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Will Increased Delivery Demand Bust the Gold Warehouses?
Jim Sinclair: “I have been speaking with many people this evening who have taken gold delivery. What I am hearing is not impressive. When examined closely it is a paper system that may have fallen badly behind as gold moved ahead since 2001. There is a possibility the system is antiquated and more FUBAR than anyone, even the warehouses themselves, realize.” COMEX Warehouses in Trouble?

Will the Manipulation of Gold & Silver Prices Ever End?
Gold and silver price suppression has been going on for years now, as documented by GATA and Ted Butler. Who’s behind it? Evidence points to JPMorgan Chase using massive (and illegal) short-selling on COMEX, at the bidding of the president’s Plunge Protection Team. Now, Jim Sinclair answers the question on everyone’s mind: Will the COMEX Manipulation Ever End?

What? You’re Still in the Stock Market?
Maybe you’re not bothered by the largest amount of insider selling since the DOW’s all-time high in 2007. Maybe the recent, massive, engineered bear-market rally has you seeing “green shoots” as well. Maybe you’re just lookin’ for Ten Reasons to Buy Stocks Now [humor].

What Will Foment the Coming Riots?
California, the world’s 7th largest economy, could be the first car in the jerking roller-coaster ride to the bottom of our financial and societal meltdown. Their “Governator” warned, “Califonians have until June 15 to make draconian cuts or face insolvency by the end of July.” But could these budget cuts have unintended consequences? Governator Squeezes Trigger for Crime-n-Riots

Crush COMEX Like a Ripe Melon?
A perceptive reader, Mike, is puzzled by all this talk about busting COMEX. Why hasn’t it happened yet? Does the fact that it hasn’t happened yet mean it’s likely it’ll never happen? Are we silver bugs simply doomed to suffer? Reader Asks, “What’s So Hard About Busting COMEX?”.

October 2009 Shaping Up Worse Than October 2008?
The Web Bot guys have been re-tooling their predictive software. Now it’s forecasting  “the bombing of Iran by Israel in late October, about which time, the U.S. government will be contemplating use of its ‘continuity of government’ plans due to social unrest brought about by (what else?) economic collapse.  And that in turn sets a 4-week temporal ‘timer’ that brings us to the part where South Korea receives a nuke or two from the North.  And then things get bad.”
Tired of getting a good night’s sleep? Read Web Bot Forecast for Fall 2009.

What the Next 36 Months May Look Like
In the interest of providing you with an alternate vision—something outside the mainstream—a guy over at SeekingAlpha has penned a worse-case-scenario for the next three years. Some of this is hard to stomach but could he be right about America By 2012: 10 Dire Predictions?

FEMA’s Martial Law Preparations
County officials south of Chicago reveal FEMA’s attempts to coordinate emergency vaccination of populations, structural hardening of police and fire stations, planning for mass grave locations, and anticipation of ammunition shortages. Indiana officials are worried FEMA’s Planning for Martial Law.

“11:11” Time For Lunch Or Something Deeper?
Is there a special significance to the occurrences of 11:11 found in just getting through the day? What about “Lightworkers”? More than just installing fiberoptic cables for faster Internet? Here’s my take on the 11:11 Phenomenon & Lightworkers.

Planet X. 2012.
OK, you asked me what I know about 2012 and “Planet X.” I spill the beans AND hit you up with how a dead star 45,000 light years away may have killed 240,000 people here on little ol’ Earth a few years back. Planet X and 2012.

Race Riot Warning
OK, I admit his writings make me squirm. But what if Idaho attorney Edgar J. Steele is right about the disenfranchised minorities in the US rising up against the Average Joe? How ugly could things get? Have you heard about Mexican drug gangs terrorizing residents of Tuscon? Straight Talk About Coming Riots.

Read about the only indicator I’ve found that has correctly predicted the timing and magnitude of the 1929 crash in Market Predictions for 2009-2010.

