Financial topics

[OLD1953]

Ok, I see what you mean. I'd always thought of futures markets based on actual delivery as just factors or contract brokers, not as a speculative futures market per se. I suppose I dated myself there, you never seem to hear of someone calling themselves a factor now.

[Higgenbotham]

A couple pages back I mentioned the cash settled silver contracts, where someone can sell a silver futures contract and upon expiration no delivery of metal is required or even possible. The positions are squared with US dollars upon expiration (this actually creates a demand for dollars, not metal). To think that separate futures contracts have been created for the sole purpose of speculation is quite remarkable. If future generations are able to read about this type of activity they will scratch their heads trying to figure out why it was all considered perfectly normal at the time. Further, knowing that top science and engineering graduates from top universities were wasting their time on this while being paid more than similar people working in their respective fields will help them understand why the still upcoming collapse was so devastating.

[Higgenbotham]

I just entered into a short silver position on today's outside bar reversal and will add on confirmation. I was looking for a high around $45 before the reversal but it didn't quite get there.

Added to the short silver position as it fell further. I will not add any more unless/until the May low is taken out. But not as much down there. Silver is down about 4% on the day.

Covered half of the short silver position from yesterday. Silver is down about 5% on the day and down about 10% from yesterday's high.

[Higgenbotham]

I just entered into a short silver position on today's outside bar reversal and will add on confirmation. I was looking for a high around $45 before the reversal but it didn't quite get there.

Added to the short silver position as it fell further. I will not add any more unless/until the May low is taken out. But not as much down there. Silver is down about 4% on the day.

Covered half of the short silver position from yesterday. Silver is down about 5% on the day and down about 10% from yesterday's high.

Covered the remainder. Silver is down about 7% on the day.

[Higgenbotham]

This article gives some of the details about why printed money causes chaos and revolution. Due to Bernanke's policy of printing money, the authorities are unable to deal with the corruption, as they themselves are corrupted by the big pools of printed money and the possibilities of how to redistribute it (and probably get a little cut for themselves).

http://news.yahoo.com/bank-americas-no- ... 31303.html

Again I would refer to Playfair's quote from 1805.

As in the hall, in which there has been a sumptuous banquet, we perceive the fragments of a feast now become prey to beggars and banditti; if in some instances, the spectacle is less wretched and disgusting; it is, because the banquet is not entirely over, and the guests have not all yet risen from the table.

William Playfair
An inquiry into the permanent causes of the decline and fall of powerful and wealthy nations
1805

They can't stop themselves.

[richard5za]

I am now driving blind, grateful that I am 95% in cash.
I think that general stocks are going to crash, but that depends, at least to some extent on Bernanke on Friday. I think that gold will find a support level, but don't know where. If stocks crash, gold may continue its amazing up run, but who knows.
It could be a volatile time in the next few trading days.

[RDRUNR]

Amazing how gold is now down $150oz since yesterday. Investor fear of losing more will cause it to go down again as people scramble to get out of this massive bubble and into the safety of the US dollar.

[John]

The price of gold has fallen $150 per oz in the last few days. This
has pushed it below the 200 day moving average (or some other moving
average if not that one), which makes it a HUGE BARGAIN, a BARGAIN OF
HISTORICAL PROPORTIONS.

Gold is such a SAFE investment because it's the only remaining
NON-FIAT currency on earth. The American dollar may be a fiat
currency since it went off the gold standard, but gold has stayed true
to the spirit of the Austrian school by remaining a true non-fiat
currency, backed by -- you guessed it! -- GOLD!

With the historic cheapness of gold, now is the time to borrow as much
money as you can and buy GOLD! GOLD! GOLD! Gold will be selling for
$50000 per ounce before you know it!!!

John

P.S.: For those who are new to this web site, please don't assume
that the above is serious.

[Higgenbotham]

December Futures

Gold
This Week's High 1918, Last 1714, Down 10.6%

Silver
This Week's High 44.30, Last 39.43, Down 11.0%

It's very surprising that gold is moving down in lockstep with silver. In recent posts, I have given the opinion that close to gold $2000 and silver $45 was the place that the gold bubble could break at the very earliest but gold could be higher for years into the future after this break. I'm now changing that opinion for now as gold is exhibiting weakness comparable to silver. If gold were still in a bull market it would be stronger than silver as it comes down. That's still likely to be the case, but this is saying that a lot more can come off the price before that happens.

I'm short silver again from about 50 cents higher than where I got out on average yesterday. The market is moving so fast that posting positions won't be possible.

I'm also keeping in mind that the August 26 panic date could be primarily in the metals.

[richard5za]

which makes it a HUGE BARGAIN, a BARGAIN OFHISTORICAL PROPORTIONS.

You are welcome to joke about gold, John, but there is a serious side as well. Gold has been in a bull trend for about a decade, and whilst it has recently been over bought to a very considerable extent, there is no indication as to whether the long term trend has reversed, or that gold is still a bull.
Gold has established itself technically as a safe haven, albeit that this was quite recently and might in certain circumstances reverse, but a safe haven status is a plus point for its long term bull trend.
The question to be answered is where gold will find its next support point, and once found will it hold that, later rise, or in due course will it break down to the next support. Its impossible as I write to come to a reasoned and logical view because the technical data is not yet present, plus the recent history has been massively volatile.
Richard