16 February 2012
SilverDoctors: Upside Reversal Positive Proof Paper Futures Marke...
SilverDoctors: Upside Reversal Positive Proof Paper Futures Marke...: Guest Post From SD reader FW: An upside reversal as seen today was almost unheard of 12 months ago and on back through the start of this ...
The true value of money – or why you can't fart a crashing plane back into the sky
by Charlie Brooker, Guardian.co.uk
Banknotes aren't worth the paper they're printed on. The entire economy relies on the suspension of disbelief
I'm no financial expert. I scarcely know what a coin is. Ask me to explain what a credit default swap is and I'll emit an unbroken 10-minute "um" through the clueless face of a broken puppet. You might as well ask a pantomime horse. But even an idiot such as me can see that money, as a whole, doesn't really seem to be working any more.
Money is broken, and until we admit that, any attempts to fix the economy seem doomed to fail. We're like passengers on a nosediving plane thinking if we all fart hard enough, we can lift it back into the sky. So should we be storming the cockpit or hunting for parachutes instead? I don't know: I ran out of metaphor after the fart gag. You're on your own from hereon in.
Banknotes aren't worth the paper they're printed on. If they were, they'd all have identical value. Money's only worth what the City thinks it's worth. Or, perhaps more accurately, hopes it's worth. Coins should really be called "wish-discs" instead. That name alone would give a truer sense of their value than the speculative number embossed on them.
The entire economy relies on the suspension of disbelief. So does a fairy story, or an animated cartoon. This means that no matter how soberly the financial experts dress, no matter how dry their language, the economy they worship can only ever be as plausible as an episode of SpongeBob SquarePants. It's certainly nowhere near as well thought-out and executed.
No one really understands how it all works: if they did, we wouldn't be in this mess. Banking, as far as I can tell, seems to be almost as precise a science as using a slot machine. You either blindly hope for the best, delude yourself into thinking you've worked out a system, or open it up when no one's looking and rig the settings so it'll pay out illegally.
The chief difference is that slot machines are more familiar and graspable to most of us. When you hear a jackpot being paid out to a gambler, the robotic clunk-clunk-clunk of coin-on-tray, you're aware that he had to go to some kind of effort to get his reward. You know he stood there pushing buttons for hours. You can picture that.
The recent outrage over City bonuses stems from a combination of two factors: the sheer size of the numbers involved coupled with a lack of respect for the work involved in earning them. Like bankers, top footballers are massively overpaid, but at least you comprehend what they're doing for the money. If Wayne Rooney was paid millions to play lacrosse in a closed room in pitch darkness, people would begrudge him his millions far more than they already do. Instead there he is, on live television: he's skilled, no doubt about it.
Similarly, it may be tasteless when a rapper pops up on MTV wearing so much bling he might as well have dipped himself in glue and jumped into a treasure chest full of vajazzling crystals, but at least you understand how he earned it.
MORE
Banknotes aren't worth the paper they're printed on. The entire economy relies on the suspension of disbelief
I'm no financial expert. I scarcely know what a coin is. Ask me to explain what a credit default swap is and I'll emit an unbroken 10-minute "um" through the clueless face of a broken puppet. You might as well ask a pantomime horse. But even an idiot such as me can see that money, as a whole, doesn't really seem to be working any more.
Money is broken, and until we admit that, any attempts to fix the economy seem doomed to fail. We're like passengers on a nosediving plane thinking if we all fart hard enough, we can lift it back into the sky. So should we be storming the cockpit or hunting for parachutes instead? I don't know: I ran out of metaphor after the fart gag. You're on your own from hereon in.
Banknotes aren't worth the paper they're printed on. If they were, they'd all have identical value. Money's only worth what the City thinks it's worth. Or, perhaps more accurately, hopes it's worth. Coins should really be called "wish-discs" instead. That name alone would give a truer sense of their value than the speculative number embossed on them.
The entire economy relies on the suspension of disbelief. So does a fairy story, or an animated cartoon. This means that no matter how soberly the financial experts dress, no matter how dry their language, the economy they worship can only ever be as plausible as an episode of SpongeBob SquarePants. It's certainly nowhere near as well thought-out and executed.
