They just showed their hands. The paper Ponzi pyramid is
wobbling. It’s time to go in for the kill.
Let me explain. But first let’s get a handle on what’s
happening:
“We’ve traded gold for nearly four decades and we’ve
never … ever… EVER… seen anything like what we’ve witnessed in the past two
trading sessions,”
Dennis
Gartman, via The New York Times
“This is an orchestration (the smash in gold).
It’s been going on now from the beginning of April. Brokerage houses
told their individual clients the word was out that hedge funds and
institutional investors were going to be dumping gold and that they should
get out in advance…it is the Fed’s concern with the dollar because the dollar
is being printed in huge quantities at the same time that other countries are
abandoning the use of the dollar as international payment.
The exchange value of the dollar is (being) threatened,
and if that collapses the Fed loses control over interest rates. Then
the bond market blows up, the stock market blows up, and the banks that are
too big to fail, fail. Soit’s an act of desperationbecause
they’ve got toestablish in people’s minds that the dollar is the only safe
place, it is the only safe haven, not gold, not silver, and not other
currencies.
And to help protect this policy they have convinced or
pressured the Japanese to inflate their own currency. The Japanese are
now going to print money like the Fed. They are lobbying the ECB to
print more. So I see this as a dollar protection policy...I know where
the gold is coming from in the market,it’s just paper. It’s naked
shorts, there is no gold there. If somebody wanted to take delivery
on those contracts nobody would be able to provide it. I don’t know
what the source of the (physical) gold is...
..I think the power of the West has already been
lost. When you have off-shored your manufacturing and professional
service jobs, you’ve hollowed out your economy. So gold or no gold, the
United States economy has been severely damaged and I don’t think it can
recover...
This gold business (smash in price) is something to do
with the dollar….They are trying to destroy gold as a (safe) haven from the
dollar in order to carry on the Fed’s policy of negative real interest
rates. That is what is driving the illegal policy of selling naked
shorts in order to manipulate a market. If you and I were to do
something like this without the government’s instruction or protection, we
would be arrested. So the fact that it’s illegal, being done by the
authorities, tells me thatthey are seriously worried about the dollar.”
Paul Craig Roberts, Former Assistant Secretary of the
Treasury (viaKing
World News)
If there is one thing this latest shock-and-awe “theater”
in the Gold market tells us, it’s that the government and banksters (i.e. the
oligarchy) must beREALLYpissing their pants. It doesn’t show their
strength – it lays bare their weakness. They just made it abundantly clear
(again) how important Gold is in their scheme of things. A rapidly rising
Gold price would reveal the utter fraud of their paper money Ponzi scheme and
reveal them as simple hucksters, charlatans and scamsters counterfeiting
money and hiding behind all the elegant regalia. The emperor would be naked.
Can’t let that happen. The franchise of the paper dollar – arguably the most
profitable franchise in history enabling theft on a global scale - must be
protected at all costs. Something is or must be about to go seriously wrong
with their empire of fake paper money (perhaps the recent gyrations in the JGBmarket is a tell).
With this recent paper Gold market “drama” they have only
showntheirdesperation and weakness. The level of their desperation
this time is so great that they had their bought-and-paid-for shills in the media mouthpieces attack and mock Gold and
its buyers even before the sell-off (which further goes to
proves that it was orchestrated; I’ll provide more evidence below). Consider
this in an article “Lust for Gold” which appeared in the New York Times on
the 11th April by none other than the lead bankster shill and
cheerleader Paul Krugman:
After all, historically, gold has been anything but a
safe investment…John Maynard Keynes famously dismissed the Gold standard as a
“barbarous relic”, noting the absurdity of yoking the fortunes of a modern
industrial society to the supply of a decorative metal…for a while, rising
gold prices helped create some credibility for the goldbugs even as their
predictions about everything else proved wrong, but now gold as an investment
has turned sour, too. So will we see prominent goldbugs change their views,
or at least lose a lot of their followers.
Its funny how the paperbugs liken Gold buyers to a cult,
while not realizing they themselves sound like one, with their irrational
faith in and defense of paper money (well, not completely irrational - they
know where their next paycheck is coming from :-)). While I may provide a
full rebuttal to Mr. Krugman in a later article (it barely deserves one,
childish and inane as it is), I will point out this: If Gold is so
inconsequential and such a “barbarous relic”, why is the government lapdog
media busy trying to discredit it and all those who buy it? I mean just look
at the sheer gloating:
From the Business Insider:
The WSJ also joined in the fun:
I’ll tell you why - because underneath all the bullshit
they are spewing they know that buyers of Gold are not actuallybuyinganything
but votingagainsttheir paymaster government and bankster
oligarchy. There is nothing spectacular about Gold except for its ability to
reveal the truth about the scam being run by our ruling feudal masters, and
this is the one and only reason why Gold and all those who buy it are so
vilely derided by the establishment.
