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Heading up to the mines at Silverton
https://railpictures.net/photo/713023/
Buygold @ 13:39 Gold Price Discovery
India imports about 800 tons of gold each year. Most of it is fabricated into 22 karat jewelry. The jewelers must have this gold to satisfy demand and the cost of the finished product is mainly dependent upon the cost of the imported gold stock.
Ok…now say that the Comex price is $1480 per ounce but these jewelers can only obtain the actual physical at a much higher price, say $1530. What do you think would happen? Well the arbitrage boys would be all over it…free money for them! Buy Comex Futures, demand delivery @ $1480 and sell to India @ $1530. If Comex refuses to honor these contracts then they have defaulted via settling in cash @ $1480. Though legal this would be a MAJOR news item and probably cause a run on all Gold supplies including retail dealers and worldwide central bank mints. So, the Fed would have to give Comex an emergency physical supply to prevent a panic disaster in the gold market.
Could be done on an emergency basis but, you can only go to that well so many times before the well itself runs dry. Therefor Comex would be put on notice to not let this happen again and heads would roll with probable criminal indictments.
Bells are ringing..Thus, I was totally not surprised to see this cover story for Barron’s this week:
From the Slope of Hope:—BULLISH BARRONS–Helpfully, Barron’s gets very specific uncovering little-known equity opportunities (like Google………….no, seriously) for the year ahead.
Grass is green. The Pope is Catholic. Clouds float in the sky. And Barron’s is bullish.
Indeed, I can’t remember any time when Barron’s has called for a market reversal. It’s normally chugging along as a classic shill for Wall Street, bested only by the less-esteemed Investor’s Business Daily, which is sort of the Highlights magazine for the investment world.
Grass is green. The Pope is Catholic. Clouds float in the sky. And Barron’s is bullish.
Indeed, I can’t remember any time when Barron’s has called for a market reversal. It’s normally chugging along as a classic shill for Wall Street, bested only by the less-esteemed Investor’s Business Daily, which is sort of the Highlights magazine for the investment world.
The unannounced meeting between the Fed and Trump was a briefing on the Repo Crisis BECAUSEthe real crisis cannot be discussed publicly.
The unannounced meeting between the Fed and Trump was a briefing on the Repo Crisis BECAUSEthe real crisis cannot be discussed publicly.
I have not been getting much sleep lately. This is a very serious crisis and all the BS on TV of these pretend analysts giving their two cents is really amazing. They are making up stuff and speculating because they have no idea how the global economy truly functions and they do not advise institutions. They do not understand the risks for year-end and calling this QE proves they do not understand what is taking place.
There are too many people trying to sound authoritative when they are clueless. Yet they seem to have to say something to pretend they know what is going on when all they are doing is creating confusion. We have more institutional clients around the globe on every side than anyone would imagine. We are in the front row with real live clients in the middle of this issue.
I appreciate the severity of this crisis. Requests to attend board meetings I have only been available by phone. I simply cannot fly all over the place. I really wish I could just come out and spill the beans, but this situation is too critical at this point and I fear that if someone does not blink here, we are headed into a global political contagion.
This is why a deal had to be tentatively arranged with China on trade. There are politicians out of the loop and this whole thing which is way too far above their heads to even grasp an understanding.
Stand and deliver
Quietly, Comex physical gold delivery notices (20 week MA) ~+65%, shattering kept records. This in past 4weeks alone. Of interest, this coincides with a minor drain of GLD (piggybank) tonnage. Physical supplies running low at current prices. pic.twitter.com/SfFgw8nRRH
— DC (@dimit) December 13, 2019
Buygold–I dunno what all the fuss is about–in september rates shot up t0 10%
and there were a lot of breathless doom articles generated in ZH and other places…but stocks and bonds just kept on truckin
Everyone knows by this time that the U.S. financial mkts are on a permanent plateau of prosperity…the FED/CBs just have to click a few key strokes of “money” into existence and all problems are resolved…there is a black swan out there…a market top…and a bear market…but they won’t appear because of just repos…[what everybody knows and sees isn’t woth knowing]…but some gestalt** of issues will just materialize one day and the bear will start…
**
: something that is made of many parts and yet is somehow more than or different from the combination of its parts
FYI
there’s a slug of 60-75 year olds right now that finally put a few shekels together after the 1987, 1998, and 2008 crashes and haven’t got time to start over again after the next one. Ta-da…cash and PMs …and Bobs your Uncle.
@Richie re Shortage Of Actual Cash.
Re part: “idea to convert a huge chunk of your savings into actual cash and park it somewhere safe bcuz when the giant run starts- it will be too late.
Comment: My thoughts at first, the US Treasury can simply print hundreds of pallets of fresh new currency. But who would need it? Or want it? If the Treasury CAN’T physically print that much physical cash? Then the physical currency would have to gain value, everything getting cheaper, deflation, no?
