Thursday, August 30, 2012


That's right....another rabbit trick. Unlike many out there trying to divine the maestro I find the better course of action to accept the inevitable and stick with your trade. We are in a deleveraging disaster and finding an out is going to go on for months and years. Trying to guess Ben's next move may be fun but it will surely cost you money if you are leveraged or overtrade you position. Whatever Ben says tomorrow will most likely provide support for PMs. If they try to paint a picture of holding the monetary purse too tightly then of course the PM beatdown and market beatdown would be severe. That may provide you the last opportunity to pick up physical sub 1600 and don't expect it to last more than a day or two. More than likely they have made expectations factored in for little action tomorrow. The more interesting period will be next Friday's job report. A very weak number would really set this market up for some Sugar. Ben would have a clear shot at the next week's FOMC meeting on the 14th. THAT SHOULD be the battleground IF Ben wants it to be. He knows who the next Prez is going to be so he could care less about "political" ramifications......HE IS the Chief. Do any of you remember Batinator. Bright guy. Do you recall how convinced he was of the complete collapse of liquidity in the summer of 2010 and then into late 2010? NEVER FIGHT THE FED! Even some of the brightest pundits trying to time this mess have been completely confounded by the market. It is amusing to listen now to the daily verbage on CNBC about the "fiscal cliff" or the "financial crisis". Over and OVER they repeat these phrases, while simultaneously saying invest in Starbucks or Tiffany or Chipotle or Whole Foods or Fraudbook. How can any CONfidence get restored in our financial system with a "Crisis" report at 7pm and an Options monster show an hour before. Its pure unadulterated insanity. Your money is "safe" however in this system so just relax sheeple.

Wednesday, August 29, 2012


A lot hinges on the Wizard Speaking this Friday morning. The entire Free World is waiting with baited breath. The stockings were hung by the chimney with care in hopes that Sugar Ben will come dropping in. I think I could be mixing metaphors so perhaps I'll focus in on THIS holiday. Friday will unfortunately for many expecting major sugar will just be a lump of coal. If this money man announcement sets up the way I believe it will then we could actually get TWO different outcomes for PMs and PM equities. I believe that Ben MUST push out the "official" announcement of QE until the EU has their stars aligned. Right now the EU is in disarray. NO ONE knows exactly how they are going to play their hand. This meeting in cowboy land for Cowboy Ben is going to be critical to some degree however. He CANNOT state that QE is off the table. In fact if he gives any indication that QE may not be needed then he will look like he has lost control and when he DOES monetize as he will be required to do then he will be ridiculed. So......he is going to nudge up the rhetoric regarding QE. Not a big shocking announcement, but a ratcheting up of the noise of QE. This will be even more bullish for PMs....whether you see it on Friday or will form the basis for the tone of the PM market.

The bigger question is what the game will be from here on out and with the jockeying for actual bullion still in play before the "big reset" expect more sovereign raids by the PTB. THEY need bullion to service the game. The game is reaching a very lethal stage now and no army can stand in the way of the greatest army ever assembled.........unless maybe.....Russia....or China.....or Iran.....or Venezuela....or ....North Korea....or India..........or Pakistan...... Hmmmmmm We have a lot of people suddenly standing in our way. This is starting to set up like a bit of a standoff. Expect some proxy wars ahead. I hope they stay contained, but somehow proxy wars tend to escalate. This game is getting old and our neighbors are growing weary and discontent in many of these nations is starting to simmer. Diversions will be needed and truth is always the first caualty. gl

Tuesday, August 28, 2012


Since Jim Willie brought it up already I think we can discuss this briefly and move on. More than likely the behemoth investment cough cough "Commercial" bank appears to be getting set up for a good old fashioned flushing. Too many bankrupt Zombies in the game and Morgan will be next in line for the firing squad.
Just be aware of the past hypothecation and rehypothecation these events are associated with this type of event. Too many carnivores in the same room and if you are in this game then you can become "collateral damage". I bring up Morgan tonight because it will leave damage.

