"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput

Trader Dan's free work will soon be available at www.traderdan.biz

Saturday, October 12, 2013

Velocity of Money Falling

The following chart is a bit dated as it only covers through the first quarter of this year but even at that, the trend is glaringly obvious - down!

Combine this with a CRB index or Goldman Sachs Commodity Index that cannot gain any upside traction, abysmal to miniscule job creation and of those, many are now part time jobs thanks to Obamacare, flat to relatively stagnant wages, and you can understand why, even without this chart, that the factors necessary to push prices sharply higher are currently missing.

I also would include something which is more anecdotal but which I feel is also a contributing factor to the deflationary pressures being exerted upon the US economy in general, namely, the fallout from Obamacare in the area of soaring health insurance for a large number of Americans. You have already or will have very soon, heard the horror stories as they continue to increase about health insurance premiums tripling for many Americans. In an environment in which wages are flat, that price increase comes right off the top of the consumers' disposable income. That means less money available for discretionary spending.

I believe this is what we are seeing reflected in this chart.

From the standpoint of gold, this helps explain why the metal keeps sinking lower. With the US Dollar not falling apart, the urgency to own the metal is subsiding among Western-based investors. That is evident from the continued drawdown in the reported gold holdings of the giant ETF, GLD.

Also, when one considers especially an artificially goosed US equity market working its way higher and higher throwing off ridiculous gains practically month after month, investment capital is going to need a compelling reason to be taken out of that sector and allocated into gold. Since gold pays no yield all investment gains from the metal must necessarily come from capital appreciation. In other words, if the price of gold does not keep rising, why own it when the Fed has created a perpetual motion machine in the form of US stocks?

This is why I keep coming back to the same point that I have been making - it is going to take something, some event, some occurrence, something, to break CONFIDENCE in the US Dollar or in the US monetary and political leaders for gold to respond upward in price.

 Most of you who read this site, and I myself believe that the US is on an unsustainable path which is going to end badly.  I believe over the long term, we will be proven correct but here is the current issue - as bad as the US is, does anyone believe that the UK, Japan, the Euro Zone, etc are really and truthfully any better? They have the same problem as we do, out of control spending at their national levels and gargantuan debt levels. There remains malinvestment in China which has its own set of problems while Brazil also has its issues to deal with.

The current monetary system, with the US Dollar as the Reserve currency is fatally wounded but what is there realistically to replace it at this point? Answer - nothing! At some point there will be but for now, the game continues. This is what allows the Federal Reserve to enlarge its balance sheet to obscene levels ( it is currently sitting near a mind-blowing $3.7 TRILLION and rising) without the Dollar imploding into Hades. It should come as no news to those who are informed that thanks to the Federal Reserve's shortsightedly stupid programs known as Quantitative Easing, the Fed is now the largest owner of US Treasury debt in the world. This is a Ponzi scheme, the likes of which the world has never seen and will never see again for it is one of near Cosmic Proportions.

Which brings me to another point -  no nation out there which is holding US Treasury obligations as part of their reserves wants to see the Dollar crash and the "value" of those reserves go up in smoke. Thus, no one rocks the boat other than some bilateral trade agreements here and there and noise about a new reserve currency. For all that noise and all those grumblings, the US Dollar is still enthroned as the king of the current monetary system.

This is why I go back to what I have been saying when it comes to gold - only if confidence is lost in the US Dollar will we see gold sentiment shift here in the West. I would watch the Dollar more closely than anything right now as a result. Interestingly enough or perversely enough if your mind thinks like mine, a rising interest rate environment would theoretically make US Treasury debt more attractive in the sense of better yields but this same rise in interest rates tends to crush any incipient forms of life in the US economy further aggravating its already out of control national debt ( less economic activity means lower tax revenues). If that were not bad enough in itself, it also makes servicing any interest payments of newly issued debt even more challenging for a country whose DEBT to GDP ratio is already over 100%. And yet, this rising interest rate environment is what had pulled the Dollar higher until recently.

In the long term this is why I believe gold will ultimately benefit but between the long term and the shorter term in which trading/investment decisions are made, there remains some formidable headwinds to the upward progress in the price of gold.


  1. One of your better letters yet. Truly the world is caught between the devil and the deep blue sea and that is why I have continuously argued that the $ is still better than the rest of the fiats and that using it as a bull argument for the pm's is wrong-headed. As for obamacare, well, simply stated it is criminal and a Goddamn shame. steve in sparks

  2. Any thoughts about Bitcoin Dan?

    1. BitCoin is the new Tulip...

    2. Dan, didn't know you change your name?

    3. MIchael;

      I do not care about Bitcoin - never did....remember, I am a trader so I focus on those things which impact my profession and not the auxiliary stuff such as that.

    4. Thanks for sharing. Respect.

  3. Steve is there a way to invest your thesis? The dollar will be the winner in all this then.

    1. Concord; I stay short Yen and look to add, as I think it goes back to levels last seen in late 70's.

  4. The US$ will be the last to fall (Takes time for the strong to fall). Money not entering the system reeks of de-flation, hording, depression. Miniscule returns in government paper, forces money to higher paying dividends in stocks and/or capable of rising (stock) prices that in the long run will lead the government to raise % rates. Bail-ins force monies into stocks. Gold needs to be looked at on a world view, not just in US dollars as a final downdraft will put in a bottom in the next 6-12 months. Bitcoin is already being disassembled as a tax avoidance scheme that also competes against the US$, big no-noes in government. Short term, gold down, US$ up, regular markets up. Consumer confidence continues the slide down. Bitcoin ceases to exist.

  5. I found this to be your best summary yet. I agree that there is incentive for other major central banks around the world to not "rock the boat", and that point is often overlooked by commentators. At the same time, however, I do not understand how it might be possible for gold not to appreciate both significantly and rapidly when the COMEX defaults, and the confidence is lost in the paper market.

    In other words, even if you are correct, and TPTB are able to keep the Dollar standing for longer than many expect, how can they possibly continue to suppress the price of gold when the fraudulent paper market is exposed?

  6. Dan, I disagree with your theory.
    There is a possibility that Wall Street is just trying to discourage people to own gold, but they are doing everything they can to accumulate. If that's true, then what you described here is just on the surface.
    I know you don't believe in conspiracy theory, but unfortunately it will take a while to test if this is true or not. Like it happened many many times, banks are shaking weak hands off and accumulate at the same time. We won't know the truth till the end game is here.

    1. In fact, in the 2nd quarter, with their call to sell gold, GS increased the holding of GLD by 540.66%. This is in public domain:


    2. chalice;

      Who is "Wall Street" in particular? Is it the large investment banks such as GS, JPM, etc? If so, they are currently doing a lot of short covering (buying) in gold as hedge funds do the selling. That is why I keep pointing out that one cannot logically state that it is the bullion banks that are behind the sharp selloffs in gold that we have been seeing recently. It is hedge fund selling. I do not know why this is so hard for so many to accept other than the fact that they have been conditioned like mindless lemmings into accrediting every single move lower in gold to bullion bank manipulation of the price. That is not only intellectually foolish, it is laughable.

      The bullion banks do not sell into downdrafts; they buy when the hedge funds are doing the selling. On the upside, they sell, when hedge funds are buying.

      The same people who are bitching and moaning about "all those contracts dumped on gold in such a short time" say not a DAMN WORD when the hedge fund computers all come in and BUY "all those damned contracts in such a short time". In other words, it is selective outrage merely because the price is going down instead of up, the direction they want it to go.

  7. Thanks Dan for sharing your thoughts once more.

    "The current monetary system, with the US Dollar as the Reserve currency is fatally wounded but what is there realistically to replace it at this point?"
    Which is why the "something" break in confidence may probably be a matter of confidence towards all fiat currencies of the present system, not only the dollar...and gold will go up not just against the dollar but against ALL fiat currencies. Then we will see the bull market back.

    "Which brings me to another point - no nation out there which is holding US Treasury obligations as part of their reserves wants to see the Dollar crash and the "value" of those reserves go up in smoke."

    My question would be : is the rest of the world going to be subdued once more into using the US petrodollar (see India), or are they simply preparing themselves and gaining some time to reduce the impact of a dollar collapse? I remember Sinclair mentioning that China is net short dollar, if you consider all the contracts it signed with long-term commitments, selling dollars and buying raw materials, rare earth, oil, gold, firms...

    1. Hubert;

      I believe the current monetary system is inherently unstable at this point but until something arises to replace it, I cannot see any nation deliberately taking steps that would injure the value of their own reserves. A new system will have to arise at some point but as far as timing, I am as much in the dark about that as anyone else.

  8. Aflaccc - very interesting point. I see that Morgan Stanley and NY Mellon also increased their holdings. Aint these banks all on the board of the Federal Reserve?

    Dan, you state the following...

    "Combine this with a CRB index or Goldman Sachs Commodity Index that cannot gain any upside traction, abysmal to miniscule job creation and of those, many are now part time jobs thanks to Obamacare, flat to relatively stagnant wages, and you can understand why, even without this chart, that the factors necessary to push prices sharply higher are currently missing."

    none of these points was in place in late 2010, early 2011 when the commodities index hit its highs. In fact, the US jobs market was a lot worse.


