While there may be "true believers" in the gold bug fraternity, there are many, many more "true believers" in a fraudulent system set up to service the chosen few and very happy to look the other way because they are munching from the trough of unlimited money.
Don’t hold you breath.
Excellent discussion, very informative and full of learning (except of few personal attacks/fights).
Here is a silver price prediction chart I made on March 13, 2011 (red line) and after predicting correctly crash in May 2011 and September 2011 corrected a bit its time scale in October 2011 (green line, or line that does not shoot up in April 2012): (use right click-view image to see the numbers):
i will explain how I made the chart that proved quite succesful so far - actual prices in blue-everyone knows where they are at the end of April):
As I made my silver chart as a copy/paste from about 10 years past silver action at some point which before that point matched in pattern the pattern before March 13, 2011, and the silver bubble in May I saw coming, just changing time/value scales to match the current scales, and PROJECTED forward i.e. copy pasted its part that went beyond the matching part, i can say that due to the charts accuracy so far:
The markets at that point of time and in that time and value scale were manipulated almost EXACTLY in the same way as TODAY.
Does not say much for increased manipulation argument. In fact, the pattern I took from past was in much smaller time/value scale, almost unnoticeable.
What was common , though, both before current (after 2008) and then market action there was a shock event that brought EXTREME cooperation (groupthink, herding) in all markets that later , in silver market, deco operated (individual participants looking after their interests in more and more divergent ways) in the same way, producing the same pattern.
What my idea was, each market as a system has its distinctive way to decooperate ( seen in price over time chart pattern) after shock events, which should more or less repeat itself every time these shock events lead to ultimate freezing, or herding, of market at question.
Similar to an eg analog electronic circuit: by putting a delta impulse at the input, the circuit based on its internal "black box" structure will give similar output every time, on any scale as long as it stays linear ( i.e. input amplitude is not too big/small). The black box action on delta impulse or sharp loss/gain in value= Heaviside step function ( shock event) will then be described by a single analog parameter =chart =so called transient response function.
If the system ( market) internal structure (and that includes everything) does not change much during time, it will always respond the same way. Well , of course, real shocks differ very much, but some of them are so strong that action on market can be considered similar.
Ivars
If Jeff Christian is such an expert that mining companies pay for his expertise, I would be interested in knowing precisely which mining companies he is consulting with and what their results are in contrast to their peers. I would assume that if Mr. Christian is the expert that Erik makes him out to be, he should have multiple examples (or at least 1 or 2) of companies he has strategically consulted with which has allowed them to optimize their profitability on behalf of their shareholders. These results should be demonstrably better than other comparable miners and we would likely be familiar with the performance of said miners - and if not - would like to.
If Mr. Christian isnt able to provide that information - I would challenge the veracity of the label of "expert". That seems reasonable to me as it is analogous to demanding that Andrew Macguire provide certain information to demonstate his bonafides.
Switching gears…
I very often hear talk about a persons reputation, background, who they have worked for, etc… as a way of vetting them (are they credible, are they an expert, etc…) My own personal experience is there are many people that are incompetent, lazy, or just plain stupid. But, if you look at their resume or view their profile on LinkedIn - you would think they were great.
It makes more sense to me to evaluate what a person says in the context of my own understanding about the subject matter. Then - to seek out other viewpoints so that I can compare and contrast. That process serves me much better than relying upon a "groupthink" opinion that so and so is an expert or because someone went to a certain school or worked at a certain company somehow makes them credible.
Strawboss
After I posted this last note, I noticed that Strawboss had asked me to verify my qualifications.
Strawboss, go to cpmgroup’s website. You will see a lot of material about us.
To your specific question: CPM Group’s client list is confidential. Several companies allow us to use them as references, and we are seen in the market as experts. If you look at our annual Gold Silver or Platinum Group Metals Yearbooks you will see various companies as sponsors. Obviously, these are companies that use us. If you review the list of corporate sponsors of our annual Silver Reception and Specialty Metals Receptions at PDAC, you will see other major corporations.
Around 70% of world gold production, 85% of silver, and most of the platinum group metals comes from companies that take some level of research or consulting from us.
You probably would find the Yearbooks incredibly informative. Also, I wrote a book, Commodities Rising, in 2005, released in 2006. You probably would find that very interesting and insightful. It is a very chatty book, full of anecdotes, so you can learn a lot more about my background there, while also learning all sorts of things about commodities markets.
