Eric Sprott Asks: Did I Lose $10 Million From the Barclays Gold Take-Down?

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Source: Nanex

In this EXCLUSIVE, MUST LISTEN interview with The Doc, Eric Sprott dissects the fundamentals in the gold and silver markets, coverage of manipulation finally reaching the mainstream, and reveals his updated outlook on gold & silver.
Eric discusses why the precious metals options markets always expire at MAX PAIN for the customers, and why he urges all PM investors to STAY OUT of the futures options markets, and simply accumulate physical metal.
Sprott explains how PM manipulation shifted from being conducted solely by the Central banks to the dealers active daily participation that we see now, and discusses how much he personally lost when a Barclays trader manipulated gold down into the London fix.  

Regarding his price outlook for the metals, with silver trading under $20 and gold trading near $1250, is Eric still looking for new highs in 2014?
His answer might shock you.

The Doc’s full Exclusive interview with Eric Sprott of Sprott Asset Management is below:


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Doc:

Eric, lets start off with your thoughts on the state of the physical markets in both gold and silver.
I know you have that dream of taking that very last physical bar of gold and silver off the market.
We’re not seeing retail shortages and delays like we did a year ago- yet we’re still at record investment demand levels.  Silver Maple sales for Q1 were 8.2 million ounces- 24% higher than the 2013 record.
The US Mint has sold over 22 million Silver Eagles over the first 5 months of the year- on pace for a new record, and a 97 to 1 ratio to Gold Eagle sales by the way.

First, what is your take on the current state of the gold and silver markets, and second, if we are already at record investment demand levels for silver with sentiment at rock bottom, what might demand and coin sales look like if the silver market experiences another parabolic rally like it saw in 2010-2011?

 

Eric:

Well, you know Doc, I spend alot of time looking at the physical markets.  I would reference back to an article I wrote in 2012 which asked:  Do Western Central Banks Have Any Gold Left? 

My analysis suggested that boy, these guys have got to be suppressing the price of gold, and they can’t have much left.   I think they were getting very close to being out of gold, and that’s why they had the raid in 2013, they took 900 tons of gold out of the various ETF’s in the world, which was of course consumed, and it shows the amount of physical consumption vs. supply.
Supply is something like only 2700 tons from the mines, maybe 1300 tons from recycling, we had the 900 tons from the ETFs, and it all got consumed.  Of course it all got consumed by the Eastern countries. 

There are various people (myself included) who suggest that Chinese demand is equivalent to all Western mining.  Between what they produce for themselves and import, both through Hong Kong and directly into China, it just looks like they are almost consuming all of global mining production!

Which begs the question- where is the gold coming from, and where is the silver coming from?
We’ve seen data from Switzerland now that shows where the imports come from, and they come from the UK, & the US.  The UK produces no gold, so whose gold is it that the UK is exporting to Switzerland?

The US is exporting WAY BEYOND what they produce- so where’s that gold coming from? 
Of course its always been my conclusion that the Western Central Banks continue to find gold somewhere. 
We’ve had various commentators stating they must be getting down to the bottom of the vaults because the bars are backdated back to the 60′s.
Whenever I look at demand, I think man, there’s more demand than there is supply, yes you can mess around with COMEX all you want until someday somebody asks for delivery, and they’re not going to get delivery.

I’m quite impressed by the demand for the metals on all fronts, and you can even include Platinum and Palladium in there!  All the metals really look like there is a shortage, it just hasn’t been able to manifest itself because of the control of the futures markets.

We’ve seen by the Barclays example what you can do in the futures markets. 
I might point out Doc, that one of the things I find interesting is that Palladium, which doesn’t have futures trading, is within about 3% of its all-time high.  
I think if it goes to a new high, it will tell you what a non-futures market can do, and should do. 
Both Platinum and Palladium are both screaming that there has to be a shortage.  Unfortunately in Platinum there is a futures market, and the commercials have gone massively short to keep things under control.   I’ve always speculated that some day there will be that failure.

So the demand seems to be there, the reasons to own gold get better by the day, there is no economic recovery. 
The former Chairman of the ECB said that we live in a fictional financial system.  That’s what we live in!
We live in a fictional financial system!  There is no recovery!  We spent trillions and trillions of dollars buying bonds- what did we get for it?   We got hardly anything for it!

The middle class is just getting ROUTED here because of the serious inflation that they have to face- whether its education, healthcare, food costs- everything is going up.  Its not 2%, we know that, and the wages don’t go up by even 2%.

We have a very great environment for gold to go higher, it has not been allowed to go higher. 
It has not been allowed to go higher because anyone in their right mind knows that printing money is vastly irresponsible, and the irresponsibility will show up in a higher gold price.

