Record High Demand For Physical Gold Threatens To Break The Back Of The Paper Gold Market

The demand for physical gold is exploding all over the world, and bullion banks are now experiencing a supply crunch that is absolutely unprecedented. 
As physical demand continues to rise, the massive Ponzi scheme that the bullion banks have been engaged in is going to become increasingly obvious, and at some point the lack of physical gold is going to break the back of the paper gold market and we are going to see the price of gold go to levels that we have never seen before.
You see, the truth is that the central banks of the world and the bullion banks have made “paper promises” that vastly exceed the amount of actual physical gold in existence.  This kind of scheme works fine if everyone does not come asking for their gold at the same time.
Unfortunately for the ones running this scheme, people are now starting to ask for their gold back and it is causing huge problems.

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From End of the American Dream:

It started earlier this year when Germany asked for 300 metric tons of their gold which was supposedly being held at the New York Fed.  If the New York Fed really did have as much physical gold as they claim that they do, that request should have been no problem.  Instead, the Germans were told that it would take seven years to fulfill the request.

At that point, alarm bells started to go off in financial circles all over the planet.  People all over the globe began asking for their gold back, and now this is causing serious stress for the bullion banks.  The following is what Hong Kong hedge fund manager William Kaye told King World News the other day…

There are serious strains in the (gold) system. I’ve never witnessed such a serious strain in my lifetime in terms of the backwardation of gold, and in terms of the lease rates being negative for such an extended period of time. This suggests that there are two forces at work: One is that there are serious strains in the system — that the bullion banks are struggling to come up with the physical gold for spot delivery that the market demands.

Right now the bullion banks are experiencing unprecedented difficulties coming up with the physical gold and physical silver that they are supposed to have.  Evidence of this supply squeeze is starting to pop up all over the place.  Some of this evidence was summarized in a recent article by Jim Willie

It’s so ugly that in the silver market, JPMorgan has not yet satisfied and delivered on the June silver futures contracts!  It’s so ugly that using hidden entities that Andrew Maguire has detected in London, JPM is using hidden entities to hog 90% of the July silver deliveries!   It appears that JPM doesn’t have the silver to meet June delivery, and is trying to replenish their own vaults by taking delivery in London, secretly, to replenish their inventory!   Where are they getting it from?  Maybe the SLV!

The JPM clients have removed between December and June- close to 40,000 kg of gold- thats 40 metric tons.  While JPM’s house account has removed over 40 tons in the same period!  What’s the lesson there?  It appears JPM’s best friends and clients don’t trust them anymore!

My best source (originally a trader with Scotia Mocatta) tells me that the allocated gold account raids have resulted in 40-60,000 tons of gold!   (The US likely doesn’t have any of its reported 8,500 tons left at all!).   Rubin and Clinton might have made $2-$3 trillion leasing and selling the US gold.  Someday the US may have to replenish its gold.

We’ve had other things like ABN Amro’s default, and another small Dutch bank just made the same statement that they’re not going to redeem on gold accounts.   Morgan Stanley is stalling on every single metals transfer request.  When it is finally transferred the serial numbers and weights are different than what was documented.  Clearly the broker dealers are going into the market to find the gold, to find supply just in order to meet their daily requirements.

The Brinks’ accounts are going bare and are almost down to zero – these are all problems on the supply side!

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At some point the lack of physical gold and the lack of physical silver are going to become glaringly apparent to the general public, and at that point we could see a fundamental shift in the marketplace.  Keith Barron speculated on what the “trigger” for this shift might be during a recent interview with King World News

All I know is that this ‘trigger’ which is going to ignite this move is coming, and it will involve substantial repricing of both gold and silver. One possible trigger may turn out to be a failure of the COMEX. We do know that there is a shortage of physical gold for delivery, and that’s because so much gold is going to Asia right now.

You can see by the price action in the U.S. dollar right now that the Asians are dumping their dollars. But, interestingly, they are also paying a premium to get physical gold right now with no delay in shipment. So there is a loss of faith in the paper gold and silver markets by major participants. It’s almost as if they expect a failure.