No one really understands how it all works: if they did, we wouldn't be in this mess. Banking, as far as I can tell, seems to be almost as precise a science as using a slot machine. You either blindly hope for the best, delude yourself into thinking you've worked out a system, or open it up when no one's looking and rig the settings so it'll pay out illegally.
The chief difference is that slot machines are more familiar and graspable to most of us. When you hear a jackpot being paid out to a gambler, the robotic clunk-clunk-clunk of coin-on-tray, you're aware that he had to go to some kind of effort to get his reward. You know he stood there pushing buttons for hours. You can picture that.
The recent outrage over City bonuses stems from a combination of two factors: the sheer size of the numbers involved coupled with a lack of respect for the work involved in earning them. Like bankers, top footballers are massively overpaid, but at least you comprehend what they're doing for the money. If Wayne Rooney was paid millions to play lacrosse in a closed room in pitch darkness, people would begrudge him his millions far more than they already do. Instead there he is, on live television: he's skilled, no doubt about it.
Similarly, it may be tasteless when a rapper pops up on MTV wearing so much bling he might as well have dipped himself in glue and jumped into a treasure chest full of vajazzling crystals, but at least you understand how he earned it.
MORE
CFTC: Flawed Silver Investigations and Breaking The Law
OPEN LETTER TO THE CFTC
February 16, 2012Commodities Futures Trading Commission
3 Lafayette Center
1155 21st St. NW Washington, DC 50581
Re: Flawed Investigations and Breaking The Law
Dear Commissioners:
For over 2 decades a large group of silver investors have been yelling and screaming at the CFTC to stop the rampant downward manipulation of the COMEX silver market. On May 14, 2004 the CFTC released the results of their 1st investigation by Michael Gorham, Director of Market Oversight, saying they have not found any evidence of silver market manipulation.
http://www.cpmgroup.com/free_library1/COUNTER-ARGUMENTS_TO_SILVER_CONSPIRACY_THEORIES/CFTC_Silver_Letter_May_2004.pdf
Dr. Gorham, who once worked at the Federal Reserve Bank, resigned only 3 weeks after releasing this report:
http://www.cftc.gov/opa/press04/opa4935-04.htm
As a truly REMARKABLE twist of fate, or not, Mr. Gorham now serves on the Probable Cause and Business Conduct Committees of the CME who were supposed to be overseeing MF Global before it imploded:
http://www.marketswiki.com/mwiki/Michael_Gorham
Then in May 2008 the CFTC released another report on the same topic again stating again that the silver market was not being manipulated. This time the CFTC decided NOT to put anyone's name on the report:
http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/silverfuturesmarketreport0508.pdf
This report piggy backed off the 2004 report in reinforcing the main argument why there was no manipulation in the silver market...
"Staff in 2004 also examined the relationship between NYMEX silver futures prices and cash market silver prices to determine whether NYMEX prices appeared to be unusually or significantly out of line with cash prices."
"NYMEX silver futures prices tend to track closely the price of physical silver...This analysis shows that there is not a downward bias in the NYMEX futures price vis-a-vis the LBMA price, which, as noted, is widely regarded as the benchmark value in the marketplace."
In BOTH reports the CFTC cites the "cash prices" as the prices for silver on the London Bullion Market(LBMA). It is absolutely important that the NYMEX (COMEX) prices stay in line with the "cash prices" of silver otherwise it would prove that the futures and options trading was SETTING the price for physical silver which is illegal. The PROBLEM with the CFTC's analysis is that they are comparing the NYMEX prices to a massively flawed proxy for the price of physical silver.
I'd like to direct your attention to the CFTC hearing on the silver market manipulation issue. Jeffery Christian of the CPM Group points out clearly that the LBMA really has NOTHING TO DO WITH THE "PHYSICAL MARKET" IN SILVER.
MORE
SilverDoctors: COMEX Open Raid in Gold & Silver
SilverDoctors: COMEX Open Raid in Gold & Silver: Another day, another raid on the COMEX open. Silver was slammed 0.60 on the COMEX open, to the bottom of its range trade near $32.50. Sil...
SilverDoctors: Global Gold Demand in 2011 Rises 0.4% To $200 Bill...