Meanwhile we have everyone saying, oh, the market’s going up, there’s no inflation, everything’s fine, and everyone is staying calm, but the day is coming when they won’t be staying calm because of all these forces that are at work today.

There are so many things going on today that are all gold positive, but gold isn’t allowed to rise….yet.
But it will.

Doc:

Eric, you touched on the Barclays trader who manipulated the price of gold into the London fix, the mainstream financial media bent over backwards asserting that this was a one-off event, and isolated to a single trader.
As you and I know, that certainly wasn’t the case, and it appears that after years of denials and scoffing, the story is slowly leaking into the mainstream.  The Financial Times reported Tuesday that “Trading to influence gold price fix was ‘routine’ in the industry.”

I want to read a bit of the Financial Times piece for our listeners Eric, and I quote:

 

While the Financial Conduct Authority says the case appears to be a one off – the work of a single trader – some market professionals have a different view. They claim the practice of nudging a tradeable benchmark in order to protect a “digital” derivatives contract – as a Barclays employee did – was routine in the industry.

“If I was at the FCA I would be looking at all banks trading digitals. This could be the tip of the iceberg – there’s a massive issue with exotic derivatives and barriers.”

 

This was in the Financial Times Eric! Not on Zerohedge or SilverDoctors!   Has the precious metals manipulation story finally achieved a critical mass where mainstream financial media can no longer ignore the story, but are finally forced to cover it?

 

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Eric:

We do have the class-action lawsuits, we have statements that were made by CFTC Commissioners who said it looked like something illegal was going on (although nothing did eventuate from it), we have the Barclays incident…

And that Barclays incident, it was one day, for one purpose.  There are 250 trading days in a year, and each one of those days there is purpose.  The longer I’m in these markets, the more I realize that the guys who buy options are basically set up to fail by the dealers, because they’re collecting the premiums.

There’s a theory in our business that the price of a thing that trades in the options market always expires at MAX PAIN.  Max Pain is where the customer loses the most money.  We could use that analogy with the Barclays situation.  What was the Max Pain for their customer?  It was to close it at $1350 – just to inflict max pain on their customer! 

It’s symptomatic with the whole business!  Whether its FOREX trading, LIBOR trading, precious metals trading, undoubtedly stock trading- we see the same thing in stocks where they tend to close where the futures options would cause max pain, and of course the dealer scoops all the premiums off! 

These markets are pretty big, and every expiry there’s probably billions of dollars on the table, so its a routine they just go through! 

God knows now big those digitals trades are in Europe!   What a wonderful thing!  You’re sitting there as a trader thinking me and my buddies can control this price, and we can all write these tickets, and basically scoop up all the money every options expiry .

There’s no doubt that its gone on for a long while.

There have been various parties who have manipulated the price of gold.  For sure the Central banks have been involved- and announced they’re selling, just to keep the price of gold down, and that may have ended in the early 2000′s. 

Then I think the dealers figured out- hold it now…we can do this too and skim the options!   We’ve got pretty deep pockets!
So I think it transferred over to the investment dealers.
I would hate to think of how many millions of dollars are on the table.  Just think of that Barclays trader.  I wonder, how much did I lose that day?  Did I lose $5 or $10 million that day for me and my clients? 

That was only one day and one moment in time!  You can set the tape up for technical failure or disappointment, they all know it, and they play it like a violin- all to the detriment of bona fide players in the markets. 
The high frequency traders and the algo traders run the markets.  Thats why participation in the markets keeps going down, thats why the investment dealers trading revenue is down 25%- who would want to trade?

I encourage people not to trade in options in precious metals, because then there’s no dry kindling for the commercial banks to light up!   If nobody bought the options and we just concentrated on the physical metals, I think we’d have a much easier opportunity!

Every time we buy an option, we pay that premium to the dealer,  well, he’s gonna try to steal it!  Typically most precious metals buyers are long calls- there’s way more calls than puts, so the pressure’s always on the downside.  I think it’s best just to stay out of that market.

Doc:
Eric, you came out earlier in the year and stated that you thought gold would see new all-time nominal highs in 2014- I think $2400 was the number you were looking for.
With gold currently trading around the $1250 level, thats nearly a double from current valuations.

I’ve reminded alot of people lately about your 2010 call that silver would reach $50 within 6 months, when it was trading at about $18 at the time.

Do you still believe we’ll see new nominal highs in gold in 2014, and if so, how do you see that happening?

 

Eric:
It’s a great question, and obviously we’ve lost some of our time window here, but there’s nothing in the physical data that distracts me from thinking that demand is way in excess of supply.