In the 1990s we had advertisements that used three references. One was Sir James Goldsmith, one of the best gold investors of all times, and one of the most amazing people I have had the pleasure to work with. Another was Stanley Druckenmiller, who was in charge of the Quantum Fund for Soros Investments at the time. The third was Mark Lettes, who ran the gold hedge book at Amax Gold. At the time the market was valuing gold at around $340. Mark’s team was trading around the market and earning around $500 per ounce for the gold it sold from the mining operations. His performance speaks volumes. In fact, one anti-hedging advocate in a debate with me in London said that if every gold mining company could have a CFO or Treasurer like Mark Lettes, he would not be against hedging.
There are many others.
Read the books. That’s the best way to get to know me.
Oh, there is another way. In the early 2000s GATA tried to get attention for itself by challenging the World Gold Council, GFMS, or Jessica Jacks/Cross to a debate. None of them would respond. One of the world’s largest gold mining companeis said to GATA that it would finance and arrange a global, via the internet debate for GATA, but with me on the other side. GATA stopped making that challenge, until 2009. It made that challenge in 2009, and Bernard Lo of Bloomberg TV (at that time) said they would arrange it. GATA backed off. We dragged them to a debate at Jim Puplava’s Financial Sense in May 2010, after they lied about my CFTC testimony. That debate is still available on the internet, as is the second one we dragged them into in October 2011 at the Silver Summit, also available on the internet. I thought their refusal to debate me was a compliment. So, too, was the fact that another ersatz competitor of ours used to refuse to be at the same conferences as us, much less on the same panel as us. So, too, it seems, Ted Butler’s and Harvey Organ’s unwillingness to engage in any debate with me. Scam artists don’t like facts and figures, and sober analytics.
I hope that helps point you to ways to qualify me.
Again, good night.
I remember that 2% cap claim be made, but can’t remember where. Can someone provide the link to the source. Questions I have are over what time period was the analysis done and the exact claim.
In the meantime I had a look at % price moves from AM Fix to AM Fix the next day since Jan 1 2000. I picked the London Fix as I have the data to hand in a spreadsheet and could knock this up quickly.
Over that time period we have 3029 data points and the summary frequencies are:
Greater than -2% - 118
From -2% to 0% - 1337
From 0% to 2% - 1427
Greater than 2% - 147
Looks pretty balanced to me with a skew to the positive, which we should expect during a bull market. I have a chart but can’t upload at this point. Anyway, need the source link so I can replicate the analysis.
Thank you.
I note that it was not particularly gracious but I accept it. I am sure we all await the umpire’s verdict with interest.
SR
[quote=Erik T.]Given the redeemability clause and the law of efficient arbitrage, I don’t believe it’s possible for PSLV to trade at anything more than a very, very small discount to NAV (equivalent to the cost of arbitrage).[/quote]You are correct, the ability for the big boys to redeem should mean not too much discount will occur. However I seem to remember PSLV had a different tax treatment and something about tax liabilities but can’t find it. I think it was that redeemers don’t have any tax liability (which is good for no discounted buyback prices) but that the tax liability is left with the remaining holders (not good), but not sure about that.
@ Bron,Good input, thanks. The 2% cap claim was made in this thread several times with the time frame being from 2000 as you have covered.
I have a spreadsheet for the AM & PM Fixings and I will run it later several ways to see whether we are dealing with statistics or damn statistics as I suspect…the SK Options work* (updated Jan 2012**) was based on Adrian Douglas article from August 2010 (based on Dimitri Speck’s research…everyone covered?) was referenced on this site by Chris Martenson and is referred to as "The Overnight Trade"
https://peakprosperity.com/blog/gold-manipulated-thats-okay/72892 .
SR
* http://www.skoptionstrading.com/updates/2010/8/27/proposing-an-overnight-gold-fund.html
** http://www.skoptionstrading.com/updates/2012/1/14/revisiting-our-proposal-for-an-overnight-gold-fund.html
[quote=Strawboss]Firstly - they are purported in a GLD vault, but, the bar they show belongs to another fund? Who’s vault were they really in?[/quote]
They were in HSBC’s vault, which happens to store metal for various clients and various ETFs. They just didn’t check to make sure the pallet Pisani picks up the bar from was one with GLD bars, not ETF Securities bars.
No they aren’t light, but nor are they impossible to lift. I can’t get access to the video so can’t give it a good look. However, that bar will probably resurface on another bar list at some point, hopefully GoldMoney’s, and they check all their bars. What is interesting about Warren’s bar list database is the movement of bars between clients. Anyway, I think your "twirl" argument is scraping the bottom of the barrel as proof the ETFs don’t have the metal.
Kyle Bass explains why they took delivery and at 1.35 gives an insight into how seriously some warehouses take the concept of segregation, which may have a bearing on the GLD bar discussion.
http://www.youtube.com/watch?v=UQTa66gCggY (2.08 total)
Hi,
I have various comments.