The global economy is still in shambles and the oligarchy
have shown that they can’t do ANYTHING of ANY real consequence except
manipulating the public opinion – either via “market” shenanigans or media
mouthpieces. Just think about it – a global empire, a powerful and apparently
invincible oligarchy threatened by just an inanimate piece of metal. But they
know that because all their power is based on lies and deception, a simple
truth - the rising price of Gold indicating the massive dilution of currency
- can completely destroy it. Having become thoroughly corrupt, impotent and
incompetent, unable to fix anything (they couldn’t run a lemonade stand if
their lives depended on it) and fast becoming desperate with Gold having
risen more thanseven-foldfrom about $250 in 1999 to $1900 in 2011
exemplifying the worthlessness of their paper money and reality catching up
to them, they did the only thing they knew: attack the messenger - Gold. It’s
a short term fix which perpetuates their paper money franchise and thus their
power, but longer term it’s meaningless. It doesn’t fix the massive
misallocations which have occurred and are occurring due to central control
of money via the paper money system and it doesn’t change one bit of the
truth of the present dilapidated state of our economy and society which is a
direct result of it. In fact it’s making the situation worse as by not
allowing the misallocations to correct and reallocation of capital to productive
hands to occur, huge amount of scarce resources – both human and material –
continue to be wasted on unproductive enterprises.
Unless and until the following factors are no longer true,
there is and will remain a case for buying Gold. These factors did not vanish
overnight because of a single orchestrated plunge:
1.Exponentially increasing Government and private debt
2.Exponentially increasing money supply
3.Consistent rise in the price of items of daily need (yes
I know there is no “inflation” but anybody who goes to the supermarket knows
what a crock of bullshit the government CPI numbers are)
4.Rising unemployment and falling incomes
5.Corrupt government and politicians
The banksters are acting like a child throwing a tantrum
because daddy (Gold) is going to take their toy (paper money) away from them,
so they simply wail and try to hit back at daddy, as if that would accomplish
anything. People who know the truth should simply sit back and laugh at the
banksters and their shenanigans while using the opportunity to buy even more.
The Discount of a Lifetime
The way this price fall occurred makes it clear that there
were NO fundamentals behind the move and, paradoxically, strengthens the case
for Gold even further. Let’s take a look at exactly how this latest plunge in
Gold price happened (via Ross
Norman):
The gold futures markets opened in New York on Friday
12th April to amonumental 3.4 million ounces (100 tonnes) of gold sellingof
the June futures contract in what proved to be only an opening shot. The
selling took gold to the technically very important level of $1540 which was
not only the low of 2012, it was also seen by many as the level which
confirmed the ongoing bull run which dates back to 2000. In many traders
minds it stood as a formidable support level... the line in the sand.
Two hours later the initial selling, rumored to have
beenrouted through Merrill Lynch's floor team, by a rather more
significant blast when the floor was hit by a further 10 million ounces of
selling (300 tonnes) over the following 30 minutes of trading.This was
clearly not a case of disappointed longs leaving the market - it had the
hallmarks of a concerted 'short sale', which by driving prices sharply lower
in a display of 'shock & awe' - would seek to gain further momentum by
prompting others to also sell as their positions as they hit their maximum
acceptable losses or so-called 'stopped-out' in market parlance - probably
hidden the unimpeachable (?) $1540 level.
The selling was timed for optimal impact with New York
at its most liquid, while key overseas gold markets including London were
open and able feel the impact. The estimated 400 tonne of gold futures
selling in total equates to 15% of annual gold mine production - too much for
the market to readily absorb, especially with sentiment weak following
gold's non performance in the wake of Japanese QE, a nuclear threat from
North Korea and weakening US economic data. The assault to the short side was
essentially saying "you are long... and wrong".
The CME's 10% reduction in the required gold margins in
November 2012 from $9133/contract to just $7425/contract made the market more
accessible to those wishing both to go long or as it transpired, to go short.
Soon after we saw the first serious assault to the downside in Dec 2012,
followed by further bouts in January 2013 - modest in size compared to the
recent shorting but effective - it laid the ground for what was to follow.
One fund in particular, based in Stamford Connecticut, was identified as the
previous shorter of gold and has a history of being caught on the wrong side
of the law on a few occasions. As baddies go - they fit the bill nicely.
Thevalue of the 400 tonnes of gold sold is
approximately $20 billionbut because it is margined, this short bet would
require them to stump up just $1b…. By forcing the market lower the Fund
sought to prompt a cascade or avalanche of additional selling, proving the
lie ; predictably some newswires were premature in announcing the death of
the gold bull run doing, in effect, the dirty work of the shorters in driving
the market lower still[1].