On Friday we will have the 10AM Bernanke speak. When this is concluded be aware that a beatdown of PMs may follow. I would be surprised if they take Gold below 1600 this week.....but they may. Miners will follow. Here is what I would expect. NO definitive QE surprise there....but IF they do not announce QE do not despair. He will instead pump the improvements in the economy and then state that there is NOT ENOUGH IMPROVEMENT YET and that MORE WILL NEED TO BE DONE VERY SOON. He has to talk the talk or it would be a bloodbath Friday. He can levitate the market for awhile with the overhanging threat of QE ...AND  sell bonds with the threat of a collapse looming also. This can play out for awhile but not forever. Eventually his bluff will be called and he will announce the bazooka. In the meantime he must hold QE over the head of the market like a club and those pronouncements will provide the impetus to push the PMs higher. Remember the boyz return next week and the market moves will begin in earnest. The gold bulls may get their revenge if the mo mo boyz start to get in. The big boyz are its the rest that will get to play.

Monday, August 27, 2012


I was asked today how much gold is there totally. I hope you enjoy this summary. Keep in mind that the above ground gold in the entire world would fit in one olympic size swimming pool approximately 30 ft deep. The more interesting above ground problem is silver.We can make it without gold..but NOT without silver. Its vital to industry...especially technology.Silver is used up in tremendous quantities and gold is preserved. Silver will be the ultimate battleground.But lets go to gold now.


Page Contents

  • How much gold is there?
  • What's it worth?
  • Who owns it?
  • What's left undergound?
  • Inelasticity of supply
  • Anticipated inflation of gold supply
  • Table of gold stats and values
  • How much gold is there ?

    In the world there are currently somewhere between 120,000 and 140,000 tonnes of gold ‘above ground’. To visualise this imagine a single solid gold cube with edges of about 19 metres (about three metres short of the length of a tennis court). That's all that has ever been produced.
    Divided amongst the population of the world there are about 23 grams per person, about 1.2 cubic centimetres each. This equates to about $250 - $350 worth per person on Earth, depending on the current price.

    What's it worth ?

    The value of that short tennis court sized cube is about $1.8 trillion. This compares to the US government’s sovereign debt of $6.9 trillion, which until 1971 was part-backed by gold. The US Gold Reserve is just over 8,000 tonnes - which is about 6% of the total gold ever mined. It is worth about $100 billion, or 1.5% of the US national debt.
    $1.8 trillion is about one fourteenth of the paper based international bond markets, which themselves, at about $26 trillion, are about two thirds composed of western government sovereign debt almost all of which has appeared, co-incidentally, since 1971 and the declared supremacy of paper money, which was what allowed governments to borrow without caution. The total gold content of the world would pay - at current values - about 7% of the international bond market's sovereign debt.  But of course 75% of the world's gold is not available to governments - being held privately as jewellery, bullion and coin.  In fact only about 30,000 tonnes, about 1% of the world's sovereign debt is what is held in central bank gold reserves.
    Meanwhile the entire gold stock of the world - including the privately held bulk - is much less than one half of one percent of the underwritten risk in the global financial derivatives markets.
    The world has placed absolute trust in paper currency denominated assets. Investors have shunned gold for about twenty years while the notional value of paper based financial assets has exploded.

    Who owns the gold ?

    About 30,000 tonnes of the world’s gold [20-25% of above ground inventory] is held in central bank vaults.
    Major Central Bank Reserves (2000)
    Nations & institutionsReserves (Tonnes)
    The totals for other central banks tail off rapidly after these main holders.  Most only hold a few hundred tonnes, and together they make up a bit over 30,000 tonnes in all.
    The rest is held by individuals in the form of gold jewellery [approx 70,000 - 80tonnes

    Sunday, August 26, 2012


    Frustration levels continue with rising expectations of a severe market pullback to provide Sugar Ben with the necessary cover to flood the market with new money. The market continues to be levitated with Jawboning from the Sugar-in Chief and his Governors. The problem continues for the PM trade as long as the Cartel can hold out losing actual bullion, but that time is starting to wear out. NO ONE not even the biggest Cartel ever wants to lose bullion at discount prices. They've scraped up bullion to fulfill the urgent need through Mubarak, Libya, M F Global etc. but time is running out on easy marks. Now the time comes to start taking out the Sovereigns like Greece, Portugal, Spain, Italy, etc. This is the end game as the "Big Reset" is put into place. Its not random and as some very experienced people have said, trying to trade this is going to be very very difficult. A simple formula is stay out of paper and be in hard assets with emphasis on gold and food. I can't tell you the time frame but everyday that passes puts it all a little closer. I will still be in the trade for now but be forewarned, anyone in this paper market is in a crapshoot. There are many solid signs that the miners have reversed but remember they do not want you in this trade so be prepared. Rain in the Midwest was welcome this weekend, but spotty and not enough in most places in not in time for most crops. gl all