    1. trystan;

      The USDX was sitting below 74 when gold made its all time high back during that time frame. It is currently sitting near 80.50.

      That speaks to the issue of CONFIDENCE that I have stated and will continue to state. As long as confidence in the US Dollar is intact, gold is going to struggle to sustain rallies.

      Also, commodities were the rage back then because everyone was concerned about the impact of QE on the value of the Dollar and inflation was the sentiment. That is no longer true.

      I would also disagree with your assessment that the jobs market was a lot worse. the impact of obamacare on the us employment situation cannot be ignored. It has resulted in large scale reductions of full time employment and an increase in part time employment among small to mid sized companies.

  9. technically.
    Daily : we just confirmed the break of the neckline of a head and shoulders, whose theoretical target is around 1160$. I say theoretical because TA is a matter of probabilities, not certainties, and 1160 is not a given, only a target.

    I have an intermediate target which is 1230, as the Bol 100 daily is in range and its inf Bol is at around this level. On the 2day chart, one can also trace a downtrend channel whose support is grossly also around 1230. So 1230 next stop? Probably...all I can say is that most of my indicators are now on the red, we are still in the downward pitchforks on a weekly scale, and there is still potential in the impulsion down on daily and 2day time scale.

    But the worst is given on the 2-week scale here attached.
    I'm still not very used to these indicators, as I've been using them only recently, but overall :
    - the CDUR is a cyclical indicator which helps monitor the strength of a trend. The message here is very clear : when it went down, prices went down as well from 1800 to 1200. When it went up to overbought again...well, prices are not going up...or a mere 100 points. The CDUR is still in overbought territory, it didn't even start going back down yet, and prices are already weak...so I let you guess what happens when this indicator starts plunging.
    - this is confirmed by the ET MACD, which estimates volatility. It reached a top 5 candles ago before reversing down (red), and while both Bollinger were heading down. To say it simply, usually, ET MACD anticipates the convergence of Bollinger, i.e here the lower bollinger band reversing UP...normally within 3 to 4 candles. BUT if, despite the ET MACD reversing down, Bollinger Bands keep staying in a downtrend, well then,...we are in a "tendance en ligne" with a potential continuation of a strong downtrend :(
    And you can see that this Inf Bol is already at the level of the recent lows, and shows the same target as the Head and Shoulder break of the daily unit, ie around 1170 $.

    With that, I don't see any technical reason to be optimistic right now, as a bull :(
    Of course, that's just my opinion and my interpretation of the charts...


  10. http://abcnews.go.com/Business/story?id=7168919&page=1&singlePage=true

  11. Hurry up, let's krach paper gold prices then buy the real thing with dollars as long as the dollar is still worth something...you don't do it now, you won't do it later.
    In the same time, let's indeed burn the miner's price and buy them for a penny. Controlling gold price is also controlling miners.
    When gold bounces back up, we'll be the real billionaires, in control of the production as long as the metal.
    Soon, it will be too late. China is already starting to bother us...


  12. Hubert are you shorting gold at this point? It seems based on your projections it is the logical thing to do. The gold market has gone down on feelings of an agreement and gone down on no agreement. It is being driven technically and nobody knows that better than you.
    Thanks again

    1. Hi Concord.
      I am really embarassed to take a large short position on gold right now, because it seems to me that technicals are contradicting fundamentals, latest suggesting that gold prices at least should stop falling.
      Besides, I bought gold as an insurance against a sudden unexpected systemic event, so going short, I would simply cancel that insurance and expose myself to that risk.
      Last but not least, I don't want to have a huge short leverage on gold at the moment, which is what would be needed to cover my long physical position.
      I am hedging sometimes my physical position, but by buying puts out of the money on anticipation of a big and fast down move. This way, the entry ticket is quick. It's an insurance on my insurance goind down :)
      Overall, I am sometimes short on my trading position as well, but quite moderately, and just as for every over line of my trading account, small.
      I play small because I'm not day trader and I don't live from trading, so I'd find it frustrating to lose a lot of money if I made a blunder. I'm still training, fine tuning my approach and trading system.
      My view regarding trading is : don't focus on one single market and play all the time. Instead, have a broad approach with screeners and detect a few good opportunities on a lot of different markets. In other words, wait for a real good hand and play tight.
      If you have a trading account, then you can trade many more different markets than just gold.
      To me, as explained in the beginning, gold's behaviour is too awkward and too contradicting vs fundamentals that I dare trade a lot on it.
      But as you saw from my previous posts, I was globally :
      - long at 1200
      - half out around 1300
      - full long again stop 1345
      - half out above 1400 average (between 1380 and 1420)
      - totally out back at 1349 (sell stop)
      Flat since then, and probably I will short a bit the market should gold re-test 1290 without success, aiming at 1230.
      I accumulate some cash in order to buy more phyz should prices reach 1000 $ an ounce.
      Anything else is simply in/out dynamic management of a globally long trading position in order to make a profit, rarely but sometimes short. Watching back, I should have probably been much more aggressive on the short side since 1530 were broken. But as I said, with such terrible fundamentals, I would hate to lose money overnight on a systemic event, being shsimply ort gold. But that's just me and I could have made more profit with a more aggressive attitude on the short side for sure.

  13. Basically, this is yet another piece of strong evidence that the Bernanke Fed will go down in history as using the most brilliant policies ever devised.

    Students will be writing thesis for their PhD's at all the top business schools studying this matter.

    Where else in financial market history has so much money been printed, resulting in the resounding success of achieving seemingly impossible goals? Such as:

    1. Kicking of the biggest, fastest, steepest consumer stock rally in recorded history

    2. Creating untold amounts of wealth in the 401(k) accounts for the masses

    3. Re-igniting another "rehab/rent/flip" housing bubble, starting only 2 years after the greatest financial and housing crash since the 1930's

    4. Creating such a frenzy in stocks, global money flows have exited out of virtually all commodity asset classes, sending the CRB Index into a bear market

    5. Maintaining the U.S. Dollar as the gilt-edged reserve currency of choice, despite the Fed's intent to "do whatever it takes" to restore economic growth and reduce unemployment

    6. Create such a sensitive "Algo/Robo driven financial market, that virtually any threat of inflation can be instantaneously quashed by mere "words" from the Fed Chairman

    7. Turning hundreds of "acclaimed experts" like Marc Faber, Kyle Bass, Harry Dent, etc. who keep predicting "Endgames" and "Financial Chaos" into Wall Street laughing stocks.

    8. Making gloom and doomer hyperinflationists such as John Williams and Peter Schiff look like carnival barkers who do nothing but talk amongst themselves in an attempt to self-validate their foolhardy predictions, thus convincing the investing public to ignore them and keep invested in Fed-sponsored, preferred asset classes

    Basically, the eye-popping success of the Bernanke Fed will create a fountainhead of new knowledge, economic paradigms, and central bank modeling which will be emulated and duplicated the next 100 years, assuring that regular bust cycles can always be stopped dead in their tracks and the world will be able to move forward with renewed vigor and vitality.

    1. Be careful, Mark. Some might be tempted to misconstrue a subtle undercurrent of sarcasm.

    2. Really Mark, that was uncalled for. Most literal readers can't differentiate between what is real and what is sarcasm. Conflicted they are, much to the delight of governments.

      US government have destroyed retirement and savings account with zero or negative % rates thus wiping out the middle class. Even with the DOW at 20,000, everyone will still be treading water.

    3. Mark's sarcasm is of such brilliance that I am surprised he chooses to waste it on the weak-minded, foolhardy true believers of gold as the ultimate currency who frequent this blog. I am especially bedazzled by is his analysis in hindsight of where the smart money should have been for the past 2 years. Brilliant!

  14. Its so bad and stupid, that they can threaten to default on the bonds and yet the bonds are higher, the dollar is hardly lower and the metals are hardly higher. One can appreciate Marks sarcasm, as it does seem appropriate.

    1. arnie - the market isn't stupid. The market is very efficient and dynamic. I suggest it is your opinion/analysis of the situation that is wrong.

  15. As Jim Puplava noted in his podcast this weekend, now that that we are in the midst of the angst of the debt ceiling, potential T-Bill default, and Yellen's nomination is now assured,

    There are NO catalysts seen on the horizon to reverse the brutal bear market in gold and the depression-era crash in the gold stocks.

    The only place to invest right now is in the riskiest, most economically sensitive stocks in the U.S. markets.

  16. come on fear bid...Gold should be higher by now....

    1. We really don't know the cost basis of JP Morgan's long position. and when taken with the profit of their short position their weighted average profit could be much higher even with lower prices... Besides I estimate that the cost basis of their long position could be as low as 1250 to 1300 and they could have sold off most of it between 1300 and 1420. Goldman's long position in GLD it's only about 11 tons. their paper short could be much larger than gld long. JP Morgan is also replacing the gold that was sold in the allocated accounts earlier this year... There has been no reporting since the closure so we don't know what's going on anymore I don't think the bullion banks are buying I think they are selling their long positions.

    2. The trading in gold is the most sophisticated version of Game Theory I have ever seen, because there are few relatively large players. I took some of these upper level classes in undergrad a long time ago, but it developed my mind to think how evil scumbag globalists think and how to anticipate how they would act. Perhaps, if I were JPM or GS I would trip people up into thinking they were going long and the report readers would trumpet it. I haven't noticed the hedges going that much more short over the past few weeks (but since we don't have reports now we just don't know). I submit that in fact it could have been JPM dumping the last of their longs as the hedges were buying in anticipation of US default.