– Checking Off My “To Do” List
– WSJ Talks Amero
– Stats Say Yes, It’s a *Depression* 
– Warnings & Advice from a Saint, Part 1 
– 2009: Worst Still Ahead 
– Best Way 2 Control the Masses
– Uncle Sam’s Gold Grab   
– Something of Historic Proportions Is Happening 
– Shadow Powers Plan for 2011 
– Sober Prediction for Nov. 2009 
– Market Prediction for 2009-2010 
 
– >> How to Rate Your Bank’s Safety <<
– History of the Meltdown… (on-going)

America By 2012: 10 Dire Predictions

If this doesn’t make you think–make you want to prepare–I don’t know what will. From “Big Jake” on SeekingAlpha, “The Worst Case Scenario (Someone Has to Say It)” [edited for length]

Since the economy began sliding downhill in late 2007, mainstream economic and market experts have consistently erred on the sunny side.

As late as June 2008, mainstream consensus held that the U.S. was heading for a “soft landing” and would avoid recession.

Several months later, the slump was acknowledged to have started in January 2008, but we were supposed to see renewed growth by mid-2009, with unemployment peaking in the eight-to-nine percent range. A quick “shovel-ready” stimulus bag was supposed to set us back on the road to prosperity.

In January, recovery projections were pushed forward to late 2009. Today, the consensus is for a mid-2010 recovery, with unemployment peaking at just over 10 percent. Clearly, the mainstream has struggled to catch up to reality for well over one year. What are the chances that they finally have it right this time?

In the interests of providing you with an alternate vision—something outside the mainstream—below are ten predictions for America through the year 2012. This is not boilerplate doom-saying. Rather, I am laying out in highly specific terms what will happen over the next three-odd years. Others have thrown around the term “Depression”, but I am going to tell you precisely what it means for you, your investments, and your community.

Prediction one.
The twenty-five-year equities bubble pops in 2009: the S&P 500 will sink below 500. In a bid to stem the panic, the government will enforce periodic “stock market holidays”, and will vastly expand the scope of its short-selling prohibitions—eventually banning short-selling altogether.

Prediction two.
With public pension systems and tens of millions of 401k holders virtually wiped out—and with the Baby Boomers retiring en masse—there will be tremendous pressure on the government to get into the stock market in order to bid up prices.

Therefore, sometime in 2010, the Federal Reserve will create and loan out hundreds of billions of fresh dollars to the usual well-connected suspects, instructing them to buy up stocks on the public’s behalf. This scheme will have a fancy but meaningless name—something like the “Taxpayer Assurance Equities Facility”. It will have no effect other than to serve as buyer of last resort for capitulating smart-money types who want to get out of stocks entirely.

Prediction three.
Millions of new retirees—including white-collar people with high expectations for a Golden Retirement—will be left virtually penniless. Thousands will starve or freeze to death in their own homes. Hundreds of thousands will find themselves evicted and homeless, or will have to move in with their less-than-enthusiastic children. Already strained by the rising tide of the working-age unemployed, state and local welfare services will be overwhelmed, and by 2012 will have largely collapsed and ceased to function in many parts of the country.

Prediction four.
“Quantitative easing” will fail to restart previous patterns of lending and consumption. As the government sends out additional “rebate” checks and takes ever-more drastic measures to force banks to lend, hyperinflation could take hold. However, comprehensive debt relief via a devaluation of the dollar is even more likely. This would entail the government issuing one “new” dollar for some greater number of “old” dollars—thus reducing both debts and savings simultaneously.

Prediction five.
The government will stop pretending that it can finance continuous multi-trillion-dollar deficits on the private market. By late 2010, the sole buyers of new U.S. Treasury and agency bonds will be the Federal Reserve and a few derelict financial institutions under government control. This may or may not lead to hyperinflation. (See prediction four).

