Based on a short analysis of bank forecasts, we can conclude they are clueless about the direction of the gold price.
This year, the difference between the average gold price and the predicted gold price for 2014 is already $75 per troy ounce, as you can see from the chart below. It seems like bank analysts tend to extrapolate past returns. They were too optimistic in early 2013 and they seem to be too pessimistic on gold right now.
Based on a short analysis of bank forecasts, we can conclude they are clueless about the direction of the gold price.
In gold we see that what all the headliner commentators thought were the bullion banks taking a big long position prior to the supposed blast off to the moon – in reality those bullion banks (producer merchant) have been packing on shorts right and left the last five weeks and have gone from just about 1.2 million ounces net long to a mere 311,000 ounces net long as of last Tuesday. Those swap dealers are packing on the shorts this past reporting period as well adding just over 641,000 short ounces.
What does all this mean?
For the first time in a long time we have both houses of the commercials moving congruently to significantly larger short positions. People, they are not taking those positions so they can report a loss…
Get ready for a price drop and back up the truck soon! [Read more...]
Much confusion persists regarding the method, or mechanics, of how the big banks are able to push the price of precious metals around at will for so long.
The confusion comes from declarations that on price drops, the bullion banks are selling. This then triggers the frequent and violent down-drafts we have witnessed over the last 2 years and counting. However, the trading data indicates the contrary. Commitment of Traders (COT) data shows that the big banks always buy on these dips and they always sell on rallies. Always. (This is clear evidence of manipulation in and of itself.)
So how do they get the price moving in one direction or another, usually to the downside?
The mechanism is made clear by the forensic analysts at NANEX, which provides documented real time price action down to the microsecond:
Stacking the Bid with Fill or Kill. [Read more...]
Analysts at investment banks are a bit like amateur meteorologists. Whatever is the latest trend usually informs the tone of their research reports. Last week TND and Silver Doctors detailed examples of capping efforts by the cartel leading up to and following the “no taper” announcement. With the precious metals complex under wraps, it should come as no surprise that investment bank analysts are now coming out of the woodwork to declare bearish views.
While we believe the Fed will eventually perform a tapering to save face and attempt to maintain credibility, it will likely be a short-term performance, and nothing more than Kabuki theater. Any notion that QE can be meaningfully tapered over the next two years runs smack against the object reality of a weak economy sensitive to another downturn in housing and asset prices in general, which rising interest rates can easily cause. Then there is the problem of weak demand for US bonds requiring the Fed to act as the buyer of last resort.
Click here for more from TND on how the banks are using the Fed’s taper threat to bash gold:
The trillion dollar question is what is really going on with metals? No one is selling, everyone is buying, drying up supplies and sending premiums through the roof. I will tell you and make it as clear as I can. I will detail for you the exact reasons behind the scenes from the board room strategies to the public market.
We are witnessing a grand chess game being played out right before us. [Read more...]
In the wake of his epic $50,000/oz gold call Friday, Jim Sinclair sent an email alert to subscribers over the weekend calling for paper longs to stand for physical delivery of gold, and stating that the current physical demand for gold threatens to completely destroy the fractional gold system.
Sinclair states that the recent $200 take-down in the gold price will ultimately result in damage to the gold banks, and not to gold bullion itself.
Nothing will unnerve the paper gold shorts more quickly and do more to undercut their confidence than to strip them of the real metal and force them to come up with more hard gold bullion to make good on deliveries. “Stand and Deliver or Go Home” should be the rallying cry of the gold longs to the paper gold shorts.
Sinclair’s full alert is below: [Read more...]
The Doc sat down with gold and silver expert and billionaire fund manager Eric Sprott Wednesday for the first of a series of interviews regarding the markets.
Eric warned The Doc prior to the interview that the KWN and USAWatchdog sites were maliciously attacked the day they published interviews with Sprott. There appear to be powerful interests that would prefer to keep Eric’s thoughts on precious metals out of the public at the present, as SD also sustained a confirmed co-ordinated Apache flood DOS attack during the recording of the interview.
With gold smashed nearly to $1550 and silver nearly to $28 Wednesday, Eric discussed the latest paper raid in the face of epic physical demand, and stated that the demand for coins has been stunning!
Sprott also stated that there is an absolute shortage in platinum and palladium, and although he still believes silver is the investment of the decade, there is no telling how high platinum and palladium could go.
With silver trading back under $30, Eric states that silver should be $100 today, that he expects it to massively outperform gold, and that he conservatively expects the metal to reach $200/oz. Eric states that $200 shouldn’t be considered the top however, and that All we know is that the price should be up massively. Anyone who’s been a student of the market sees these ridiculous trades, but some day these guys will be brought to their knees by people just taking delivery.
The first of Eric Sprott’s MUST READ interviews with The Doc is below: [Read more...]
Treasury Releases Results of NY Fed Gold Audit, Inadvertantly Reveals US Gold Stores at NY Fed Are Only 466 Tons!