      We just don't know

  17. When you see 500000 sold short in a minute one can't stop thinking more than ever that this really is really is fear vs greed. I'm my opinion longs are becoming fearless and shorts way too greedy. One day, one of these hedge funds is going to get amaranthed, that will probably shift the sentiment very quickly. if you guys a're waiting for an inflation headline out of market watch to go long gold, good luck with that.

  18. Back to basics. Gold is the anti FIAT no more no less, it is the one money nobody can manufacture, duplicate, counterfeit. Since April the paper Gold market has been manipulated exactly with one aim support of failing FIAT currencies. History is your guide all FIAT currencies fail for the exact reasons that are in play now, a Ponzi system requiring more and more debt more and more FIAT. I suggest investors be patient and take advantage of the Gold paper sale discount to steadily accumulate real Gold.

  19. ok so this debt default thingy, obviously they will never let the US default...but as of today im thinking they may actually let the US semi-default just to give everyone the cover needed politically (red and blue team), to raise the debt ceiling...just saw this little bloomberg video on the 5 options, and the on ei thought they might do is go past the deadline by a few hours, let the market semi-crash, for the congress to pass debt ceiling...but regardless of that, if the U.S. defaults, gold should drop, right? i mean, maybe fear leads to it going up, but by monetary theory, less debt equals lower gold...ya?....and so the opposite is true for the inverse....when the debt is raised, gold (and everything else i presume) should rally? what does everyone else think of the scenarios?


    this is a five minute bloomberg video on the scenarios.

    1. Precious
      I think that no matter what the DOW/S&P will go on a rampage to the upside.
      I am still short gold and long DOW.
      I should have bought more DUST before the weekend but didn't. It used to be that I would be nervous holding these 3x short ETF's over a weekend...not anymore.
      They are almost becoming guaranteed money..sad but true.
      Still waiting for $1000.00 or less.

  20. @concord, as mentionned this "morning" for me, I went short at 1290, very slightly, aiming at 1230 ideally, with a stop loss somewhere above 1300 $.

    1. Thank you very much Hubert. I wrote a response to your Armenia comment a couple of threads down the page.

  21. you are such a good trader Hubert , I am amazed , do you mind publishing every single move you make , please ? , that is of great interest . can you explain what makes you go short at 1290 , and cover at 1300 ? . Thanks in advance .

    1. Hi stella,
      I wish I could tell you I'm a genius and I found a formula based on esoteric french curves and cycle convergence improved by the moon cycles, but the truth is I just got lucky on that hunch of 1290. It was simply based on a potential pullback towards the neckline of the head and shoulders on my chart, plus the fact that some were following 1280 as a horizontal support, others 1300...so all in all, I thought that the middle of that area and neckline was not a bad spot to try a short.
      Very simple and "amateurish" as you can see.
      Stop loss just above 1300 because as I mentioned, previous support zone was around 1285-1300 so, if it became a resistance, prices shouldn't get over it, especially with 1300 a round psychological number.
      I got even luckier because on intraday time scale, I'm rarely available to follow short term time units and see if the impulsions stop or not, so it was really a hunch, for a short term trade.
      I have no idea what prices will do next, so I already took profit on 1/3 of my short at 1380 actually, put down my stop loss at my entry level just above 1390. Now maybe I will be stopped, but at least I can only win, not lose, so it's the most important thing to me.
      See how a bit of luck can make you look amazing, lol :)
      By luck, I mean hitting exactly the top of the day.
      I didn't expect such precision.
      Have a nice day,

  22. GDX/GLD ratio now making fresh, all-time, new world record lows.

    Hands down the worst performance of any sector in any period of time since the Great Depression. Even the Internet stocks did not get hammered this badly after the 2001 - 2002 tech bust.

    Never before has so much money been lost at the hands of the gold shilling "experts" who claimed outlandish and ridiculous price targets for gold and gold related equities.

  23. Mark I think you have made your point.

  24. This comment has been removed by the author.

  25. So Mark...what are you trying to say?

    I'm pretty sure everyone here gets it. I don't see any super bulls left here or on any other site.
    You are starting to sound just like the shills that you so despise.

  26. Which begs another question
    Is there anyone here who is NOT short gold ?

  27. I think I will be adding more to my short position tomorrow. When they announce the raising of the debt ceiling gold prices should absolutely crater.

    1. That makes sense. In order to solve a debt problem, just issue more debt. And then sell something that has no debt attached to it.

    2. unless it is so expected to be that way that it is priced and exactly the opposite will happen? :)
      I keep my stop loss poised just above today's highs, just in case gold rushes to 1340 and beats all pessimistic scenarios :)

    3. I would be more than happy to be blown out of my short position Hubert.

  28. I am not ... went long friday , I guess I m the sucker ! lol

  29. Replies
    1. Stella

      Just like the Beer...very very bold...good on you !.
      You and White Wolf have serious balls

  30. Just read Stewart Thompson. The Banksters in India have pretty much destroyed the Gold market there. Only 6.9 tons imported this month when it should have been 69 tons.
    Refiners, jewellers etc. all shutting down there.
    We will look back at $1000.00 being the good old days...all I can say is "Yikes" !

    1. what have I been saying about government intervention especially India. Anyone putting on long positions right now is rather foolish. The stuff being put in place in India will be the same eventually around the globe....

    2. Then where does it end Eph?
      Gold permanently devalued until worthless?

  31. Dean I know less than Eph but gold is not going to be worthless.

  32. think of the impact the actions in India have had on gold. Vietnam implimented actions and restrictions. This will spread. In the eyes of the globalists, they see these test cases as being highly successful and much more effective than confiscation or owndership restriction. The people don't geet alarmed, though the real objective is capital control. The govts will use excuses like current account deficit mitigation, etc. All flimsy excuses, but the average person doesn't know any better. Also, I see down the road that gold will begin to be attached to terrorism. Gold may always be legal, but govts around the world will make it expensive, risky, and with their intentional volatility injected into the paper market not worth it to own, unless you are like me and hedge and acquire when the bottom is finally put in. I guess it will be high triple digits eventually. Wait for the end of year to come when India is absent from the demand side. COMEX may show a sub 1,000 print.

    Unfortunately, you may not be that far off the mark. Govts may make it such a pain in the ass to own that it may become "devalued." Whether it's worthless, I don't know. I see it as being death by a thousand cuts. Each cut is carefully thought out.

  33. this blog looks like a bear convention , for a bug like me all these talk about thermo nuclear cases scenarios is music to my ears , well people , going back to my hole , tomorrow i ll come out again see if I can find some gold nuggets right at my door , it doesn't take much work these days ... weather is changing loooong winter ahead ...

  34. I told you guys that shorting paper contracts on the COMEX can be done in infinite quantities, as long as speculators, hedge funds, and governments continue to cough up and dump their gold holdings in order to buy momentum stocks.

    Physical markets do not matter, not as long as so many last minute hopers still clinging to their gold contracts continue to stubbornly hold.

    We need a $200 down day in GC to flush these guys out for good, then maybe we mark a tradeable low.

  35. Dean and Eph mentioned the importance of Indian imports.
    Dan thinks that Asian demand is just enough to put a floor under gold (slippery one at that...), but not enough to generate an uptrend, which requires hedge funds.
    The position of Sinclair earlier this year was that those hedge funds were mere mice against russian and china central banks.

    So the battleground is set once again : will physical demand on gold from the Brics (people AND central banks) be enough to humble the short side and reverse the trend up? And will they manage to break the neck to this demand (careful that black market doesn't just replace official imports...).
    They are sure trying to do so.
    Look France! A few days only before Marie Antoinette Lagarde announced the possibility of a 10% tax on every european bank account (!!!), they announced that they raised taxes on selling gold in France, from 8% to 12%!! Dissuasion is there.
    Why not raise 20% of the accounts tomorrow, Christine? After all, it's not as if that money was really somebody's property, as it is in a bank, huh?
    Why not raise taxes on selling gold at, say, 35%. After all, we could consider it as a filthy investment which encourages terrorism.
    But I think if this happens, you will see a lot of black market and people will race towards gold anyhow, because it will be gold OR being stolen 80% of their assets potentially, like in Cyprus.

  36. Hi Hubert
    Thanks for the input.
    I am close to just getting out (including my core position). My short position has helped but it is not enough.
    My nephew who lives in Hong Kong just sold out today. He was sick and tired of seeing nothing but red on his screen.
    My brother went to NYC this spring to attend a Q&A with a well known gold expert. After the presentation my brother asked "are we at the bottom or should we expect more downside before a recovery" the expert looked him in the eye and replied " the bottom is in"
    Thankfully none of us backed up the truck on that remark but it did delay our getting out.
    It is a very good lesson...never ever trust anyone in the financial world.

    1. hehe Dean, I like your way not to give names but saying Q&A in NYC :) :)
      Bah look, maybe it's in, maybe it's not.
      I didn't go to those Q&A, but I think that expert relies on some other experts about T.A based on cycles of some stuff, one in particular who called the bottom (once unsuccessfully before at 1320...) once more at 1180. Let's see. In terms of T.A, I always prefer not to rely on someone else's analysis or judgement, and to be wrong because of my mistake, rather that because I listened to someone else.

