Tag Archives: paper gold

The Audit The Fed Movement In Congress Is A Joke

CNBC announced yesterday that “The ‘audit the Fed’ movement is taking a big step in Congress this week.”  Only here’s the problem:

The bill seeks not a financial exam of the U.S. central bank but rather a peek behind the curtain of how monetary decision-making happens.   LINK

The first time I read that, it me left somewhat stunned.  “A peek behind the curtain” of how monetary decisions happen?  Seriously?  I think we get to see this in action every day between FOMC meetings, when the various Federal Reserve retards step up to the podium to drool all over themselves as they as mumble incoherently about raising interest rates at the next meeting.  In fact, just today some chode from the Atlanta Fed named Lockhart stated that:

June certainly could be a meeting at which action could be taken. I think it is a little early at second-quarter data to draw a conclusion, so I am at this stage inconclusive about how I am going to be thinking about June, but I wouldn’t take it off the table.

Here’s SF Fed Head John Williams – this is just priceless:   “I think the incoming data have actually been quite good and reassuring in terms of policy decisions, so, in my view, June is a live meeting.”

Really John, June is going to a “live” meeting?  Does that mean that the rest of them have been fake?   From where are you getting your data- the toy chest at your dentist’s office?

I hope that guy didn’t actually  have to pay for his education because it was a colossal waste of money if he did.  Do we really need Congress wasting time passing legislation to mandate a “peek” at that?

I just don’t understand how these Fed officials can threaten to raise rates predicated on the economic “data” that’s being released.   It’s childish. Everyone knows the Fed can’t raise rates without collapsing the house of cards it has created.  The sharp sell-off in the Untitledstock market today was attributed to the turret’s syndrome outbursts by these two idiots. But nothing could be further from the truth.  The market sold off today in a reversal of the manipulated spike higher yesterday.  The momentum-chasing computer algos began dumping the historically overvalued shares they gobbled up yesterday.

One of the big banks issued a study a couple weeks ago which showed that the only entities buying stocks right now are pension funds.  “Smart” money is dumping shares at an unprecedented rate and really smart money is getting extremely net short and/or loading up on gold (it was revealed yesterday in an SEC filing that Soros Funds made gold its largest holding).

I said 12 years ago that the last asset remaining  after housing for the elitists to loot would be the retirement assets.   It’s starting:  severely underfunded pension funds loading up on the overvalued stocks being dumped by insiders and “smart” money.  “Underfunded” is a socially polite way to say “the pension fund has a big debt obligation to future beneficiaries.”  An underfunded pension fund buying stocks on margin is no different than someone buying stocks in a IRA on margin, only the latter is not allowed by law.

An audit of the Fed will NEVER happen.  This country will collapse before any kind of reform or change is ever possible.  I knew the possibility of an audit of any substance died the very first time Ron Paul tried to pull a proposal through the House Financial Services Committee.  Chairman Barney Frank sat on it before deciding to use it as toilet paper.

What do we need an audit for anyway?  Everyone knows the Fed does not have the gold that it claims to be “safekeeping” on behalf of the U.S. Treasury.   The Fed knows everyone knows.   But as long as no one forces the Fed to open up its “deep storage” vaults, everyone can keep pretending that the gold is there.

A reader asked this question today:  “if naked shorts are allowed to be dumped on the Gold and Silver exchanges without any regard for reality, how can the companies that are shorting be stopped from shorting? It seems to me they control the deck and the rules on the Comex and CFTC have been tailored to allow them to manipulate the market and if that is the case what can stop them?”

My answer is that the physical market will eventually cause a massive default by the naked shorts.  But my view for the last 15 years has been that the U.S. will start a world war before it is forced by the physical market  to reveal the truth.  I stand by that call.   A non-audit of the Fed is likely deferring the inevitable…

Guest Post: Precious Metals Bull Snorts, Resumes Move

The character of the precious metals market has changed.  The manipulation efforts using paper derivatives masquerading as gold and silver futures contracts is losing traction.  I believe that the supply/demand dynamic in the physical gold and silver market is beginning to drive the price.  Control over the price of the metals is likely shifting from NY/London to Moscow and Shanghai.  I’ll have more to say about soon.

