The Friday Gold Price Raid Reeks Of Desperation

The bears are driving gold down into zones at which [Asian] physical demand will become prodigious.  – John Brimelow,  John Brimelow’s Gold Jottings Report

The economy is starting to collapse.  All the non-Government-reported economic metrics are showing that the bottom is falling out of the demand side of GDP at all levels of the economic system – OEM, wholesale, middleman, retail.

The cable biz news networks have sent their emissaries out to the landmark Times Square/Herald Square stores in NYC to try and manufacture a story about “Black Friday.”  Aside from the footage of the pre-dawn door openings at Macy’s – and at a few semi-ghetto area Walmarts around the country where fights broke out – there is no story.  I just saw a clip of some blonde bimbo from Fox Biz at the Times Square Toys R US store – it was very quiet in the background aside from some curiosity seekers.

So why not cover up the truth by hiding the “canary in the coal mine” and blasting the price of gold?   That’s exactly what happened on Friday morning at 8:00 a.m. EST:

UntitledAs you can see from the graph to the left, the trading in gold during the Asian and early London hours was largely subdued. At 8:00 a.m. the Comex paper gold contract went into its now-familiar cliff-dive formation.  Bare in mind that this is probably one of the most quite, low-volume trading periods of the entire week, as Asia and the Middle East are in bed and London’s paper gold market is starting to doze off the weekend.   No one single other commodity  or market index exhibited any unusual trading patterns or volume when gold was smashed.  Even silver, after an initial “sympathy” sell-off, has held up remarkably well.  This was an intentional raid on the gold market.

Between 8:00 a.m. and 8:30 a.m., 19,595 contracts were traded, largely dumped into the market.  This is many multiples higher than the typical pre-Comex floor open volume. Make no mistake, any seller looking to move, 1.96 million ounces of paper gold – approximately 58 tonnes – would wait for the periods of time when the there’s is a lot more volume in order to mask the amount of paper he needs to sell AND to maximize the sale proceeds.

The sell operation put into motion did not have the slightest intent to maximize proceeds – it was sheer shock and awe.  Interestingly, GOFO/lease rates in London are exhibiting the signs of increasing “stress” on the demand for physical gold deliveries.  The GOFO rates posted this morning were negative out to three months and the rates for 1 week and 1 month had moved from -.30/-.20 to -.35/-.25, respectively.   This means that any entity looking to borrow gold collateralized by a cash was willing to pay a higher rate to do so today than last week.

Interestingly the mining stocks seem to be looking “through” the extreme price suppression of the price of gold and have recently been diverging from the latest take-down:

Only time will tell if this positive divergence between the mining stocks and the price of gold is aUntitled harbinger of a big move higher in the price of gold.  A lot of contrarian style analysts are starting to call for a big move up in the price of gold:  Gold/Gold Stocks and Get Ready For a Year-End Gold Rally, for instance.

I believe that as it becomes more apparent to a wider audience that the U.S. economy is collapsing, big investors will be forced to dump their hideously overpriced stocks and find a hiding place, away from the fraud-infested paper assets.  That hiding place will be physical gold.

17 thoughts on “The Friday Gold Price Raid Reeks Of Desperation

  1. Yesterday i red an article on Rorys Daily Coin regarding the fact that Amazon Services are the supplier of services both to the CIA and Obamas Healthcare organization.
    There we have the explination regarding the “iron floor” we were talking about yesterday.
    Amazon is “systemically important” and the stock will be held up at any price.
    Am I wrong here?
    Maybee there are competitors that are pissed that Amazon probably got the contract by “dirty play” and corruption, but will they be able to expose the fraud?

  2. We are all sick of these Comex beat downs. Hopefully the physical market will start to exert itself. It will be interesting to see what the December open interest is on Monday.

    1. Won’t matter even if “the physical market exerts itself”.

      Certainly as “the gold price”, in paper, is driven down leverage will increase. 300-to-one will be nothing as compared with what is to come.

      But so what if someone wanting real bullion is paid off in cash via a ‘force majeure’? Will that close down Comex? Will regulators act? Will punters and bettors flee Comex? Not at all. A failure to deliver will have absolutely no effect. Bettors will continue to place their bets on “the gold price” there. Owners will continue to be incentivized to store their bullion there.