      Maybe the bottom is in.
      Personally, I don't have the "skills" to make this possibility a certainty at that point, neither was I since we hit 1180.

    2. Dean,
      I saw the same man in Los Angeles and asked him the same question in front of 500 people. His answer was the same except I saw uncertainty in his face. I know why now.

  37. The questions imho are :

    1) can they break the demand of prhysical gold from Asia? India has not increased its gold imports a lot those last years anyway. China did. Russia does but it represents a small quantity. If BRICS keep buying because they think that gold will be a component of the new monetary system (see Sinclair), then we could have a long term floor on gold, even with short term volatility. But we also know that BOE or BoFrance sold some of their gold at the lowest possible price 10 years ago. So what will it be? Will they stop buying this strategic asset? I see no reason why they should...yet India is showing us how their government can become a US puppet.

    2) If they manufacture a new collapse (which I think possible, as mentioned) towards 1000 $ (or even a bit lower :( ), what is their longer term game plan?
    a) keep gold at a low broken price forever?
    b) accumulate as much physical gold as possible, go through a few years during which owning gold will be punished (higher taxes to sell, etc...) in the western world (see bloody French measures...), wait for a new monetary system to emerge and manufacture a dollar collapse, then ride the bull wave on gold with a lot of physical, aiming this time at pushing gold prices to extreme highs?

    Make your bets...

    1. Hubert
      It appears that they may prefer a permanent broken price.
      I understand the need for a correction, corrections are needed to keep a bull market healthy.
      But is this a normal correction?

    2. Also, you would think an expert with decades of high level experience should know better. The purpose of the Q&A now totally baffles my brother and myself.

    3. I'm not sure...if those guys made as much money as they could on the short side, pushing prices even below production prices for a while, the only way to make money then would be up.
      If the game is to own as much physical gold as possible and then let the dollar krach because this event is considered as unevitable eventually, why not play the up side of gold big time when they are fully loaded and all the other holders sold it?

      Just a question...

    4. Hubert; Are you first in line ready , willing, and able to give up your 10%? And what are your thoughts on Penn? swb

  38. nothing better than riding 4-5 gold contracts short at 3am MDT. I wonder what my neighbors think when they see my lights are on.

    Just covered one at 1253...

    I write on this blog and as guest writer on others, because I want to inform those who know something is wrong, but are making the mistake of buying gold as a defense tactic.

    1. we dropped from 1430 without much of a bounce...I'm still expecting a bounce sooner rather than later...my target is 1230 min, and I sure keep my stop loss in case of a big bounce up...

  39. FED TBTF as seen since April continues to short precious metals setting up cover for a major increase in QE money printing as the US moves into a deflationary spiral where contracting economic activity is strangling Government. Gold being the canary in the coal mine is being manipulated lower in the paper markets. The problem with the Comex Gold market is the same as the FIAT paper market both man made by design will fail. Gold precious metals becoming better and better value the lower they go. Hold and accumulate.

    1. I'm not sure gold would explode higher with all current QEs if it were not manipulated, because as Dan wrote, the velocity of money is decreasing.
      This money printed is not finding its way to the real economy via new loans, deposits, etc..
      It doesn't generate inflation because it is simplys stored by banks as a Reserve to their favorite central bank.
      Money is stored, it doesn't circulate, therefore for the moment at least, it's not really inflationary, i.e not bullish for gold.

      Of course, what will happen with all this money when the economy gets out of recession is anyone's guess... :)

    2. Accumulate at your own peril.
      Sorry, but today I am dumping the miners that I am still up on.
      There is something else going on here, this is not a healthy correction where you can value buy, this is total outright destruction of an entire investment class.

  40. FedEx now surging to world record highs.

    Market seems to be pricing in an economic boom of epic proportions.

    Gold miners are pricing in sub $1,000 gold at the moment, poor Jim Puplava just dumped his 6% Kimber stake for a paltry 15 cents a share on the Invecture takeover.

    Oh well, at least the company didn't go completely broke and he was able to salvage what he had to avoid a 100% wipeout.

    Stay the course.

    Stay in the system.

    Don't fall for all the gloom and doom predictions from guys like Marc Faber who have been dead wrong for years now.

  41. look at this volatility... Now, we can say these are hedge funds doing this, and they are for the most part. But the hedges doing the globalists' work, and are causing this on purpose. Who in their right mind looking at this would say, "let's go buy gold!"?

    Gold's price should be somewhat consistent, even if it is falling in value. But to see 100 bi-weekly swings says something. This slow grind of ostensible insanity will continue to weigh on prices. However, there is nothing insane about the motive.

    This is how they "devalue" gold's store of value.

    I hope some people have listened and realized that there will be no collapse, no inflation (more than 5-7% yoy), and that we need to move on, lick our wounds, and realize that many have been duped by those talking collapse. I was duped, but woke up about 12 mos ago. The markets are all managed, and if we do get a collapse, it will be planned. However, the globalist plan is to keep things going until war. War always is used to wipe monetary systems clean, and war will be used in this instance as well - probably the end of the decade.

  42. Eph,
    I don't doubt we will see lower prices, and the governments of the world will collude to control not only the markets but the populations, but gold will have value in the end if they allow us to own it. It won't be more than a couple of years in my opinion before the sh-- hits the fans. A war if it happens will end the world most likely don't forget that.

    1. A war might be the horror of having the Chinese wipe out our grids with their satellite technology. That would not end the world but it would be hell on earth.

    2. This war that I talk about will be brutal to many. However, it's been in the cards for decades, the globalists have built up China and Russia for this purpose, but the "stepping and fetching" and bumbling Chinese and Russians cannot keep up and build their armies, and esp. navies fast enough. This is even after we transfer all our tech to them. The war outcome is already determined, and will bring in the global govt "needed" to deal with such issues. The US will be the bad guys of this war. That's why the US is being positioned as a villain in the international community.

      The world will still go on, but under a military and financial dictatorship. this should be 8-10 years.

      China will become the new Soviet Union dialectic.

    3. Eph,
      How can you consider a global world war without considering the end of the world? A world war of the magnitude you describe (US vs Russia and China) means a global thermonuclear war.
      Nothing would survive that, there would be nothing to build further to that, except maybe a globalist worldwide government the kind of "12 monkeys'...
      I mean people are worried of Fukushima now.
      I;m sure you are aware of the number of tactical and strategic warheads in possession of the 3 powers you described.
      A war would blow 4 times the surface of the earth.
      Do you think that by any means such a war could remain local and limited in terms of weapons of mass destruction?

    4. It will be bad, but survivable. For many they are going to wish they were dead. It will be kind of Revelation/Ezekiel 38-39 stuff. Zechariah talks about this, too. Most people survive years after a nuclear blast. They look like zombies, the living dead. Notice the zombie movies - this is what the globalists call us.

      The globalists have been communicating this war to us for decades. Think about Planet of the Apes with Charlton Heston and the Statue of Liberty scene on the beach. Think about Soylent Green.

      Back then the referrals were not that often, but were being introduced to us. Now, it seems every other movie is perparing us for that life-changing day.

      After WWII the globalists thought this war would take place by the late 90's, but the delays in propping up China and Russia have kept putting back the date - this is to out benefit. God is giving us a break and more time to prepare.

      The globalists will then come out as our saviors, saying we need to give up everything in order to save us from big bad China. We will have to show our allegience to this new government. We will have renounce most things like religion, privacy, etc. We will have to opt into their financial system, and take their mark.

      The radiation from Fukushima is much worse than atomic weapons. It's ongoing, with long lasting isotopes. With bombs, nuclear fallout lasts for several days, with the worst being radioactive iodine (half life of 4-5 days). The plan is to move the NWO capital to Denver after DC is taken out. CO Springs would be taken out, since it is the Northcom head, but Denver would be spared damage as the mountains would act as a filter from the west coast fallout.

      This is the only way the globalists can be spared the blame and judgement of a failed monetary system, and also appear as our saviors. Think Stockholm Syndrome... They are using these QE's etc, to buy up and consolidate as much of the world's assets and wealth before then. They know it's going to fail. The just need to convince us for a few more years that all will work.

      Think about this... How else will stubborn Americans give up sovereignty? What event that is planned will be that catalyst? It is going to have to be pretty bad in order for people like me to willingly sell their soul. I won't, of course.

      Since I haven't had a job in almost 15 years, I have become somewhat of an expert on this fascinating stuff and have plenty of time to learn and study.

    5. BTW, ever wonder why China is building vacant, redundant cities hundreds of miles away from the major cities? Their leaders know that after the United States absorbs China's initial strike, the Anglo-American NWO will pull out all those black budget/Area 51 type weapons that were thought to be only sci-fi, and take out hundreds of millions of Chinese who just happened to flock to the coastal cities to look for work over the past 20 years. The Chinese govt knows what's going to happen to these poeple. they will be taken out with weapons that we never even knew existed.

      These are very interesting times. In order for these events to come to pass, what we are currently witnessing around the world and in the financial markets need to take place. they are and the timeline is now irreversable.