The  News Doctor’s Eric Dubin posted commentary and analysis of the blatant paper attack on the price of gold and silver that took place about 40 minutes into the floor trading session on the Comex on Thursday morning (April 21).  The initial price attack occurred in the space of about seven minutes in which $2 billion of paper gold and 1,218 tonnes of paper silver were  dumped on the Comex.   Over the last five years,  an attack like this was usually the start of bigger systematic price-takedown of the precious metals over a period of several days.  However, in the last couple of months, the market seems to shrug off these paper attacks and head higher.

“We’re setting up for an epic battle, and if silver keeps motoring forward, we may very well have an $18 handle on silver smack in the middle of the expiring contracts window.  Buckle-up!  There’s going to be fireworks, one way or another” – Eric Dubin, The News Doctors  You can read the rest of Eric’s commentary here:   The Precious Metals Bull 

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Hugo Price Salinas: The Crumbling World Order And Gold

The massive “disintermediation” of physical gold from western Central Banks plus bank and ETF custodial vaults to the east, especially China, India and Russia will eventually be one of the biggest stories/events of this millennium.   This acceleration in the migration of physical gold this year has been triggered by the relentless manipulation of gold by the Fed/ECB/BoE and its agent bullion banks using fraudulent paper gold contracts.  Recently, the drawdown in the amount of gold reported to be in the vaults on the Comex and in HSBC’s GLD vault is nothing short of stunning.

Hugo Salinas Price has written a must-read essay on the collapse of the west and measures China will implement assume the lead role in a restructured global world order:

The Chinese evidently have some plans which they are not divulging, for we see that China is purchasing huge amounts of gold. In the meantime, the US insists on trashing the price of gold, as if to say that the Dollar is and will remain the world’s supreme currency till the end of time.

China is quietly accumulating gold and saying nothing. But we can try to guess what China is thinking: “The US is mired in an insoluble problem. Do nothing to provoke the US. The US will destroy itself in a huge collapse.”

You can read his entire analysis here:   The Crumbling World Order and Who Will Pick Up the Crumbs?

The middle class in the United States has no idea that a heavy 2×4 is being at the back of their heads.  By the time many of them realize what is happening, it will be too late to duck.

 

The Credibility Of Andrew Maguire

Andrew Maguire has been a controversial figure in the gold/silver world ever since he blew the whistle on JP Morgan’s silver manipulation.  The information provided by Maguire to GATA was presented by GATA’s Bill Murphy at a hearing held by the CFTC on the precious metals market manipulation in March 2010.  Maguire had originally sent an email to someone in the CFTC enforcement which detailed how the precious metals would be attacked two days later when the non-farm payroll report was released.  Maguire wrote to the CFTC after the attack:

It is common knowledge here in London among the metals traders that it is JPM’s intent to flush out and cover as many shorts as possible prior to any discussion in March about position limits. I feel sorry for all those not in this loop. A serious amount of money was made and lost today and in my opinion as a result of the CFTC’s allowing by your own definition an illegal concentrated and manipulative position to continue.

GATA has detailed the entire event in this article:  LINK.

After Bill Murphy’s testimony at the CFTC’s hearing, Jeffrey Christian – a known shill for the bullion banks – publicly slashed and burned Maguire’s reputation with highly slanderous assertions about Maguire’s background and experience.  Christian’s remarks were intentionally deceitful, but the damage was done. The fraudulent attack on Maguire opened the door of doubt in the minds of many about the credibility of market intel delivered by Maguire to the public via venues like Eric King’s King World News.