Prediction six.
The government’s narrow unemployment figure (U3) will rise into the high teens by late 2010. The government’s broader unemployment figure (U6) will cease to be reported when it reaches 25 percent—it will simply be too embarrassing. Ultimately, one in three work-eligible Americans will be unemployed, underemployed, or never-employed (e.g. college grads permanently unable to find suitable work).

Prediction seven.
With their pension dreams squashed, and their salaries frozen or cut, police and other local government workers will turn to wholesale corruption in order to survive. America’s ideal of honest, courteous, and impartial cops, teachers, and small-time local functionaries will have come to an end.

Prediction eight.
Commercial overcapacity will strike with a vengeance. By 2012, thousands of enclosed malls, strip malls, unfinished residential developments, motels, truck stops, distribution centers, middle-of-nowhere resorts and casinos, and small-city airports across America will turn into dilapidated, unwanted, and dangerous ghost towns. With no economic incentive for their maintenance or repair, they will crumble into overgrown, plywood-and-sheet-rock ruins.

Prediction nine.
By the end of 2010, tens of millions of households will have fallen behind on their mortgages or stopped paying altogether. Many banks will be unable to process the massive volume of foreclosure paperwork, much less actually seize and resell the homes.

Devaluation (as mentioned in prediction four) could ease the situation for those mortgage holders still afloat, but it would also eliminate any incentive for most banks to stay in the mortgage business. In any case, the housing market in many parts of the country will lock up completely—nothing bought or sold.

With virtually no loans being made, even the government will finally acknowledge that most banks are fundamentally insolvent. A general bank run will only be averted through a roughly one trillion-dollar recapitalization of the FDIC, courtesy of new money from the Federal Reserve.

Prediction ten.
As an economy is never independent of the society within which it functions, the next few paragraphs will focus on social and political factors. These factors will have as much of an impact on market and consumer confidence as any developments in the financial sector.

Whether rightly or not, President Obama, having come to power at the dawn of this crisis, will be blamed for it by over 50 percent of the population. He will be a one-term president. In response to his perceived socialization of America, there will be a swarm of secessionist and extremist activity, much of it violent. Militias and armed sects will be more prominent than in the early 1990s. Stand-off dramas, violent score-settlings, and going-out-with-a-bang attacks by laid-off workers and bankrupted investors—already a national plague—will become an everyday occurrence.

For both economic and social reasons, millions of immigrants and guest workers will return to their home countries, taking their assets and skills with them. The flow of skilled immigrants will slow to a trickle. Birth rates will plummet as families struggle with uncertainty and reduced (or no) income.

Property crime will explode as citizens bitter over their own shattered dreams attempt to comfort themselves by taking what is not theirs. Mutinies and desertions will proliferate in an increasingly demoralized, over-stretched military, especially when states can no longer provide the educational and other benefits promised to their National Guard troops.

There will be widespread tax collection issues, and a huge backlash against Federal and state bureaucrats who demand three-percent annual pay raises while private sector wages remain frozen or worse. In short, the “Tea Parties” of tomorrow will likely not be so restrained.

Finally, between now and 2012, we are likely to see another earth-shaking national embarrassment on the scale of the 9/11 attacks or Hurricane Katrina and its aftermath. This will demonstrate conclusively to all Americans that their government, even under a savior-figure like Obama, cannot, in fact, save them.

By 2012, there will be a general feeling that the nation is in immediate danger of blowing up or coming apart at the seams. This fear will be justified, given that the U.S. has always been held together by the promise of a continuously rising material standard of living—the famous “pursuit of happiness”—rather than any ethnic or religious ties. If that goes, so could everything else. We were lucky in the 1930s—we may not be so lucky again.

Week of May 11, 2009

What the Next 36 Months May Look Like
In the interests of providing you with an alternate vision—something outside the mainstream—a guy over at SeekingAlpha has penned a worse-case-scenario for the next three years. Some of this is hard to stomach but could he be right about America By 2012: 10 Dire Predictions?