  43. Don't worry Eph,

    A lot of people were "duped" by so-called "60-year veteran, acclaimed experts" who have been calling for a "Terrifying Collapse" in the economy and markets.

    When are these guys going to wake up and realize that the "Terrifying Collapse" has already happened in the gold sector?

    And how much longer can they ignore the spectacular surges and breakouts in many cyclical and industrial stocks?

    How much longer are they going to blame everything on the "Central Planners" and "Manipulators"??

    I mean, really, the scene is getting totally comical. What planet are these people living on?

    At what point do these people's reputations become so tarnished for being wrong for so long, that their careers actually begin to suffer?

    That is the amazing thing about pushing the "Gloom and Doom" theme, there is never a shortage of pushers and believers for them to feast upon.

    1. I wouldn't doubt if some of what you talk about traces itself back to govt servers.

      It is designed to wear us out, alienate us from the others, and to discredit us. By the time any of this stuff happens it will be years away.

      The best thing we can do is to get on with things, and stop listening to these people all the time. Yes, it will happen eventually, but go on with life, live vigilantly, and be prepared mentally and spiritually. And yes, make as much money as possible in the system. We are all in it, but let's not be of it.

      This is what I often say to myself, which is why I have changed some aspects of my life. I'm almost 50. I guess it's never too late to change, but we need to make sure we have enough money to live comfortably. I like gold at any price, as I would like to keep 30% out of the system we are all stuck in. By hedging I can achieve this number regardless of gold's price, and without buying more with other money than from trading profits.

    2. Mark they are not necessarily wrong but messed up on the timing. Things can change any minute now.
      BTW who's this Jim Puplava you bring up? Never heard of him.

    3. Yes, the idea is simple : keep some physical gold as an insurance and out of the system, and just forget about it. Speculate with everything else as much as you want, but keep a foot outside the system. I agree with the 30% ratio...

  44. ooops...?


  45. Boom...see that gold can also rallye pretty fast!
    Who knows where this market goes next?
    Watch out imho if 1290 breaks.

    Here is an interesting video from someone more optimistic than Eph.
    But our common point, her, me, Eph, Sinclair...we own gold as an insurance.
    Dont let emotions take control because of price volatility, keep your insurance.

    1. Hubert you called it the wall is now at 1290.

    2. Hubert, you never answered me whether or not you were happy about the idea of giving up 10% of your savings account for the betterment of the sick and broke EU? And also, what about your girlfriend Le Pen, is there any future for her and her type? Oh, no problem, you have Draghi and Hollande to steer you through the coming nightmare, right? I make the O/U on the Euro's death at 36 months; swb in sparks

    3. Comrade steve, you are talking like a capitalist!
      Of course, I would be glad to give all my savings for the great cause of our greater nannycracy.
      You remember Maggy :
      "The problem with socialism is you eventually run out of other peoples money"
      Well, she was wrong. It's not only with socialism nowadays :)

      Marine is doing fine thank you, thanks to a great French policy of diminishing all unnecessary fees such as police, justice depts, etc...and increasing all necessary taxes even more (our government requires a mere 57% of our GDP and growing...) in order to assist all the organized crime which is now growing in our country since Shengen and no borders.
      There is not one day without some bank being blowed up, police station being attacked, train being derailed and its passengers, dead or alive, being sacked.
      Add to that that French have a feeling that they work, pay taxes and are second priority in terms of right vs criminals, jobless, gangs of all sorts, and you have everything you need to foster populist party growth.
      So yes, I think there is a future for her type, maybe not herself because she is lacking a small mustachio to make her look sensible, but truth is many people are getting more and more depressed and are voting extremes, not as a protesting vote, but as a support vote.
      But I wouldn't be surprised that she soons slips on a banana skin, just as Aube Doree's leadership in Greece, or just as a dude named Adolf, who was sent to prison by the authorities before evenutally ending up as the supreme guide of his people.
      I'm sure not making at all any comparison between LePen and Hitler, just saying the time is ripe for a populist guy with a loud enough voice.

  46. If you read the Gold Reserve Act of 1934 (or at least the debates), the #1 concern BY FAR is the issue of hoarding. It appears that the East is going through the very same issues today. In 1934 the East had little to no gold. Today, they are working to accumulate as much as they can.

  47. id be pretty worried if i was shorting gold at the moment....i will repeat that i do not see gold going below 1180, probably not 1200, and it may just not go below 1240....gold has been totally slaughtered this year, and last year, as mark repeats with boring consistency...but yeah, the upside has so much more potential and the GDX and NUGT are hardly dropping, NUGT touched 37 today which is a new low, and then went straight back up, and then yeah now its in the 42s...GDX looks like its been raped like a rag doll and now theres just nothing left to sell....buy and hold GDX (and maybe NUGT) and see how much you make in the next few months....a debt ceiling pass could see NUGT rally 20 percent...i shoudl have bought it today at 37/38......

  48. Within 5 years I believe gold will be like .22lr ammo is today.... impossible to find without paying 8X normal price...

  49. Hubert,
    I responded to your war scenario above.


  50. This is a must watch - US CREDIT BUBBLE IS POPPING RIGHT NOW:


  51. Just a thought about the dollar which should translate to gold. They set up obamacare with the idea of "giving" insurance to everyone with subsidies based upon income, Yet there is no verification of the income requirements. So trillions will go out. Period. If anyone thinks that 17 trillion is a big number, it will look pretty small after they finish giving away the country.

  52. Hilarious to witness the "Great Leveling" in many of the junior gold stocks, many of which are now trading as penny stocks.

    No financial disaster that could occur "In the System" could possibly rival the utter and complete destruction of the gold mining sector.

    Those who put all their eggs in one basket hoping to profit immensely from all the hyperinflation and dollar crash predictions just got creamed.

    By the way, Jim Puplava is a former "gold bug" who wrote for 10 years on the virtues of gold investing, who suddenly turned tail and became a Fed Worshipper now touting momentum stocks and has left his "Peak Oil", "Precious Metals", and "Resource Scarcity" themes in the dustbin.

    Former guests on his show like Frank Barbera, John Doody, Jim Morgan, Jim Willie, etc. never seen or heard from again on his program.

    1. One has to sadly admit, that losing even 20% on a confiscation beats losing 80% on a gold stock. But even worse, not making 100% on a "fed" stock and still losing 80% is even sadder. Unfortunately there is nothing even to argue about. The logic is on one side, but the performance is on the other

    2. Well Puplava was right for 10 years. Thats not bad. As for his stock I guess it depends what his break even point was, maybe it was .02??

  53. Arnie

    Ignore him, if Mark was so market savvy he would be sipping wine on a yacht somewhere and wouldn't even know this site existed.
    Neither would the rest of us.
    We are all here because we have had our butts handed to us on a platter.

    The Bearish sentiment is almost at spiritual levels, someone famous said the shorts would get a religious experience...I think he meant to say longs !

    1. Arnie; Mark is what we call a classic hoosier with an alligator mouth that constantly overloads its hummingbird ass; his mom is going to finally start charging him rent next month and that is why he so incessantly repeats his tired old horseshit that even I am tired of; he is probably trading a miserable 10k line in a couple weasel etf's and nothing more; we send guys like hime home every Monday with crying towels; take care and good luck; swb

  54. Mark has an agenda. He won't tell us what it is but he is a skilled poster who bashes and gloats for a reason. The reason I don't know, he is not doing it for our benefit, but just as the eleven up years in gold set up us to be overconfident, it left others bitter and waiting for this day.

    1. see my previous post Concord; he is a loser; swb

    2. You said it better than I Steve.

  55. I will certainly try. I respect Jim Sinclair immensely and hope that his "last" trade is very successful. He doesnt deserve the derision that he is getting. This bear market must be hurting him as much as it is hurting me and many others. Let it come to an end soon.

  56. Hi Guy..

    IMHO ... the world are funny.... use funny money to trade in funny way..

    Bad new or expect something to turn bad... you buy and viola...you profit.
    Good news or expecting something to recovery you selling.. and Yeah you profit.

    The more you print, the more people don't want it. that is why the M2 is falling..

    Anyway ... hope you guy don't stuck at wrong place wrong time.

    BUY stock at these price it is NUTTTT ... anyway ...

    And finally, eph6:7 you are 50% right .. you should go to read the chinese ancient economy and financial.


    1. I will be goddammned if I know what the hell you are saying preditor1976, but glad to see you are back; I stay bearish with $100 stops gold and $2 in silver so I can sleep; everybody else cries every time there is a puke, so why do not they quit trying to trade with tight stops? can not be done, so just buy silver eagles and quit trying to trade and quit dreaming up conspiracies and nwo and all of that and the end of the world and yadada ; swb

  57. Hi steve.

    See profit take it ... don't sleep on it.

    There is profit out there more then enough you . to enjoy. you just need to take it


    1. it is Cheers, not Cheer, Preditor1976, and I stay short

  58. With respect to trading these markets, I am heartened to see the resilience shown by some of you. The Nazis tried to demoralize the people of England through incessant bombardment, literally. Figuratively, I would say that people trying to trade these markets today are enduring the same daily punishment that the English endured. It is understandable that some will give up or lose their minds, but the dark force whose goal is to control all markets and eventually all people on the planet will not have their day. Only madmen believe that they can make the divine genius of nature submit to their will. Their madness will destroy them in the end, it's just a matter of time. Meanwhile, good luck to you traders out there.

