out of control and to the point of no return. We salute them. Bernanke deserves to be Times man of the year and Greenspan was rightly knighted by the British Empire in 2002.
They exhibited rare vision, brilliance and courage to take actions contrary to logic by solving a debt crisis with more debt or like giving heroin to a marijuana addicts. Actually it works! It took courage from Paulson and Geithner to bailout “too-big-to-fail” corporations like Citigroup, GE, GM, Bank of America, Fannie Mae, Freddie Mac, AIG and JP Morgan. Do not worry about the $1.4 Trillion deficit this year, $14 Trillion debt and >$53 Trillion total unfulfilled liability in the balance sheet. It will be paid when the recovery comes. After all, America still has the most creative people and best technology in the world. They will create a new era of productivity through technologies like what they did with the Internet. Look at the best of global businesses and fundamental research today. They are still dominated by all the best universities and companies like Wal-Mart, Microsoft, Disneyland, Boeing, Intel, IBM, Cisco, L-3, Caterpillar, Exxon, etc. The best of the best in businesses and ground breaking ideas are still in America. They lead the world by a big gap.
Do not worry about unemployment. It is about 9.7% now. If you take out part time waiting for a full time job, the figure is more like 16%. But this is a lagging indicator. Employment will catch up with the road to recovery.
The stock market has gone up >70% since March 2009. The largest 500 companies
( excluding financial companies ) hold almost $1.2 Trillion in cash or > 10% of assets – the largest since 1960s. These cash can be used for increased dividends or acquiring weaker competitors if the market pulls back. Interest rates are record low. Companies can borrow at next to nothing and invest in cheap assets. The government still have 2/3 of its $787 billion stimulus money to spend over the next 18 months. The employed are working hard than ever. People are scared of getting laid off. So they work more hours for no additional pay. These have resulted in higher output, fixed costs and increased productivity. Inventory levels are low. Since the overbuilding of inventory in 2007 and 2008, inventory levels fell by 70% for some companies. M & A activities are increasing. Companies are increasing their dividends.
We are on a road towards recovery!!
We think we are bad. But look at Portugal, Ireland, Italy, Greece, Spain and Britain. They are worst than us. If we think we are in a bubble, China looks worst. Jim Chanos commented that China bubble is 1000 times of what happened in Dubai! But China is still growing at 9-10% per year on GDP.
I am sure the Chinese will continue propping up the U.S. dollar forever because they need Americans to consume their goods. They cannot allow the US$ to collapse as they are holding a trillion dollar of our currency. If US$ defaults or devalue, they will suffer greatly. So they will continue to buy our treasury, sell us their cheaply manufactured goods and US will continue to spend and live in luxury. It is a win-win proposition. Where are the markets the Chinese can export their products except US. The whole world is in a mess. Japanese is in a deeper recession with debt to GDP far worst than US. European Union is breaking down with all the troubles in Greece spreading to Portugal, Spain, Italy and Ireland. Britain is a fallen great empire and the British pounds looks like collapsing soon. US consumers are the only willing to continue to spend despite unemployment and foreclosures. Our consumers are still spending healthily and happily. All consumers stocks are up especially those selling luxuries!
The U.S. dollar will always remain the world’s reserve currency. Forget about gold and silver.
Obama is taking steps to freeze government spending and debt will decline. Trust the government and they will get the job done or they will not be elected again. Bernanke will mop up the excess liquidity before inflation hits the economy. There are absolutely no signs of inflation and interest rate will remain low. If there is anything to fear, it is deflation and it will depress the price of gold especially junior just like the credit crisis in 2008.
With gold up $13, it is a perfect time to exit. Take profit and run.
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