I bring this up because a friend and colleague of mine – someone who has been around the precious metals sector longer than me, sent email to a myself and one other person asking for our thoughts on Maguire’s latest interview in King World News:  A Historic Event Is About To Shock The Gold Market

The interview is worth a listen and I believe there’s a high probability that Maguire’s insight and assertions are accurate.  Having said that, I wanted to share my response to the email, because it explains why I think Maguire’s intel is good.  The first part of my response references some comments made to my colleague from someone who expressed concern about the potential for Russia and China to unload gold like Venezuela did in order to avoid financial trouble:

Goldman has been working on getting Venezuela separated from its gold for over a year. Recall about a year ago that Goldman sent VZ a proposal for a leasing transaction. VZ was an easy prey. In my opinion, the way that VZ has been squeezed out of its gold tells us just how desperate the bullion banks are to source real physical gold. This move was analogous to taking Halloween candy from a little kid. But China/Russia are a different matter.

Russia running into financial trouble? Please show me any evidence of that OUTSIDE of western propaganda reports.  Russia continues to add a lot of gold to its Central Bank position every month. It that the behavior of an entity worried about liquidity? Have you looked at Russia’s debt/GDP ratio? As of 2014, the latest data available, Russia’s debt/GDP is 13%.  Russia is not in financial trouble. The western media wants us to believe that Russia is in financial trouble.

China? C’mon. China has $3.4 trillion in diversified FX reserves that needs to be netted against is sovereign debt position. China’s outright sovereign debt/GDP is 41% as of 2014. The number does not net out FX reserves.

As of July China’s household/corporate debt was 280% of GDP. The U.S. total debt (Govt + private sector) is 340% of GDP. The highest of any country in the world. US FX reserves are about $35 billion – i.e. nothing. Does the U.S. even have title to any gold that we use to add to its FX reserves? Doubtful. If any country is in danger of going insolvent, it’s the U.S if the rest of the world refuses to take any more paper dollars.

What if China were to include its true gold holdings at market in its FX reserves number?

As for Andrew, I had a long phone conversation with Eric King this past summer about Andrew. Eric is adamant that everything Andrew says is based in fact.  [note:  I came away from my conversation convinced that Maguire’s intel was bona fide.  As Eric and I discussed, the cartel has the backing of the U.S./British/EU Governments, which makes it impossible to predict the timing on actual occurrence of the events that we know ultimately will occur]

It’s hard to know for sure because Andrew references a lot of information that we have no way of verifying independently. For instance, he asserts that liquidity is leaving the Loco London market. Is there a way to verify this other than to have faith in Andrew’s assertions? If there is I’d love to see it.

Having said that, everything Andrew is talking about is exactly what Frank Veneroso said would eventually happen back in the late 1990’s. Frank never laid out “who and how” but he said eventually the western banks/CBs would be unable to contain the physical market with paper because the demand for physical would blow up the paper suppression schemes.

Here’s the other key assertion that we have no way of verifying: “the aggressive and predatory bullion banks that largely infest the swap dealer category of the COT report recognize the gold market has changed and are about to split ranks and reposition more bullishly, a position they would already have if they had not accrued such large underwater proprietary positions”

If you guys have any way of verifying that assertion, then we would know that Andrew is 100% bona fide.

At this stage, I have no reason to disbelieve Andrew based on my own observations and research into the precious metals market.  I really want to believe everything that he says is happening right now, but I’ve been taking a wait and see mind-set with regard to his assertions.

Is Japan “Inc.” Pulling Out Of The Comex And LBMA?

One of Japan’s largest global precious metals trading companies, Mitsui Precious Metals, is closing down its operations in New York and London by the end of 2015.  Note that it will maintain its operations in Tokyo and Hong Kong – interestingly:   Mitsui Pulls Out Of NY, London.

Mitsui is one of the largest business groups in Japan and one of the largest corporations in the world.  “When in doubt, pull out.”  In my view, this move reinforces the growing global fear of the massive paper to physical gold/silver leverage embedded in the NY/London banking system.

Remember, we are able to assess only what might be available to back visibly traded paper gold and silver derivatives (Comex futures, LBMA forwards).  And reported inventories are based on reports submitted by the bullion banks and Central Banks.  Do any of us really trust these bank reports as reported without visual confirmation and independent audits?