- First a few links:
Kid Dynamite on Eric Sprott just buying the silver at spot without any problem:
http://kiddynamitesworld.com/paper-and-physical-silver-prices-are-not-decoupling-yet/
Warren James at Screwtape on the Sprott delivery:
http://screwtapefiles.blogspot.com.au/2011/08/erics-delivery.html
Kid Dynamite on Sprott scalping the PSLV premium:
http://kiddynamitesworld.com/sprott-physical-silver-trusts-premium-is-lower-than-you-think/
- On the issue of ‘manipulation’. Several people who sell financial products or newletters (Butler, Maguire, Embry, TF) have claimed that JP Morgan and HSBC were naked short silver at the COMEX, they would fear a rising silver price, and they would therefore manipulate the COMEX silver price down. That’s utter nonsense, and I thought we had established this fact earlier during this thread (when we compared the size of the OTC market with the COMEX, highlighting that what they observe and call ‘manipulation’ is in fact probably arbitrage).
For me, the conclusion is that these people have zero credibility. Period.
If someone (Maguire) forms an ‘army’ of inexperienced retail investors in order to ‘bring down the cartel’, using just this very COMEX nonsense as the major advert, and then charges $500 per month for this ‘service’, this is quite obviously an investment scam of the very common sort.
Now if you read my previous postings, you should have noticed that I think that gold is a very political currency. Yes, I wrote that I think the gold-oil ratio was managed. But certainly not by some banks going naked short. The gold price is probably mainly managed by controlling the credit volume in the OTC market - just as increasing the money supply of the US$ creates some price inflation, increasing the amount of credit gold lowers the gold price relative to other assets. But, hey, the people I was complaining about, seem not even to know that there is an OTC market, and so how can you expect them to grasp such a subtle concept as credit creation in the OTC market for unallocated gold.
Finally, there is some very good statistical analysis in the book by Dimitri Speck (unfortunately only in German). Some charts are available with comments in English:
http://www.geheime-goldpolitik.de/english/
He knows his statistics, he does not tell you any nonsense, and yes, he has some evidence that the market is not trading freely.
- Troy Ounce,
A low gold price means everything to CB; a high gold price means "mistrust" and the beginning of the end of the system. CB knows this very well
I am not sure you are getting the teams right. There are basically two bloks in the world. The dollar block consists of the U.S. and its very close allies (Britain, Japan, Australia, Canada). And the gold block which is basically the rest of the world (Euro countries, oil countries ex Canada and Mexico, China, Russia).
If you take a look at the balance sheet of the Eurosystem (ECB plus national central banks), you see that they like a high gold price. In fact, should they ever have to defend the Euro (so far only some governments are in financial trouble which does not affect the currency), they will buy gold and sell Euros. This increases the gold backing of the Euro because of the additional gold, and it revalues the existing reserve upwards. If you think about how the Euro has been set up, it is engineered for a world in which the dollar is replaced by gold as the major international reserve.
The followers of the usual precious metals blogs and websites are in for a huge surprice when they realize how the world outside the U.S. works.
Sincerely,
Victor
I did not ask you whether David Morgan or Jim Sinclaire were your friends. This is completely irrelevant! Instead, I gave you a list of people who claim to be PM experts and I requested you to comment on each one of them whether you think that they are real expert (hence the public could trust them) or charlatans (i.e. the public should not trust them). Since you do not strike me as unintelligent, I would have to assume that you have intentionally avoided responding to my question yet you’ve misled your readers by pretending to actually respond. So I am asking you again: David Mogran is an expert or charlatan?
Jim Sinclaire - Expert or charlatan?
Eric Sprott - Expert or charlatan?
The same question regarding James Turk, Keith Neumayer and Chris Martenson. Also the same question regarding 2 people that are on your side of the argument:
Jon Nadler - Expert or Charlatan?
Dennis Gartman - Expert or charlatan?
a) Thank you for this data.b) Would you mind providing the same data, but instead of 2%, use 2.30%, 3% and 4 percent.
c) Assuming that your data is correct, another thing which I find interesting is an almost equal amount of down and up days during an 11 year bull market (52% up, 48% down). Could you (or anyone else) please provide some historical references and compare to other secular bull markets in history? Thank you.