Going forward, the supply of gold is going down! 
We haven’t done the exploration, we’re not doing the development, it’s hard to finance projects.
The average mine has about a 10 year life, and if you’re not finding and developing new things, 10 years from now there would be no gold production on average!   Obviously some mines will expire in 2 or 3 years and some will be 20 years , but the average life of a mine is less than 10 years, so I can see going forward that supply is going to be diminishing, the Chinese influence in the gold market, if we bring India back into the gold market (which it looks like they will come back into the market, and I suggest that the Indians will be buying LOTS of gold) continuing interest in the broad market of people owning gold.

There was a shortage of 900 tons last year, we know that because it came out of the ETFs and it went somewhere,  so far it looks like we will have stead state in the ETFs this year- if we actually get some momentum going in gold, we could see it reverse by the end of the year.  Imagine if people bought 900 tons instead of selling 900 tons- that would be a 40% change in the supply/demand equation! 

I’m still very optimistic, and I’m so terribly disappointed that its taken this long, and that we have to go through these events like the May options expiration where they have to bang it down to $1240 so everyone loses their money, it just is as frustrating as can be. 
We’re in a very tough environment here, nothing seems to make alot of sense fundamentally.
Retailers are coming out with terrible numbers, yet the markets at an all-time high, its mind boggling.

But it comes down to that there are forces at work in the markets which shouldn’t be in markets.  And I’m referring to the Central Banks as a whole.  I’m absolutely convinced that they’re involved in the gold market, I’m so happy to hear that the gold is just pouring out of these countries- lots of people are speculating that there is very little gold left- the UK’s exports fell off a cliff, and they can’t keep exporting 100 tons a month, they don’t even produce an ounce of gold! 

I still firmly believe that we can get there (to new all-time highs), and that we can have some stunningly fast moves here- particularly of course if a physical default was ever announced. 

 

Doc:
Substantiating that theory that London and the bullion banks are running out of gold, on Monday Bloomberg reported that Ecuador had agreed to essentially lease over half of its entire gold reserves- 466,000 oz- to the Goldman boys for 3 years in exchange for liquidity.

I think we’d both agree its a fairly safe assumption that Ecuador won’t be seeing an ounce of that back in 3 years- its probably being unloaded from a plane in Shanghai or Hong Kong as we speak-
But I’d like to hear your take Eric on the implications as far as the state of the gold vaults in the Western banking system- is this the latest indication that they have reached the absolute bottom of the barrel in regards to gold?   Have they come knocking on your door yet for the PHYS gold?

 

 

Eric:
No.  Everything’s counter-intuitive in the gold market. 
For example, today: we had the employment data and it was weak.  Gold shoots up all of $2, and probably as I’m speaking its flat on the day. 
There’s nothing that ever seems to have a direct relationship because it’s not allowed to happen! 

Anything that should be gold positive news results in the price going down because they don’t want the relationship of gold to anything.  If the trade deficit rises, we can’t have gold going up because then people will link onto that every da*n month, or if employment data is weak- you don’t want the gold price going up because then if the next month is weak, people think gold should go higher.
These people try to control it. 

Its perverse, but most people can take some comfort in the fact that there’s weird, weird things going on in the financial markets- whether its that we’re supposedly tapering, but now all of a sudden Belgium is buying all these bonds.  My guess would be that the Fed has some swap lines with the ECB and they’re buying the bonds in Brussels, and they haven’t really decreased their QE at all, they’ve just found a different route and vehicle to do it, so they can say, oh look, we’re responsible, which of course they haven’t been semi-responsible. 

I’m very hopeful our day is coming, it’s very hard to predict what’s going to happen, but I still think it has an excellent chance of doing well this year. 

 

Doc:
It’s amazing that the mainstream takes the news of Belgium suddenly buying T-bonds at face value.

 

Eric:
There is no Mainstream News-Mainstream Reports What The Guys Running the System Want Them to Write, Thats Why Sites Like Yours & ZeroHedge That Analyze The Numbers Are So Interesting- I’ve always told people that I’ll be interested in the stock market again when they stop using the expression “beat expectations”.   Just tell me what the numbers were!  Were they up or down?

 

Doc:
Before we let you go Eric, I know you’re excited about the Sprott Natural Resource Symposium in Vancouver British Columbia in July.  Its going to be an excellent opportunity for investors to learn from some of the top minds in the natural resource sector- and what better time to acquire quality resource companies than after the brutal multi-year correction gold and silver have endured?   Many of the smaller and mid-cap gold and silver miners are currently at valuations comparable to the beginning of the secular bull market!
The line-up looks like a cornicopia of experts in the energy and resource field.  Tell our listeners a little more about what they can expect from the Sprott Natural Resource Symposium Eric.

 

Eric:
Stocks are cheap, the price of gold is low, we have a very good line-up, I would encourage people to attend, it should be a fun show with lots of excellent speakers.

 

Doc:
For all our listeners interested in finding out more or signing up we’ll have a link included in the write up of our interview.