In fact, I will go as far to say that any analyst in this sector who presents any analysis and commentary based on bank-generated gold/silver inventory reports that does not stipulate up front that any and all information is based on reports that may or may not be accurate is thereby presenting invalid analysis.

missingbullionAnd, too be sure, all analysis that can be reasonably issued in entirely incomplete because it is impossible to assess the realistic exposure of OTC precious metals derivatives.   Even the banks who issue these opaque securities likely are in the dark.

I would suggest that Mitsui’s move pull out of the NY and London – thereby joining Deutsche Bank and Barclays – is symbolic of the world’s increasing perception that the New York and London financial markets are the biggest Ponzi schemes in history.  At the very least, it suggests that the world of growing weary of the fraudulent paper gold and silver markets on the Comex and the LBMA.

 

How Come No One Will Attack The Comex Gold Short?

The open interest on the Comex for the December contract is approximately 293 thousand contracts (final number as of Friday is not posted until Monday morning).  That represents  approximately 29 million ounces of gold.

Yet, as of Friday (Oct 2), the Comex vault operators were reporting 161,642 ozs of gold in their “registered” vault accounts, which is the amount of gold that has been declared eligible for delivery.

This means that the ratio of December open interest to deliverable gold is approximately 180:1.   Thismissingbullion is a mind-blowing number.  There’s 180 ounces of long/short positions for every ounce of deliverable gold sitting in Comex vaults.  This ratio of paper gold to “allegedly” available real gold represents the most extreme exploitation of the paper liability fractional reserve banking system in the history of the known universe.  

Of course, history tells us that every fractional banking system throughout the ages has collapsed under the weight of far too many liabilities piled on top of too few assets to back those liabilities.  This one eventually will collapse as well.

In 1992, George Soros attacked the British pound sterling in what was billed at the time as “the trade of the century” (I was a junk bond trader at the time on Wall Street and worshiped Soros’ success (I despise the man now, for the record).

Prior to the implementation of the euro, an European “Exchange Rate Mechanism” was created in 1979 in which the exchange rate value of each European country currency was fixed against each other.   Previously the currencies “floated” and price discovery was set by the market.

In 1990 Britain entered the European ERM and by 1992 the pound had become egregiously overvalued relative to the German mark.  It was pretty obvious to everyone including the British Government, which was spending a fortune to prop up the pound vs. the mark.

Long story short, George Soros via his Quantum Fund had built a $10 billion short position in the the pound.   To put this in proper context, a $10 billion bet in 1992 (using Government calculated inflation) would be a $17 billion bet today.  That one bet against the pound and the British monetary system by George Soros was bigger than the size of most hedge funds in the world today.

On September 17, 1992,  Soros’ gargantuan bet paid off.  Soros and the market ultimately forced the British Government to “reset” its monetary system.   The Quantum Fund is said to have made $7 billion on the trade, or a 47% rate of return unannualized in well under a year.  It’s impossible to know the actual “cash on cash” return because we don’t know to what extent the short-pound bet was leveraged.

This brings us to the situation with paper gold vs. physical gold at the Comex.   If shorting the pound was a quite conspicuous trade opportunity in 1992, then attacking the 180:1 paper:gold ratio on the Comex by going long Comex gold futures and standing for delivery is the most overtly obvious trade opportunity in anyone’s lifetime.

This particular predatory trade would exploit the most imbalanced market condition in the history of mankind.  With only 161,646 ozs of gold declared to be available for delivery, attacking this highly artificial market condition would require only $182.6 million dollars worth of Comex contracts (assume $1130/oz for gold).  This is less than 2% of the size of the bet that Soros made in 1992.

There are several hedge funds that are more than large enough to take on this trade, which is a “lay-up trade” in the purest sense of the definition.  So how come no one will take it on?