[quote=Celestino]a) Thank you for this data. b) Would you mind providing the same data, but instead of 2%, use 2.30%, 3% and 4 percent. c) Assuming that your data is correct, another thing which I find interesting is an almost equal amount of down and up days during an 11 year bull market (52% up, 48% down). Could you (or anyone else) please provide some historical references and compare to other secular bull markets in history? Thank you.[/quote]Below are the raw frequencies in 0.25% bands for the period 1 Jan 2000 to 31 Mar 2012:
< -5.00%
8
-5.00% to -4.75%
0
-4.75% to -4.50%
4
-4.50% to -4.25%
2
-4.25% to -4.00%
4
-4.00% to -3.75%
5
-3.75% to -3.50%
7
-3.50% to -3.25%
7
-3.25% to -3.00%
7
-3.00% to -2.75%
11
-2.75% to -2.50%
12
-2.50% to -2.25%
19
-2.25% to -2.00%
32
-2.00% to -1.75%
44
-1.75% to -1.50%
68
-1.50% to -1.25%
80
-1.25% to -1.00%
99
-1.00% to -0.75%
158
-0.75% to -0.50%
219
-0.50% to -0.25%
315
-0.25% to 0.00%
354
0.00% to 0.25%
331
0.25% to 0.50%
301
0.50% to 0.75%
220
0.75% to 1.00%
218
1.00% to 1.25%
146
1.25% to 1.50%
91
1.50% to 1.75%
66
1.75% to 2.00%
54
2.00% to 2.25%
43
2.25% to 2.50%
24
2.50% to 2.75%
26
2.75% to 3.00%
15
3.00% to 3.25%
13
3.25% to 3.50%
7
3.50% to 3.75%
5
3.75% to 4.00%
2
4.00% to 4.25%
3
4.25% to 4.50%
1
4.50% to 4.75%
2
4.75% to 5.00%
0
> 5.00%
6
Below are the frequencies from 1 Jan 1972 to 1 Feb 1980 (total of 2301 occurances)
< -5.00%
27
-5.00% to -4.75%
5
-4.75% to -4.50%
6
-4.50% to -4.25%
7
-4.25% to -4.00%
8
-4.00% to -3.75%
6
-3.75% to -3.50%
8
-3.50% to -3.25%
10
-3.25% to -3.00%
12
-3.00% to -2.75%
8
-2.75% to -2.50%
20
-2.50% to -2.25%
21
-2.25% to -2.00%
23
-2.00% to -1.75%
36
-1.75% to -1.50%
54
-1.50% to -1.25%
70
-1.25% to -1.00%
86
-1.00% to -0.75%
114
-0.75% to -0.50%
139
-0.50% to -0.25%
210
-0.25% to 0.00%
294
0.00% to 0.25%
196
0.25% to 0.50%
179
0.50% to 0.75%
141
0.75% to 1.00%
111
1.00% to 1.25%
107
1.25% to 1.50%
62
1.50% to 1.75%
65
1.75% to 2.00%
50
2.00% to 2.25%
40
2.25% to 2.50%
26
2.50% to 2.75%
22
2.75% to 3.00%
16
3.00% to 3.25%
17
3.25% to 3.50%
17
3.50% to 3.75%
12
3.75% to 4.00%
11
4.00% to 4.25%
7
4.25% to 4.50%
6
4.50% to 4.75%
6
4.75% to 5.00%
6
> 5.00%
40
Knock yourself out.
On p.13 of this thread (comment 130) you wrote:
"[3] I have a close friend who is a high level player (partner) in XXXX Non-Ferrous Metals Group (one of China’s largest non-Fe metal miner/processors) with resources and processing all over the world. They won’t touch gold anywhere but in China due to “political risk”. He says quite openly that Gold mines will be nationalized, and not just in Australia & Canada. Only a question of when.
Victor,
Did you (and your “close friend”) see this?
“China’s largest private gold producer, Zijin Mining Group is all set to acquire Norton Gold Fields for $230 million.”
http://www.bullionstreet.com/news/norton-shares-up-on--takeover-offer-by-chinas-zijin/1494
All,
Apologies for my silence last 36 hrs - I’ve been traveling and it was a hell of a trip. Given all the comments and challenges that have been directed at me during that time, I feel somewhat obliged to respond, and will do so below in detail.
But before going on, I want to be clear that I think this thread has devolved to the point of sheer silliness. So before responding to all marginally relevant comments directed at me, I’m going to start by talking about what I think is actually important. Then I’ll oblige those here who have asked for my response on specific points.
The central point I was trying to make when I started this discussion can be simplified to five key bullets:
- We live in a world where massive corruption and fraud has become rampant, particularly within the financial system.
- Point #1 gives us all very good reason to be skeptical of big banks and their ethical standards.
- Because of #2, we are vulnerable to true believer syndrome, where we want so badly to know what the banksters are up to that we easily "believe" stories that seem to confirm our convictions about the fraud and corruption we know exists, but we often fail to check the facts. In my own case, I viewed people like GATA and Ted Butler as heroes... Until I did my homework and realized their arguments are bogus.