      The only things that can really change pricing are a)someone opens a physical exchange where gold is sold in something other than US dollars; b)governments instruct regulators take action to remove Comex’s role in setting bullion prices; or c) regulators institute some position limits or ban naked shorting via paper contracts, etc.

      None of these is likely to happen.

      Sometime, probably after we are all dead and buried, Western governments will decide that selling all their gold to the East was not such a good idea after all and THEN perhaps something just might happen…

  3. I backed the truck up today. Last week I added to some positions
    which I topped off this AM. Reeks of desperation. I like that Dave.
    I like it very much but feel sorry for the vast majority of the sheeple
    who are about to get fleeced as never before. This entire corrupt
    system is about to blow.

  4. That the manipulation of the Gold price is no narrative can be seen very easily (apart from waterfall smashes and dumping of large amounts of paper Gold during thin trading) by the fact that although we currenty do experience severe geopolitical tensions not seen for a long period of time the gold price does not move up. Quite the opposite is true. This is highly strange and suspecious. Actually the price of gold should have risen at least 100bucks….since Putin’s airliner has been downed over Sinai (Egypt), especially after crazy guy Erdogan shot down the Russian fighter plane.

  5. Yes, when the move comes out of stocks. Totally agree, this is when we will see the true inflationary disaster. Having said that you do have to laugh at the volume on stock exchanges’. It’s like watching snorting steers, penned and bug eyed at a stock auction, most of these traders’ are completely spooked lol. There is a couple starting to try to sneak into metal, but you can almost feel the floor boards creeking ,ready to snap and fall out of stocks…what a laugh

  6. A local dealer asked me when would silver rise. “When the supply hits zero” was my reply and he wanted to know when would that be. I told him to ask someone on the inside, not that they will disclose. Nothing has changed, the “bank wars” continue today with no Andrew Jackson to beat the bad boys to their knees. Shortly before the London Gold Pool hit its stone wall in March 1968, FED chairman Martin raved that the $35 gold price would be maintained “down to the last ingot.” In June the silver certificate redemption program was terminated and many people complained of being given silver granules (similar to jewelers casting shot) instead of silver dollars. They were lucky next to those who will find the PM etfs empty husks when the day of reckoning dawns. I’ve asked Texas officials to demand state owned gold be immediately returned, because best to lance the enormous boil and let the scandal start sooner rather than later—there is no Texas gold to return as it went somewhere offshore. All the top Wall Streeters over the years have been members of by invitation only groups, many with curious or colorful names, and one over-arches all the rest—The Pilgrims Society, of which gold antagonist Mister Martin was a member. It must be considered very disquieting that as the metals suppression shows strong signs of imminently ceasing, the drums of war are loudly beating—the same way they started here in 1914. Charles Collman in “War Plotters of Wall Street” (1915) was the first outsider to attempt exposing The Pilgrims Society. This is the group that connects the Bank of England and the FED.

  7. I can’t imagine what the CB’s long term plan for gold is. So they smash gold all year and it finishes down a bunch; OK. Congress just abolished the debt limit and increased spending while looting even more of Social Security. What is the 5 year plan?! The debt is unpayable without fabricating more IOUs. Do the CB’s really think they will still be able to suppress gold 5 years from now? 10 years from now?

    Maybe they have some new reset scam on the horizon and gold gets smashed everyday until then. IDFK, but all the thinking just seems incredibly myopic.

    1. Yes… the CB’s have a new plan; they are now printing unlimited amounts of Paper Gold …. a few years ago COMEX owners-to-ounce ratio was generally under 20 … now it’s around 300.

  8. Remember!! crooks are still in office.
    They think they are Gods but for every action there is reaction.
    Time is ticking against them.

  9. From snowy forests of Canada,
    To dusty dry flats of Nevada,
    Unencumbered rivers of gold ore,
    Flow free as earth’s unclaimed wealth store.
    Ft. Knox has not even dore, there is nada.

  10. Scotia Mocatta had a big withdrawal from eligible gold of about ~ 67000 oz, did you get a chance to look into that? Basically they dropped from about 1.09 million oz to about 1.023 million oz in 1 day.

    All total eligible has sunk from about 6.29 million oz to about 6.22 million oz, and will only continue to sink with each passing day.

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