Global Deflation Fears: Gold Slips; Dollar Two Year High;
Submitted by Michael Nystrom on Wed, 10/22/2008 - 12:04
Please take the time today to tell at least one friend about Dr. Paul, his message, why you support him, and why our country needs him now more than ever. This is a grassroots campaign. We are the grass and we are the roots. The other candidates may have more money, but Dr. Paul has something that no amount of money can buy: He has us. He has our trust, our belief, our support and our love. Let us not let Dr. Paul, nor our country down.
Created and paid for by Michael A. Nystrom, a concerned citizen. Not paid for by, nor officially affiliated in any way with Ron Paul's Campaign for Liberty. ALL RIGHTS RESERVED
THESE EVENTS WERE EXPECTED.
"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin
---
"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin
---
There probably won't be a better time
to buy silver and gold.
"Tyrants fear nothing more than insubordination"
"It's just one big club... and WE ain't in it!"
Remarkable phenomenon
The worst the crisis gets the more money the government creates and the more valuable the dollar becomes -- and all the precious metals tank. Silver hasn't been this cheap for the past three years -- but you still can't buy it at less than 50% over spot. My calls on Silver Wheaton will expire worthless. Foolish me for thinking markets would respond in a rational way.
If a large amount of silver is desired at spot...try Peñoles.
Discover Costa Rica
Discover Costa Rica
look at the silver/gold
look at the silver/gold lease rates bob! that tells the story!
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
What story do they tell?
The so-called "gold lease rate" is the difference,
LIBOR - GOFO
LIBOR is the average rate that banks charge each other for loans. GOFO is the rate that banks charge for loans secured with gold as collateral. So high "lease rates" tell the story that banks are demanding much higher rates for unsecured loans to other banks than they are for loans secured with gold. That makes sense.
Because of arbitrage possibilities, GOFO and the cost of carry for gold on the futures market stay very close to each other. It makes sense that the cost (or price) of carry is low. The supply pipeline for small gold and silver products has emptied lately. It makes sense that a lot of traders on the COMEX would want their gold sooner rather than later, because of the spreads between large bar spot prices and small bar and coin prices on the retail market. There's a lot of money to be made melting down the large bars and selling small ones.
I knew JZ and Siera would be over here that is why I peaked in.
I am glad to see that there is an implied truce between the two of you.
Deflation for the short run.
If there is a rebound look for inflation, but I have a feeling that Japan set the example for two decades now.
Don't look for hyper-inflation if the recession and/or depression lasts longer than 5 years.
Of course there will be ebbs and flows in the currencies, but this may turn out to be a long battle.
WAHOR!!
http://www.dailypaul.com/node/48994
WAHOR!!
http://www.dailypaul.com/node/48994
The FinancialSystem is DEAD
The $1/2-1 Quadrillion derivatives bubble eclipses the real economy. As it goes, it sucks the real economy away. The idiots in Washington have chosen to save the derivatives gambling casino, but are jettisoning the real economy. Congress needs to repeal the Fed (who allowed and encouraged the derivatives gambling casino), put the current system into bankruptcy, create a new currency, and save the faltering economy and he republic.
www.JoeSixPack.me
www.JoeSixPack.me
re: gold lease rates
very interesting
thanx for sharing
also look at the silver
also look at the silver lease rates! but there is no shortage mind you!
something is going on behind the scenes that most people don't see..
something else big is coming soon! what? who knows! but it is not good!
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
AKA credit a crunch and banks unwillingness to lend
SIERRAHPBT,
Higher lease rates in the thinly traded market of silver are AKA a credit crunch and banks unwillingness to lend. It in NO WAY implies a shortage. But according to you, lease rates AKA paper prices do not reflect the physical price anyway. So why are you now suggesting that lease( paper rates) increasing will have an effect on physical rates? Apparently, even with the shortage you claim, the physical price is catching up the the paper price.
Spot Prices per Ounce
Silver Bid $9.56
Silver Ask $9.60
Our Sell Price* Per Ounce
50 to 99 $11.00
100 to 499 $10.75
500 to 999 $10.65
1000 to 4999 $10.55
5000 or more $10.50
*Price at which we sell to you. The minimum order is 50 ounces.
Our Sell Price Per 5 Oz Bar
10 to 19 $55.00
20 to 99 $53.75
100 to 199 $53.25
200 to 999 $52.75
1000 or more $52.50
http://bullion.nwtmint.com/silver_nwtmintbullion.php
SIERRA, you have stated early this month , the physical price of silver is $20 per oz on Ebay. Apparently, higher lease rates must lead to lower physical silver prices, or is there is there something big going on behind the scenes only you can see with your tin foil hat? Dude you will spin any number to make your "Ted Butler" silver fairy tail to come true.
Ride that mule SIERRA, you are more stubborn than he is.