- Because of the vulnerability described in #3, several people (GATA, Ted Butler, Harvey Organ, Andrew Maguire, others) have emerged and receive great accolades for their heroic work to expose the frauds and evil-doings of the banksters. Just one problem: Their arguments are bogus and their "facts" don't check out.
- Jeff Christian contends that because these people have had ample opportunity to learn how the markets work, the only plausible explanation is that they are intentionally deceptive and seek maliciously to mislead their readers. I strongly disagree, and am convinced these people mean well, and simply believe their own BS. But either way, they do the investment community a great disservice, and I think the greater good is served by calling them out. While there may very well be manipulation in the markets, the fact remains that these people simply don't know what they are talking about. In some cases, it's benign. In others, it leads people to make foolish decisions, such as buying PSLV at a 30%+ premium to NAV.
But after more than 150 replies, nobody has even addressed the substantive issues I brought up in the first post, i.e. that every single thing Harvey said is either easily disproven, or amounts to a baseless emotional allegation with zero factual or logical backing. Nobody. We’ve had several people accuse me of "attacking the person not the argument", despite the fact that I have done no such thing. Nobody has offered a single word of rebuttal to what I actually said in the first post - that Harvey, well meaning as he may be, obviously doesn’t know what he’s talking about and shouldn’t be viewed as an "expert" by anyone. I gave lots and lots of specific examples, and nobody has responded directly to any of those .
Again, I submit that this has more to do with psychology than anything else. A whole bunch of people here continue to accuse me of "name calling", when the only names I’ve used are "really nice guy" (referring to Ted), and "charlatan". In the latter case, I’ve shown by quoting the dictionary that I used that word correctly, and proved my assertion that it described these people accurately. There seems to be so much emotion in this thread that some people actually said outright that they don’t care what the word actually means - they just don’t like me using it to describe one or more of the people they look up to as experts, whether I was using it correctly or not!
The bottom line here is that despite what are probably the best of intentions, GATA, Ted Butler, Harvey Organ, Andrew Maguire, and others in the blogosphere simply don’t know what they are talking about, and the specific allegations they have made are easily and conclusively disproven with only a modest investigation of the facts. These people do a horrible disservice to the investment community by spreading nonsensical beliefs which many accept as gospel, and which cause some poor souls to make very fool-hardy investment decisions, particularly in the case of arguments that circulated in early January of this year, implying that the absurd 30%+ PSLV premium was actually an indication of "paper decoupling from physical", an argument presented by ZeroHedge in a way that made some think it confirmed "value" in the premium, causing them to foolishly buy more.
So far as I’m concerned, that’s what this thread should be about: discussing the specific manipulation theories promulgated by GATA, Butler, Organ, Maguire, etc., and debating them on their factual merits. But nobody seems willing to do that. Instead we’re having an arguably off-topic argument about what the word charlatan means! I don’t mean to condemn the whole thread - Victor and Jeff Christian have both contributed a lot of technical material that is of high value, and much appreciated. But so far, none of the people who seem passionately inclined to come to the defense of Harvey, Ted, GATA, or Maguire have been able to offer a single iota of conter-argument refuting what I’ve said proving that these people simply don’t know what they are talking about. Despite my repeated encouragement that they do so!
To me, that says it all. The rest of this post will address the far less important issues that have been brought up in recent posts.
Avoiding Steve (Strawboss)'s 2% argument:
Wow - the rhetoric is getting strong. Some say it’s "telling" that I am "avoiding" answering Steve’s question about what he describes as a "2% cap". From the commentary, you’d almost think yet another conspiracy was in the works - Townsend and Christian suspiciously dodge the key question, no matter how many times they are reminded… Or something like that.
Sorry to rain on that parade, folks, but the reason I haven’t commented again is that I already did answer this question, quite promptly after Steve asked it, way back in post #37. Here’s what I said:
I’m not clear on whether you are referring to an actual cap (i.e. daily price limits in futures trading), or observed max moves over time (not really a cap). In any case, I’m not clear what point you are arguing here. I would think extreme manipulations would yield higher volatility, not lower. In short, I don’t understand your point.[/quote]
The reason that I haven’t said anything more about the 2% thing is simply that I don’t have anything more to say about it. As I alluded in the quote above, I don’t think the argument particularly interesting and don’t see it as particularly meaningful or telling. But on the other hand, I haven’t thought much about it. I quite enjoyed reading Victor, Jeff and Bron’s comments on it, as it is an interesting observation.