Barron is fully convinced that we will eventually see a “breaking” of the COMEX which will shock the world…

I firmly believe there will be a point in the future when this sort of event triggers a run on the COMEX, and more and more entities are going to ask for physical delivery. This will have the effect of breaking the COMEX and creating a failure. When that takes place you will see an explosion in the prices of gold and silver that will literally shock market participants around the world.

And the truth is that this has been a long time in coming.  The bullion banks should never have made so many empty paper promises.

There is only so much physical gold out there.  Warren Buffett once estimated that if all of the gold in the entire world was gathered into one place, it could be formed into a cube that would only be 69 feet long by 69 feet high by 69 feet wide.

That isn’t a whole lot of physical gold.

But there is a massive amount of “paper gold” out there today.  In fact, as I noted recently, the Reserve Bank of India says that “the traded amount of ‘paper linked to gold’ exceeds by far the actual supply of physical gold: the volume on the London Bullion Market Association (LBMA) OTC market and the major Futures and Options Exchanges was OVER 92 TIMES that of the underlying Physical Market.”

Did you grasp that?

The reserve bank of India says that there is more than 92 times as much “paper gold” as there is physical gold.

This is why you want to own physical gold.

And right now the global appetite for physical gold is absolutely voracious.

According to CNN, consumer demand for physical gold is now at an all-time record high…

Bargain-hunters are snapping up gold jewelry and coins as investors desert the metal and world prices plunge.

Global consumer demand for gold hit its highest level ever in the second quarter, spiking to 1,083 tons, up 53% compared to the same time last year.

Most of that demand came from China and India, where consumers rushed to buy jewelry, coins and gold bars.

In fact, according to the latest World Gold Council Gold Demand Trends report, demand for gold bars and gold coins in the second quarter was up 78 percent over the same quarter last year…

Globally, jewellery demand was up 37% in Q2 2013 to 576 tonnes (t) from 421t in the same quarter last year, reaching its highest level since Q3 2008. In China, demand was up 54% compared to a year ago; while in India demand increased by 51%. There were also significant increases in demand for gold jewellery in other parts of the world: the Middle East region was up by 33%, and in Turkey demand grew by 38%.

Bar and coin investment grew by 78% globally compared to the same quarter last year, topping 500t in a quarter for the first time.  In China, demand for gold bars and coins surged 157% compared with the same quarter last year, while in India it jumped 116% to a record 122t. Taking jewellery demand and bar and coin investment together, global consumer demand totalled 1,083t in the quarter, 53% higher than a year ago.

For the tenth consecutive quarter, central banks were net buyers of gold, purchasing 71t, which reinforces the trend that began in Q1 2011.

All of this physical demand is putting a tremendous amount of pressure on the paper market.

At some point the paper market is going to break.

When that happens, the price of gold is going to go absolutely skyrocketing.

Gold Coins

Comments

  1. Some type of a Revaluation of Physical Gold Bullion is coming according to Precious Metal Pete. The clock is ticking and it’s only a matter of time.  Jolly up! 

    • http://rt.com/usa/100-dollar-bills-misprinted-496/

      The october new 100$ bill got ‘misprinted’ and its release date might be changed again…

    • scott

      Wasn’t that the excuse two years ago? Printing mistakes? What a load of crap.

    • PowerBall

      I LIKE this guy ‘Precious Metals Pete’, though he said that … “To enforce payment in Gold Bullion is against the Law! The Courts (no matter how high you go) can only enforce payment in FIAT, the govt-sponsored money of the jurisdiction in which you made your claim.”

      While TRUE … it’s ONLY so in cases proceeding under Civil Law. In causes prosecuted under Common Law Due Process, however, the tables are turned 180 degrees, such that money damages MUST settle in precious metal as no other substance is recognized AS money thereunder.

