Market talk that BIS, BoE and the Fed were selling gold off earlier highs - Unconfirmed

swissaustrian · Dec 8, 2011

Market talk that BIS, BoE and the Fed were selling gold off earlier highs - Unconfirmed

Market talk’ – Signifies information that has not been formally tested through traditional journalistic channels and therefore is to be treated as unsubstantiated. Any interpretation of the talk is taken at the readers own risk and is a representation of the rumours within the market place and never generated by ourselves.
http://ransquawk.com/headlines/190980

pmbug · Dec 8, 2011

Ties right in with this:

A dash for cash by European banks in a little-watched corner of the gold market has accelerated this week, highlighting the continued scarcity of dollar funding even after a co-ordinated intervention in the market by the world's largest central banks.

Gold dealers said that banks -- primarily based in France and Italy -- had been actively lending gold in the market in exchange for dollars in the past week.

The rush has pushed gold leasing rates -- the implied interest rate for lending gold in the market in exchange for dollars -- to record lows, according to Thomson Reuters data. The one-month gold leasing rate fell to a low of -0.57 per cent on Tuesday, suggesting that a bank lending gold for one month would have to pay to do so, at an annualised rate of 0.57 per cent.
...

http://www.gata.org/node/10746

swissaustrian · Dec 8, 2011

The market is obviously under stress:

ancona · Dec 8, 2011

I say keep on selling you prick banksters, so i can get more PM's on the cheap before you blow it all up with your idiotic loser investments and CDO's.

pmbug · Dec 8, 2011

ancona said:
... before you blow it all up with your idiotic loser investments and CDO's.

DoChenRollingBearing · Dec 8, 2011

Look, I need all you guys to keep everything held together until I get back!

Just one more week and I promise that I will pull even MORE money from the banks and go buy even MORE gold and silver! Maybe another gun too, and a few hundred more rounds of ammo. And one of those solar ovens.

One more week fellas! Do it for the Bearing!

:flail: <--- About all I can do down here in Peru!

pmbug · Dec 8, 2011

Almost there...

DCFusor · Dec 8, 2011

Everyone is flailin', man. Pretty insane to watch - even more than usual. But what they are flailing about seems to be that there's really not much worthwhile anyone can DO at this point. General hysteria all over is what it looks like from here. Time to duck! Body armor more important than ammo just now.

They're going to pieces so fast the risk is being hit by the shrapnel.
HHGTTG ref.

swissaustrian · Dec 8, 2011

For once, I was faster than zerohedge...

DCFusor · Dec 8, 2011

swissaustrian said:
For once, I was faster than zerohedge...

Wow, good show man!

swissaustrian · Dec 10, 2011

Market News International retracts report about central bank gold sales
http://www.gata.org/node/10758

ancona · Dec 10, 2011

swissaustrian said:
Market News International retracts report about central bank gold sales
http://www.gata.org/node/10758

Well then, that comfirms the original story. We all know a retraction means it is true.

pmbug · Dec 10, 2011

Most likely, they didn't sell gold as reported. They leased it.

swissaustrian · Dec 10, 2011

PMBug said:
Most likely, they didn't sell gold as reported. They leased it.

Hehe, you´ve learned to think like a criminal

DosZap · Dec 10, 2011

Fusor,

Got yer Ceramic Jammies on?

You got that right, EU is coming totally unwound.No signs, and NO way anyone see's a chance to save the Euro. None.

Or the EU.

Hope you all read the article on ZH about MF GLOBAL.
Rehypothecation................read it if not.

Also,Sinclair a great interview with Eric King(KingWorldNews.com ,on this deal...............

He's said he's never been more concerned in his whole life.It's going to get worse than EVEN he thought, way worse.

As Jim Sinclair stated that you CAN fix a Broken Market, but NEVER a Broken SYSTEM.

Bottom Line MFGlobal, most likely has damaged the system to the point of NO return.

Meaning (like CONfidence in a currency,once lost) it's history.

Under law, the customers that lost 1.2B are SOL.

Like we crazy Bugs say, IF you ain't holdin it, you don't own it.

PS: PM BUG,hope I did not break a rule by adding a site(just a super important message from one of the greats).If so, advise.

DosZap · Dec 10, 2011

Said they did not sell it,said LENT it.............unless me eye decieved me.
At this juncture, I do not see ANY Banks selling Gold.
ZERO.

DosZap · Dec 10, 2011

Hep an ole fool here.............why would anyone(A Bank I know),Lease GOLD to anyone and LOSE money on the deal?.
Banks are idiots.

pmbug · Dec 11, 2011

Just a guess, but they are lending to themselves only (not to individuals like you and I) to play accounting games with their balance sheets. Fractionally reserving (rehypothecating) gold paper claims until the curtain is pulled back and the show is over.

pmbug · Dec 12, 2011

lol:

Goldcore said:
...
With concerns about liquidity and solvency in the European banking system, there is lending and possibly even selling of gold by banks to raise much needed cash. This may be creating short term weakness in gold bit is bullish for gold in the long term.