Yes, Steve, I was intentionally ignoring your repeated demands for an answer. The reason is that I found them to be in poor taste and completely inappropriate. I do not answer to you, and I do not owe you anything. When you asked the first time, your question was posed politely, as a question, and I answered this and your other six questions in post #37. And I responded to all 7 of your questions within 2.5 hours after you posed them. But as I already indicated in the above quote, I really don’t have anything more to offer on the subject myself. When you began posting demands that I answer your question, I started ignoring you.
Him H’s Excellent (still partly unanswered) challenge to Jeff:
Jim, that’s some damn fine commentary and I think you pose some excellent questions. Jeff answered part of this, but to my reading, you are making a couple of really excellent points that have not yet been answered. Specifically, if retail owners (direct or indirect) of silver stocks bail out, silver stocks are going to be annihilated when "waterfall selling" develops after weak hands are stopped out. On that I think we all agree. But Jeff seems to be saying that the existence of Sprott’s funds somehow amplify this effect. I don’t see why that would be true - whether the weak hands are being stopped out of Sprott shares or silver mining shares they own directly shouldn’t matter. Jeff: If we are missing something, I hope you’ll enlighten us.
But more to my point, Jim is responding to the substance of something Jeff said, and challenging it on its technical merits. And Jim makes a damn fine argument, by my reckoning. That’s what I wish we had more of in this thread - more debate about the substantive merits of what GATA, Butlers, Maguire, etc. claim, as opposed to useless arguments about who is or isn’t calling who "names". Ironically, there has been a lot of sentiment expressed about frustration about all the "name calling", yet there hasn’t really been any name calling. Meanwhile, the substantive critique of Harvey and others’ arguments has gone without response. Hello?
Jim, bravo for this excellent post. I hope you’ll continue in that same vein, and challenge me by contesting my substantive arguments debunking Harvey et al, as you have done with Jeff in this post.
[quote=Travlin]
Reading this thread leaves me shaking my head in disbelief. All that sound and fury about how there really isn’t any manipulation of precious metals. [/quote]
Trav, what are you smoking? Nobody here has said anything to the effect that there is no manipulation of PM’s. Forget "sound and fury" - there hasn’t been so much as a whimper! All that’s been said is that Harvey, Ted, et al don’t know what they are talking about, and that the substantive arguments they make are easily disproven.
I don’t think you’re making any sense here. I’m certainly not an expert myself, and I have been following PM markets for far fewer years than Chris and Harvey have. But I can see that Harvey and Ted don’t know what they are talking about by applying simple techniques of fact-checking and deductive reasoning. No expert credentials required. I’m disappointed that so far Chris seems to have been snowed by these people, and for the record, that’s my opinion: that Chris would do well to apply some critical analysis to these claims, and verify them for himself. If he took a critical view toward them, I think he’d quickly satisfy himself that for the most part, what these people say is without merit.
Yes, I’m (obviously) inclined to call Harvey out, and no, I really don’t need to listen again. I already quoted enough tidbits to make my point. Chris has been vocal in inviting others to challenge and critique all of his work (as all true scientists always do), and I continue to have nothing but the utmost respect for Chris and his work. But that doesn’t make it any less obvious to me that these people are full of crap. That Chris appears to have fallen for it doesn’t change the facts.
Perhaps I’m all wet, and am not seeing the merits of some of these arguments. If that is that case, I hope (as I’ve repeatedly begged for elsehwere and at the beginning of this post), that we could start talking intelligently about the substance of this topic, rather than wasting time arguing about whether or not the dictionary definition of charlatan accurately describing the people in question justifies its use in describing them with that term. I welcome critical feedback from Chris or anyone else telling me what I’m missing. But if what you are suggesting, Trav, is that "anyone who respects Chris should never challenge him on his own website, even when he’s obviously wrong", I’m sorry, but I don’t agree with you, and I respectfully remind you that Chris’ own public statements have affirmed that he welcomes critical feedback.
No, we cannot. But what we can do is to evaluate specific theories about how manipulation may be occurring, and weigh the facts to see if those specific theories have merit. That’s what I’ve tried to do with the first post here, and I contend that it’s very easily demonstrated that almost none of the manipulation theories promulgated by GATA, Butler, Harvey, or Maguire have any merit whatsoever. To be certain, a few do - we all know about stop-clearing runs and futures ramps designed to push the closing price above or below some key technical level. But it’s common knowledge that these things happen in most markets - nothing about those tactics is unique to PMs. The other stuff - like equating paper-to-physical ratio as being a matter of leverage or the set vs. discover the price argument very clearly demonstrates to me that the people putting forth these arguments suffer a very deep, fundamental lack of comprehension about the basics of how these markets function. In Andrew Maguire’s case, I have to agree with Jeff Christian that it’s very hard to see how anyone could say the things Maguire says unless there is a conscious and intentional intent for deception. In the case of the other people I’ve mentioned, my belief is that they mean well and simply don’t recognize the glaring holes in their own logical arguments.