  2. A bit of snapshot math.
    Total 2,200 tons of gold produced ex China and Russia
    Total demand 4,300 tons
    600 tons removed from GLD
    1,300 tons removed from Bank of England
    Demand deficit 2,100 tons
    Removed from bullion banks 1,900 tons
    total deficit 200 tons. 
    Shortage is evident but not extreme—Yet
    When will shortages become total lack of supply?
    Unknown,  but it will probably happen very soon as the scramble to buy gold will ramp up as the price rises.
    As everyone who wants gold piles on the price of gold (and silver) will rise.
    These two metals will be called a Giffin good
    That means the greater the demand, the greater the price.
    The low price and scarcity will create a frantic desire to get some precious metals before they are priced out of range.
    Charlie knows this quite well.  He has a ear to the ground and a good gut instinct for this.  Stack it, he says.  His warning has been heeded.  Cheers

    • Indeed it has, AG.  Those of us who stack these metals are well aware of the history of money and the fact that paper fiat money ALWAYS crashes and burns because those who are running these systems ALWAYS get greedy and over-print them.  Bernanke can call his money printing programs “QE” all he wants but it is still just printing more money.  As with any other good or service, creating a lot more of it always reduces its value.  Diluting anything reduces its value.  100 proof booze costs more than 80 proof which costs more than 40 proof.  The proof is in the sipping in this case but it is also true of currency.  Japan is very busy these days doubling the supply of yen.  All economists know that this will reduce the value of each individual yen by 50% or so.  Yet they do not speak of this because they are in a profession that is susceptible to coercion from banks and governments, not coincidentally the very entities involved in this currency dilution!
       
      Pure gold and silver are not diluted by excessive money printing and cannot be zapped up out of thin air at the whim of the Fed or the Gov. This is what makes them REAL money and intrinsically valuable.  It takes a lot of effort to find gold and silver ores, more effort to dig them out of the earth, even more effort to refine and purify them and make them into coins, bars, rounds, jewelry, and other products that people want and need.  Paper money?  Not so much.  It costs the same to make a $1, $5, $10, $20, $50, or $100 Federal Reserve Note… about 4-5 cents, depending on whose estimate you read.  Not so with 1/10th, 1/4, 1/2, and 1 oz. gold and silver coins, rounds, and bars of many sizes.  In all of these products weight or size matters because gold and silver are valued on a per oz. basis, so the more ozs. you have the more value you have.  
       
      We are told that the denominations printed on fiat currency makes this one more valuable than that one and people generally treat them in this manner.  At some point, however, the mask will be ripped off of the paper Ponzi scheme and EVERYONE will become aware of the fact that the US dollar has been gutted of its value, largely by the Fed but also by the US Gov, and that it is only as good as our creditors say it is.  When they get to the point that they no longer accept ever cheaper dollars for real goods any more, anyone who does not have REAL money will be well and truly screwed.  Got gold and / or silver?
       

    • Ed_B  … “fiat money ALWAYS crashes and burns because those who are running these systems ALWAYS get greedy and over-print them”

      With warm and Brotherly respect, Ed, I must disagree. All virtual ‘money’ fails because of Interest. The quantity of interest ALWAYS ultimately exceeds the quantity of Principal.

      The only way that any ‘substitute money’ can be floated is on the raft of Interest, because it’s underlying substantiation of true money (gold and silver) can’t be pledged initially without remuneration. Those ‘backers’ of the scheme know too much to take banknotes as Interest … THEY want their Interest payments in MONEY, not banknotes! Thus, MONEY is sucked from circulation, leaving nothing BUT banknotes. Once all specie is gone from circulation (circa 1963), the Principal and Interest begin co-generating each other in a mathematical Positive Feedback Loop, such that growth of currency inflation and debt service obligation magnify each other.

      ‘Greed’ has absolutely nothing to do with it. That’s a meme propagated so that if impositions and inflation periodically bear onerous inconveniences on people, all the elites have to do is switch ‘jockeys’ on their horse and false ‘hope’ is restored. Our natural behavioral default to blame human foible, allows these elites to KEEP their SYSTEM of enslavement, while mere bit players on the stage of their Punch and Judy Puppet Show, distract us from examining the inner works of their ‘magic perpetual money machine’. We’re SUPPOSED to boo the puppet with his hand on the lever, but ignore the machine itself! That’s what’s behind all this ‘Bilderberg, and Zionist’ garbage. Highly charged emotional dissuasion from digging down into the inner workings, to only look as far as the wrapping on the box.

      Paper Rots, Coin Does Not.

    • Yeah… What Ed said.