The Treasury Department has released the results of a gold audit on the Treasury’s gold holdings stored at the NY Fed which began in 2010. Not surprisingly, the Treasury report claims that the audit found no issues with the quality of the gold held at the NY Fed, or in any policies or procedures by the NY Fed.
The audit reportedly claims that in 3 of 367 tests of the gold’s purity, the gold was more pure than Treasury records had previously indicated, and as a result has increased the book value of the US’ gold holdings by 27 ounces.
The most newsworthy revelation in the report however was that the US (which is supposed to hold the vast majority of its gold reserves at the NY Fed) holds a total of 32,021 good delivery bars on deposit at the NY Fed:
As part of the audit, the Treasury tested a sample of the government’s 34,021 gold bars in the New York Fed’s vault five stories below Manhattan’s financial district.
Why is this so significant? As anyone with a simple calculator can discover, the Treasury department has just inadvertently admitted that rather than the official 8,133.5 tons the Treasury reports as the US’ official gold reserves, the Treasury’s actual physical gold stores at the NY Fed are a measly 466.57 tons! While the Treasury does reportedly also hold gold at Fort Knox, several reports have claimed that up to half of the US Gold is held at the NY Fed!
No wonder it will take the Bundesbank 7 years to repatriate 300 tons!
Jim Sinclair has sent email subscribers another alert Sunday night regarding the latest take-down of gold.
Sinclair again re-iterates that the bullion banks will be the entity that makes the greatest gains in the current precious metals bull market.
Those who think the Goldmans or Morgans are stupid and clumsy are the ones demonstrating those traits. I see and know the same things these greatest of all time manipulators of price see and know. This is 1979 in the gold market right before the greatest price appreciation took place over the shortest period of time then. The most money over the shortest period of time in the gold bull market of the 70s was not made by the gold crowd but rather by the mega powers of Establishment Wall Street after doing the same things they are now doing.
Sinclair concludes by stating that in years to come his missives on gold will be dismissed based on his prediction for $3,500 gold, and the $3,500 number will be looked back upon as just the start of gold’s move.
Sinclair’s full email alert is below:
With sentiment among the precious metals community remaining downright terrible (to see just how bearish the current sentiment is, peruse the reader comments on today’s silver chart of the day) legendary gold trader Jim Sinclair continued his efforts tonight to convince PM investors to sit tight and be right.
Sinclair again informs readers that the gold boys (bullion bankers) will soon flip their naked short positions net long, propelling gold to $3,500 an ounces (Doc’s note: and silver likely to $90).
Sinclair states that legendary 10+ baggers will be seen in the mining shares sector, and that precious metals investors must stare the bastards in the eye and defend themselves- by simply being right and sitting tight.
For the first time ever, the legendary gold trader has advised metals investors to go ALL-IN on further price weakness!
Sinclair: Stare the Bastards in the Eye and Defend Yourself! [Read more...]
Jim Sinclair has sent email subscribers an email alert regarding the latest take-down of the gold market by the bullion bank cartel.
Sinclair states that the latest actions are not motivated by paper profits, but are an attempt by the cartel to shake free real physical gold bullion from weak hands in the cash market. Gold is going to and through $3500 in the reasonably near future. The point of this entire operation was to shake the tree to accumulate not in the paper market for gold, but real free gold in the cash market.
The gold banks are short the real Mccoy, and are desperate for precious metal investors to liquidate their physical holdings in a panic.
Sinclair states that all that is necessary to win the battle is to do nothing, ie hold on to your gold.
Sinclair’s full update is below: [Read more...]
The legendary Jim Sinclair (who called the current bull market before anyone over a decade ago) has long maintained that the bullion banks would make the lions share of the profits in this massive secular bull market, not the average gold investor.
Sinclair has sent an alert to metals investors today, advising that the current massive take-down in the metals is the end-game, and the Great Train robbery is in progress in which the Goldmans of the world will go massively long in gold.
Sinclair states that as soon as the bullion banks have grabbed every last available ounce of gold they can lay their hands on, gold will EXPLODE to $3,500.
MUST READ! [Read more...]
After the standard COMEX open raid this morning, gold and silver have traded strongly throughout Thursday’s session, and have rallied exactly to the cartel’s caps of $32.50 and $1735 in the afternoon access session. 7
Once $32.50 and $1735 are taken out to the upside, look for explosive moves to quickly commence in gold and silver.
Sinclair states the current bullion bank generated corrections in the metals are nearing completions, and guarantees that gold will trade above $3,500/oz. [Read more...]
The self-doubting going on around the metals community recently about the facts of manipulation are, after all this time, downright annoying.
Ted Butler’s point has always been that what’s occurring is manipulation not because the spread positions and hedges are unbalanced, or because it’s naked shorting, but because there exists a grossly disproportionate concentration and collusion of positions within the bullion bank activities in silver.
As of two weeks ago, JP Morgan alone held more than 1/3 of ALL short positions in COMEX silver. THAT is concentration that would’ve blown the Hunt brothers’ minds. [Read more...]