COMEX Crimes Finished?
Gold and silver prices have been manipulated for more than two years now in an attempt to prop up the US Dollar. The CFTC, part of the Plunge Protection Team, looks the other way. But now one observer asks is the Gold/Silver Manipulation Over in 30 Days?

Swine Flu Hoax: Time to Vaccinate?
We went through this before in 1976. The gov’t created a Swine Flu scare to vaccinate the populace. The vaccination maimed and killed more people than the flu. Oops! Hey, the Shadow Powers say, let’s do it again. Big Pharma’s Swine Flu Scam.

If the Taco Sez “Time to Buy…”
Oh, here’s a good story. Yeah, it’s a sad story too. Makes you think what if “but for the grace of God…” Investment guru Jeff Clark is out for his nightly jog and gets A Sell Signal You Won’t Hear About Anywhere Else.

FEMA’s Martial Law Preparations
County officials south of Chicago reveal FEMA’s attempts to coordinate emergency vaccination of populations, structural hardening of police and fire stations, planning for mass grave locations, and anticipation of ammunition shortages. Indiana officials are worried FEMA’s Planning for Martial Law.

“11:11” Time For Lunch Or Something Deeper?
Is there a special significance to the occurrences of 11:11 found in just getting through the day? What about “Lightworkers”? More than just installing fiberoptic cables for faster Internet? Here’s my take on the 11:11 Phenomenon & Lightworkers.

84-Year-Old Legend Says You Ain’t Seen Nothin’ Yet
Richard Russel launched the financial newsletter format in 1958 and famously called the bottom for stocks in December 1974. At a dinner in California honoring his achievements he spoke out about today’s economy vs. 1974 and the Great Depression. Richard Russell: Market To Get Tougher

Planet X. 2012.
OK, you asked me what I know about 2012 and “Planet X.” I spill the beans AND hit you up with how a dead star 45,000 light years away may have killed 240,000 people here on little ol’ Earth a few years back. Planet X and 2012.

Race Riot Warning
OK, I admit his writings make me squirm. But what if Idaho attorney Edgar J. Steele is right about the disenfranchised minorities in the US rising up against the Average Joe? How ugly could things get? Have you heard about Mexican drug gangs terrorizing residents of Tuscon? Straight Talk About Coming Riots.

Masters Do Not Collect Money From Their Slaves
G. Edward Griffin, author and hero, responds to a reader who wonders if the “Shadow Powers” are about to “shoot themselves in the foot”? She asks, So What Happens When We All Are Broke?

Summer from Hell: US Dollar Collapse 4cast
George Ure (of Urban Survival fame) is talking about “competitive collapse of currencies world-wide” beginning “no later than late May.”

I’ve also watched the LEAP/E2020 European think tank’s economic forecasts with great interest. Now they’re not only predicting the demise of the world’s reserve currency, the dollar, this summer but events equally ominous. Sometimes you gotta go outside the mainstream US media to get the straight scoop. Consider the Think Tank’s 2009 Predictions.

Read about the only indicator I’ve found that has correctly predicted the timing and magnitude of the 1929 crash in Market Predictions for 2009-2010.

– Checking Off My “To Do” List
– WSJ Talks Amero
– Stats Say Yes, It’s a *Depression* 
– Warnings & Advice from a Saint, Part 1 
– 2009: Worst Still Ahead 
– Best Way 2 Control the Masses
– Uncle Sam’s Gold Grab   
– Something of Historic Proportions Is Happening 
– Deflation Xforming to Inflation Soon
– Shadow Powers Plan for 2011 
– Sober Prediction for Nov. 2009 
– Market Prediction for 2009-2010 
 
– >> How to Rate Your Bank’s Safety <<
– History of the Meltdown… (on-going)

Remember what’s in store for us: What’s Coming R Way

Gold/Silver Manipulation Over in 30 Days?