SilverDoctors: Global Gold Demand in 2011 Rises 0.4% To $200 Bill...: Global demand for gold reached 4,067.1 tonnes last year, the highest tonnage since 1997, due in large part to a nearly 5% increase in in...
PIMCO,Texas Teacher Reitrement Fund &Soros buys into GLD/Greek bailout no further ahead as potential delay in implementation/ Portugal
Good evening Ladies and Gentlemen:
Gold closed up today by $10.70 to $1726.60 by comex closing time. Silver was ambushed by our bankers after being up considerably during the early part of the comex session. Silver's final comex resting price was $33.39 up only 7 cents. It was close to $34.00 at the second London fix. As I pointed out to you on previous commentaries the bankers do not like what they are witnessing in silver. They are viewing the players as different from before and they are probably scared witless that many are taking delivery. The last two non delivery months of January and February is all the evidence that they need that some newer and stronger entity is here trying to get as much of physical silver as possible. You will see below that for the 6th straight session the net OI for the front February month increased again (we remove yesterday's delivery notices from the Feb OI to get net OI)
Let us head over to the gold comex and assess trading today.
The total gold comex surprisingly rose by 4380 contracts yesterday from 426,784 to 431,164. I guess the raid had no damage done to the open interest as gold leaves refused to fall from the gold tree. The front delivery month of February again saw its OI fall from 493 to 452 for a loss of 40 contracts despite only 1 delivery notice yesterday. Blythe was handing out the candies in full force today as 40 contracts succumbed to cash settlements. The next big delivery month is April and here the OI rose from 231,263 to 232,679 as long players certainly took note that the Euro meeting scheduled today was cancelled. The estimated volume today was very weak at 128,217. The confirmed volume yesterday, with the raid orchestrated by our bankers registered 167,886 as they supplied huge amounts of non backed gold paper.
Silver is the object of the bankers interest. Today the OI registered a slight retreat of 1320 contracts to 104,872 from 106,192 as it still trades in this very narrow channel. The front options delivery month of February saw its OI fall 81 contracts from 212 to 131. However we had 127 delivery notices filed yesterday. Thus for the 6th straight day, the number of silver oz standing for delivery rose. Today an additional 50 contracts ( 250,000 oz) are standing.
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MF Global: Where's the Cash -- Part II
This week in The Institutional Risk Analyst we published a comment on the ongoing financial genocide at MF Global, “MF Global: Where's the Cash?” http://us1.irabankratings.com/pub/IRAstory.asp?tag=515
The comment correctly identifies the location of the “missing” $1.6 billion as JP Morgan Chase and other bank custodians of MF Global. The trouble is that even though we now know where the missing customer money has gone, namely JPMorgan, there is little chance that the defrauded customers of Jon Corzine will ever recover a dime.
Here’s the link to a video by William Rochelle of Bloomberg News explaining how the safe harbor in Section 546(e) of the Bankruptcy Code likely will prevent MF Global customers from ever getting their $1.6 billion back -- even when it’s located, as it has been evidently.
http://www.youtube.com/watch?v=3zVEZ-knlcA&feature=youtu.be
When Bill recorded the video, the bankruptcy trustee hadn’t yet raised the loss estimate from $1.2 billion. In case you’re wondering why Bill is so knowledgeable about bankruptcy law, he was head of bankruptcy litigation at Fulbright & Jaworski in New York before he decided to take up journalism.
What people need to understand is that like the case of WorldCom, the MF Global bankruptcy illustrates the way in which the large Wall Street banks have used their Washington lobbyists to encroach upon the rights of investors. Even if it were proved that John Corzine and his colleagues committed criminal violations of the Uniform Securities Act and state law, there is little chance that the investors in MF Global will ever receive equity and justice. Again, read the WorldCom case.
The problem here is that the existing laws against pillaging customer accounts and other acts of fraud are in conflict with the bankruptcy statute designed to make the world safe for large banks and over-the-counter derivatives. Specifically, the post 2005 bankruptcy laws prohibit trustees from clawing back the $1.6 billion in stolen customer funds. Indeed, the Bankruptcy Court and trustee are precluded from pursuing the banks just as the trustee in the Madoff fraud has likewise been stymied.
