Tuesday, February 8, 2011

Welcome to the February 8th*Updated

A couple of weeks ago, I snipped some anonymous internet rant about a cabal of traders buying silver and gold (paper) longs and that at the end of the settlement month(s) they were going to demand delivery of the underlying commodities.

*A commenter on another site noted that no in fact, the squeeze was on and the trade would be settled in cash, this is proving inaccurate. From the mighty Organ. Thus the total number of silver oz standing in February rose dramatically today to 1,455,000 +  475,000 =  1,930,000.  We gained a massive 500,000 oz today).  Somebody was need of silver in a hurry!!*2nd note. Email confirmed I had the wrong bank shorts. JP Morgan, HSBC...noted and edited.

Most people I follow believe that the Comex has far more contracts trading in paper gold and silver than deliverable gold and silver. Such contracts are almost always settled with cash. However, if some cabal actually all demanded delivery of physical gold and silver at once- could it be delivered? The smart money says, "no." They have 30 days to deliver the goods. If they are right, spot prices could go parabolic. The villains in our story are JP Morgue and HSBC...smaller players as well. But they are bankers. Thieving, greedy, manipulative bankers.

Normally, I think such ranting is usually internet BS. Here's the weird part. That rant was written on Jan. 7. And everything the writer has said- has happened. He predicted the start would be today. A search of his comments. http://search.messages.yahoo.com/search?.mbintl=finance&q=wynter_benton&action=Search&r=Huiz75WdCYfD_KCA2Dc-&within=author&within=tm And what are we seeing? Heavy buying in both complexes. Gold is pushing through resistance at 1350. Silver pushing through resistance at 29.80. Good stuff. God bless those Chinese physical buyers. They have stretched supply to it's limits and made this scenario possible. In a country with incredible food inflation woes...they know the only safe haven is physical.

Great stuff from the Organ. http://harveyorgan.blogspot.com/

For more on the February phenomenon, please read this crazy bastard's blog. Fresh back from a trip to Vegas that I have yet to hear one thing about. Some cliche comes to mind. http://tfmetalsreport.blogspot.com/2011/02/hmmm.html

1 comment:

Aaron Kinney said...

What happens in commodities stays in commodities? Nah, I must have the cliche wrong...