Part 1: THE SILVER CARTELS HAVE CHANGED THEIR M.O.
Part 2: THERE IS NO GOLD TO BUY!!!
So this $100 billion suggestion (for Spain) is WAY below the number! Of course it doesn’t matter what the capital deficiency is, how much of the money is leaving the banks? When money leaves a bank, the asset theoretically, well, they’ve got to write a check, but how do you write a check when you can’t sell an asset? That’s why they have to keep getting bailed out.
I suspect that the stock market being the headline thing that everyone looks at has a very big hand of governments who realize they have this awful financial system, and how can we make it look better?
Most times financial institutions have done something that was inappropriate they always just pay some meager little fine- never having to admit that there was any guilt- they just pay the meager fine and it goes off into the sunset.
That’s always been my argument. Even in 2011 the silver sales exceeded the gold sales in dollars.
Gold is the canary in the coal mine, and if people go there, the pressure on the central planners becomes extreme. In the last two letters PIMCO’s Bill Gross wrote, he is going more and more to hard assets and he mentioned gold in the last letter. I just think of it this way. Ok Bill, you’re the bond king.
It’s just a matter of time before this shift gains some momentum! We are now seeing some early stage guys, mostly in the hedge fund business and of course the University of Texas fund and a few others, but it’s a groundswell that is just going to pick up speed given time.
We have a desperate financial situation already, let alone that Europe’s in a recession, China’s industrial activity is in a recession, the US is probably in a recession, how do you keep this thing going here?
Throughout the whole bull market, I always thought of it as a supply and demand thing in the physical markets. Yes, Central banks would stop selling. Yes, they would become buyers, which they have. The hedgers would stop hedging, which they have. The EFT’s came into existence, which they weren’t.
Ultimately the real purpose for gold is that you own gold because you don’t want your money with a levered financial counter-party. All of the financial counter-parties in the world are highly levered.