If you’ve been a precious metals investor for more than six months you’ve heard about the rampant price manipulation on COMEX. (COMEX sets the cash price for gold and silver through its daily futures and options trading activity.)

Many of us have been waiting for the illegal manipulation (run primarily by Bear Stearns until March 2008, then JPMorgan Chase since then) to end for over two years.

Adrian Douglas thinks it may be over in as little as 30 days.

At lemetropolecafe.com he writes (edited for length, link):

BIG MONEY MOVING INTO COMEX GOLD & SILVER CALL OPTIONS

In November 2005 when gold was trading about $450 I predicted the mega-move in gold up to $720/oz by noticing a very large build-up of call options in the HUI component shares. [link]

In August 2007 I identified a massive Gold call option build-up in the COMEX DEC 2007 contract and predicted a big gold move. [link] Gold was trading at $660/oz at the time and ran up to over $1000/oz by March 2008.

It just recently came to my attention from two different confidential sources that JPMorgan and Goldman Sachs have been buying large amounts of Calls in gold and silver. This made me put on my gumshoes and take a serious poke around the COMEX option open interest once again.

Figure 1 shows the cumulative Open Interest across all strike prices for the COMEX Gold Call positions and the Put positions for the JUN 09 options.

Figure 1

The ratio of Calls to Puts is 1.81 so Bulls outnumber Bears dramatically. What is also remarkable is the amount of open interest. For example, 100,000 contracts would be in-the-money if the gold price runs to $1,250/oz in the next 30 days. This is an astounding amount of option OI considering the open interest in all the futures contracts stands at only 345,000 contracts!

Let’s take a look at Figure 2 which is for DEC 2009.

Figure 2

The bets by bulls outnumber those by the bears by a 2.3 to 1 ratio which is even more bullish than for JUN 2009. The Total Call option interest is 113,663 contracts which is very similar to JUN 09. Furthermore if gold is trading at around $1600 by DEC then 100,000 contracts will be in the money!

I consider option players highly sophisticated speculators.
Such large bets are likely being made by some large money interests who are buying out of the money options BEFORE going into the futures market. Buying long futures in large volumes will rapidly drive up the gold price but the massive open interest in the Call Options then allow access to much more futures contracts at the same price by exercising the options and then perhaps taking delivery of the gold. This is bolstered by sources revealing that JPM and GS are buying in quantity. So on the part of JPM this is likely a ploy to try to cover a chunk of their massive short position.

Let’s now look at silver.
Figure 3 shows the cumulative Open Interest across all strike prices for the COMEX Silver Call positions and the Put positions for the JUL 09 options. The ratio of Calls to Puts is 1.80 so Bulls outnumber Bears by 80%. What is also remarkable is the amount of open interest. For example, 18,800 contracts would be in-the-money if the silver price runs to $25/oz in the next 60 days. This is an extraordinary amount of option OI considering the open interest in all the futures contracts stands at only 94,000 contracts!

Figure 3

Figure 4 shows the cumulative Open Interest across all strike prices for the COMEX Silver Call positions and the Put positions for the DEC 09 options. The ratio of Calls to Puts is 1.68 so Bulls outnumber Bears by 68%. Again the total Open Interest in Calls is high at almost 25,000 contracts when the Open Interest in all futures currently stands at 94,000 contracts.

 
Figure 4

I conclude that smart money is being placed for a massive rise in the gold price in the next 30 days and silver in the next 60 days (which probably means within 30 days for both metals) and again by December.

Only sophisticated traders tend to be in the precious metals option market so when there is a huge build up betting on a particular direction that is typically a directional indicator as I have shown was the case for the last two big moves in the precious metal bull.

The flat contango in gold and silver suggests there is a shortage developing of precious metals for delivery. We know that two large banks hold almost 100% of the commercial net short position. They need desperately to cover their exposure if the market is about to make a big move.

