SD Weekly Metals and Markets 3/29 FDIC & BOE Create Resolution for Cyprus-Style “Bail-Ins”

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SD Weekly Metals & Markets is below:

 

10ozntr ban

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SD Metals & Markets 3/29/13:

Gold And Silver:  Strong Dip Buying Supports “Bottom” Call

 

Markets were closed on Friday, but we still managed to witness precious metals price data feeds go haywire across the world.  It should be interesting to see where quotation picks up late Sunday as Asian trading opens.

 

Gold moved below $1,600 and silver tested $28.  Options expiration week came and went, with the cartel managing to close the April gold contract at $1,599.70, leaving a significant number of $1,600 call option holders hosed.  Some things never change and in fact hosing call holders was part of their motivation behind the capping effort.  Silver keeps bounding off the $28 floor and the physical market remains tight.  We in fact saw upside reversals in both markets this week, especially on Wednesday, March 27th.  Considering the ongoing cartel suppression effort, Wednesday’s trading performance just goes to show that dip buying is alive and well and the cartel continues to only be able to the rate of price appreciation.  It might not feel this way, but the cartel has NOT been able to kill this bull market.  That’s not even their primary objective.

Gold - march 27 - 2013

 

Silver March 27 - 2013

 

Meanwhile, Jim Sinclair’s birthday call that we’d never see gold dip below $1,600 failed.  He’ll have to adjust his Johnny Carson Carnac the Magnificent hat.  All things considered, however, he did make his original call in February, when gold was testing the low $1500s and buying support from China and other central banks manifested exactly as he anticipated.  $1,6000 gold didn’t hold, but the dip buying just below that level remains substantial — even suggesting that BRIC central banks have upped their bids above their former $1,550 trigger.  Time will tell.  We continue to believe those looking for higher prices SOON will win this war because fears about banking system distress simmer on the back burner despite MSM message of calm about Cyprus.

 

 

Mr. Sinclair, poking fun at himself:  “The Birthday Boy all dressed up for his party. If you cannot laugh at yourself you cannot live.  What is 27 backwards? 72 of course!”  (Source:  JSMineSet.com)

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Cyprus:  Banks Finally Opened, Calm Deceptive

 

Cyprus-Euro-cash

CAPTION:  “Cypriot citizen reunited with cash”  – Source:  AAP

MSM:  Nothing to see here, move along…  What’s wrong with this picture?  CONFIDENCE!  Cyprus banks might not have the direct derivatives bird’s nest seen with, say, a Lehman Brothers.  But loss of faith in the Western banking system is spreading like cancer.

* * * * *

 

Banker Bail-in Bash Comes To Canada?

 

 

Cyprus appears to be just a warm-up.  Following last week’s revelation about bail-in discussions in New Zealand we now have documented proof bail-in plans are well advanced in Canada and SD broke the news Friday night that depositor bail-ins will be pursued going forward in both the US & UK!

 

What ever happened to placing banks in receivership, dividing good and bad assets?  The restructuring following the Savings & Loan Crisis of the early 1990s saw limited burden placed on the US Tax payer and a reasonably honest effort to prosecute fraud.

 

Today?  Forgetta ’bout It.  Bankers have amassed enough political power to pretty much avoid the courtroom, never mind jail.  Meanwhile, the goal today is to keep the too-big-to-bail/jail banks open, increasing in size, and when and if problems arise, “tax” the depositor directly, not governments.  Their claim that this is in the taxpayer’s interest is PR hogwash attempting to cover-up the main difference today versus previous crisis periods.  Today, we have a policy of “No Bank Left Dead.”  This creates total socialization of losses, unlike previous crisis periods.

The key section of the Canadian budget document can be found on page 145:

 

“The Government proposes to implement a bail-in regime for systemically important banks. This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital.

This will reduce risks for taxpayers. The Government will consult stakeholders on how best to implement a bail-in regime in Canada. Implementation timelines will allow for a smooth transition for affected institutions, investors and other market participants…

This risk management framework will limit the unfair advantage that could be gained by Canada’s systemically important banks through the mistaken belief by investors and other market participants that these institutions are ‘too big to fail’.”

 

* * * * *

BRICS 2013 Meeting: Eroding US Dollar Reserve Status

 

BRICs - 5TH SUMMIT

From left to right:  Indian Prime Minister Manmohan Singh, Chinese President Xi Jinping,

South African President Jacob Zuma, Brazilian President Dilma Rousseff, and

Russian President Vladimir Putin during the fifth BRICS Summit in Durban on

Wednesday;  Photo by Rogan Ward/Reuters

 

While the Western banking system is crumbling, BRICS are formulating mortar and a structure for the future.  This week’s Durban, South Africa meeting included discussions about a new development bank that would rival the rolls played intermittently by the IMF and the World Bank.  Discussions for additional bilateral currency swap deals and the transition away from US Dollar based global trading system continue.

 

* * * * *

 

Next Week?  What Nation/Region Is Next?

