This Feels Like the Action in 2008 Right Before the Collapse

Doc asked me last minute to fill-in for Eric Dubin, who’s M.I.A. somewhere on the shoreline of southern France, on Silver Doctor’s Metals and Markets weekly podcast. Among other topics we discussed why the current trading action in the precious metals paper market feels very similar to trading in the spring/summer of 2008 – ahead of the great financial collapse crisis and why the Fed/bullion banks are making it obvious that they seek  to scare investors away from buying precious metals with their “shock and awe” price-takedowns.

But one big difference between now and 2008 is that these “zip-line” vertical drops in the paper are being met with aggressive buying from the eastern hemisphere physical buyers, thereby limiting the size, intensity and duration of the price-hits.

As of the latest COT report release Friday which details the constituent trader positions through last Tuesday, the trader positions are moving toward a highly bullish set-up for gold and silver. In silver, the hedge funds are now net short silver futures and the swap-dealer segment of the bullion bank positioning is net long. In gold, the hedge funds have aggressively reduced their net long position and the swap dealers are long to a relatively large degree. Historically, this position shift has preceded major bottoms.

In the latest Mining Stock Journal, I present a silver producer who’s stock that was ruthlessly taken recently. I review the details in-depth, including my conversation with the CEO, and discuss why this is an opportunity to buy into a major producing company at irrationally low price level based on the facts of the situation. I also lay-out the call options I put into the fund I manage in large quantities to bet that my assessment has good probability of being correct. You can find out more about subscribing here:   Mining Stock Journal info.

After subscribing to Brent Cook for 3 months, I was underwhelmed.  Resubscribed to you a few weeks back and sure am glad I did so. You are one the few straight shooters still out there. Keep up the great work. I think we are right on the cusp of a serious market break, thus the war drums.  – subscriber “Chris

6 thoughts on “This Feels Like the Action in 2008 Right Before the Collapse

  1. Dave
    As a person who saw the collapse first hand, starting in 2006-7 with the crash of housing and crap mortgage, the damage to the peripheral loans and real estate took another year in my world of commercial financing and real estate.

    Now the commercial side is having its very rough patch with large malls, big box retailers, small businesses and assorted tenants and owners of properties in their shadow starting to slip

    This time period does feel like 2008, not so much from the hammering I took during that period but because of my relentless studies of the causes of incipient calamities that are looming on the horizon and rolling down the slopes.

    What we are not seeing, YET, is the collapse of big banks and brokerage such as unfolded in 2007. These zombies are being kept afloat with the continual application of bull shit analysis of their capital ratios and leverage, the remarkably unhealthy nature of their loan portfolios, and the fact that many large banks are little more that hollowed out financialized trading engine. churning funds for the slim yields that tell of a market that has no zip or pizzaz and is ready to roll over and play dead.

  2. I had my eye on that stock mentioned for quite a while, but now I’m in. It’s difficult to envision a better entry point than the one now offered. Thank you, Dave, for that no-stone-unturned analysis given in the latest Mining Stock Journal. You’re the Wyatt Earp of newsletter writers.

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