The obvious answer is that hedge fund managers point to what happened to the Hunt brothers when they attacked a similar trade set up on the Comex in silver in 1979. Eventually the Comex changed the rules of the game and charges were levied against the Hunts by the CFTC for an attempt at cornering the market.  It was the epitome of Government intervention in a market to protect the Comex bullion banks under the “veil” of market manipulation.  A true tragedy in the history of the financial markets.

But where are the charges of market manipulation against the entities who are selling-short paper gold contracts into the market at a 180:1 paper to gold ratio in order to satisfy the demand of Comex futures buyers?   And better yet, how come the long side of the gold open interest trade never stands for delivery.   A mere $182 million bet that stands for delivery has the potential of a more than doubling or tripling (or more) in a very short period of time.

Concomitantly, if the rules of the game were changed to rules that reflected the true supply and demand of physical gold globally, it would force the mother of all short-covering trades.   In all of the other products with futures markets in the U.S. the ratio of paper to physical is not even remotely close to the 180:1 ratio in gold.  In fact, the CFTC cracks down if when the percentage of paper to deliverable exceeds much more the 20-40% in any other futures market.

It is a riskless bet that no one is willing to take on.  This is because it’s loaded with 100% risk in one aspect.  If someone were to attack the fraud on the Comex in order to make a lot of money on the obvious, the Government would step in and prevent the trade from occurring to completion even though the Government is unwilling to prevent the fraudulent market condition from developing in the first place.

This is a bigger injustice to our country and our financial system than was the Hunt brothers debacle.  And the truth of the matter is that when the Comex finally does crumble under the weight of its own fraudulent, Ponzi scheme grotesque obesity, it will trigger or coincide with the collapse of the entire U.S. systemic Ponzi scheme.

The Comex Is One Big Lie

The total amount of ALL gold held by ALL market participants at ALL the Comex warehouses, whether it is on offer or not, is about 218 tonnes. That is less than one month’s demand for physical bullion in China and India and India alone. And by far the vast majority of that gold is not for sale AT THESE PRICES. And given the leverage of paper claims everywhere, not just Comex but at the more important LBMA, and one can see that a misstep by the gambling goofballs of Wall Street could lead to quite a messy market situation. This also is what Peter Hambro said.  – Jesse’s Cafe Americain (must read article)

In fact, the United States itself has become the biggest lie in history, but that’s for another day.   For some reason there’s a debate raging about whether or not a shortage of bullion – gold and silver – really exists.  That in an of itself is a fatuous endeavor because nearly every ounce of gold ever mined still exists.   Furthermore, there will always be a fiat currency price level at which a holder of gold or silver will be willing to exchange their bullion for paper currency.

Even more silly is the fact that the paper bullion market apologists point to the published Comex warehouse stock of gold and silver and use that as their “proof” that there’s plenty of bullion available.  I’m not sure why the argument uses the Comex as the point of focus. Maybe because, in theory, it has more “transparency” than the LBMA.

However, there’s one small problem in using the Comex as data a proof of existence:   “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.”

This disclaimer showed up mysteriously without any formal news release on the daily Comex warehouse reports in June 2013.  The legal translation of that one sentence goes like this:  “this report shows numbers which represent quantities of gold and silver which may or may not exist and the CME hereby is legally immune from any legal claims against it should those numbers be fraudulent.”

My point here is that the Comex is a big lie.  It’s the precious metals market equivalent of Enron.  The trade and inventory data are cleared, accounted for and reported by the big banks that operate the Comex.  Do you trust the banks to report accurately and honestly the data in that report with an air-tight legal disclaimer attached to it by the CME’s lawyers?

Anyone can see that the Comex is nothing but a paper bullion trading exchange.  The amount of gold represented by the paper gold open interest is now well over 200x the amount of alleged gold that has been designated as available to be delivered.  As of today, the paper gold o/i is more than 6x greater than the total amount of gold reported to be held in Comex vaults (see the disclaimer again).