If someone is selling anything, the rational thing to do
would be to get the best price possible, right? Would you get the best price
if you sell your lot in one go flooding the market? Would you want to
overwhelm all the bids and crush the price? Yes, but only if exactlythatwas
your objective – to crush the price. Nobody sells400 tons(!) of gold
in one go if they are trying to get the best possible price. So this wasn’t a
case of varied market participants selling their gold holdings having
considered the fundamentals for Gold and arrived at the conclusion their long
position didn’t make sense anymore. This was a case of concerted selling byone
single entitywhose sole intention was to drive down the price. Not only
that, nobody sells $20 BILLION worth of Gold in ONE GO without some sort of
state/CB backing. You think some piddly hedge fund manager would have the
balls to do this while risking prosecution and jail time? So not only was
this market manipulation, but state-sponsored market manipulationcompletely
unrelatedto the reality and the fundamental basis for buying Gold, which
remains as strong as ever.
But it gets better. While this is the probably the most
spectacular takedown of the Gold price ever, but by no means is it the first
or the only one. Anyone who has actually traded the Gold futures market for
any length of time knows that this happens on a regular basis. So basically
the government/Central Banks use the paper gold futures market as a price
control mechanism for Gold (of course, they can’t impose price controls on
Gold overtly as it would reveal the lie - if Gold is a barbarous, meaningless
relic why would you need to impose price controls on it?). But what happens
when price controls are imposed on something? Shortages start to occur
resulting in an even greater moonshot in price than would have otherwise
occurred. A “black” market (which is actually the free market at play and
depicts the true price of the commodity) eventually emerges where it sells at
a premium to the official price. There are two reasons for this:
1.Buyers - aware that the commodity/good is available at a
discounted price - beat a path to the door of whoever is foolish enough to
sell it at the government mandated price. Availability at that price soon
runs out.
2.The good becomes even scarcer as the costs of producing
and selling it are no longer covered by the government mandated price. Aware
of this, sellers withdraw from the market and demand ever higher prices for
the good.
And remember: for marketable goods, the “out” is money, but
the only “out” for money is a superior form of money. When the paper
currencies become unstable, the only “out” is Gold so you can be sure there
will be no lack of buyers, only sellers – and there is no upper limit to high
it can go. Theoretically, the price will be infinity when no seller is
willing to sell Gold in exchange for paper. You want to be “out” of paper
before we reach that event horizon.
If the rigging in the futures market keeps continuing, the
futures price at some point will decouple from the physical and become
meaningless. This is exactly why you should use this opportunity to buy as
much physical as possible at discounted prices while there
are foolish sellers still willing to sell at the stated official (futures)
price. I’m sure many of you remember Gold’s spectacular fall from about $1000
to $680 circa 2008. How many of you have regretted not buying at those levels
while you have been watching Gold’s inexorable rise since? You’ve been
waiting for a price drop, haven’t you? So what are you waiting for? We saw
the same scary headlines in the MSM that we are seeing now with the same
bullshit reasons – while the reality hasn’t changed ONE BIT. Some media
mouthpieces are proclaiming
a bear market in Gold has begun while others are hoping
that their paymasters’ moronic ideas are finally working but remember this is
the same media that sold you real estate before the bust, the same media that
sold you DOW 36000, the same media that sold you Obama’s “hope and change”
and has pilloried gold and gold buyers whenever its price crashes but has
been largely silent throughout the past 13 years of the gold bull run.
There’ve been many of you saying Gold is too expensive and waiting for an
opportunity to buy in. Well, the banksters in using the futures market as a
propaganda vehicle against Gold have unwittingly provided you with one.
Overcome your fears for fortune favors the brave. It’s time to go in for the
kill.
Don’t Pick Pennies In Front of The Steamroller – Get
Out Of The Paper Markets
First, you must be clear why you are buying Gold. Sure,
paper gains are nice to have but are only a side effect. The real reason is
this (from one of my previous
articles):
Any type of financial asset that has a counterparty –
which is pretty much all the paper assets in the world – bonds, futures, any
and all derivatives and yes, even the paper currency – will crash. What will
they crash against? Yes, that’s right - Gold. All the world’s capital –
trillions, perhaps quadrillions of it - will come rushing into the very tiny
physical (NOT paper) Gold market. Remember, the world’s real physical capital
– real assets such as land, oil-refineries, mines, infrastructure, etc. will
not vanish, only it will be re-priced in terms of Gold and its ownership
transferred to those who hold it. Since everything stays on this planet, it
is a zero-sum game and the winner will be Gold. In other words, an ounce of
physical Gold will command a lot more in real purchasing power than it does
today. Just like a national currency is a claim on goods and assets within
that country, Gold will be a claim on global goods and assets worldwide.
In other words, wealth preservation in the face of a
currency collapse and an insurance policy against the idiocy and depredations
of our monetary masters.