    • In the very same gentlemanly fashion, I must at least partially disagree that greed is not the root of this situation and the very raison de terre of the entire fiat paper currency scheme.  Why else invent fake money that is borrowed into existence if the plan is not to garner all of the wealth into the hands of the planners of said scheme?  Yes, I know about interest, compounding, etc. and agree that this is a huge part of the scheme.  In the past, the US economy was growing faster than the interest on the debt created by borrowing money into existence.  But, it was known to TPTB that this would not always be the case and that they could use the interim to install their fiat money system, the Fed to watch over it, and the income tax to pay for it.  Eventually, their time would come and the US economy would not be growing quickly enough to cover this debt.  Tens of trillions of dollars were siphoned off and dumped into useless wars to ensure that it would not be reinvested back into the economy and thus perpetuate the economic strength that would continue to cover the debt that our currency creates during its birth.  Having done that, they are now busily grabbing every possible real bit of wealth that their tentacles can reach… and they have a LONG reach.  It is time to start preparing the calamari for the consumption of the common man rather than continue the consumption OF the common man by the calamari.
       
      Of course, this is probably the barest speck of what these psychopaths are up to and I shudder to think of what their final goals and their methods for obtaining them might be.  Likely, it will be worse than any of us can imagine.
       
      I do hope that the end of your comment is not an accusation of shallow interpretation of our current situation.  I have little doubt that any of us knows more than a little that is going on or understands more than a bit here and there.  The phrase of wheels within wheels likely falls short by orders of magnitude… and yes, I do know what those are.  ;-)
       
      @Shamus

      Thanks for the support. It is useful at times. :-)
       

    • Ed_B  … “I must at least partially disagree that greed is not the root of this situation and the very raison de terre of the entire fiat paper currency scheme”

      Ed, I’m pleased to expand on the underpinning bases behind my positions, so I truly do welcome your challenges. My Dad taught me that ‘no idea is ever advanced by agreement’ and so acceptance of affronts to my reasoning is taken in respect of his gift. All the more so, where I markedly stand in difference from the prevailing opinion.

      We’ve heard the old saw that ‘a good King is the Father of his Peoples and wise Steward of the Realm’. In that Patriarchal pretense, ancient governments operated by varying degrees. Too many manuscripts to recount, attest this justification for governments to have existed ‘by leave of God the Father of all Humankind, to His anointed Father of our Land’. So, we can begin with an understanding that in its origins, media was overseen by government as society’s arbiter of fairness to keep ‘the Kings Peace’.

      But, it’s a quirk of natural occurrences that population growth slightly exceeds the mine recovery of precious metals on a long scale average, which presented a quandary for government and the merchants on whom they survive through percentage taxation. The phenomenon causes the metals to creep up in rational valuation due to ‘population demand’ on circulation, despite annual inflation of new mine supply (never recorded as a known insufficiency, to my knowledge). This, in turn, bore pressure on merchants to lower their prices in consequence. Since money had … unfortunately … had unit nomination stamped on it and accounting by governments and merchants became accustomed to valuing the numbers over the weight of the metals and their rationally derived worth, the ‘standard’ persisted by rote habit.

      Now, the very effect of the ‘Population Demand Factor’ itself proves that numeration of coin, as opposed to alternative unitization of its weight in a given fineness, was the folly to abandon. The volume of money in circulation always trends toward equilibration to the goods-at-market. Had the money NOT been adjudged by sheer number stamping … all would balance out accordingly … WITHOUT BOTHER. As long as government didn’t overburden circulation in such excess as to diminish trade, affecting EVERYONE, government included, then the money of the whole realm grows in value apace, keeping all content in their places, however much or little volume is in circulation!

      It’s easy enough to see then, that the instances of ‘coin clipping’, ‘debasement’, depreciation’ and all the rest were complications that, if properly understood at the beginning, were to NO ONE’S benefit, but rather to EVERYONE’S disadvantage. Humans gravitate to solutions that render less complication and difficulty for themselves, so its safe to surmise, they never REALLY understood WHAT the nature of the devil was that tormented them … those stinking, wholly superfluous numbers!