SPROTT VANCOUVER NATURAL RESOURCE SYMPOSIUM 2014

Eric, it was great to have you back on the show.

Eric:
Ok Doc, my pleasure, and keep up the great work.  I love going to your site.  All the best!

SPROTT VANCOUVER NATURAL RESOURCE SYMPOSIUM 2014

 

Comments

  1.      ”Where is the Gold coming from?” yes indeed. I have two guesses.  One, the PRC and the Western banking system are in collusion with the scam.  They’re shuttling Gold back and forth in order to keep up an appearance of regular market activity.  Why would they do this? Well to support their own currencies and keep the sheep in their own countries down.  Nobody can sell their bonds these days anyway right?  Two, nobody knows just how much Gold the West has plundered and and how much is available for sale.  There’s no law that says sovereign nations have to reveal how much Gold that they actually own. 
         If I was trading options I wouldn’t place a stop loss order.  I would pay the margin call after expiry and try to add to my position.  Can you place a stop loss order at the roulette wheel? Why would you do that at the comex then?   Double down.
         When the bull run resumes I’ll be listening for news that some mines are reopening for my own personal sell signal. 
         Stackers unite!
     

    • I don’t think the bull run is too far away now, can the Dow go much higher? I believe it is tanking, which means broker depression will kick in … COMEX is strained, and India is coming back online, so we’re definitely at the bottom in PM’s IMO, any knockdowns will be reinforced with enough buyers that aren’t going away. The manipulators themselves are wearing down their own ability to stuff with the ‘market’.
       
      I do believe however that TPTB are planning an international incident perhaps in October this year, where they may be able to stop physical deliveries of PM’s on the international market … I don’t know what it will be, but I can feel it in my bones. They won’t allow their systems to crash without blaming it on someone/something else. Super Criminals always divert attention away from their crimes, and we are dealing with SuperCrim Corp LTD (100% Insured by Tax Payers).

    • “One, the PRC and the Western banking system are in collusion with the scam.  They’re shuttling Gold back and forth in order to keep up an appearance of regular market activity.  Why would they do this? Well to support their own currencies and keep the sheep in their own countries down.”
       
      SPOT ON ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
      You have written what I have been thinking.
      The scam has been going on for far too long for this NOT to be happening.
      I wonder what Eric thinks of this.
      Hey Doc can you run this by Eric & get back to us with his thoughts??????????

    • That works… except for the part where the Chinese Gov is encouraging their citizens… er, subjects… to accumulate as much gold as they can afford.  Once they do that, all 1.4 billion of them, then there will be a LOT of gold suddenly unavailable for shuttling.  That does not support your thesis.  What goes on in the West, however, supports it to a “T”.  Ergo, it is the West that is screwing with the gold market in order to support their fiat currencies while China and Russia suck up all the gold they can.  This does not look like collusion to me.  It looks more like a game of VERY high stakes poker.
       

    • China plans 50 to 100 years ahead, they are not cooperating with western banks in any way. To do so would stop the downfall of the USA and that is something they WANT badly. We crash they move in and buy up assets for pennies on the dollar.

    • whoa thanks for taking the time to consider my post and reply back there folks.  @MaryB the Chinese have 4 trillion in reserves most of it denominated in dollars.  They had to be cooperating with the western banks at some point in time to accumulate that much in foreign reserves.  @EdB just where is the Gold coming from then?  Just take a stab at it.  @Da yooper…fist bump man. @WillNotBeASlave I don’t think that the next leg up is far away either.  10 years tops.   Sorry it took so long to get back to you all.  I was getting carried away at other websites.  For some reason I feel compelled to try and be a gentleman here.  At other sites it’s more like an open squad bay or army barracks with everybody cussing and swearing.  I like that.  Don’t get met wrong the atmosphere is just right for the subject matter presented here. Like I said I’ve been running my mouth elsewhere all day.  

    • @Andrew James
       
      “just where is the Gold coming from then?”
       
      From the gold reserves stolen from various nations ala the NY Fed and the ground, would be my guess.  Remember, the total world gold reserve is supposed to be valued at about $9T.  That’s a LOT of gold.  Also remember that when WW-II ended, the US gold hoard was reputed to have been about 28,000 tons.  Today, it is reputed to be about 8,100 tons.  If these numbers are true, then what happened to the other approximately 20,000 tons?  I am unconvinced that the US still has 8,000 tons of gold in its national hoard.  The rumors about Clinton and Rubin stealing it and selling it are not out of the realm of possibility.
       

  2. Excerpt: “The former Chairman of the ECB said that we live in a fictional financial system.  That’s what we live in! We live in a fictional financial system!  There is no recovery!”

    I couldn’t agree more than 17 trillion percent.

    • Exactly.
      I would still rather hold my own Phyzz than expect Sprott’s investors won’t scuttle their ship too early after being warn down by the parasite banking scum.
      I can literally sit on my hedge fund, and if I can’t protect it then I only have one person to blame … myself.
       

