Tag Archives: Commitment of Traders Report

Shadow of Truth: An Age Of Deception And Fraud

If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State.  – Joseph Geobbels,  Hitler’s Minister of Public Enlightenment and Propaganda

Put it on CNN and it’s true.  Perhaps one of the most baffling aspects of our system is the extreme dichotomy between perception and reality.  Anything reported by one of the major mainstream news sources is gobbled up and accepted as the truth by a majority of Americans.

Dr. Paul Craig Roberts wrote a brief commentary which describes how news reporting is used to control our perceptions in order to ensure the public acceptance of the Government’s agenda:  “Liberalism has helped to make Western people blind by creating the belief that noble intentions are more prevalent than corrupt intentions. This false belief blinds people to the roles played by deception and coercion in governing. Consequently, the true facts are not perceived and governments can pursue hidden agendas by manipulating news” – PCR, How They Brainwash Us.

The problem is, once you “see” the truth underlying the thick systemic facade of fraud and deception, you can’t “unsee it.”  The monthly non-farm payroll report will be released on Friday.  Every month market participants guzzle Maalox and sit on the edge of their seat in anticipation of the headline news release.  It seems beyond silly that the financial world spends an entire day discussing and analyzing the employment report, which is fictitious in its entirety.   Hell, the Government releases two different statistical versions of the employment report.  Which one is it – the Household Survey or the Payroll Survey?

It doesn’t really matter because once the unemployment rate metric hits the tape, that IS the number.  The truth is that the real unemployment rate is well over 20%.  But when everyone discusses The Number, they use the reported number which is currently 5%.  The process of reporting the monthly employment situation is extreme absurdity in its entirety.

In the Shadow of Truth’s latest “Market Update,”  we focus on the gold and silver market – or the fraudulent paper version thereof.  Like the monthly employment report, most market analysts base their assessment of the gold and silver market on the weekly Commitment of Traders report.  Of course, it makes no difference that the data in the report is already three days old by the time the report is released.  Neither does anyone seem to care that data in the report is compiled and submitted by three of the most corrupt banks in the world.  Another interesting misconception is the use of the gold/silver prices on Kitco as the “spot price.”  But that’s a fabrication as well…

Untitled

Is The Pullback In Gold Over?

The price of gold ran up 20% since the beginning of 2016 through early March.  In response to “overbought” readings in the popular momentum indicators, the superficial gold commentators become short term bearish.  Additionally, based on what appeared too be a heavy “off-sides” in the bullion bank net short position vs. the hedge fund net long position in Comex gold futures, per the Commitment of Traders report, the “big price correction” side of the ship deck became heavily mobbed with short-term timing forecasts.

About two weeks ago, I decided to roll up my shirt sleeves and dirty up my hands with the COT data compiled by my business partner going back to early 2005.  What I found in terms the current net short / net long positioning between the bullion banks and the hedge funds might surprise a lot of observers.  Of course, I presented the information to the subscribers of my Mining Stock Journal in the March 17th issue (along with a relatively undiscovered “de-risked” junior mining stock idea with substantial upside, risk-adjusted).

As it turns out, while the net short position of the criminal banks is above the average net short position from 2005 to present, it’s not even remotely close to the net short position historically that has signaled an imminent price-smash operation.   Currently the net short position is 200k contracts.  But the highest that net short since 2005 has been is well over 300k.  The net short position was well over 200k for large portions of 2010.

In other words, while there is some concern that the cartel is set up to force the price of gold lower by bombarding the Comex computer system with paper gold detonators, the comparative historical statistics suggest that gold has lot more upside and the open interest has a lot of room to expand before the cartel is in a position to throttle gold lower.

In fact, a case can be made that the current pullback in the price of gold may be winding down – click on image to enlarge:

Untitled1

As you can see in the graph above, gold has nearly pulled back to its 50 dma (dark blue line) and the momentum indicators (RSI, MACD) have moved from “overbought” to a neutral position.  The RSI may be actually be turning back up (green box).