      This is the background from which their attraction to banknote money (distinguished from money receipts) evolved. It’s apparent (to me at least) that the ages old creeping ‘disruptor’ of money appreciation … negating those sacred numbers … could be evaporated by printing Notes in such quantity that prices (and taxes) could remain constant AND the value in circulation as well. Since the banknotes MUST be loaned into circulation at interest (the scheme has backers who demand, and rightly deserve, remuneration for putting their capital at risk), their volume inflates automatically by invariable design.  The ‘trick’ was to control the inflation AND debt growth within productive capacity to generate trade goods sufficient to offset the debt carry, which NECESSITATED manipulation of the current-interest-rate so adjustments could be made accommodating good and bad economic fluctuations. THAT necessitated the creation of ‘Central Banks’, to assure such ‘control’.

      Of course, absolutely NONE of this de-construction excuses the vile turpitude this CURRENT crowd in government, banking and monopoly industrialism is stooping to, for the sake of delusionally preserving the fetid ‘tradition’, but explains how I can view THE ORIGINS as somewhat innocent, if not just plain dismally stupid, making its whole history a sad comedy of errors that for sake of a single choice, was a long string of completely avoidable evils.

  3. High oil prices helps Russia, high gold prices helps China, high stock indexes helps Soros. The 13-F is out and notably, gold and silver plays are missing. He sees a correction in the SP 500 with a put, but nothing but blue sky ahead according to Soros and his money managers. The satan worshipping anglo’s will melt some faces more still if you watch the second by second ticks. Yes, a dollar move on silver is 4% after the wicked beat down…but still 50% away from 48.00. The DOW is up over 13% in 2013. A 200 point drop is now only 1-2%, or aint shit. The only people making money on gold is the dealers and their 14-20% mark up premium…2nd qtr 2014 to re-evaluate here, like get out of some low percentage positions so far. Tell you what, I will be happy buying melt before it leaves my LCD, but that is about it… I have a stock charts.com subscription…you can zoom in and watch one second live charting…very unhealthy. Zoom out and breathe for pete’s sake.
     
    http://www.sec.gov/Archives/edgar/data/1029160/000114036113032845/xslForm13F_X01/form13fInfoTable.xml

  4. Thomas  Is this Soros Quantum Fund. Interesting weighting in certain tech stocks. JC Penny will be a loser but who knows.

    • Institutional investment managers “having an aggregate fair market value on the last trading day of any month of any calendar year of at least $100,000,000 shall file a report on Form 13F with the Commission within 45 days after the last day of such calendar year and within 45 days after the last day of each of the first three calendar quarters of the subsequent calendar year.”
      Not sure on particulars.

  5. Well gee … why would ANYONE want to deal in gold and silver when they can choose to just pay infinite bank interest and undefined government tax for the PRIVILEGE to use these ‘Trade Facilitation Instruments’ (banknotes) we so carefully concocted? Don’t people know what’s GOOD for them? As slaves, all their basic needs are … assured!

    • No, people do not know what is good for them. In fact, people do not know their ass from third base. People Do Not Read! There is a 1912 8th grade test floating around. When compared to today’s education standards, this 8th grade test would equal the SAT test… graded on a curve. I am avoiding the dealer premiums by buying silver melt from my LDC. Bent cups, banged up platters, candelabras, mismatched tableware at spot/weight, and neat finds. I know silver and gold will come back when the ignorant majority can see further than three feet in front of their noses, when our enemies take what we give them to take, when the anglo-satanist perverts are exposed as what they truly are. Meanwhile, I look for clues at the crime scene.
      http://chasvoice.blogspot.com/2013/08/newly-discovered-eighth-grade-exam-from.html

  6. Since we’re all getting philosophical here, I’d like to contribute my thoughts:
    Energy is TRUELY money! Energy converted to harvest crops, to make clothing, to manufacture everything, then there’s portable energy like oil, batteries etc.  If coinage represents portable energy spent in mining,smelting etc. And is used as a means of conversion between goods, which are produced by energy, then ENERGY is the real money, and all coinage like any goods are just fungible/divisible goods for breaking down transactions of energy.
     
    THEREFORE, those energy harvesters are the puppetmasters, coinage is a byproduct of the real money….energy! Wars are waged for energy in various forms, fuels, goods, potable water. He who owns the invisible energy owns you!  and you all wrestle over paper, and metals… Mua Hahaha!

