Submitted by SD Contributor FW:
Frequently, silver worrywarts claim the cartel can ultimately control the price of silver, and that no advance will come beyond levels the cartel deems appropriate. This logic fails in the face of the 12 year old bull market. More to the point, the argument fails to factor the importance the powers that be assign to keeping the rigged game going. Sure, the cartel cheats. It’s like they play poker with 15 extra decks of cards under the table, able to pull needed cards at will just as easily as manufacturing naked short sales. But they sure as heck don’t want to flip the entire poker table over and end the game forever. It’s critical that you understand this analogy. On an incremental basis, as the cartel’s manufacture of naked shorting becomes increasingly brazen and ever more separated from the realities of the true physical market, they run the risk of flipping over the poker table. They lose all power to control paper prices when the game is seen by all as over — when the poker table is flipped over.
On an intra-day basis we can see longer-term money sentiment was actually buying precious metals equities AFTER the Friday morning COMEX paper raid. Look at the chart of the Dec. COMEX silver contract vis-a-vis the GDX and GDXJ below for an expression of that dynamic.
More and more people are coming to understand what the cartel is doing and these people are buying the dips. You don’t see it on the COMEX as easily as expressed in the comparison above. But the buying is here, and it’s not going away.
In early September when silver first challenged $35 there was quite a bit of discussion in the precious metals community about the cartel having the ability to crash the price back down to the $32 and change area — if not a full retest of $30. I noted at the time it was unlikely given the qualitative shift that had happened with physical market demand. Indeed, that case proved out — and will continue. For all the monumental capping efforts the cartel has executed, they’ve only been able to get silver to just a bit below $34 on a spot basis for mere hours. I don’t give a rat’s arse about their rising short position nor hyperventilating about the scary picture painted by the commitment of traders data. There comes a time when those signals fail to operate and being able to know when and when not to let that data trump decision making is a qualitative art. The past two months have proven to be a cartel failure and the smart money knows it. Rising shorts in the face of higher silver prices is to be expected and exactly what we’ve seen historically.
Frequently, silver worrywarts claim the cartel can ultimately control the price of silver, and that no advance will come beyond levels the cartel deems appropriate. This logic fails in the face of the 12 year old bull market. More to the point, the argument fails to factor the importance the powers that be assign to keeping the rigged game going. Sure, the cartel cheats. It’s like they play poker with 15 extra decks of cards under the table, able to pull needed cards at will just as easily as manufacturing naked short sales. But they sure as heck don’t want to flip the entire poker table over and end the game forever. It’s critical that you understand this analogy. On an incremental basis, as the cartel’s manufacture of naked shorting becomes increasingly brazen and ever more separated from the realities of the true physical market, they run the risk of flipping over the poker table. They lose all power to control paper prices when the game is seen by all as over — when the poker table is flipped over.
The poker table analogy isn’t perfect. But it might be helpful to some struggling to understand the link between the physical market and its ability to limit the power of the paper market. Yes, we are ruled over by gods that play in the paper market. But by definition, the paper market only has power because market participants give it legitimacy through participation. If there’s anything that scares the cartel more than the rising price of silver it’s the scenario of the cartel overplaying its hand and thereby de-legitimizing the very paper markets that give them power to manage (not fully control) prices.
Friends, you’re witness to history. You’re watching the de-legitimizing process of the paper precious metals markets unfold before your very eyes and there isn’t a da** thing the cartel can do about it other than manage the slow burn because they want to avoid flipping over the poker table at all costs.
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/live/s_silv.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/live/s_gold.gif)
Let me be devil’s advocate here for a moment. (!) this cartel makes money on the way up and the way down…true. But they (without admitting it out loud) are recognizing that the Silver/Dollar rate is much more important than the Dollar/other Fiat rate. They are in fact preserving the Public’s Money (doing god’s work) and purchacing power (never mind that the bill goes to grandchildren to eternity) in the short term. If (when) our ounces are worth $100 (+) then think what that will do to the Price of Tea in China.