I plead guilty to calling Ted a name. Specifically, that "name" was "a very nice guy". Aside from that, I don’t know what you’re talking about, Trav. There has been LOTS of discussion ABOUT name-calling, but no name-calling per se, so far as I can see. If you really think this is an issue, please elaborate on what you mean. Who has called whom what name, in which post(s)? Is charlatan, a "name", and if so, can you explain why? Seems to me that I was not using it to attack anyone, but rather to indicate my opinion that these are people who represent themselves to have expert knowledge when they obviously do not. I’m sorry if my choice of vocabulary offended you and others, as it clearly has. But again, the dictionary is on my side here.
As to effective debate, even more important than the persuasion vs. denigration issue is that it should be based on substantive factual or logical arguments. I’ve offered plenty of subject matter to debate on its merits (No gold in Ft. Knox, Paper-to-Physical=Leverage, ETFs don’t have any gold, etc) in the first post, but so far nobody seems interested in discussing those arguments on their substantive merits. Why is that?
Andrew Maguire, CFTC, @S Roche, Eliud Ramirez, etc.:
I appreciate Jeff taking the time to answer S Roche’s challenges, but honestly I find all this to be relatively unimportant. It feels to me like a few people here would love to catch Jeff in a mistake and show him up, but I have a hard time understanding what it has to do with the substantive discussion about veracity of PM manipulation theories.
For example, what matters is Andrew Maguire’s substantive allegations about market manipulation, and whether those arguments stand up to critical scrutiny. Whether and to whom he sent e-mails professing these theories, or whether they were acknolwedged as received by CFTC, either publically or otherwise, seems irrelevant to me.
All you have to do is listen to Maguire’s earliest KWN interviews where he makes absurd allegations about Jeff Christian’s "shocking admission" of "100:1 leverage on the LBMA". Jeff’s statement was about paper to physical clearing volume ratio, and had nothing to do with leverage. But Maguire, Eric King, and GATA were all over it, making a huge big deal about leverage. Some have tried to dismiss this, saying "oh, so what - they just slipped and used one word wrong - so what?" That misses the point. They didn’t just call this leverage - they made a huge deal about the implications of having such extreme leverage. The fact that Maguire, King, and GATA’s Douglas made this unbelievably naive mistake is strong cause to question whether Maguire ever worked in the metals business on a professional level, and clearly demonstrates that none of these guys posess a basic working knowledge of how these markets function. Regardless of how many decades they may have spent not learning about that subject. Maguire’s refusal to authenticate his credentials appears to confirm the suspicion that he never worked in the PM business in any professional-level capacity. The fact that he continues to make this absurd assertion to this very day - despite that it has been widely debunked - should bring rise to the question of whether it was really naive mistake afterall, or if Maguire is intentionally and deceptively using promoting this "belief", which has no basis in fact, as a tool to manipulate people.
My point is, if we’re going to argue about Maguire, I request that we set aside the relatively unimportant detail of whether his e-mails to CFTC were acknowledged or by whom, and return to the much more important issue, i.e. that almost everything he says is nonsense that is easily shown to be factual misrepresentation. So far nobody has offered a counter-argument on that one, but plenty of people have chimed in with accolades and attestment to Mr. Maguire’s character. I don’t get it.
@Troy Ounce:
Really, sir, you need to read the posts more carefully. What I actually said is that these things clearly do suggest great suspicion toward the greater system. To say that I cannot or do not want to make the connection is absurd. What I’ve said is that by making this connection, we also make ourselves vulnerable to succumbing to the natural desire to believe the next thing we hear that confirms this connection, perhaps without doing our homework first. I remain convinced that this is the psychological phenomenon that makes it possible for otherwise extremely rational, fact-and-logic-driven people including Chris Martenson to suffer temporary lapses of due dilligence, instead believing in what seems to make sense and fit into a bigger picture that already made sense, without taking the time to stop and fact-check the hypotheses being posited. When you take that step, it becomes clear that while massive manipulations may very well be occurring, they are most definitely not occurring the way GATA, Ted, Harvey et al have described.
I never made that statement (the "only" part), and don’t think that. My opinion is that central bank balance sheet expansion, and to a greater extent, widespread expectation of further expansion, is the biggest single factor driving the Gold bull market, but there are many others.
In Closing:
Victor and Bron have added a huge amount to this thread, and I’m even starting to get interested in Steve’s 2% observation, now that I see the data being discussed. But the original substantive assertions from my first post, which amount to saying that Harvey doesn’t know what he’s talking about, remain unchallenged. That’s very telling.