  59. @Dan,

    on jsmineset today : " If no more Gold enters the dealer side between now and Dec. we will have a disastrous "cash settlement" which of course will not be called a default… but in reality and practicality "default" it will be.
    " (- Bill Holter).

    What do you think would be the consequences of a Comex cash settlement?
    A sudden price discovery of gold from asian physical trading platforms? A krach of comex paper gold price? An increase of physical price? Nothing at all?... :)
    Thanks as usual!

  60. at the moment there is a support holding on the weekly scale : it's the median of the initial downwards pitchfork which gave the direction of the downward trend.
    It's been a stubborn (but downward...) support those last weeks, not allowing bears to turn the drop into a panic.


  61. 5 month triangle on the Yen weekly charts getting ready to resolve and typically should break in the direction of the main trend. Objective if broken to downside would be around 70 futures, or 140 FX. BTW, what is it that they say about politicians? Something like they are all just a bunch of ugly comedians? Debt ceiling theatrics gives everyone a chance to run off at the mouth and that is all from sparks

  62. I guess in the big picture, for those that think gold will take out 1900, this is a bargain price, and for those who cant count that high, this is a high price. Will see who is right.

  63. if this deal passes then all that official chart painting will mean that gold could breach 1250 within 24 hours of any agreement. Without the two interventions that knocked gold down, gold would be about 1300. but gold may look to take out 1250 on a deal.

    Someone noticed the 1290 wall. that looks to be the case. anything above 1282-1285 take it as an opportunity to put on a short. last week it was 1320.

    Bart Chilton is on CNBC. Anybody putting faith into the regulatory agencies is very foolish. Bart's a frontman and has no power. Ask Andrew Maquire what he thinks now after Bart pulled the rug out from underneath him.

  64. Here is "Exhibit A" of a "Terrifying Collapse"

    Down 50% in less than 30 days.

    Here's the potential "nationalization" news:


    1. another reason to stay away from miners, especially one with significant foreign exposure to 2nd and 3rd world nations.

      If one wants to make money with domestic oil, buy real estate in the oil drilling areas. I am buying rentals in the four corners of NM. Conoco Phillips is the largest employer and the economy is doing very well there. Why buy the overpriced equity paper?

  65. DOW now has a supercharger up it's ....you know what.
    Does it come as any surprise?
    Did anyone ever think that the FED would allow even a mild correction in their beloved DOW ?
    Through the whole debt ceiling battle the commentators on CNBC just smirked like it was a joke...and in some ways it is.
    The rest of the world isn't laughing America.

  66. Notice on CNBC that they are parading Warren Buffet almost hourly now, spouting how bad a default would be.
    Getting nervous Warren?
    Getting a little fearful when all others are greedy?
    We may have to endure our moronic gold shills but the shills on the other side are just as bad.
    Both sides cram nothing but buy buy buy down our throats...no one ever tells you when it is time to sell.


    1. They will fold, not that I want that to happen but it will

  68. Here is a sample of some MSM headlines
    Apple shares shrug off weak iphone 5 orders
    Market shrugs off debt ceiling woes
    Analysts say "market impervious to everything"

    A lot of shrugging going on, my favorite is the CNBC "impervious to everything" declaration.

    Don't get me wrong, I am still long DOW.
    But...this is starting to look like "irrational exuberance"

    The mania stage is still before us...I only hope I am smart enough to recognize it and get the hell out.

    1. 'impervious to everything' - awesome. good time to buy insurance, it is cheap (assuming you'll be paid out). this is precisely the concept of a black swan that taleb (issuing mills/popper) is talking about...the fallacy of inductive reasoning. as an aside, it makes my hackles rise when ever i read people 'predicting' a black swan event or saying that such and such will be the black swan, totally muddling the concept.

  69. Some of you get pretty hung up on market manipulations, any thoughts on this:

    Basically Armstrong is saying markets CAN'T be manipulated in the long term, maybe short term rally's but it's not possible to go against a trend.
    Any thoughts?

    1. i think everyone agrees with that....short term manipulation almost always has unintended (negative) consequences in almost every field (politics, war, biology, etccc)...

    2. Armstrong correctly sees free markets as another force of nature. I like the analogy of weather modification. Cloud seeding can sometimes increase the amount of moisture that precipitates. Sometimes it works as intended, sometimes it doesn't work and sometimes there are unintended consequences. But if men make the leap from believing that they have the ability to influence local precipitation events to believing that they can control the weather on the planet, they are delusional.

  70. First observation..why isn't Armstrong the richest man in the world? With his predictive abilities there should be no such thing as a losing trade for him. He claims he is giving advice and running his website as a free public service...sound familiar?
    I think Martin is totally correct. Just take a look at what has happened in the last 5 years. The FED prints ever more amounts of money..do we have a robust, growing and healthy economy?
    They have only been able to hold the Bear at bay but not change the long term trend... but this is still to be determined.
    He also answers the question of suspicious amounts of gold being dumped in big lots on the market. He claims this is just funds selling to meet redemptions. Ask Armstrong if this is the way he would liquidate an asset (or any other trader for that matter)
    Even the non gold shills are noticing something is not quite right with the size and timing of these sales.

    1. Dean; Price and time have not squared. Relax and enjoy the $1550-$1180 cut up zone as everybody has a daily answer or beef; Time is needed for pm's to bottom and begin a new bull mkt. And btw, when is the last time you heard a bullish and NEW argument for higher prices? Same same same, as we used to say in Chu Lai; swb in sparks

  71. What does GLD do once this is passed? I am disgusted by these so-called leaders. They are spineless. They had YEARS to get the budget/spending under control. Instead, they kick can kick can...etc.

    After the arguments, these slimy politicians go have cocktails and laugh at all of us sheep.

  72. I tried to check out the latest gold stocks on COMEX, but the page will not open. Anyone else having that issue?

    1. The debt is going to 20 trillion , at least, and there is nothing to stop it. So why the 'manipulators would want to smash gold when they should be doing exactly the opposite is beyond reason.

  73. Now Goldcore tells us about the last time we had one of these phony debt ceiling jokes that gold surged 17%. However conveniently they do not mention that we were then in a bull mkt and that the rally made the top at $1920. So do you really think we can now rally $218 from here? No, I did not think so and that is all. Hubert, the action is sloppy I think, but these daily moves do not mean that much to me anymore. have a good one, chief, swb

  74. Why are none of the Gold Writers out there talking about Tax Loss Selling...The way this year has gone, a lot of people have made lots of money on the DOW and S&P and one of the few sectors with potential tax loss selling is the Precious Metal stocks....Tax loss selling is going to start early and if it starts from these levels, it will be brutal....I hope we have some sort of run up these next 2-4 weeks, so that once tax loss selling starts it won't be from these brutal levels....glta

  75. so the SPY and DJIA didnt exactly rally that much once the debt ceiling was announced....all priced in i guess...i think gold/silver are/have bottomed...yeeeeah, it can go down 20, 30 dollars, but i just dont see this 1100 or below price coming....GDX also looks pretty finished with the selling at 'new' all time lows....i rate gold miners a nice hold at this point...and theres no taper coming, just the same trend as the last decade+..more debt, more spending, more borrowing, more defeicits, etc....

  76. Gold flinched up a bit but nothing to get excited over. If miners go into the red in afternoon trading, my prediction is gold will be heading back down after the knee jerk reaction.
    Precious wood "but i just dont see this 1100 or below price coming...."
    Could you see gold going from 1500 to 1100 in 3 months? Or 1800 to 1100 in 8 months?

    1. no i couldnt see gold going from 1500 to 1179 or 1800 to 1179 - ill admit that straight up, but i still dont see gold breaching 1179 this time either...if they say yes to start tapering then yeah, but i dont think they will, i think theyll eventually have to increase QE and when that happens gold will eventually go above 1520 and the bull cycle returns....

  77. New lows for GDX/GLD ratio. Gold trying to move higher but the stocks keep imploding.

    1. I think now we know how miners in the late 70's gold bull gained hundreds and some of them thousands of %, they were are decimated and starting from uber low levels when gold pulled back from 200 to 100.

  78. Economy is in good shape now and there's more money to go around for the essentials of government and the banking system. DJIA to 16,400 and beyond now. Crash JPM? I don't think so:
    DEBT DEAL REACHED: Wall Street Rises

    Sit back and relax: The 401K's, IRA's, Annuities, Stocks, Bonds, and Mutual Funds are all safe again in a growth economy.

    Has anyone seen the new $100 bills yet. I'm going to stack some of those but I hear they might have RFID tracking devices in them. Is that true?

    1. Economy is in good shape now? A growth economy? Does one measure economic growth in terms of equity prices? Or is this another version of genius sarcasm that is lost on simple-minded slugs like me?

  79. Totally correct Weather Unit

    As CNBC stated "the market's are impervious to everything"
    No need to worry.
    When you storm chase are they also that predictable?
    No need to worry

    1. Actually when I storm chase most storms are rather predictable although you have to watch them close because you can get some unpredictable changes so you have to maintain a keen awareness of what's going on. But I have noticed over the last few years that storm systems are not following their usual patterns and at times are more often becoming difficult to predict. I have even noticed the meteorologists who have varying degrees of wallpaper have had a hard time figuring out the tropics and have been way off with their hurricane forecasts.