I’ve been watching these PM raiding games being played for over 15 years. And every year someone comes out saying crash JPM or cartel going to get overrun or CFTC going to make the rules change. So far nothing has changed, and I am not expecting it to change.
When the COT numbers get to extremes like they are now, you better pay attention:
http://snalaska.com/cot/current/charts/SI.png
History says the goons always win in situations like this, and playing an all-in strategy waiting for the “cartel to get overrun” is a strategy to the poorhouse. Maybe it will happen one day, maybe it won’t. But be sure the people running the show are NOT idiots. You can use your gambling money if you like, but backing up the truck right now is both historically and statistically not a wise thing to do.
Stop hoping and complaining, and start trading smart instead.
The possibility of a cartel crash is simply the cherry on the cake. The main investment drive is unprecedented debasement of currency.
Well the statistics actually show that now is a good time to back up the truck; the chart fundamentals strongly point toward a rise to
the previous silver top, and the silver golden cross has recently been made.
That being said I think one can do much better than buying bullion, which at worst will protect against long-term inflation. I am aware of Chinese numismatic traders that do not raise an eyebrow unless their investments net at least 3x short-term return.
In that 15 years have we had qfinity and a rising chance of hyperinflation like we have now? That factors in on purchasing silver now for a lot of small stackers. Even the tiny little bacteria can kill the giant!
I’ve been watching the cartel’s raid and gold and silver’s prices for one year. What I am seeing during these months is the cartel losing power every time they raid those two metals. So, I do think that the cartel will soon get destroyed and once they do, high inflation in gold and silver will happen.
This is a good post. I have been through the disappointment of counting on the CFTC to do the right thing. Now I know it is only the physical market that will make things right. It is easy to think the cartels are omnipotent and can control the market forever. But they cannot denfy natural laws with impunity. Just like gravity, human awareness and desire for the real thing will overcome paper.
To IS, keeping the dollar/silver rate low does not help the public. It only masks the inflation that is already present. To aganalyzer, there is no problem backing up the truck if you are in the fully paid for physical. It is only margin calls that can hurt the long trader when a downdraft occurs.
Just my two cents. I’m open to correction.
O.K…One Ounce of Silver @ $34.51 will buy 8.67 gallons @ $3.98 per. One silver Dollar bought 3 gallons @ 32.9. The price of gasoline has actually gone down.
“To IS, keeping the dollar/silver rate low does not help the public. It only masks the inflation that is already present.”
Not IS, but… let me suggest that the “mask” that inflation has is a lot like the one that “covers” Superman’s eyes, preventing anyone from recognizing that the other 90% of his face looks EXACTLY like Clark Kent. IOW, the disguise is REALLY thin and anyone who wants to recognize either Superman or inflation can rather easily do just that.
I agree that this ratio is not helping most of the citizens in this country. Depressing the prices of gold and silver has one and only one real use – that of defending the US dollar from even further decline in value. Confidence in the US dollar MUST be maintained at all cost is their mantra. Unfortunately for them and the US dollar, confidence IS eroding in spite of all these government sanctioned metals manipulations. The US dollar is not in serious danger of imploding but, like a dropped piece of ice on a Texas sidewalk in August, it is rapidly melting away in buying power. Bernanke seems to be “helping” by grinding that bit of ice under his heel.
@Ed_B you said, “Depressing the prices of gold and silver has one and only one real use – that of defending the US dollar from even further decline in value.”
Doesn’t it also allow central banks as well as eastern interests the opportunity to keep on stacking at reduced rates? I’m not aware of any evidence the US government is controlling the prices through JPM shorts. Couldn’t it also be some other faction? I doubt we’ll ever know who the ”cartel” really is.
@40OZ… Yes, it does allow anyone who wants to buy gold and silver at lower costs the opportunity to do so. However, this price suppression action also occurred in the 1990s when central banks were net sellers of gold and before China started buying and producing so much gold. They are occurring at the same time now but this was not always the case. Because of this, it seems to me that metal price suppression / dollar support is the primary goal here.