The FT reported last week that “gold dealers” said that banks – “primarily based in France and Italy – had been actively lending gold in the market in exchange for dollars.”

The key question is who is lending and is their lending simply liquidity driven - to raise dollars or euros?

John Dizard, who frequently comments on gold in the Financial Times wrote on Saturday that,

“Gold market people say European commercial banks are being driven to lend gold for dollars at negative interest rates just to raise some extra cash for a few weeks.

There’s not a lot of transparency about where the banks are getting the gold they are lending out, but it could be lent to them by either their national central banks, or by gold exchange traded funds.”
...

http://www.zerohedge.com/news/etf-and-central-bank-gold-lent-banks-being-relent-market

Daisy chaining paper claims. Beware the kinetic energy!

DSAbug · Dec 12, 2011

This is going to make matters much worse i'm afraid..

swissaustrian · Dec 12, 2011

short term leasing rates seem to have bottomed on thursday:

pmbug · Dec 12, 2011

We'll see. If this is an attempt to shore up liquidity in Euro markets, we may not have seen the end of it yet.

swissaustrian · Dec 12, 2011

Same banks must be really desperate. They´re paying others to take their gold for short term cash due to the negative interest rates.

DCFusor · Dec 12, 2011

Isn't "lending" something for cash equivalent to selling it if you can't pay back the cash?

Inquiring minds want to know (Frank Zappa).

pmbug · Dec 12, 2011

Well, I doubt any physical metal is actually changing hands or moving anywhere. They are just creating more paper claims - bullish for the physical paper industry...

swissaustrian · Dec 12, 2011

DCFusor said:
Isn't "lending" something for cash equivalent to selling it if you can't pay back the cash?

Yep.
The fact that there is no physical transfer is probably not important, because the gold is stored in a large warehouse anyway. It will stored in somebody elses name then.
If this gold is used to satisfy physical demand, i.e. it is sold into the market during the lending period, we should see massive buying action once these loans expiry. If the lenders were central banks, they could just extend the loans. That´s basicly what they´ve done during the 1990s.
Regardless who the lenders are: In the end it´s bullish for physical

DCFusor · Dec 12, 2011

This little guy showed up awhile back, and while I'm not sure what he's predating, he's behaved fairly well, so I've not squished him. Just climbs around on stuff on my end table and waves his antennae at me.

I figured someone might want the pic for an avatar at some point.
That's a "Horynak neutron detector" he's crawling on when the pic was taken. Took a few shots to get a decent one without too much of my slobbery in the background - and in focus, this little bug can really move.

ancona · Dec 12, 2011

It's like a story I read on the net somewhere about how the velocity of money works. A man walks in to a small town hotel and says, "I would like to look at a couple of rooms", the clerk says "Fine, but I'll need a deposit". The man puts a hundred dollar bill on the counter and walks upstairs with a couple of keys to check out the rooms. While he's gone, the clerk runs over to the butcher and pays him a hundred bucks for the pork sausage he serves at breakfast to customers, then the butcher runs over to the laundry to pay for the laundry services to wash his aprons, then the laundress runs back to the hotel and pays the money she owes for a room she checks in to while having an affair with a local teacher. When the man comes downstairs again, he states that the rooms do not meet his needs, thank the clerk, takes his hundred dollars back and leaves.

This is what the banks are doing with CDS. They all sold each other CDS insurance on a bunch of dodgy paper and show the investments as fully hedged bets. The fact of the matter is that the "hundred dollar bill" does not exist and no one has the money if in fact a failure occurs. They have a name for that, it's Armageddon.

pmbug · Dec 14, 2011

James Turk says MF Global is Lehman Bros. part two:

"For a few months now I have been worrying that there would be another Lehman moment and have been expecting it before year-end. I said the failure of Dexia was not the event, and initially I thought MF Global was not big enough to cause it either. But, Eric, it is now becoming clear that the ramifications of MF Global are earth shaking, and consequently, I think we are already in another Lehman moment.”
...
The aftermath of the Lehman collapse was a liquidity scramble. So precious metals prices were hit back then as people needing liquidity threw out the baby with the bath water. They sold what they could sell, not necessarily what they wanted to sell. It was a great buying opportunity, and largely irrelevant to all long-term holders and accumulators of the precious metals.

This time I have been expecting a ‘fear event,’ with money rushing into the precious metals for safety, to avoid counterparty risk. Therefore, higher metal prices will be the result. We'll see how it plays out, but I still think a ‘fear event’ is the logical outcome we should expect. I believe that even though, like occurred in 2008, liquidity seems to be drying up again.”
...

http://kingworldnews.com/kingworldn...in_Progress_as_Financial_System_Implodes.html

Market talk that BIS, BoE and the Fed were selling gold off earlier highs - Unconfirmed

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