    Thursday, August 23, 2012


    This is our children's future? Does ZIRP and NIRP and QE to infinity guarantee this scene a million times an hour in our near future? I am not able to divine that answer and probably none of you are either, but we can make some educated guesses on what our money men are going to do and how it will affect us. You are welcome to fret about your investments in PMs and PM equities and of course that is precisely what the game is designed to make you do. Those dramatic monthly candles, weekly candles, and daily candles all tell a story in retrospect. They are designed to induce responses....FEAR....GREED.....EUPHORIA.....PANIC... that is the game....they do not reflect these emotions.....THEY ELICIT THEM. You are supremely conditioned lab rats that have been psychologically dissected and analyzed for maximum performance on the ultimate human behavioral laboratory. So when you do feel like puking and when you do press that key too early or too late don't feel are only doing what the majority faced with the same decision will make.

    To the task at and silver are making their move.......sit tight or add on pullbacks.....this is going to get wild.....BTW THERE WILL BE VIOLENT FLUSHES.

    We still are not getting rain and what is occurring is too late. So all of you can expect some real impact in the coming months. Take care out there and realize your family and friends come first. gl

    Wednesday, August 22, 2012


    "You don't know what I know..."
    Well damn well better believe we don't......after all Bob....we're only little people. We are only pawns in the grand game of life conducted by puppet masters that have no human empathy in a single pore of their being. And furthermore Bob, as your sad soul sits surely in some form of purgatorious hell may I just ask you one simple question .......why? Why are there brilliant, people like yourself inflicted upon the masses to do the bidding of evil? Okay Bob maybe two questions while you languish in Hell.....I'm sure you'll enjoy the company....many of us will be joining you soon...How can  a smart young Harvard MBA like yourself become such a sociopathic shill in life, killing literally millions and MILLIONS of innocent civilians as the architect of death while never accepting direct blame. Oh wait Bob......that's what technocratic, sociopathic, monsters do in life.......justifying and rationalizing their evil lives. You know Bob as you made very clear in the "Fog of War" was wait it was Curtis Lemay....oh wait just forget about it Bob.......just tear up and admit you had to commit evil to help the greater good. You are right their Bobby boy..........YOU DID COMMIT EVIL.........but did you really help the greater good? If you want some light viewing watch the documentary on Bobby Boy McNamara......a "True American Hero"oh wait that's not the title....its The Fog of WAR. It will help all of you understand the mind of evil and what will always be "the game".

    The following is a wiki excerpt. In 1993, Washington journalist Deborah Shapley published a 615-page biography of Robert McNamara entitled Promise and Power: the Life and Times of Robert McNamara. The last pages of her book made clear that while Ms. Shapley deeply admired certain aspects of McNamara the man, and the public servant, she had seen first-hand his need to manipulate the truth, as well as to tell it. Shapley concluded her book with these words: "For better and worse McNamara shaped much in today's world -- and imprisoned himself. A little-known nineteenth century writer, F.W. Boreham, offers a summation: `We make our decisions. And then our decisions turn around and make us.'"
    McNamara's memoir, In Retrospect, published in 1995, presented an account and analysis of the Vietnam War from his point of view. According to his lengthy New York Times obituary, "[h]e concluded well before leaving the Pentagon that the war was futile, but he did not share that insight with the public until late in life. In 1995, he took a stand against his own conduct of the war, confessing in a memoir that it was 'wrong, terribly wrong.'" In return, he faced a "firestorm of scorn" at that time.[3]
    The Fog of War: Eleven Lessons from the Life of Robert S. McNamara is a 2003 Errol Morris documentary consisting mostly of interviews with Robert McNamara and archival footage. It went on to win the Academy Award for Documentary Feature. The particular structure of this personal account is accomplished with the characteristics of an intimate dialog. As McNamara explains, it is a process of examining the experiences of his long and controversial period as the United States Secretary of Defense, as well as other periods of his personal and public life. In this documentary he referred to the Vietnam War and he said, "None of our allies supported us. Not Japan, not Germany, not Britain or France. If we can't persuade nations with comparable values of the merit of our cause, we'd better reexamine our reasoning."
    Silver and Gold are about to enter a very tree shaking, volatile period that will leave those of you still in the game dizzy from the movement and volatility. Strap in and be prepared.....its go time, from here on out we could experience some explosive movement designed to move you completely out of the trade. Trading out of positions completely will be punished......unless you put it into physical.'ll need it.