 

Two facts are known:      1)  The Western banking system is insolvent;

2)  It can be profitable tearing the system down to “repair” it

 

Cyprus marks the start of a new phase in the banking crisis.  “Bail-ins” are aggressive and their use indicates a certain “burn it all down” mentality given massive damage done to confidence.  The global financial system is built on confidence, first and foremost.  Current events imply we are witnessing the powers that be willing to act differently.  A new global reserve trading system and reformed Western banking system can’t be avoided now — and the banksters are going “all in.”

 

System bailouts for Spain and other “PIIGs” nations remain on the docket.  We might escape further turmoil next week, the clock is still ticking and the bankster script will call for more of the same in Spain and beyond.  Spain is of particular note given the level of unrest its citizens have already demonstrated, with protests and strike actions involving millions of people.  When it comes to the next black swan, Spain is looking like an unusually plump bird.

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Comments

  1. Next Week? What Nation/Region Is Next?

    If your as old as me, does anyone remember the TV show “That Was The Week That Was” Hell Wait Till Next Week. LMAO
    It looks like the  Brics Countries are sure gonna have a lot of fun with the West down the road and a lot of Western Countries are going to turn their backs on the USA including the UK and Germany WTSHTF.
     
     

  2. Glad to see you’re back up and running Doc. How did the attack go down this time? Why no story about what happened?

  3. A very knowledgeable guest Doc. Really good interview! Thx

  4. @TheDoc: I won’t go into all the reasons for obvious reasons but your site isn’t the same! It’s up but it’s not right. Alex Jones has some really, really good tech people. Not that you don’t. But it couldn’t hurt to get your people and his people talking!! Just a thought but, in the grand scheme of things we are all fighting on the same side, the side of truth. Where ever that takes us.

    • I personally hope that the Doc doesn’t associate himself with Alex Jones.  That group spreads to much disinformation.  Not as bad as Steve Quayle, but, bad enough.  I was very disappointed with the Gerald Celente interview from a day or so ago.  The truth is now very selective and not being shared in total.  Its all about the money right now, based on spreading fear.  We need correct information now which should spare us from fear based decisions.  Alex Jones sells Midas precious metals which is a shady dealer at best.  The Doc still has integrity.  

    • @Pollo: Jones has been dealing with these sort of attacks for a long time. His people could have some ways of defending against this stuff. As for Midas, they are cheats! Look at their prices, rediculous.

  5. In that photo of the five heads of stare in the BRICS Summit, I am glad the caption stated which one was from India and which one was Russia’s Putin.
    Never would’ve figured that one out by myself.
    LOL!

  6. Speaking of the past week’s events, it seems that some people are finally tuning in.
    Two weeks ago I put up a Craigslist ad for an assortment of Silver Dollars, Halves, Dimes, Quarters, Canuk Wildlife Series coins, and ASE’s.  Nothing but low-ball offers until this past week, when I sold:
    - 16 Peace Silver Dollars
    - 13 Morgan Silver Dollars @ $29/ea.
    - 1 ASE @ $39
    - 22 Mercury Dimes for $2.75/ea.
    -  -  -  -  -  -  -  -  -  -  -  -  -
    Two of the three buyers told me they were relatively new at buying Silver; I touted ‘junk SIlver’ as a good place to begin accumulating.
    I will use the proceeds to restock my stack.  However, Silver Dollars seem to be more difficult to come by than a few months ago.  Although my two LCS’s will sell them to me at spot, they’ve only had ‘onesies & twosies’ lately.

    • A new LCD opened in a town about 10 miles from me. They were asking 30 x face value. There may be people buying at that price? Not me, but someone out there must be. For me 20 to 21 x tops for 90% or I go for .999 @ 2$ over spot and no more.

    • I’ve never taken a profit on Ag. If the price were in the 40s again I might try the sell side of a trade. First I have to find a deep sea diver who will work for food!

    • I think it is a good idea to sell metals on craig’s list.  Ask for the high premiums on small purchases.  It is the same where I live.  If you want to buy just a few coins the premiums are astronomical.  Its not worth it for the dealer to sell one oz of silver unless the premium is nice and high.  I would pay 40 dollars for a silver eagle if I was looking for a nice gift for someone for example.  That one oz could get someone interested in stackin!

  7. @Mammoth:  Can I call you to sell my silver when I’m ready to sell?  The premiums you’re pulling are amazing.  With silver at $28.70/oz, the silver content of a Morgan/Peace dollar is $22.20.  You’re pulling a 29% premium on those.  A dime comes in at $2.08 for silver content at $28.70/oz.
     
    There certainly are two markets:  paper and physical.  But eBay isn’t a pure representation of the physical market, as some in the metals community would think (Mammoth knows….).  The high fees associated with sales pushes most prices upward given that sellers frequently post without cost, only to see fees on the back-end.  The market isn’t that deep, and when it comes to novice PM buyers, eBay has more than its fair share, which results in some of the crazy premiums some people are willing to pay (as Mammoth’s case points out;  had those people had more experience, they wouldn’t have to pay that much over spot).
     