The entire matter could be settled with an independent audit made available to the public.  It should be required by law because if myself and many others are right, if and when the Comex defaults the the CME will likely look to the Government for a bailout.  Here’s why:

41 million ounces of paper gold – the current open interest in paper gold – is valued right now at around $45 billion.  If and when the Comex eventually defaults, the only card it has to play is the force majeur clause in Comex contracts, which enables the Comex to settle paper contracts in paper currency. But as of its latest 10Q, the CME had only $1.5 billion in cash and $21 billion in book value (which assumes its assets are properly marked as to their worth).

My friend and colleague, Craig Hemke, offered some compelling arguments today in response to neanderthal analysts who were out and about serving up half-truths, distorted trusts and willful omission of facts in the commentaries regarding the current supply and demand of gold and silver.  Please take the time to read his work here:  Attack of the Comex Apologists.

Back to half-truths, distorted truths and willful omission of facts.  This chart was making its way around the internet in an attempt to prove that the Comex paper to reported physical ratios are not out of whack vs. historical highs:

ComexCrapThe facts that have been willfully omitted are these: In 1998, the Comex only reported total ounces, not registered vs eligible. Second, the total amount of gold reported at the time was only 1 million ounces. Finally, the comment in yellow was added by me. This denotes the infamous “Brown’s Bottom” when the Bank of England dumped 400 tonnes of gold on the market, marking what turned out to be the bottom of the bear market in gold.

About 5 years later, a hearing was conducted to find out why Gordon Brown unloaded half of England’s gold on the market.  This stunning full-truth with regard to the paper short position of the bullion banks vs. the available supply of gold to deliver into those contracts was revealed (Eddie George, BOE Governor):

“In front of 3 witnesses, Bank of England Governor Eddie George spoke to Nicholas J. Morrell (CEO of Lonmin Plc) after the Washington Agreement gold price explosion in Sept/Oct 1999. Mr. George said “We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake.

Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K.”

When you shine the light in the right places, the truth emerges. Now we know that the Bank of England bailed out the Comex and LBMA in 1999. It will be interesting to see if a bailout is possible this time around, because the western Central Banks have been drained of most of their gold and the paper to physical leverage numbers are significantly larger by several factors than they were in 1999.

Wax On, Wax Off – Interest Rate Hike On, Interest Rate Hike Off

Non-farm payroll report comes out and Spoos [SPX futures] go down 32 handles. Gold starts off up $4, now down $6. This is totally rigged. I’m going to Vegas, at least the tables are more level then these markets and I get free booze and some really hot chicks.  – reader comment after employment report hit the tape

Despite the rhetoric coming from the Richmond Fed’s Lacker, there will be no interest rate hikes in September.  It’s not about the fictitious and indisputably managed and manipulated non-farm payroll report, it’s about the catastrophic degree of leverage in the banking system.

All along, despite the disingenuous pretenses of helping “main street,” the Fed’s money printing has been targeted specifically at keeping the big banks from collapsing and to enable them the continue sucking wealth out of the U.S. economic system.  Secondarily, it’s enabled the U.S. Treasury to continue issuing debt obligations that will never be repaid.

There will be no interest rate hike in September, or in 2015 for that matter.

In order to support this intended monetary policy, the Fed has to discourage investors from converting fiat paper money into real money – gold and silver – by creating shock and awe terror in the paper precious metals markets (hey, it worked with 9/11 and we got the Patriot Act, Detainee Bill, Homeland Security Act and an unfettered NSA).

Here’s what this anti-gold terrorism looks  like in the paper gold trading market – click to enlarge – the time-scale on the x-axis is MST:

Untitled1As you can see, after a quick initial move up, an avalanche of paper selling hit the paper market, driving the paper price of gold below where it was when the report hit the tape. We would have expected a big move up in gold as the logical response to a jobs report which badly missed Wall Street’s consensus estimate, and thus convincing the hedge fund algos once and for all that there would be no rate hike in September.