For those of you who have read my work, this current smash
shouldn’t come as a surprise. In fact – not to beat my own drum – but if you
understood and followed my advice, you would have been out of the paper
markets and not affected one bit by these shenanigans. If you wish to trade
the paper market for short term paper gains, by all means do it (at your own
risk though - and you just saw what that “risk” looks and feels like), but in
the end always – ALWAYS – convert those paper gains to real profit by buying
the physical metal because Gold will never ever attain its true
price in the futures markets. They can always issue an unlimited supply of
naked paper contracts. The following extract from one of my previous
articles explains the reality of the futures market:
The futures market is nothing but a tool for the dollar
managers (US Government/Fed/Bullion banks) to manage/control the price of
Gold. Any rational observer with an iota of brain who has watched the gold
market for any reasonable length of time can tell that the price is
intentionally driven down during the Comex trading hours. If you don’t
believe this, either you’re in denial or worse – collusion - and IT WILL end
up costing you big time. Given the massive, concentrated and long-term (the
entire past decade - they haven't been net-long - not once - during that time
period) nature of their short positions, it really isn’t that hard to deduce
that the banks do not nearly have enough metal to cover their shorts and that
the sole intention of the massive short position is to control the price.
Whenever the price rises (or threatens to rise) the big bullion banks ala JP
Morgan create massive naked shorts introducing fake supply of Gold in the
market, thus driving the price down. “But the price has been rising for the
past decade, hasn’t it? So how can you say they are driving it down?”, many
people ask. Well, the constraint on the bullion banks has been the
availability of the physical metal. If the metal is not available, the fraud
of the paper market is exposed and they lose their price managing ability. So
they allow the price rise to a level at which there are some weak hands
willing to sell and then they hold it there till all the sellers have been
exhausted (I am assuming the Fed has already sold all the US Gold during the
past decade). So strong are Gold’s fundamentals that despite the massive
rigging, all they have been able to do is slow its rise. The weak hands who
sell the physical metal at every price rise have helped them in this
endeavor. But soon, as the bond market implodes, they will run out of
sellers. Treat the availability of real metal at today's paper price a gift
and buy as much as you can.
To those who think that the Comex shorts will be
crushed one day and the price of paper Gold will do a moonshot, to them I
will say that you are dreaming. The Comex shorts will be crushed, but not in
their own casino! If and when a majority of paper Gold longs demand delivery
a force majure (who do you think the US Government will side with?) will be
declared with cash settlements and/or offers of equally worthless GLD shares
(don’t tell me you didn’t know about this). By some accounts, this is already
happening. What will happen to the paper price then? That’s right – it will
utterly collapse even as the physical’s price is rocketing. Paper gold
holders will dump it all to buy the physical – which, unfortunately – will
most likely not be available at all…in light of the sum total of the recent
developments mentioned in this update I think it is too risky to be trading
right now and one should just sit 100% in physical Gold and some currency for
day-to-day needs…Trading paper markets for paper gains is like picking up
pennies in front of the steamroller. It’s time to stop trading and just buy
the physical metal….
They don’t have nearly enough Gold to cover all the
contracts they’ve sold in the market. If you’ve bought one, stand for
delivery. I’m sure many will be offered cash premiums in place of Gold.
Refuse. Demand the metal. This is the right time to tighten the screws on
them while they are vulnerable having sold 400 tons of non-existent Gold in
the market. Getting out of the fake paper market and collapsing it will have
a threefold benefit:
1.Buying physical with cash preserves your anonymity and
safeguards your wealth in your hands away from the prying eyes of the looters
posing as “the government”.
2.Counterparty risk is eliminated as there is none. You’re
home free.
3.The fake paper market will collapse due to
non-availability of the physical and non-participation of the majority. The
sooner it happens, the sooner Gold will attain its true value and the emperor
will be naked for all to see. This fake money system needs to collapse so the
work of reallocation and rebuilding can begin. The cancerous tumor of
banksters needs to be eliminated from the economy.
Make no mistake, this is a war. A war for your freedom,
liberty and life. They have won the battle but they are not going to win
the war. It is upto you to make sure they don’t take you down with
them. Those buying gold are not in it for the short term pleasure of
paper profits but because they understand that it is the only way to
safeguard your wealth and a claim to a chair when the music of the paper
pyramid Ponzi finally stops.
To me, the only question is: Who Would I Trust With My
Wealth?
The best time to buy is when there is blood in the
streets. That time is NOW.
So don’t panic. Just buy the physical, sit back, relax and
enjoy the show!
_________________________________________________________________________________
[1] Some people may find this description of events to
be too “conspiratorial”, but rest assured, if anyone does the diligence, I’m
sure they won’t find things differently. This is how things are “done” in the
“markets” today.