  3. Silver vs Palladium
    “I might point out Doc, that one of the things I find interesting is that Palladium, which doesn’t have futures trading, is within about 3% of its all-time high.”   
    -Eric Sprott
     
     

    • Great point!
      Maybe something to do with a potential Russian war upsetting global supply and making Western Industrialists hoard at the moment?? apparently a very large QTY of Palladium supply comes from Russia. The end of 2012 was when the problems in Ukraine started to start up, but it seems to be too many months prior to heavy developments for it to be organic market reaction.
      A very good point and worth investigating further.

    • I haven’t listened to the interview yet, was the palladium quote from this interview?  Because there are palladium futures.

    • Yes it was from the interview but maybe something has been lost in translation. I commented on this too further down. A quick google search prompted by your doubt mikeyj80 shows that yes there are palladium futures…….CME group showed first too. Palladium is doing very well then. I wonder what Eric Sprott is talking about?

  4. @The-Doc  @The-Admiral    Doc…Always great to hear from Eric Sprott and I really liked having a written transcript, too.
     
    What I wanted to talk about is Ecuador.  I’m fascinated how short everyone’s memory is.  No one, and I’ve heard other recent interviews with Alisdair MacLeod, Jim Willie, Max Kaiser, now Eric Sprott and yourself, has connected the dots on Ecuador.
     
    Recall back in 2012 Ecuador demanded repatriation of her sovereign gold.  I’ve previously posted on SD about this.  
     
    http://www.zerohedge.com/news/2012-10-31/it-begins-ecuador-demands-repatriation-one-third-its-gold-holdings
     
    Ecuador’s recent “liquidity” deal with Goldman Sachs is nothing more than a cash settlement, a failure to deliver, a Force majeure.  Ecuador never did get her gold back in 2012.  Ecuador had entrusted the NYFed and London to hold her sovereign gold in safekeeping.  It’s gone, stolen.  And Ecuador knows it.  This deal with Goldman is nothing more than a cash settlement with a NYFed “pinky promise” to return the gold in three years.  It’s a message to other countries that your sovereign gold account with the NYFed will only be settled in cash.
     
     

    • UglyDog … “Ecuador’s recent “liquidity” deal with Goldman Sachs is nothing more than a cash settlement, a failure to deliver”
       
      Hey, UD, that’s a fascinating take! Given the development of overall conditions in the past couple years, I think it’s too plausible for mere ‘speculation’.

    • Agreed.  But can we soon discover that Ecuadorian special forces operatives are hunting NY banksters and… finishing them off… one by one.  Now, wouldn’t THAT be a twist on the blatant gold manipulation scams?  ;-)
       
       

  5. Took me a while to figure out something so simple i can not believe it took me so long to figure it out. Central banks are stopping the storage of wealth in commodities. They are trying to increase the fluidity of money, to get banks to put money out in the markets. Precious metals to them is like putting money in a block of ice. I always thought it was to kill off competing currencies, but on further reflection, its about increasing liquidity, into a dead market. 

    • They are trying to increase the fluidity of money, to get banks to put money out in the markets.
       
      I sold one of my homes recently & the bank that the buyer used did it’s best to stop the deal. It made the buyer’s life & the real estate agents life a living hell to the point they didnt know if we would be closing on the date & time they gave out until an hour before we closed
      IMO the banks are dragging their feet as far as home mortgages are concerned  

    • Maybe this is part of their logic but I think it would be rather flawed. Cash and other assets would also be viewed as dead too and obviously they are making it less desirable to hold cash but forcing the current pricing of metals lower merely locks down the value held in those metals even longer because no one in their right mind would sell at these prices unless forced to. If values had been maintained or increased more people would be in and out of these assets and in the case of cash higher interest payments would probably lead to increased spending to a degree. If I had had a reasonable gain or even had my metal assets stay around their purcahse value I might be in the market for a new car right now but theres no way I’m selling those now so that is £20K I wont be contributing to any car dealers yet. I think the current approach is precisely what is causing the low money velocity.

    • IMO the banks are dragging their feet as far as home mortgages are concerned”
       
      Of course they are.  What’s that saying?  One burned, twice shy?  Something like that.  This is nothing more than banking pendulum swinging too far into tough loans after having already swung too far into easy loans and the banks getting financially burned over it.  Of course, the Clinton regime was in that up to their eye-balls and were the primary cause of the mortgage market collapse.  They forced the banks to either make loans to people whom the banks KNEW could not repay them, or be pursued by the US Just Us Dept. for racial profiling and other nonsensical charges with very serious ramifications.  That was done in the name of “racial equality”.  Race had jack all to do with their housing situation and everyone knew it.  It mainly had to do with their relatively low income, their lack of a substantial down payment, and them not having a good credit rating.  Yet, the politicians insisted that this was needed for “social justice”.  This was a banking catastrophe and it was 100% created by politicians making economic decisions for political reasons.  
       