MORE
Here’s the link to a video by William Rochelle of Bloomberg News explaining how the safe harbor in Section 546(e) of the Bankruptcy Code likely will prevent MF Global customers from ever getting their $1.6 billion back -- even when it’s located, as it has been evidently.
http://www.youtube.com/watch?v=3zVEZ-knlcA&feature=youtu.be
When Bill recorded the video, the bankruptcy trustee hadn’t yet raised the loss estimate from $1.2 billion. In case you’re wondering why Bill is so knowledgeable about bankruptcy law, he was head of bankruptcy litigation at Fulbright & Jaworski in New York before he decided to take up journalism.
What people need to understand is that like the case of WorldCom, the MF Global bankruptcy illustrates the way in which the large Wall Street banks have used their Washington lobbyists to encroach upon the rights of investors. Even if it were proved that John Corzine and his colleagues committed criminal violations of the Uniform Securities Act and state law, there is little chance that the investors in MF Global will ever receive equity and justice. Again, read the WorldCom case.
The problem here is that the existing laws against pillaging customer accounts and other acts of fraud are in conflict with the bankruptcy statute designed to make the world safe for large banks and over-the-counter derivatives. Specifically, the post 2005 bankruptcy laws prohibit trustees from clawing back the $1.6 billion in stolen customer funds. Indeed, the Bankruptcy Court and trustee are precluded from pursuing the banks just as the trustee in the Madoff fraud has likewise been stymied.
MORE
Debt saturation ensures much higher gold and silver
Remarks by John Embry
Chief Investment Strategist, Sprott Asset Management, Toronto
California Investment Conference
Cambridge House International
Hyatt Grand Champions Resort, Indian Wells
Saturday, February 11, 2012
It is once again a great pleasure to address the attendees at this conference following the GATA Workshop I participated in this morning. I'd like to thank Bill Murphy for his kind introduction. As many of you may know, Bill and I have become great friends as the result of our mutual struggles in the gold and silver markets over the past 13 years. That struggle has simultaneously represented the most exhilarating and the most frustrating experience in my nearly 49 years in the investment business.
After acknowledging my longevity in the business, I'd love to say that I started when I was 12 years old but that unfortunately is not true. I'm just getting old, which, at least so far, beats the alternative.
The main subject I want to address today is the staggering debt situation throughout the industrialized world and the impact it will have on the value of paper money and by extension, gold and silver. However, before I get to that topic, I would like to make a few comments about the price action of gold and silver in the last four months of 2011, price action that incidentally set the stage for the explosive price rises we've seen in the first six weeks of this year.
Up until Labor Day last year, gold was enjoying an excellent year, rising by comfortably over 30 percent in price in eight months. This strong advance reflected the turmoil in Europe, the U.S. debt rating downgrade, excessive money creation worldwide, and widespread economic and financial deterioration generally. Ergo, gold was acting exactly as it should in these circumstances.
However, this also represented the worst nightmare for the powers that be, essentially revealing to the public that all was not well.
Thus, in response, the Western world governments, their central banks, and their bullion bank allies sprung into action. Gold plummeted nearly $300 in a month and silver dropped by a third despite not an iota of visible improvement in the world economic and financial backdrop. It was just the same tired old criminal drill that we have seen throughout the more than decade long powerful bull market in gold and silver. These muggings took place primarily in the paper markets of the LBMA and the COMEX while the regulators, most particularly the Commodity Futures Trading Commission here in the U.S., blissfully slept on.
Then, after gold subsequently re-established its equilibrium above $1,700 and silver bounced back into the mid 30s, both collapsed again in the wake of a totally failed European summit in early December. In the absence of any palatable solutions to their many intractable problems, the Europeans undoubtedly knew the scope of the quantitative easing they were going to have to unleash to hold things together. Thus, they and their American counterparts deemed it essential that gold and silver not be seen as an attractive and essential alternative to their beloved pure fiat currency system, which was failing rapidly in plain view. Gold dropped well over $200 and silver fell by 20 percent in a three-week period, with much of the damage occurring in the traditionally very quiet week between Christmas and New Year's Day.