”I’m not aware of any evidence the US government is controlling the prices through JPM shorts.”
The Internet is awash in info on this. No, most of it probably is not the hard evidence that a court would require but when there is a substantial amount of circumstantial evidence on something, it tends to exist for a reason. There was a wired message from a US embassy in either China or Japan to the US State Department in DC about gold price suppression that strongly implied that this was occurring, that the government was directly involved, and that it had been occurring for some time. Other memos and letters from years past show that various Fed Chairmen recommended suppression of gold prices as ways to support the US dollar. Do a Google search for “gold price suppression scheme” and see what comes up.
I believe that price suppression of gold and silver are happening. JPM is likely a big part of this but not necessarily the only player here. The recent Libor rigging scandal is only a small but important part of the activities of some of the people in the financial arena. Until that story broke and insiders started talking, NONE of us was aware of it even though it had been going on for the better part of 10 years.
“Couldn’t it also be some other faction? I doubt we’ll ever know who the ”cartel” really is.”
Yes, it certainly could be someone else or even several some one elses… but it is pretty clear that JPM is involved in the naked shorting of the silver market and that the government is not interested in pursuing them on this issue. Well, why not? Others have been pursued for this behavior but not JPM. Coincidence? Maybe, but that seems quite unlikely. JPM is a very high profile company, so is definitely on the regulator’s radar, should they choose to look at them. If we start with the basic premises that money is power and that absolute power corrupts absolutely, it is not difficult to come to the conclusion that the BIG banks of the world with HUGE financial resources available to them are using these to shape the world as they see fit. The confluence of interests between banks and the government is just too close and friendly for many of us not to recognize the potential for and the likelihood of some serious financial skulduggery.
As in a lot of things in this world of ours, it is up to each of us to do our own research and then reach the conclusions that seem most reasonable to us. While doing this, it is best to keep an open mind and question EVERYTHING. As you suggest, it is likely that what we don’t know about this is much greater than what we do know, so there is considerable room for supposition here. Hopefully, it will be well educated supposition with as much corroboration as can be found.
The one aspect very precious few folks can even remotely factor into their thinking is that the banknote scheme has run its course. Though it’s happened each and every time its dig up from its deserved grave, since the notion of representative ‘money’ was first conceived. Those who watch its culmination simply refuse to accept their eyes, ears and intellect. Paper ‘money’ dies! It’s a fact of real life on this physical plane. That ‘card table’ isn’t merely going to flip over, it’s disintegrating into saw-dust as surely as if it’s been colonized with termites from the day it was built. The ‘infestation’ is a mathematical progression that had shifted into exponentiality back in the mid-1960s.
FBI Warrants Issued For Jaime Dimon..
Doc none of my posts show up on your breaking news. So, I will post it here. http://www.myspace.com/tom_heneghan_intel/blog
This video was put up on Youtube on Oct. 2…….no sign yet (Oct. 7) that this has been reported on other alternative news sites…
I agree with jsnip4 on this Tom Heneghan clown.
@NetRanger808 Thank you for the feedback. I don’t see it in the spam filters. Is anyone else noticing similar issues?
@ BullRun..No Problem.. I keep attempting to post these in Breaking News Forum. Yet, I can never see the links & or attachments post.. There are other feeds pertaining to the indictment of Jaime Dimon. Just could be something that Gata Bill Murphy was previously referring too. However, could not comment on.
The “cartel” is our govt. playing a musical chair game with real assets with the other “cartels” ( other govts.) around the world. Trying to see who can hold the lionshare in the end . Their minions jpm and the like use munipulations in a brazen attempt to place a maximum gamble to maximize their profits. Knowing all the while that they will can default , de-base or otherwise be bailed out. The rest of the world can see through this greed. Our reputation as the reserve currency will forever be tarnished. costing us dearly in the future world marketplace. We americans are just pawns , who will be ever increasingly fleeced to make up for this shortfall by our leaders.
A story like this seems incredible. There I was, thinking that the BIG NY banks owned the US government and had bribed everyone who was anyone in the government and now this pops out of the woodwork. Seems hard to believe. Show trial? Could be. Conviction? Not bloody likely!