      Note to ALL politicians:  THIS DOES NOT WORK.  Furthermore, it has never worked and it will never work.  SO GIVE UP ON IT, ALREADY!
       

  6. WillNotBeASlave
    We are deeply embedded in what I the paradigm of DIVERSION PORN
    We used to see something outrageous about once a month, then it was once a week, then it was once a day.
    Not we are being beaten around the head and shoulders with this every hour or two.  
    Bergdahl?  Diversion Porn
    Malaysian Flight 370?   Diversion Porn
    Benghazi?  Diversion Porn.
     
    Frankly I kind of getting used to it in that it does not fill me with a sense of outrage; just a seething, slow boil sense of anger and complete willingness to do what it takes to kill it.
      DIVERSION PORN can only be effective today to the degree that it creates a new level of outrage.
    People like us who study this are almost like scientists or, better yet, protologists.
     If you’ve seen one, you’ve seen them all.  
    It will be best of us, the students of Continual Outrage Syndrome, COS for short, who will  be able to see the real deal when it looms large in front of us.
     It will be noticed as it grows.  
    We may not be able to predict the hour of its arrival but knowing its signs beats the heck out of seeing it clearly in the rear view mirror.  
    If that happens you’ll be likely to end up like a crash test dummy from the Columbia School of Protology.
    Keep your peppers open.
     
     

    • What it is going to take is going to be a large loss of lives to toss out the bankers and DC rot.

    • @AGXIIK Diversion Porn indeed, it is everywhere … just like the Property Porn, house renovation TV and equity loan pushers to keep the property bubble as inflated as possible so the NY Banks can package it up and sell it to the Fed etc…
      Anything but the Truth! The Truth surely has become a revolutionary concept.

    • @AGXIIK
       
      “Keep your peppers open.”
       
      Will do.  I HATE closed peppers!  ;-)

  7. Da Yooper   you are completely correct in your assess  Part of the problem is the overreaction of the banks and theri regulators to prevent another Subprime melt down, something that nearly destroyed the US and international Finance system.  The slave state feudalistic bankster empire does not want to loan money to the filthy little people who are still striving and stuggling to buy a home.  They are serfs, peasants and zeks to the banker overlords.   All these bankster classes want is a rentier class with no sovereign territory to call their own, be it ever so humble a home
    They want to play the market with ther govfunds, reaping trillions of income via fraud and paper deceits.
    The poor schmucks in the trenches, trying to approve a home loan, or a business loan for that matter, have not yet come to the conclusion that their bosses are their worst enemy, preventing them from making enough loans and income to justify their  jobs.  I heard that something on the order of 250,000 loan agents are now working at McD or Starbucks after theri jobs were slashed

    • Thank you brother AGXIIK as always your assessment has hit the nail on the head.
      The banks are holding the economy back – we need to bring back Dodd-Frank & take alot of abused power away from them.
       

    • We still have Dodd-Frank and it is one of the biggest steaming piles of legislative crap ever created.  It needs to be repealed ASAP, as it is virtually unworkable.  What we REALLY need is to revive Glass-Steagall so that savings and investment banking are separated and banks can no longer play in the Wall Street casino with depositor money.
       

  8. I found what Mr Sprott had to say about there being no futures market in palladium very interesting too. I know others have picked up on it. I wasn’t aware of this. We live and learn. The last time I bought some silver on 
    Goldmoney I had some change and bought 1 gram of palladium for novelty value. On 24th Feb 2014 I paid £14.93
    including the buy fees of 5.52% for 1 gram of palladium. I can today sell that 1 gram for £16.07. The Palladium 
    graph has done since the fall from the spike highs in September 2011 exactly what we might have expected gold and 
    silver to do in a less manipulated environment. I wish my gold and silver were performing similarly. I suppose 
    that if palladium is less manipulated perhaps it is closer to a correct value and has less upside potential but even 
    so I will probably be putting some more fiat toward palladium if it is not subject to the same futures market corruption. 

    • There are no absolutes, and you are paying me nothing for the advice, so that may be what it is worth.
       
      Would you rather buy something that is within three percent of it’s all time high hoping the moonshot is right around the corner, or would you rather buy something that is down 60% from it’s all time and recent highs?
       
      All things being equal, which they never are, i would choose the latter.