    its coming....Hewlett-Packard sees well below normal seasonality in revenue from Q3 to Q4
    Says that's driven by macro and by a very competitive pricing environment. Says top line headwinds are limiting ability to expand operating margins.
    QANTAS Airways, reporting its first annual loss in nearly two decades, has cancelled orders for 35 of Boeing's more fuel-efficient 787-9 aircraft in a bid to save $US8.5 billion ($8.1bn).

    CHINA FLASH PMI DISAPPOINTS more stimulus needed now

    Monday, August 20, 2012


    Not in the's already occurred. We have seen it happen already. The discussions out in the public and cyberland regarding Zombieland is no accident. As noted by this blog nothing occurring is random or by "accident". This IS a zombie economy and a zombie deconstruction of a zombie system. You can try and maintain CONfidence only so long with magic levitation before gravity takes over and the fall begins. The only question now is when does everyone see it. When do the zombies finally become visible to everyone but the most brain dead peeps. When do the peeps suddenly make a mad dash for the store shelves and banks to claim the morsels that may provide them some chance at survival as the ponzi unwinds. Confusion, fear, and outright paranoia can be powerful persuasive forces for greater control. Of course greater control will solidify the power that the puppetmasters will need for absolute power.  Does this mean Armageddon is coming? Sorry to disappoint you if I answer that in a NON-fatalistic way......but I'll say no. I do believe that some form of collapse will take place, but it will be a "controlled detonation". I can't speak to the casualties, but it could be in the billions.....or millions. I just cannot tell what form of reset is planned. Sometimes the planning can always be prepared. Chaos is forming in the big banks....or at least the "appearance" of chaos. Resets will occur here too. We have a lot of resets ahead of us. Your big fear however is that Nature resets it for you. If they do then all bets are off. Even Jamie D has stumbled and will be reset soon as noted by Bloomy today.

    Wall Street, the global financial community reeling from public outrage and increased regulation, is proving incapable of finding a champion to replace sidelined JPMorgan Chase & Co. (JPM)Chief Executive Officer Jamie Dimon.
    Dimon, 56, one of the industry’s most forceful advocates, has lost stature as his bank, the largest in the U.S. by assets, juggles multiple investigations and a $5.8 billion trading loss on wrong-way bets on credit derivatives. His peers at other big lenders are hobbled by poor performance, tarnished reputations or a reluctance to step into the breach.

    Bankers across the Atlantic, including former Barclays Plc (BCS) CEO Robert Diamond and Peter Sands of Standard Chartered Plc (STAN), have been muted by allegations that their firms rigged interest rates or were involved in money laundering.
    “What you’re seeing in the financial-services industry is a lack of any kind of credible statesmen,” said Rakesh Khurana, a management professor at Harvard Business School in Boston. Dimon’s diminished ability to defend the industry publicly “basically leaves a vacuum,” he said.
    That means the industry is without an advocate to resist the most vigorous onslaught of regulations since Congress separated investment and commercial banking with the Glass- Steagall Act in 1933. It coincides with the lowest level of consumer confidence in U.S. banks since Gallup Inc. began polling on the question in 1979. The percentage of Americanssaying they had a “great deal” or “quite a lot” of confidence dropped to 21 percent in June from 41 percent in 2007 and more than 60 percent in 1980. thanks bloomberg

    Just keep in mind. Print or pull the plug? Those are the only choices the PTB have. If they pull the plug then you have the "real fear" trade and you BETTER own PMs. Either way......