    I like using eBay as a tool.  I’ve bought and sold bullion on it since way back in 2000 and have used ebay since the week was launched.  Just be careful and know the limitations of extrapolation. 
     

  8. @Flying Wombat, Actually, I’ve never sold or bought anything on ebay.  I use craigslist and there are no fees.  And the coins which I sold, I got my asking price.  But this is actually only the first time that I’ve sold stuff from my stash.  The other two times were US Mint coins – (1) the 2010 ‘America the Beautiful’ 5-oz coin set, and (2) the 2011 25th anniversary ASE set.
    The proper strategy is to not become so overextended that you HAVE to sell at the buyer’s price.  Always convey the attitude that you don’t care whether the deal goes through or not; i.e. ‘my way or the highway.’  Sometimes the buyer will back out, and other times he will grasp at what he perceives is being withdrawn from his reach.
    Somewhere there is a balance between stacking vs. trading – and if you dabble in the latter then you have an opportunity to increase the size of your stack.
    PM me if you are interested in doing any private deals.  I believe @AGXIIK will provide a reference.
    -Mammoth

  9. Looking again at the image of the guy happy with the cash. He either had < 100,000 Euros, he is just happy he has anything left or no one wants to get out of the cash line long enough to go pinch off a Bernanke! Coins should have 3 sides.

  10. I look at the image of the BRIICS “leaders” and I think about the two things they have in common. 1 they want to tare down the western financial and industial base.  2 they want to export to do it. INDIA – intellectual property/services. China-manufacured goods/high tech. S Africa- precious metals/raw materials. Brasil-durable goods/high tech/raw material/energy. Russia- energy/raw material/military hardware. At some point the only ones with money enough to buy anything may only be themselves. They then begin to fight among themselves for the lions share of eachothers markets. All of their exports will at some point come into competition. Competition is a sin.

  11. FW and Mammoth   I signed up for a local gun show in Minden NV, April 6-7.  I plan to test my marketing system for higher priced phyzz, with 1 OZ capped coins plus a special type of bumper sticker, Molon Labe or OMG (Obama Must Go)  The Day Of Resistance rounds look great capped with the black foam ring type of capsule.  The message is enhanced.  I’ll let you know results.  My friend has a boat load of 223 as do I with a nice score of 223 at Walmart last week.  1,000 rounds at $330.

  12. BTW   When Eric and Doc talked about the Obamacare threat that any transaction of $600 or more would entail a 1099, the next step to that could be  a very high windfall profits tax on anything you make on selling phyzz.  Windfall profit taxes are a time tested means to take the profits of oil, farm and even banking enterprises.  There are many ways to look at how you report your gains on precious metal sales.  They are so large you could drive that proverbial truck though it.  Maybe Bitcoin or another derivative of that system would all people to transaction sale and purchase of precious metals without reporting to  IRS.   Our government, or maybe I should say, the government that represents other people in this country, people who voted for this freaking morons, is going after Bitcoin in a serious way. It may be the only way a person can transfer, transport and transact financial matters without the baleful eye and grasping little rat claws pulling at your sleeve and wallet
    I’m not pro or con Bitcoin. I only mention its potentials for covert transactions.

    • I think that when Shtf coop’s in local community’s will be formed where people can get to know one another and trade using cash etc.  They will learn to trust those folks that are members of the coop.  People will be able to buy and sell things of value with known members.  For example, if you need cash you will be able to swap gold and silver for a fair price or to trade silver for a fair swap for things we need to get by.  Wouldn’t it be nice to be able to contact a friend to sell a gold coin and get a fair price and not have to make records?  We are not there yet.  But, these coop’s will allow some one with a hand full of silver eagles to trade them for items they need.  The members will fully understand the value of a silver round or a gold round.  Or, we could trade a gold round and get a line of credit to use later with the change.  These kinds of arrangements will happen in time, when the USD becomes more imperiled and devalued or just plain less trusted.  The coop or barter system will become important in the next few years.

    • @Pollokeeper, the possible future trading system which you describe provides a good example of why it is prudent to accumulate different denominations of both AU & AG.  When 1-oz of Gold is too much, a 1/10-oz coin may suffice.
      But as far as a ‘line of credit,’ it the future these may be nonexistant.

    • I live in the Banana Republic.  We are broke here.  And, yes, we extend lines of credit.  You go into the store and get what you want.  The lady knows you and your family and she writes the amount of what you bought in the little black book.  You pay later.  This type of barter is necessary for the spooges survival and is common here.  Most folks don’t have regular work.  The paradign you live in now will change when we all become humbled by reality.  Family is valued in the third world and they don’t want a baby or small child to starve here.  We don’t have food stamps here.  It is tough.  Will things be different in the USA?  I doubt it.  In my wifes beauty salon it is common for my wife to extend credit to known neighbors in the hood.  She may not get paid for months but she eventually gets paid.

  13. There are many ways to look at how you report your gains on precious metal sales
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    I report them here, LOL!

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