Why does your graph in the upper right hand corner have http://www.kitco.com on it? Isn’t that like taking your shorts from yesterday and turning them inside out to wear today!
http://www.huffingtonpost.com/2012/05/15/jamie-dimon-jpmorgan-trading-loss_n_1519055.html
Huffington Post…Previously Stated Jaime Dimon was safe for the time being…
well, what do you know, another major takedown just a few minutes ago. Glad I held off on buying the dip on Friday, although resistance and reality asserting itself and silver regaining much of this by close tomorrow wouldn’t surprise me.
Excuse me ya’ll, but we’re under attack… down 30 cents in 10 minutes on a dump of 3700 contracts. Somebody wants to sell lots of contracts really cheep! You always make the most profit selling 18,000,000 ounces all at once on a Sunday evening… ?
80 cent dump now.
If silver is the greatest danger to the banks and the FED, why wouldn’t the FED simply eliminate this danger to their existence? What would prevent the FED from manipulating Congress to pass laws to ban individual ownership of silver for the sake of insuring that industry use of silver would be preserved? The best way to persuade Congress to ban silver ownership would be to provide the evidence that such action would benefit the American people. If silver is truly scarce, then eliminating a major source of consumption (silver ownership), would make silver more abundant for industrial use. In removing a major source of acquisition (individual ownership) the availability of silver would become more plentiful for industry. However, the real purpose behind such action would be the preservation of their scheme by eliminating the greatest danger to their game, personal ownership of silver! The results would make owning silver a crime punishable by law. Plus, by outlawing ownership of physical silver, paper contracts would then be only competing with the physical industrial market. Or…, am I missing something here?
This wouldn’t work because this would be met with a lot of political opposition. Secondly, US investors could still quite easily obtain silver in the black market and or purchase them overseas (or most likely in Canada).
Remember, officially, there is no manipulation going on in the gold/silver market and to take such a drastic step as to outright ban silver purchases by Americans would pique the interest of investors worldwide and could cause even greater interest in the metal.
But if the government bans the silver ownership, then there would be a lot of black markets selling silver and the premiums might be high. Also, I’m sure that there will be Americans against that law because it will affect their liberties and might start a protest.
Why my posts are taken down when I speak my mind, I have no idea unless “The Doc” disapproves my mind
speak. No vulgarity, just connecting dots that make more sense than a Raid.
Ranger from Texas
@Ranger The Doc hates you and he wants you to get out of SilverDoctors because you are causing troubles!
Just kidding! The actual reason is because the website’s moderators are checking the comments to see if they are spams or not. Am I correct Doc? (@the-doc)
The main question that everyone is asking is when will the cartel flip the precious metals poker table. Now all I can see is that the cartel is losing power. Also, there are new silver buyers joining the silver market every time which means that they are making the demands bigger.
Here I am again in vogue and the Doc is pissed at me. There are so many contadictions stated that some or most
replies here are confusing, even from all the expert pitches.
I am No Silver Basher whatsoever! The fact is that I don’t really believe anyone knows where Silver or Gold
is going in any time frame. Like I have mentioned concerning Silver. JPM has sold more paper Silver that
has ever been mined. There is a lot of Short staying power left. I would like to see Jamie Dimon and Blythe Masters
go directly to jail along with the other criminal cronies. That won’t happen in anyone’s lifetime on this blog.
Heck I own physical and SLV and if I can get what I paid for SLV (which was a very dumb move on my part!) I intend to
buy more physical Silver and then a sleeve of Gold Eagles. I always look to the other side of the coin so to speak, when
it comes to predictions of fortunes made. All I say here at this point from a previous post is what “IF”. Governments of the
debasing monetary world are not stupid. Just because we own Silver and Gold doesn’t mean that they cannot consficate
the same from us as they can from any Bank account, Ira or 401K. In the end the government is not the debtor of
our massive debt, the American taxpayer is!
Adios for now.
Ranger from Texas