  9. Well I need to buy a few oz’s today as Brother Sprott has confirmed my positive outlook on PM’s. As for Ecuador that payoff is the beginning, Germany or Austria next? I don’t think that will happen as it will upset the applecart in Europe and the Americas allies. And Then There Was None  It’s gonna get scary when we have every country breathing down our necks. Keep Stacking

  10. If I had practiced what I preach, gotten some palladium for opportunistic PM swaps, I would be many silver ounce UP right now, even if I had bought just one ounce of Palladium. What kept me back is the absent numi market in palladium, and the high VAT on it in Europe. None of that would have mattered with this humongous divergence.
    I cannot comment on futures trading or not. But Palladium seems to be responding to actual cost and supply/demand. And perhaps those with insight are not even dreaming to corner this iny tiny market, as it would be stepping on the wrong toes. Eric Sprott has mentioned such a thing even for silver. He does prefer to live over the alternat-ive.
    It would seem silly now to get into Palladium, but is its rise unfounded? Is silver or gold about to shoot up, for real? Is the palladium-silver ratio as high as it’ll ever be? No way to tell for sure. 
    I am pondering palladium, still. Silver has so many more things going for it the way I go about my PM, especially near-term, price unrelated. But having a swapping portfolio with gold and palladium/platinum in there does seem to make sense. Sinde The P’s don’t have a real numi market where premiums predictably rise, it would need to be a dedicated swapping portion of the PM portfolio. In with low grade junk silver and gold. Keep track of purchase moments and ratios. Spot trading opportunities to get ahead.
    Today a swapping portfolio (on top of a silver-heavy typical stacker/flipper’s portfolio) could be for :
    45X ounces of silver
    1X ounce of Palladium
    6X 1/10 oz gold.

    Similar fiat figures. Scale to taste
    If Silver tanks relative to gold only, sell gold to get silver.
    If palladium rises against silver mostly, sell palladium to get silver
    etc.
    Having swap coins/bars that have low buy/sell spread helps of course.

    I am (against my own preeching) a 100% silver man. I do regret that. I could and could have toned done the low-premium silver (junk epsecially) and gotten palladium. When in 2011 GSR bottomed at 32, I was not buying anything. Probably too broke at the time also, and brokeN by what the 2011 margin hikes did to my silver longs…
    Anyway, next time GSR fall under 40, I will be paying attention, and wondering what to do. Probably the best opportunity in my stacking career to own some gold, and not give up as much silver purchase power. But after GSR=40, we could see 32 again. And in more open markets, 20. I got into silver anticipating (hoping) this to eventually happen. As long as the GSR is not fixed globally, I have some hope. But 40 would be a nice win when I am buying mostly >60. And into semi-numis which help me leverage the gold. Or palladium for that matter. If some freak incident takes palladium down and nothing else, and fundamentals seem untouched, it will be time to swap some serious silver for palladium. Right now, Palladium look like a normal market. If something abnormal makes it affordable, it will be more of a buy than silver is now.
    But what do I know, I didn’t buy palladium when I told other to.
    There are nice choices. Cook Islands, Russian Ballerina, even the Maple. And a few bars with COA.

    • “But what do I know, I didn’t buy palladium when I told other to.”
       
      There IS something to be said for eating one’s own cooking and this is a great example.  Thanks for sharing this.  Many of us have done something similar, so you are not alone in this.  This is called, regret.
       

  11. It is not easy for us to devise strategies other than to stack and wait because we don’t have the info or firepower that the manipulating banks and hedge funds do. If you know that moves are going to be forced and when, then really, this is childs play. Hardly surprising that their hands probably won’t be prised from the metals throat until they are cold and dead because they can make it a money spinner whichever way it’s going with the use of a futures market. It is pure corruption and manipulation and now applies in so many other markets too. Our financial markets are such a sick joke and yet it all just goes on and on. That said gold, silver, platinum and palladium and other commodities also have huge impacts on our world through the pollution their production causes. We cannot ignore that fact.
    For anyone in the UK with access to BBC iplayer there is a programme on there called “I bought a rainforest”. In episide 2 and the second 30 minutes of the programme there is a long section on a very small scale peruvian gold mine. It is an interesting watch. At the end of a days production and after slopping around with mercury they produce 6.5grams of gold worth, they say in the programme, about £175.00. I haven’t done the maths. Makes one glad I can still earn a living doing what I do. The link is here:
    http://www.bbc.co.uk/iplayer/episode/b046td9n/i-bought-a-rainforest-episode-2

    Episode 1 of this programme is also available on youtube in its entirety and so as episode 2 has only just been broadcast it should be available there too soon. There is a trailer for episode 2 on youtube.

  12. @The-Doc
    ++1 to UglyDog
    Thank you @UglyDog, that what I was thinking myself listening to this interview and in fact the same with doctor Willy’s interview; too late to respond last night.
    For some reason this news is taken at its face value regardless it came originally from Bloomberg.
    Ecuador asked for their gold in 2012 and didn’t get it, instead they were cash settled. I guess this was the only option they had knowing that even Germany can’t get their gold.
    Ecuador takes active stand against USA policies. This was clear demonstrated in Julian Assange and Snowden’s case. It is very unlikely they would go to bed with Vampire Squid. If they need liquidity they have other options namely Chine which has huge presence in Ecuador.  
     