    • So what’s the average person supposed to do, other than transfer increasingly worthless fiat for tried and true precious metals?
      Do we miraculously, suddenly, and with great difficulty turn our individual hands to becoming oil explorers, and eventually, oil developers and oil-field owners?
      Philosophical solutions are one thing; practical solutions, and practical solutions which account for 99.99% of people on the planet, are quite another.
      Therefore, precious metals in the most practical sense, can only be described as the main game.

    • I was thinking about this the other day, I read an interesting article arguing the same point energy is money, and I came to the same conclusion. The article used the example of the work a man could do in an hour (100 Watts) compared to the energy stored in a barrel of oil, equivalent to about 17000 hrs of labour.  So in that context a barrel of oil is still very cheap.

      On face value that sounds extraordinary, until you factor in efficiency. A typical engine is about 20% efficient, that then brings the number down to 3400hrs still an impressive figure. I guess it depends what you are expending the energy on.
       

    • James … “precious metals in the most practical sense, can only be described as the main game.”

      “Main game”, yes, agreed. There’s another expense free ‘wealth’ that can be gathered, though; which is our Labor ‘marketability’. It’s not a bad idea to explore some ‘uncommon’ trade skills (like appliance repair or furniture restoration, for example) that can broaden your adaptability to more work accommodation as opportunities surface. You may need to acquire a few specialized tools in the process, but they themselves will also appreciate in value during crisis conditions.

    • @Neo
       
      “I guess it depends what you are expending the energy on.”
       
      EXACTLY!  This is similar to the concept of government spending creating stimulus for the economy.  In many cases, the economy is not stimulated because the funds are misallocated into things that are not in and of themselves productive.  Yes, building a bridge to nowhere does employ people to build it and perhaps even some to maintain it but the bridge itself does not foster economic growth via its use, which is supposed to be the point of stimulus.  Or do I have it all wrong?
       

  7. The way you explain it, Shamus, is easy to follow. It
    makes the energy equation the base of an inverted pyramid.  The tip is the base. 
    The rest of the pyramid balances on this point, the energy pivot  for all things that come above the point. 
    It could also be viewed as a fulcrum, leveraging the rest of the pyramid.  This is the first time I’ve thought of it this way so my reasoning may be a bit weak.
    Steve DeAngelo pointed out at in a late article and discussion that if the EROI of energy is more than 11 to 1 we can have what we call civilization, art and culture because of the energy surplus that exceeds the basic needs of survival.
      EROI in the mid single digits is a bare subsidence existence.  Precious metal coinage in a byproduct of energy usage and with lower yielding ores and greater cost of extraction, this industry requires substantial ly more energy to continue the production of these valuable products. 
    EROI of energy slips with passing years as the cost to extract energy continues to climb.  Gold and silver production drops in part due to this factor. Price drops in PMs exacerbates the situation.  Our life styles drop due to the steady erosion of the EROI.  The price of PMs should climb to reflect the real value and will likely reach a much higher value when the price suppression stops and reality sets in.
      Those without coin will be in sorry shape as the day approaches when silver coin is again a medium which is both fairly valued and the means to acquire energy and its equivalents in the form of food, shelter, medicine and basic creature comforts. 
    Energy holds sway over this  and precious metals have always been the means to acquire it in real terms.  Paper money will see its demise due to this 5,000 year old equation. 
    The hard part of this is the entire world runs on energy, requiring increasing amounts to maintain the same lifestyle level just as more fuel is required to extract the same amount of precious metal commodities.  The world is also awash in FIAT that will become increasing worthless in its abilities to buy energy.  Or so it seems

    • “It makes the energy equation the base of an inverted pyramid.  The tip is the base. The rest of the pyramid balances on this point, the energy pivot  for all things that come above the point.”
       
      An interesting thought, AG, and one that I have long held regarding the creation of human knowledge, particularly in science where knowledge compounds upon itself very quickly.  The more we learn, the more we CAN learn.  This is akin to making a simple tool that then allows us to make progressively more complex and capable tools.
       
      The hard part of this is the entire world runs on energy, requiring increasing amounts to maintain the same lifestyle level just as more fuel is required to extract the same amount of precious metal commodities.”
       