MORE
Chief Investment Strategist, Sprott Asset Management, Toronto
California Investment Conference
Cambridge House International
Hyatt Grand Champions Resort, Indian Wells
Saturday, February 11, 2012
It is once again a great pleasure to address the attendees at this conference following the GATA Workshop I participated in this morning. I'd like to thank Bill Murphy for his kind introduction. As many of you may know, Bill and I have become great friends as the result of our mutual struggles in the gold and silver markets over the past 13 years. That struggle has simultaneously represented the most exhilarating and the most frustrating experience in my nearly 49 years in the investment business.
After acknowledging my longevity in the business, I'd love to say that I started when I was 12 years old but that unfortunately is not true. I'm just getting old, which, at least so far, beats the alternative.
The main subject I want to address today is the staggering debt situation throughout the industrialized world and the impact it will have on the value of paper money and by extension, gold and silver. However, before I get to that topic, I would like to make a few comments about the price action of gold and silver in the last four months of 2011, price action that incidentally set the stage for the explosive price rises we've seen in the first six weeks of this year.
Up until Labor Day last year, gold was enjoying an excellent year, rising by comfortably over 30 percent in price in eight months. This strong advance reflected the turmoil in Europe, the U.S. debt rating downgrade, excessive money creation worldwide, and widespread economic and financial deterioration generally. Ergo, gold was acting exactly as it should in these circumstances.
However, this also represented the worst nightmare for the powers that be, essentially revealing to the public that all was not well.
Thus, in response, the Western world governments, their central banks, and their bullion bank allies sprung into action. Gold plummeted nearly $300 in a month and silver dropped by a third despite not an iota of visible improvement in the world economic and financial backdrop. It was just the same tired old criminal drill that we have seen throughout the more than decade long powerful bull market in gold and silver. These muggings took place primarily in the paper markets of the LBMA and the COMEX while the regulators, most particularly the Commodity Futures Trading Commission here in the U.S., blissfully slept on.
Then, after gold subsequently re-established its equilibrium above $1,700 and silver bounced back into the mid 30s, both collapsed again in the wake of a totally failed European summit in early December. In the absence of any palatable solutions to their many intractable problems, the Europeans undoubtedly knew the scope of the quantitative easing they were going to have to unleash to hold things together. Thus, they and their American counterparts deemed it essential that gold and silver not be seen as an attractive and essential alternative to their beloved pure fiat currency system, which was failing rapidly in plain view. Gold dropped well over $200 and silver fell by 20 percent in a three-week period, with much of the damage occurring in the traditionally very quiet week between Christmas and New Year's Day.
MORE
Global gold demand exceeds US $200 bn for first time in 2011: WGC
NEW YORK (Commodity Online):Global demand for gold in 2011 rose to 4,067.1 tonnes (t) worth an estimated US$205.5 billion - the first time that global demand has exceeded US$200 billion and the highest tonnage level since 1997.
The main driver for this increase was the investment sector where annual demand was 1,640.7t up 5% on the previous record set in 2010 and with a value of US$82.9 billion.
The pre-eminent markets for investment demand in 2011 were India, China and Europe. Central banks continued the trend established in 2010 of being net buyers of gold.
MORE
The main driver for this increase was the investment sector where annual demand was 1,640.7t up 5% on the previous record set in 2010 and with a value of US$82.9 billion.
The pre-eminent markets for investment demand in 2011 were India, China and Europe. Central banks continued the trend established in 2010 of being net buyers of gold.
MORE
Rothschilds Want Iran’s Banks
By Pete Papaherakles
Could gaining control of the Central Bank of the Islamic Republic of Iran (CBI) be one of the main reasons that Iran is being targeted by Western and Israeli powers? As tensions are building up for an unthinkable war with Iran, it is worth exploring Iran’s banking system compared to its U.S., British and Israeli counterparts.
Some researchers are pointing out that Iran is one of only three countries left in the world whose central bank is not under Rothschild control. Before 9-11 there were reportedly seven: Afghanistan, Iraq, Sudan, Libya, Cuba, North Korea and Iran. By 2003, however, Afghanistan and Iraq were swallowed up by the Rothschild octopus, and by 2011 Sudan and Libya were also gone. In Libya, a Rothschild bank was established in Benghazi while the country was still at war.
Islam forbids the charging of interest, a major problem for the Rothschild banking system. Until a few hundred years ago, charging interest was also forbidden in the Christian world and was even punishable by death. It was considered exploitation and enslavement.
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