Tuesday, July 2, 2013

Back from Vacation to More of the Same

I have just returned from 2 weeks of vacation with family and friends.  Good that I was focused on what is really important when I saw that the banksters had manipulated the gold price to $1,200.  Although it should not surprise anyone that the price of paper gold is being further suppressed.  And that the prices were suppressed leading in to option expiry date.  Shocker!!  One step closer to the day that paper gold and silver markets default and are revealed as pyramid schemes.   One day closer to when physical metal is precious.

It seems that this time around,  unlike during the mid-April smack down, coin dealers did not stock out and are not charging excessively high premiums.  The coin dealers must be proficient at hedging their purchases.  I wish I knew exactly how their purchases, from the US Mint for example, are priced.  There are reports of historically high premiums in the wholesale precious metals markets.  China has increased their bullion purchases.  Interesting times in India where government restrictions on gold imports is tampering demand.  According to import data presented by Sprott, Indians have switched to purchasing silver, large amounts of silver, which is currently not restricted.  http://www.sprottgroup.com/thoughts/articles/silver-is-winning-india%E2%80%99s-%E2%80%9Cwar-on-gold%E2%80%9D/

There is a very interesting situation with JP Morgan on the COMEX that Harvey Organ has been reporting for several weeks.  And now that June is complete the situation is especially pertinent.  According to COMEX reports JPM does not have enough gold in inventory to settle gold contracts that JPM wrote for June.  Please go to Harvey's site to see his writing directly.  http://harveyorgan.blogspot.com/  I will summarize it here:
JP Morgan, as a dealer on the COMEX previously entered contracts to sell gold for delivery in June.  The buyers of these June delivery contracts 'gave notice' or 'stood for' delivery of 494,600 ounces of gold.  JP Morgan has not yet delivered gold to the buyers of these contracts as evidenced by reports of JP Morgan's dealer vault inventory.  The inventory reports show that JP Morgan has 401,877 ounces of gold in their dealer vault.  Where is JPM going to get the necessary 93k ounces to avoid defaulting on their contracts?  What about for all the contracts that JPM has written for delivery in future months?  Stay tuned.  How will JPM get out of this one - like James Bond after the villain has placed him in another death defying situation.   Of course the villain like a good regulator always leaves the scene allowing Bond to escape his end.  "Can we get some sharks with friggin' laser beams on their heads?", Dr. Evil.


  1. Given the current market conditions, do you think this is a good time to buy a little silver, a lot of silver, or really whole bunch of a lot of silver?

    1. I don't like to give investment advice because good advice depends on you, your tolerance for risk, time horizon, etc as much as on the markets.
      Averaging in (or out) of an investment over time works well for me and my goals and risk tolerance.
      If/when you do invest in precious metals, make sure that you know exactly what you are buying and the risks - is it really bullion or a paper claim on receiving bullion in the future?