      And so it goes with the economy and our markets: The fundamentals and technical analyses used to make more sense (even to the average observer) but for some reason that is also changing. The markets were somewhat predictable but now they are modulated by a different atmosphere of high frequency algorithms along with a notable hypersensitivity to news events.

      Could it be we have in part an artificial atmosphere and and artificial economy? I think there's some food for thought here.

    2. I believe it is all artificial.
      If the FED never propped up the markets what do you think the DOW would be at right now? 10k maybe?
      The algo's do scan and react to news headlines, just read Reuters or CNBC, the headline is often different than content.
      I think chart patterns are all painted by Hedge funds, FED etc. to suite their own needs, this is why TA has become somewhat diminished in effectiveness.
      The economy is very slowly improving but only because of cheap money.

  80. Also
    Here is a link that is a must for every Wall Street broker, trader etc.

    Since the markets are now impervious to everything, it is only appropriate that Wall Street, CNBC etc. all have a good repertoire of dance moves to celebrate the daily never ending gains in equities.

    1. Wow I wonder how this IBM shakeout is going to jolt the market tomorrow? I think it's time for some HFT WARFARE.

  81. Indians paying $100 dolar premium per ounce of gold ... but , but , but didnt the government pound the table , and told Indians they cant buy gold any more ? That they had to buy silver instead ??? !

  82. Would someone please be kind enough to answer a question for me? Why won't the website open for the COMEX gold stocks? I click the link on the CME page and a blank page comes up.

  83. if you have a mac type comex gold stocks , click on the cme link , it will send the spreadsheet directly to your computer file


    GOLD Report Date: 10/16/2013
    Troy Ounce Activity Date: 10/15/2013
    Registered 118427.32 0 2699.85 -2699.85 0 115727.47
    Eligible 117627.86 0 0 0 0 117627.86
    Total 236055.18 0 2699.85 -2699.85 0 233355.32
    Registered 131673.32 0 0 0 0 131673.32
    Eligible 3048691.42 0 0 0 0 3048691.42
    Total 3180364.74 0 0 0 0 3180364.74
    Registered 283102.63 0 0 0 0 283102.63
    Eligible 181049.51 0 22986.12 -22986.125 0 158063.38
    Total 464152.14 0 22986.12 -22986.125 0 441166.02
    Registered 14568.04 0 1297.8 -1297.801 0 13270.24
    Eligible 5150.2 0 0 0 0 5150.2
    Total 19718.24 0 1297.8 -1297.801 0 18420.44
    Registered 173692.57 0 0 0 200.46 173893.03
    Eligible 2836694.94 0 24218.03 -24218.028 -200.46 2812276.45
    Total 3010387.5 0 24218.03 -24218.028 0 2986169.48
    TOTAL REGISTERED 721463.88 0 3997.65 -3997.651 200.46 717666.69
    TOTAL ELIGIBLE 6189213.92 0 47204.15 -47204.153 -200.46 6141809.3
    COMBINED TOTAL 6910677.8 0 51201.8 -51201.804 0 6859475.99
    The information in this report is taken from sources believed to be reliable; however,
    the Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness.
    This report is produced for information purposes only.
    For questions regarding this report please email Registrar@cmegroup.com or call (312) 341-3370.

  85. Wow, do I feel stupid. Thanks Stella! Apparently I downloaded it 50 times!

  86. All Time Donkey for lame duck as president is without a doubt this clown, who hands down beats ford, Nixon, and carter in a cakewalk, what a joke and sad state of affairs; I hope this is the bottom in political non-leadership in this once great country/; even ashamed to claim his true heritage; what a joke, a very sad joke; sparks as usual

  87. Something very counterintuitive is going on with gold here. it should be going down, but it is moving up steadily. What is going on. It is building some upside here. Covered half my shorts when gold could not drop below 1280. Very odd. Could we have put in a bottom? Test 1300 tonight? Will the globalists run it here? stay tuned as the night unfolds.

    Check out this link I got off a GATA email...


    It explains that at current pace of gold prices, production may just soon shut down completely.

    1. Eph,
      You smelled this move in gold before anybody. I saw the move from 1270 back over 1280 yesterday as odd considering the debt ceiling was lifted. The dollar got crushed this morning and while it is probably curve ball move for gold right now you seemed to see it before it happened.

  88. There is only 1 conclusion from all of this. The US to the world. We dont care what the debt is, we will spend forever, we will print forever, and that is that. And the worlds response will be, you can take your dollar and shove it.

  89. Arnie,

    The message back is,"we don't care what our European debt is, Japanese debt is, or Chinese debt is, we will continually print also". Read the debates on the Gold Reserve Act of 1934, and history repeats... remember what happened 5 years later...

  90. Martin Armstrongs latest
    He doubts that gold will ever have any future value.

  91. Dean,

    If you are referring to his,"Destroying the World Economy" response, I think you are reading too much into it...

  92. I read Armstrong Dean. I think his comments on gold far beyond what you read. He is saying his preparing a PM report and that he will address 2014.

    Just remember as I know you know, that Sinclair was like an oracle on gold for eight years. Right every time, but the rhino horns and sell the fishlines worked like a charm. And then he was wrong, again and again and again.

    Armstrong will most likely do the same, maybe not for awhile. He is arrogant, and slightly delusional he will over do the same thing just as Sinclair.

  93. oh well, it looks like another "asian-overnight-pump-to-sell-to-the-asians-at-a-higher- price-before-the-european-dump" false alarm.

  94. Sinclair has been ACCURATE on most things, except price. While that is super important for near term investors/traders/gamblers, it is not as meaningful to long term physical holders (dollar-cost-averagers). Might I remind you all that Jim Sinclair said there would be a time where manipulators would make it so painful, that even the die-hard gold bugs would run for the hills. I do not believe that time is here, but everyone on this damn blog seems to think so. The ESF and the Fed and foreign countries could smash gold and silver down however much they like...LEGALLY (although certainly not ETHICALLY). UNTIL people start investing in Physical ONLY, and get out of the IRA gold scams. When that happens, the truth will prevail. Until then, you feed the beast. I have lost a lot of money due to my GAMBLE on Sinclair's call. However, HE strictly said physical and gold shares... I GAMBLED in other-than-physical and got bit. Please notice Sinclair still offers his opinions, but avoids price points. Something I wish he did earlier. But I do believe he is right intermediate term and long term...

    1. Nate, Sinclair at least has his heart in the right place: Armstrong is just a pompous ass. Armstrong says no manipulation just the boyz being boyz (hedgefund selling to divert cash, yadayadayada but Sprott, Sinclair and numerous others can pinpoint the hour and location of take downs. Wht takedown? Same as the old expression "painting the tape" on stock action as it sets up for whatever momo is desired, in this case down draft. Scare the crap out of the goldbugs and preserve Dow, US$ etc.
      Some chatter lately of G-20 group considering a true universal currency for trading. Makes a lot of sense and eliminates all the manipulation of US$......the reason the dollar has done so well is demand for dollar for trade settlement. China is pissed and holding over 1.25 trillion of US paper and they know its not healthy. They like gold a lot and encourage their citizens to buy and hoard. I wonder if one day they'll demand payment in gold? I could just here them say "we'll take your Fort Knox gold".....what do you mean there's no gold in Fort Knox? Well then, we'll take the german gold you're storing for them.....what do you mean its gone?" LOL
      Britain gave away their gold at bargain basement prices many years ago as did Canada. We're not really sure where the US stands with their gold holdings. Its painful to realize how derelict our financial genius central planners have been over the past decade. I have every expectation that this will end very badly. When that mental switch gets tripped and the West suddenly wants to accumulate gold, it'll be an uphill battle. One more point to whoever posted about the tons of gold GLD has.....only accredited investors (read the prospectus) such as JPM, GS, etc can demand physical for paper so nothing for us small fish to get from that source, just paper. GLTA.

  95. Eph , do you really think that the chinese can not buy or sell gold at GMT or EMT , last time I check they have huge presence in London and NY, If they want to take it down they will at any time they want , the chinese are smarter than that , please dont be naive . The dumping for the London fix its been done way before 2013 and it will continue since they run it as a cartel and is obviously legal the price is decided by 4 bullion banks so go figure .

  96. Great comments all.
    Armstrong will be right until he is not, every oracle has it's day.
    He actually is long term bullish on gold. If I recall his claim is that the real Bull market in gold still lies ahead. Sometime in Jan/14 is when it starts but everyone will be selling the rallies to get out....I believe Jim Sinclair has made a similar prediction.
    They want to make sure that as few as possible will be onboard for the ride.
    IF, there will be a ride at all.
    Trying to stay objective here.

  97. Someone wrote me about my previous post :
    "we dropped from 1430 without much of a bounce...I'm still expecting a bounce sooner rather than later...my target is 1230 min"

    When I said min it meant at best, i.e lowest, sorry for the confusion in my writing.
    To get away from daily noise and scissors, as I mentioned in my last post, I had a look at the weekly scale (see lat char link on my previous post), I see :

    - a first red pitchfork, oldest one, giving the basic direction of the downtrend. We are inside it since then. Interesting thing is its median is now acting as a support. We bounced on it again near 1250. Hope for bulls? :) At least hope of keeping it slow as long as it holds.
    - a second pitchfork, more recent, since the top at 1430. Its direction is even more down. We are capped by its mlh sup now.