Between the 8:30 a.m. (EST) report release and 9:00 a.m., over 42,000 paper gold contracts traded, most of them “sell” orders.  This is 4.2 million ounces, or the equivalent of 122 tonnes of paper gold.  122 tonnes is more than the amount of gold that India is said to have imported in August – Business Standard, Mumbai

Of course, this action in the paper gold markets on Fridays, especially non-farm payroll report Fridays, has become standard operating procedure for the Fed.  With all of the physical gold trading markets closed for the weekend, the Fed is free to operate unfettered from the pressure that physical demand exerts on the paper gold pornography.  In fact, China has been closed for the past two days, which has alleviated temporarily China’s inexorable demand for physical gold that is delivered in to China.

To give you an idea of the extreme degree to which the bullion banks – backed by the Fed and the U.S. Treasury – have gone in order to keep a lid on the price of gold using paper, you’ll note that the ratio of paper gold outstanding to the amount of gold being reported as available to deliver has spiked back up to 126:1:

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I sourced this graph from Jesse’s Cafe Americain and recommend reading the the accompanying commentary:  LINK

In any other commodities market on the CME, if the ratio of the amount of paper to the amount of available underlying physical commodity approaches anywhere near even a 2:1 ratio, the CFTC cracks down the “manipulator.”  For some reason the paper gold and silver markets have the dubious distinction of existing free from any legal regulation by the U.S. Government and the bureaucracies that exist that are supposed to enforce the rules governing market manipulation.

Meanwhile, retail demand for U.S. mint gold and silver eagles surged this summer.  From June to August silver eagle purchases were up 126% over the same period last year.  And gold eagle purchases tripled from Jun-Aug this year vs. last year (data source:  SRSRocco Report).

I won’t go into the flow of gold from west into India and China.  Imports into those two countries will hit all-time record highs this year.  That’s a lot of Pet Rocks being bought with U.S. fiat currency.

Without question the extreme intervention in the paper precious metals markets – NYC and London – is serving the purpose of hiding the fact that the Fed will not be raising interest rates this year, or next.  In fact, the next policy move will be more money printing.  Or “QE4” if you want to call it that.  But until the Fed sells its Treasury and mortgage holdings, for now what is occurring is pure money printing.  And more of it is coming.

WaxOnWaxOff

So Much For Bloomberg’s New Bull Market In Oil

As I mentioned two days ago when oil popped about 10%, Bloomberg was all giddy in declaring a new bull market in oil.  Within two days oil took back all of Monday’s gains, and more.   With oil now down over 10% from Bloomberg’s “point of new bull market,” is this a “correction” or a sell-off from a paper-manipulated bounce:

OIL

Next up: the “new bull market” in fraudulent Government non-farm payroll reports…

Gold has worked down from Alexander’s time… When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory – Bernard Baruch, famous Wall St financier, philanthropist and Presidential advisor

The Trading In Paper Gold Reflects Sheer Desperation By The U.S. Government

I got this comment in my email from John Embry this morning in reference to the blatant paper attack on gold after London closed this morning (see graph below):

How do you like these antics after the London close today? I still believe that to be this blatant they must sense real trouble.

I replied:

John this is pure desperation.  An incredible amount of gold was delivered into the SGE the past two weeks. Everyone follows “withdrawals” because that’s what “prince” Koos has them conditioned to watch.  But you can’t “withdraw from” without first “delivering into.” You can get delivery numbers daily at the SGE website.

Did you see this:  http://www.zerohedge.com/news/2015-08-14/alarming-indicator-back-level-last-seen-10-days-bear-stearns-collapse

Also this report hit the wires today:   Chinese Gold Premium Spikes, Indian Imports Surge.

There was also a report out yesterday showing a huge increase in non-performing loans at the big banks in Q2.  I really think the economy hit a wall the last two months.  That industrial production report was purely a function of the big downward revisions in May and June that made the “increase” in July look relatively healthy.  The IP number was a product of auto industry inventory build-up – cars that won’t get sold.

John, they can try to cover-up the carnage to the economy by pumping up the stock market and smashing the metals, but they can’t hide the coming sub-prime driven debt implosion OR the massive gold-buying going on in China.

GOLD