Meanwhile, quite a few people seem to be pre-occupied with the idea that "name calling" and "personal attacks" have been the focus of this thread, when no such thing has occurred. It appears that my choice of the word charlatan has triggered these reactions. I think that very unfortunate, as I had no intention of denigrating anyone or calling them names. But I won’t apologize, because as I’ve said, all that I meant by the word charlatan was that these are people who represent themselves as being experts with great knowledge of these markets, when in reality only the smallest amount of scrutiny reveals that they simply are not. I regret that so many people took the word charlatan to mean something other than what I meant it to mean, and what the Dictionary confirms it to mean. But the fact remains that these guys make a lot of bogus arguments, which can be and have been debunked as specious and meritless. I continue to await someone to come along to refute that central contention of my argument.
All the best,
Erik
Bron,
Thank you for providing the data. If my understanding is correct, what you are providing is the AM fix. Can you provide the same data for the PM fix as that was my initial observation (PM fix to PM fix)? Much appreciated.
Jeffrey - I am very much aware of CPM group, its clientele, etc… I was hoping for something more substantive - i.e. where your efforts have helped a mining company to optimize its profitablity thereby enabling it to stand head and shoulders above its peers. Your statements would seem to lead one to believe that CPM groups is "THE" consulting firm for mining companies with an impressive list of "sponsors". Erik made a statement earlier in the thread that a service you provide is to give companies (who are not experts on the market) the strategic consulting that banks offer - but, at a substantially friendlier price. Same expertise - less cost; if I am understanding Erik correctly.
Where I get confused is when looking at the miners performance as a group. When I look at the HUI or GDX or any number of PM indexs priced in gold - they have been in a bear market for many, many years.
How is it that a mining company that relies on you for your strategic expertise underperform gold year after year after year? Shouldnt a mining company provide outsized returns to the predominant metal they produce - especially when that metal is averaging over 20% gains YoY (nominally in USD)?
Forget all the claptrap. Speaking for myself - the above point goes to the heart of my cynicism of yourself and those you represent/associate with. I welcome any commentary on the above point as an opportunity to put my cynicism to rest.
Erik - Bart Chilton said the silver markets are manipulated and that the perpetrators should be prosecuted (paraphrased). There are only 3 logical conclusions I can come to. He knows of what he speaks and was speaking the truth; or, he is a moron that is unfit for his office; or, he was doing the bidding of a monied interest such as Sprott to fan the flames within the community.
There seems to be some agreement amongst the camps here that gold/silver IS manipulated in some fashion by some entit(ies)y. If the theories put forward by Butler, Organ, et al are scientifically not acceptable as they are unable to withstand a rigorous cross examination - can we attempt to craft a theory that fits the facts that we have access to that can better explain the price action we see?
Very much enjoying this thread. Iron sharpens iron. Steel comes out of fire. Purity is a result of refining and refining uses fire (oftentimes).
[quote=Celestino]Did you (and your "close friend") see this? "China’s largest private gold producer, Zijin Mining Group is all set to acquire Norton Gold Fields for $230 million." http://www.bullionstreet.com/news/norton-shares-up-on--takeover-offer-by-chinas-zijin/1494[/quote]I know that there are still people who invest in mining companies. You just need to keep in mind the political risk involved in this. Let me repeat: Canada and Australia sold their gold reserve long ago. Especially in the case of Australia, it was mentioned this was no problem because they could always take the gold in the ground. Many other countries’ central banks are also underweight gold relative to the US$.
Do you realize that the following strategy is inconsistent: They tell you that the ‘fiat ponzi scheme’ is about to end. Then, at the same time, they advertize the shares of mining companies to you. Now if you really believe the system is going to end, you are basically guaranteed to lose your mining shares, either because they are nationalized outright or because they are forced to sell their gold to the government at a regulated price (which will turn the mine into the equivalent of a telephone or water company, i.e. bascially into a utility company). On that comparison, however, most of the mining stocks are grossly overvalued.
The mining companies as an investment make sense only if we get higher inflation and a lot of financial liquidy, but the financial system survives unchanged. Sure, you are free to bet on this outcome. But you should understand what scenario it is you are betting on when you buy mining stocks.
Sincerely,
Victor
http://www.zerohedge.com/news/todays-124-billion-targeted-gold-slam-down-makes-mainstream-press
7500 gold contracts sold into thin liquidity within 1 minute.
No rational trader would do that - especially on a day where Asia is on holiday and Europe is getting ready to go on holiday.
If one was conspiracy minded, one would think it was a deliberate smack down. But, I am sure there is a rational explanation - arbitrage or some such thing…
Its getting pretty blatant when even the dullard WSJ is writing stories about it…