    So its an interesting configuration, because within both downwards figures, we are, if we stay inside them, going to see a descending wedge.

    Except from that, not much has changed and it looks rather bearish to me right now, as long as we are inside both those ugly downward pitchforks...

    Have a nice day and good trades :)

    1. i think 1330 and in particular 1350 needs to be taken out to have a nice chance to get to 1380, 1400 and then 1445...i hope we can keep the 13 handle in the meantime...i think it will take macro news to act as a catalyst..like another non-taper news from the Feders.

    2. yes, on the short-term time units, it's nice volatility, but on the weekly time unit, the test is imho the mlh sup of the most recent pitchfork, i.e around 1340 as you mentioned.
      Between 1250 and 1340, it's the descending wedge I was mentioning abobe...though such a wedge has a good probability to end by an uptrend move...

  98. the chinese will decide when the bottom is in , the rest of us are just passengers including a few bullion banks , by the look of things this could be it , who knows , what makes it difficult to go on with this gama anymore is that the americans have made it widely openly clear as ever that as long as they can get away with it they will keep on printing , hence the Houdini shit they just pulled with all the Hollywood drama included ain't flying anymore . This may be the last time they are allowed to do so . The republicans merely didnt play ball , and they didnt do themselves ... and the Fed , in other words , the US any favors . Everybody in the world and my grandmother is talking about the possibility of a US default , the damage in my opinion has been done . Uncle Ben and his gang , I am sure are not happy with the politicians because they let their little secret out in the open , a taxi driver on my way to the airport was teaching me about the latest on the freaking default , and I am not in the US , this is just the start .

  99. Well, so much for all the shorts here. Heads up to the two remaining longs!

  100. good luck to Dan reading this record amount of comments haha...this is the result of being such a good trader-blogger


  101. From the standpoint of gold, this helps explain why the metal keeps sinking lower. With the US Dollar not falling apart, the urgency to own the metal is subsiding among Western-based investors. That is evident from the continued drawdown in the reported gold holdings of the giant ETF, GLD.

    How do you explain SLV and the all time high bullion inventory there? The price of silver has been similarly hammered, yet no flow of bullion out.

    I think it is a huge mistake to conclude that GLD bullion levels follow price or investor sentiment in the "gold" market. I think GLD bullion inventory reflects the sentiment of a small sector of the "gold" market, namely the physical gold bullion for delivery market.

    I view GLD as a convenient place for Authorized Participants to hang their gold deposits, where they can be converted into shares and then used to generate a yield. When demand for physical is slack, GLD bullion bias will tend to be to the upside. When bullion demand is high and supply is short, the bias will tend to be lower as shares are redeemed for bullion by the APs in order to cover customer withdrawals or allocation.

    Therefore, GLD operates like a shock absorber between the market and the APs. The way to view this IMO is the "shock absorber" is wearing out and no longer has the full travel it had a year ago. Demand for physical bullion has depleted the GLD inventory. This is wildly bullish for the future prospects of physical gold bullion and extremely bearish for paper gold and specifically GLD shares.

    So yes, I think your analysis is spot on for "gold" as we currently know it, which is primarily a paper market. Much more pain is coming. To the extent it can, physical gold will fall as well as it is firmly anchored to the paper market. But, when physical supply is fully depleted, and GLD is a hoard of physical, then you are going to see a separation of these two markets. Paper gold will sell at an extreme discount to physical, then likely will disappear altogether.

    You are an excellent technician, and while I was trading I followed you religiously. Your TA is outstanding. More clarity would result if you would emphasize the fact that your analysis really applies to a paper gold market. The implication being that paper gold and physical bullion are destined to part ways. The bullion flow from west to east is not going to stop. Paper gold can only maintain legitimacy if bullion requests can be filled. When they cannot be filled, paper gold will go poof.

    In summary, I see the declining bullion inventory in GLD as wildly bullish for a physical gold holder and wildly bearish for a paper gold holder.

    The idea of GLD as a "shock absorber" or as a "coat check room" for bullion banks is discussed thoroughly at the FOFOA blog here and here.

  102. Hey all...getting a good bounce this morning !

  103. Wow, GDX/GLD ratio still plunging as gold is taking off but the sorry mining shares are barely moving.

    1. GDX:GLD ratio is up today mark. As it was yesterday and the day before. The 50 dma is flattened and will surely turn up looking at the prices 5 days ago. 200 DMa is storming down a golden cross is very likely to occur on that one.

      I am really starting to dislike you, not because Im a goldbug but because Im a decent human being that dislikes disinformationists.

      Unless you are sure the miners will crash much more - and nobody can be sure of that - you are doing the disillusioned a huge disservice by engouraging them to throw in the towel at what may well be a historical bottom by working their emotions. You are doing what you accuse others of in the inverse. Two wrongs dont make a right.

      There are only contrarians and victims in this cyclical market. The fact that you have been victimised doesnt entitle you to do harm to others alike. Behave.

  104. Nothing to get too excited about here boys and girls. $30 pop and a flinch by the miners, just does to show you how weak the PM's still are. Keep your short positions and have a drink.

  105. Got stopped out of my GLL short...grrrr.
    Very minimal loss.
    You are right Prophet, we have seen these one day wonders before.
    One key stroke from Bernanke will take care of this one day rally.

  106. When the bears get an inch, they take a yard. There is only one way to even the score. Take back a mile.

  107. Anyone know if there is a DUST Canadian version ETF?

    1. Prophet
      The Canadian Version is HGD (toronto)

  108. http://i39.tinypic.com/34y6y3d.jpg

    So, bof...I had a target at 1230 and prices reversed a bit too early lol :)
    Now I'm watching the 2day unit, because we are in this red downtrend channel which you can see in the link above. Resistance 1320...we are there.
    In purple, the potential reverse Head & Shoulders that some are also watching.

  109. So, A rating agency in China downgrades US, dollar falls drastically. Gold and silver tattle. ESF will SMASH because they don't like the tattlers, so I bought puts.

    What that means for those of you that want to make money, do the opposite of me and you will succeed!

  110. GDX/GLD trying to attempt a turn, still at world record lows, though.

    See it for yourself:


    1. Thats a better, more correct and more reasonable observation.

    2. I hadnt opened the chart. What a low human being you are, Mark.


    3. gold leading the complex is NOT bullish; more bad news not discounted coming friends; swb

    4. Steve more bad news, all we have had is bad news. Gold went up because there is going to be no tapering for the near future. Bad news in the gold mining industry is expected.

    5. Everybody thinks gold will go to 1000$. Perhaps, I think not, but certainly not yet looking at the sentiment now.

      My target was 1250$. My target is 1500$ now.

    6. Concord; Tapering is dead issue; example of the contained depression in the fascist states of America was illustrated here in sparks this morning as a new mcDonalds dump opened up at 6 this morning with the offer of 1 year of free McMuffins for the first 100 customers; They started lining up at midnight! Take care and btw tomorrow is a full moon, and folks laugh at me, but look out Sunday because we may have some gaps; swb in sparks, nv

    7. I never laugh at comments on the full moon. Yesterday the debt deal was signed on a void moon. Which is a guarantee for future problems nothing good can come from it. It is also options expiration Friday as you probably know.

  111. Steve , what you just described is exactly what happens when inflation is about to show its ears on the horizon . Why do you think Macdonalds is giving food for free , for the same reason that insurance companies will fight for demand with cheaper rates , hotels will give you cheaper rooms , pretty soon you will have cable companies offering channels with 6 months free subscription , prices go down to get the people to spend again , as soon as they fall in the trap , next thing you see is prices skyrocketing , you want to buy a car and you have to wait because factories have not yet anticipated demand so they have to expand , and you know what , before you know the price for the car has gone up 20 % ... Please use a different example , that one is a killer for the bear case .

  112. BTW , is that what Armstrong says ? to go short when there is a full moon ?? ... lol , just kidding mate , a lil' humor to put everything in perspective , hope you dont mind .

  113. sorry , didnt want to offend anybody's faith , I just though , I just put two and two toguether ... Neil Armstrong , the moon , blah , blah , blah ...

    1. so did you start trading last Tuesday? swb in sparks

  114. Might break 1320 and hold.
    I will still be back into my short position...I just don't trust these one day wonders.

  115. and 1320 it is...so, right under the first downwards resistance at this 2day chat I'm watching. Tomorrow friday, raid day.
    Gold was out the box today.
    Let's see if they manage to put back a lid on it by tomorrow, or if it starts getting out of control after all this drama around the debt limit and this very short term agreement which solves nothing.
    I have no idea which it will be.

    Btw, with nearly 200 answers, I just hope our Trader Guest of this blog is all right and healthy as ever. Not seen him stay silent for as long as a week many times before.
    Take care all,

  116. i advise....come the next debt ceiling, the day before, just throw everything into NUGT and sell after the ceiling is raised..guaranteed 10 percent+ trade


Note: Only a member of this blog may post a comment.