It looks as if that is precisely what is happening.

Adrian Douglas
April 29, 2009

Week of May 4, 2009

COMEX Crimes Finished?
Gold and silver prices have been manipulated for more than two years now in an attempt to prop up the US Dollar. The CFTC, part of the Plunge Protection Team, looks the other way. But now one observer asks is the Gold/Silver Manipulation Over in 30 Days?

Swine Flu Hoax: Time to Vaccinate?
We went through this before in 1976. The gov’t created a Swine Flu scare to vaccinate the populace. The vaccination maimed and killed more people than the flu. Oops! Hey, the Shadow Powers say, let’s do it again. Big Pharma’s Swine Flu Scam.

If the Taco Sez “Time to Buy…”
Oh, here’s a good story. Yeah, it’s a sad story too. Makes you think what if “but for the grace of God…” Investment guru Jeff Clark is out for his nightly jog and gets A Sell Signal You Won’t Hear About Anywhere Else.

FEMA’s Martial Law Preparations
County officials south of Chicago reveal FEMA’s attempts to coordinate emergency vaccination of populations, structural hardening of police and fire stations, planning for mass grave locations, and anticipation of ammunition shortages. Indiana officials are worried FEMA’s Planning for Martial Law.

“11:11” Time For Lunch Or Something Deeper?
Is there a special significance to the occurrences of 11:11 found in just getting through the day? What about “Lightworkers”? More than just installing fiberoptic cables for faster Internet? Here’s my take on the 11:11 Phenomenon & Lightworkers.

84-Year-Old Legend Says You Ain’t Seen Nothin’ Yet
Richard Russel launched the financial newsletter format in 1958 and famously called the bottom for stocks in December 1974. At a dinner in California honoring his achievements he spoke out about today’s economy vs. 1974 and the Great Depression. Richard Russell: Market To Get Tougher

Planet X. 2012.
OK, you asked me what I know about 2012 and “Planet X.” I spill the beans AND hit you up with how a dead star 45,000 light years away may have killed 240,000 people here on little ol’ Earth a few years back. Planet X and 2012.

Race Riot Warning
OK, I admit his writings make me squirm. But what if Idaho attorney Edgar J. Steele is right about the disenfranchised minorities in the US rising up against the Average Joe? How ugly could things get? Have you heard about Mexican drug gangs terrorizing residents of Tuscon? Straight Talk About Coming Riots.

Masters Do Not Collect Money From Their Slaves
G. Edward Griffin, author and hero, responds to a reader who wonders if the “Shadow Powers” are about to “shoot themselves in the foot”? She asks, So What Happens When We All Are Broke?

Summer from Hell: US Dollar Collapse 4cast
George Ure (of Urban Survival fame) is talking about “competitive collapse of currencies world-wide” beginning “no later than late May.”

I’ve also watched the LEAP/E2020 European think tank’s economic forecasts with great interest. Now they’re not only predicting the demise of the world’s reserve currency, the dollar, this summer but events equally ominous. Sometimes you gotta go outside the mainstream US media to get the straight scoop. Consider the Think Tank’s 2009 Predictions.

Read about the only indicator I’ve found that has correctly predicted the timing and magnitude of the 1929 crash in Market Predictions for 2009-2010.

– Checking Off My “To Do” List
– WSJ Talks Amero
– Stats Say Yes, It’s a *Depression* 
– Warnings & Advice from a Saint, Part 1 
– 2009: Worst Still Ahead 
– Best Way 2 Control the Masses
– Uncle Sam’s Gold Grab   
– Something of Historic Proportions Is Happening 
– Deflation Xforming to Inflation Soon
– Shadow Powers Plan for 2011 
– Sober Prediction for Nov. 2009 
– Market Prediction for 2009-2010 
 
– >> How to Rate Your Bank’s Safety <<
– History of the Meltdown… (on-going)

Remember what’s in store for us: What’s Coming R Way