I think a true “run on the banks” would be massive buying of physical gold, like what happened thru the 1970s with mostly Silver.
R640 – Some interesting and gold positive articles on ZH
is that a good thing?
Even one of the big banks almost, but not quite have a clue.
Quantum Leap For ABN AMRO As It Questions Gold Price Discovery
you haven’t seen shit until you see millions of people trying to cash out and run at once. Panic early- panic best.
Hundreds Of Billions In Gold And Cash Are Quietly Disappearing–Something strange is going on: at the same time that central banks are injecting $100 billion each month in electronic money to crush volatility and ramp markets, a similar amount in hard physical currency and precious metals is literally disappearing.
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Years ago, I read that all of the currency stock in the U.S. was 1.7 trillion.
In addition to all of the make believe trillions in the stock market- much of which is liquid…and bank deposits…
All of the real estate holdings in the U.S. are now somewhere over 32 trillion. If 1/4 of those people sold, at ridiculously inflated prices over the last 10 years, and demanded cash…
The point I am making is this. They simply do not have enough actual dollars to pay all of these future demands and certainly not at once. It is not a nutty idea to convert a huge chunk of your savings into actual cash and park it somewhere safe bcuz when the giant run starts- it will be too late. That is already happening- obviously.
Can you say, “bank holiday?”
Inflation??? Fuck you haven’t seen shit until you see millions of people trying to cash out and run at once. Panic early- panic best.
Maya @ 23:52
There’s only one problem with this observation — apparently it doesn’t matter because prices are still controlled by the machines, banker cabal, and idiot speculators / hedgers.
Look at this past week, Powell announces a $500 billion ‘root in the rear’ for the markets and PM’s yawn because the (PM) speculators reacted by buying even more calls on GLD, SLV, GDX, etc — dropping the open interest put / call ratios. No short squeeze possible here. And markets generally only go up these days due to squeezing — just look at the broads and most shorted shares (which are generally shorted because they are crap from a fundamental perspective) — creating the up is down shit show we call markets these days.
This is the rig not many see and is the single most important element for the larger rig to be maintained. If idiot speculators stop buying calls on PM / puts on stocks — the bureaucracy’s price managers will have a big problem on their hands. They will be forced to stay ahead of the ‘collapse curve’ even more than they are currently — forcing a ‘do or die’ hyperinflation / crack up boom right when they’ve got the supplies of most commodities at low points. The ags and oil are key here going into next year. With the fracking bubble bursting in the US, and if the solar low persists moving forward (it will), both oil and the ags are set to surge right when the price managing assholes down at the bank will be most vulnerable — setting the stage for a major shift in confidence.
Or is that just wishful thinking — I love the smell of napalm in the morning. Apparently the reality of the situation was enough to drag GS out of their hole.
We will see.
Cheers
The last time this happened the Chinese stock mkt did a moonshot as billions were injected by the government–different this time?
China’s “Moment Of Reckoning” Arrives: $38BN State-Owned Giant Announces Largest Dollar Bond Default In Two Decades
ETF’s on Jr. Miners
More fuel to support Mr. Copper’s views , from Saville’s Weekly TSI . Explains a lot !
“The lack of demand for junior mining stocks
It has become very difficult, bordering on impossible, to get exposure to the junior end of the gold sector via ETFs. The reason is that over the past few years the ETFs that are supposedly focused on junior gold and silver stocks have adjusted their holdings such that they now offer almost no exposure to actual juniors. For example, all of the top 10 holdings of the VanEck Junior Gold Miners ETF are now mid-tier and senior gold producers. Actually, that’s not entirely true, because this ETF’s largest holding is SBGL, a major producer of PGMs (Platinum Group Metals). For another example, 9 of the top 10 holdings of GOEX, which according to its name (the Global X Gold EXPLORERS ETF) is an ETF focused on exploration-stage gold miners, are mid-tier gold producers. Actual juniors were eliminated from ETFs for liquidity reasons. Specifically, the managers of the funds wanted to ensure that they could easily trade in and out of the components of their funds in response to monetary in-flows and out-flows. They achieved this objective by replacing relatively illiquid juniors with relatively liquid mid-tiers and seniors. Therefore, when investors now buy ETFs in an effort to gain exposure to the junior end of the gold sector, in most cases they actually are gaining exposure to the stocks of mid-tier and large producers. In fact, there is now very little difference between owning GDXJ and owning GDX. This, we think, is an important part of the explanation for why the average junior gold mining stock fared relatively poorly over the past few years and especially over the past 12 months. The investment demand that would have been channeled into the juniors has been diverted by misleadingly-named ETFs into the stocks of larger mining companies. Unfortunately, there is no reason to expect the situation to change anytime soon, because the overarching trend is towards more passive investing via ETFs that track indices and away from active, value-focused speculating and investing. That’s part of why we have changed our stock selection approach. “