    • @The-Doc … I can’t believe how many gurus have also not pointed out what @UglyDog is saying. I had to kick myself also when he mentioned it earlier because it is so obvious. MSM Sources about the Goldman deal never state where the Physical Gold in question is currently located (New York) … they make it sound like Ecuador is sending a new physical load to New York which is surely not the case.
       
      It’s interesting, because as Ecuador seems to have caved in, Venezuela (the other demanding country) has refused such a deal and is still (years later) requesting the Physical Gold to be delivered … and the MSM don’t even touch this story. New York REFUSING to pay a Sovereign their own Reserves/property??? You would think it would be bigger than MF Global, but the MSM won’t cover it. Venezuela funnily enough was offered the same deal Ecuador has been offered for high yield Bonds, from none other than Goldman Sachs!!! And they kept/keep refusing, they want their property instead and don’t want to be just another ‘Muppet’; good on them! Some Socialists have brains it seems.
       
      It seems Goldman Sachs is doing financial diplomacy for Washington/New York now. Wherever some Jackal work is required, they send in a Goldman Sachs bonds salesman, and if that doesn’t work they send in the hit-men, just as John Perkins revealed as the US’s MO.
       
      Also Venezuela has an Orange Revolution like disturbance going on currently and its currency is being attacked (wonder who that could be?). It is a shame so many gurus have missed this action with Ecuador and Venezuela, and I am seriously surprised that Jim Willie was not all over it like honey on a bear’s mitten, but even Jim has simply called Ecuador ‘stupid’ for ‘accepting’ the Goldman deal.

  13. I couldn’t Stop Laughing. Lol Keep Stacking
     

  14. I might point out Doc, that one of the things I find interesting is that Palladium, which doesn’t have futures trading, is within about 3% of its all-time high.   
    I think if it goes to a new high, it will tell you what a non-futures market can do, and should do.  

    Good gracious, this guy is supposed to be an expert and claims there is no palladium futures market? Please tell me that was taken out of context???

    If not, you guys owe it to yourselves to ask him what in gods green earth he meant.

    @flying-wombat
    @the-doc

    • Proverbs1616
       
      They’re hardly “catching on’ when they characterize the ‘fixing’ mechanisms of either London or New York as “archaic”. Both are ‘modern’ novelties only introduced in the past hundred years as accommodations in response to the credit-’money’ banknote scheme.

      Better to restore the most ‘archaic’ method of evaluating bullion worth, by sampling the day’s average trading ratios between the actual metals as they’d physically exchanged.
       

    • @PatFields
      Good gracious. A market based mechanism where there is an even playing field for all buyers and sellers? that’s terrorist talk, and seriously un-British. Gentleman’s agreements wouldn’t be possible in a room where even the gutter scum common man could buy and sell with a Rothschild … good gracious!
       
      How would TBTF futures and derivatives be profitable for the issuers if they had no ‘benchmark’ to screw with? If TBTF was not profitable, the City of London would cease to exist and the UK Govt would lose at least half of its revenue. You’ll end up on a Hit List of some sort right under the leaders of BaFin if you keep up that talk.

    • WillNotBeASlave … “You’ll end up on a Hit List of some sort right under the leaders of BaFin if you keep up that talk.”
       
      LOL … I’ve been ‘on the list’ so long now, the ‘keepers’ of it are probably bored seeing data-points added each day.

      I used to publish ‘Broadsides’ of these sorts of commentary and read them to tourists at the historic sites in ‘Old City’ … hand-bell and all. From time to time the ‘Yogi-Bears’ would ask for a copy to ‘put in the record’ … which I was pleased to oblige. I’ve NEVER done anything in secret. I’m not timid about living in the open.
       

    • @PatFields
      I can so see you ringing a bell, that’s such a great idea … hiding as a tourist prop whilst telling the truth. I bet you the people just thought it was nice quaint theater and didn’t consume what the meaning and relevance was.
      As for your file being too big at the NSA, the frequenters of this site probably had to have a whole new wing of data storage built in Maryland to keep up with us. I’m surprised I haven’t already been knocked off so they can free up some data storage, LOL!

    • WillNotBeASlave … “I bet you the people just thought it was nice quaint theater and didn’t consume what the meaning and relevance was.”
       
      Of course, that was their initial presumption … but they DID listen. Some huffed away in visible disturbance, though most stayed and cheered at the end. That’s what kept me at it. I’d be doing it still, except that I’ve pretty well lost my voice. A pity that. It was quite enjoyable.

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