As we’ve seen with official intervention in all markets,  it’s nearly impossible to forecast directional moves with any degree of accuracy.  However, there’s a case to be made that the cartel is having problems forcing the price of gold lower.  On several occasions in the last two weeks, gold has been slammed in overnight trading only to snap-back.  Monday was a prime example, as gold was smacked hard for $10 down to $1210 in Asian trading but bounced back to close nearly unchanged from last Thursday’s close of $1221.

The fact that Indian jewelers are still on strike and thereby choking off Indian imports makes gold’s resilience even more remarkable.  At some point, India will have to start importing heavily in order to facilitate seasonal, festival-related gold buying in May.

Even more interesting is the behavior of the mining stocks.  The HUI index ran up 83% from Jan 19 to March 16.  A price correction had to be expected.  While it looks like the miners are still vulnerable to a bigger price decline than the current 7% pullback, don’t forget that the HUI more than doubled between late October and December 31st in 2008.

I’m preparing to chat with the CEO of junior gold mining stock that has been largely unnoticed by U.S. investors, retail and institutional.  But a strategic buyer recently bought a 20% stake in this company and also plunked down a considerable sum of cash for a  1.5% net smelter royalty.  I will be presenting this idea in the next issue of the Mining Stock Journal, which should be out either Thursday or Friday.  This issue will also include proprietary market commentary and other “goodies.”

SoT – Craig Hemke: Demand For Physical Gold/Silver Will Break The System

The 50 day moving average in gold has turned up and it has bullishly crossed through the 100 dma – it has also bullishly crossed through the 200 dma…It’s almost like the HFT hedge fund programs have been flipped from “sell every rally” to now “buy every dip” because the technical picture is so good. – Craig “Turd Ferguson” Hemke on the Shadow of Truth

The debate raging in the precious metals community is if and when the a big raid on the precious metals market will commence.  Today, for instance, gold had drifted higher in overnight trading only to be smacked pretty hard when the Comex opened.   That’s nothing new.  But what’s new, given the way in which the precious metals market is set up right now, is that after being taken down $12 by the criminal traders on the Comex, gold grinded higher until it was only down a couple bucks by the time the stock market closed.  Even more interesting is that fact that the mining stocks (HUI Amex Gold Bugs Index)  rejected repeated attempts to take them into negative territory and they finished up over 6 points – 3.6% – on the day.

The trading pattern of the precious metals sector – at least for now – has defied all expectations of the market given that the technical factors currently in place have historically ushered in a vicious takedown of the sector.

This data that I refer to when I talk about the bank picture, whether its the Commitment of Traders report or the Bank Participation report, it’s all dubious crap anyway because it’s generated by the criminals at the CFTC…when they crank out these reports, we’re supposed to take them seriously in the first place? The CFTC is a criminal co-conspirator [in the precious metals manipulation scheme] – Craig “Turd Ferguson” Hemke, SoT

A big variable in the expectation of a big sell-off in gold and silver is the COT “structure.”  As of last Tuesday, the “Commercial Sector,” which is primarily the bullion banks, is net short 171,000 gold future contracts.  The hedge funds  segment of the COT is net long 104k gold future contracts.  The “other reportables” and “non-reportable (retail trader) segments make up the rest of the long side of the bullion bank short position.

The net short of the bullion banks is 17.1 million ounces. Currently, the Comex vaults are showing 377k ounces of gold in the “deliverable” account and 6.8 million total ounces. This ratio of short interest to the amount of physical underlying is absurd.  Technically it’s illegal because, as Craig discusses in the interview (see below), the CFTC continuously defies the laws in place and enables the banks to skirt mandated position limits on the Comex.

What will happen if one of these days the hedge funds decide to stand for delivery?  If just 50% of the hedge funds stand for delivery?  While it’s true that in any given delivery period that, at most, 1% of the long open interest stands for delivery, the laws of probability suggest that one of these days a significant portion of the longs will decide to take delivery.  This will bust the Comex.

In the interview session below, we discuss this issue with Craig and several other factors right now that are affecting both the markets  and the Central Banks ability to manipulate the markets.  At some point the demand for physical gold/silver will break the system:

Someday something will change and the confidence scheme will fail. Every uptick [of gold] increases the pressure on that confidence scheme which is why the banks are fighting it so hard…in the end they are just not going to be able to…Craig “Turd Ferguson” Hemke on SoT