      Indeed it does.  I get very annoyed with people who look down their noses at others and exclaim that the conflict in the ME is “just about oil”, as if that were not really significant.  Just?  They have no idea!  Oil is THE life-blood of a modern industrial economy and likely will remain so for an extended period of time.  Nat gas is included in this as well as oil and gas tend to be co-products from the same wells and can often be used in similar ways.  To get an idea of the value of oil and gas to a modern economy, let the blood out of a mammal and see how well it does.  A modern economy would be in the same condition without a continuous supply of energy and oil and gas are large parts of that energy.  Transportation is particularly sensitive to oil and gas as transportation devices tend to rely on easy to carry yet energy rich liquid fuels.  Until the commercialization of controlled nuclear fusion as a cost effective source of vast amounts of energy arrives, this is unlikely to change.
       
      “The world is also awash in FIAT that will become increasing worthless in its abilities to buy energy.  Or so it seems”
       
      Yes, it does seem that way.  It is also awash in credit and the debt that then results from it, although in some sense they are the same.  Either way, they are NOT money and they have been treated as if they were.  We now seem to be collecting the results from that erroneous assumption but we are a ways yet from full payment.
       

  8. Pat
    wouldn’t it be an interesting state of affairs if the Common Law was enforced and those who needed to pay damages were forced to pay in bullion. Headline “JPM found guilty of high crimes andmisdemeanors.   Fined $1,000,000,000, due and payable in gold and silver upon demand
    There’d be a small adjustment to the little cartoon with Dimon and Blythe.
    Oh S*** they called for their gold. 
    Only this time it’s the government———of China. 
    Just musing. It would be a bit funny all thing considered.

  9. JPM now telling people to buy Gold, WTF are they up to???
    (Source ZH)

    • It’s a money maker @Neo, They tell people to buy Gold and leave the Silver alone and so then JP buys up the Silver (they have plenty right now and will add to their stack) and when the ratio gets close they trade their Silver for Gold which I will be doing when the time is right. It’s time to stack. Keep Stacking

    • Boy,
      that $22/oz prediction was on the low side.

    • JP released a report 6-8 a weeks ago that was friendly commodities, this just an extension?

    • “…and when the ratio gets close they trade their Silver for Gold which I will be doing when the time is right.”
       
      OK, Charlie, I’ll bite.  When will the time be right for this swap?  What will be the signal that tells you that the time is right to trade silver for gold?  Inquiring minds want to know!  :-)

  10. This came in from Bix.
    If he is just half way right, :) ))))))))))))))
    Anyone like to comment?
    JC
     
    Word from Ted Butler is that JP Morgan has cornered the gold market. I mean CORNERED the entire gold market including physical and electronic forms of the shinny metal. There is a lot of scenarios that can happen from here INCLUDING the forced unwind of this position thus destroying the price of gold even further. They could also run the price up to the heavens and reap the rewards in order to SAVE their hides from their SILVER LOSSES.
     
    There has never been a more important time to understand the difference between silver and gold as an investment. There is no doubt that SILVER will outperform gold by many, many multiples as the end of gold and silver manipulation ends.
     
    For Private Road Members I have put together an article that spells it all out and you can find it here:
     
    Get OUT of Gold and Into SILVER NOW!
    http://www.roadtoroota.com/members/817.cfm
     
    Truthfully, I don’t know what the price of gold will do in the coming chaos. It might go up and it might go down but whatever gold does it will pale in comparison to the moonshot SILVER will take.
     
    Today you can take your 1oz gold coin down to your local coin dealer and walk out with over 60 ounces of SILVER!
     
    Tomorrow may be a different story.
     
    May the Road you choose be the Right Road.
     
    Bix Weir
    http://www.RoadtoRoota.com
     
     
    PS – Send this email to all the Gold Bugs you know and see if they can refute my claims! 

  11. I think it would be more accurate to say that at this point in time JPM contols the segment of the market involved in price discovery.  Other parties own significant quantities of gold like Russia, China, India, and Ed_B to name a few.

    • LOL!  Yep, my 12 ounces is definitely the fulcrum upon which the world of gold and high finance will turn.  :-D
       
      Dammit.  Now you’ve done it, UD.  I just know that I am going to dream about this tonight and will likely toss and turn all night.  ha ha
       

    • EddieB…sweet dreams.

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