Is the Dollar Really Stronger or
the Euro is getting weaker. I think that if the dollar is stronger then the Japanese Yen should be trading higher. It is currently around 99 Yen to the dollar, if the dollar was stronger it should be around 115 Yen to the dollar. The dollar have been losing value against the Yen while the Euro is losing value against the Dollar.
http://www.campaignforliberty.com
http://www.infowars.com/
The dollar is stronger
The Yen is stronger still.
The Yen is experiencing strength because it's tied to the dollar (because of how much money we owe them) and also because their banks are better hedged against the mess and thus aren't needing to be bailed out like ours.
The dollar is really stronger, not only because of the exchange rate, but because every commodity is much cheaper.
The Yen carry trade
The dollar is strengthening because of forced liquidation. The yen is strengthening relative to the dollar because of the demise of the yen carry trade.
Until recently, hedge funds would borrow yen at interest rates near zero, and sell the yen for dollars. They could then either invest the dollars in T-bills at a higher rate, or they could gamble with them. The yields on T-bills have fallen to near zilch, and there are no good gambles to be had on the long side.
Investors are wanting their money (US dollars) back from the hedge funds.
So the funds are forced to reverse or "unwind" the process. They sell their assets for dollars and then buy yen to cover their shorts, so to speak. So the dollar gains when they sell the assets (buy dollars for the assets), and then the yen gains relative to the dollar when the fund has to buy yen to repay the loans. It's a short squeeze in yen.
I just love the folks on DP.com
because they represent all factions of our economy. From the destitute to the ones who are trying to protect their little grip on wealth. Paranoia manifests its self in so many ways. From knowing the world shall end to the ones who think our economy shall prosper. Keep your little delusion alive as it is the only thing to have to hang on to.
Speculation
All the redemptions going on in the hedge fund universe are putting downward pressure on everything, including commodity ETFs, that are being sold off for cash.
Jzneff, Are you currently
Jzneff, Are you currently shorting the USD?
P.S. Great call on the $70 dollar oil!
No
Hmm...didn't even think of shorting the dollar. I've never seen or heard of doing that, but i'm sure you can bet on about anything these days. What would you short it against?
You're not about to see a major move that you can get rich quick on. The dollar is not going to crash in value once the Libor gets under 2%, it's more likely to continue to produce some normal inflation.
I don't think this is an opporitunity to make you wealthy overnight, but if I see another, i'll be sure to post it here. I'll also be demanding a finders fee, rather than politely requesting like I did with crude ; )
If you want to get wealthy from the mess that our country's in...buy rental properties. Even with the huge tumble that the housing market has taken, rent on those houses have gone up at a normal rate.
thanks, Jzneff
I'm still a newbie in regards to these financial markets, but I just assumed you could short the dollar :). After your response, I now know that it is not even possible. Thanks for the advice and in depth insights, and I will heed your advice and look into rental properties!
Thanks, Jzneff!
Yes ... you can short the dollar.
I am not into currencies so I do not know if you can do it directly, but there are a number of ways to do it indirectly.
WAHOR!!
http://www.dailypaul.com/node/48994
WAHOR!!
http://www.dailypaul.com/node/48994
Look At the Kitco Front Page
Gold stock index is down
Gold lease rates are climbing
Interesting.
It's short term
The deflation will be over soon. The dollar has actually risen more than I thought it would have by this point...but I don't think it'll go much higher.
Once all of the liquidity they've been pissing on the brush fire starts to move around the economy a little, we'll get our inflation back.
http://www.bloomberg.com/markets/rates/keyrates.html
Use this metric...once the 3 month Libor gets below 2%, this is your time to buy gold, buy silver, because this is when we'll begin to feel the effect of the spending spree they've been on in the last month.
I would expect this to occur in the first 2 weeks of December. This may be your last chance ever to own gold this cheap.
Buy silver now, it's going to go up in the next 2 weeks, and might not get down this low again.
problem is you better buy
problem is you better buy now.. when the rest of the population figures this out there will not be any to be had.. we are in a shortage for gold and silver right now!
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
The problem with buying now
If it was possible to buy an anything like a normal premium over spot I agree that this would be a good time to buy gold and silver. But the premiums at the retail level are now so ridiculous I wouldn't want to buy now. If I were rich I'd just buy short term futures and take delivery, but I can't play with that kind of money.
someone will be along
someone will be along momentarily to tell you that we're currently in an inflationary period.
=)
perspective and semantics
I suppose it depends on how you look at it. clearly the fed has been inflating recently. but prices are falling. the liquidity being pumped into the banks, has not yet been put into circulation in significant amounts. the price increase and dollar decrease will come in time.
Laissez-faire Blog
Laissez-faire
When the money hits main street...
When the lions share of the "new money" (digits) hits main street America over the next 12 weeks we will realize hyperinflation the likes no one alive today has ever seen. Brace yourself. Santa will be unloading the derivatives on the U.S. and the rest of the planet come December. Double trouble and "Rome" will burn!