The Comex stock is rising, and much more than end 2011.

Hi Pirocco

There is only 1 chart worth looking at and that is the total money supply (M3). That is the amount of debt based money in our economic system.

1302_m3.jpg


Based on this show me the deflation and bear market for PM ???
Corrections in the short term even corrections of 12-18 months occur but not long term. Not in this sort of monitory expansion (inflation).
 
Pirocco, I believe you have a gross error in your understanding of the Fed and QE mechanism:

WRESBAL_Max_630_378.png


Notes:
Feb 1984 - Dec 1990: Annual Statistical Digest, various issues, Table 2.
Jan 1991 to date: Federal Reserve Board, H.4.1.
Reserve balances with Federal Reserve Banks are the difference between "total factors supplying reserve funds" and "total factors, other than reserve balances, absorbing reserve funds." This item includes balances at the Federal Reserve of all depository institutions that are used to satisfy reserve requirements and balances held in excess of balance requirements. It excludes reserves held in the form of cash in bank vaults, and excludes service-related deposits.
Click to expand...

TREAST_Max_630_378.png


Notes:
The total face value of U.S. Treasury securities held by the Federal Reserve. This total is broken out in the lines below. Purchases or sales of U.S. Treasury securities by the Federal Reserve Bank of New York (FRBNY) are made in the secondary market, or with various foreign official and international organizations that maintain accounts at the Federal Reserve. FRBNY's purchases or sales in the secondary market are conducted only through primary dealers.

Bills: The current face value of the Federal Reserve's outright holdings of Treasury bills.
Notes and bonds, nominal: The current face value of the Federal Reserve's outright holdings of nominal Treasury notes and bonds.
Notes and bonds, inflation-indexed: The current face value of the Federal Reserve's outright holdings of inflation-indexed Treasury notes and bonds.
Inflation compensation: Inflation compensation reflects adjustments for the effects of inflation to the principal of inflation-indexed securities.
Click to expand...

The Fed BUYS the Treasury's, with Federal Reserve Notes, from the USGovernment. The USGovernment spends the Federal Reserve Notes in its deficit spending each year.

The graph you posted refers to said 'Treasury's'. Hence it is going up (with roughly an 80% correlation according to your estimates) simultaneously with the QE programs.
 
grinners said:
Pirocco, I believe you have a gross error in your understanding of the Fed and QE mechanism:

http://research.stlouisfed.org/fred2/data/WRESBAL_Max_630_378.png

Notes:
Feb 1984 - Dec 1990: Annual Statistical Digest, various issues, Table 2.
Jan 1991 to date: Federal Reserve Board, H.4.1.
Reserve balances with Federal Reserve Banks are the difference between "total factors supplying reserve funds" and "total factors, other than reserve balances, absorbing reserve funds." This item includes balances at the Federal Reserve of all depository institutions that are used to satisfy reserve requirements and balances held in excess of balance requirements. It excludes reserves held in the form of cash in bank vaults, and excludes service-related deposits.
Click to expand...

http://research.stlouisfed.org/fred2/data/TREAST_Max_630_378.png

Notes:
The total face value of U.S. Treasury securities held by the Federal Reserve. This total is broken out in the lines below. Purchases or sales of U.S. Treasury securities by the Federal Reserve Bank of New York (FRBNY) are made in the secondary market, or with various foreign official and international organizations that maintain accounts at the Federal Reserve. FRBNY's purchases or sales in the secondary market are conducted only through primary dealers.

Bills: The current face value of the Federal Reserve's outright holdings of Treasury bills.
Notes and bonds, nominal: The current face value of the Federal Reserve's outright holdings of nominal Treasury notes and bonds.
Notes and bonds, inflation-indexed: The current face value of the Federal Reserve's outright holdings of inflation-indexed Treasury notes and bonds.
Inflation compensation: Inflation compensation reflects adjustments for the effects of inflation to the principal of inflation-indexed securities.
Click to expand...

The Fed BUYS the Treasury's, with Federal Reserve Notes, from the USGovernment. The USGovernment spends the Federal Reserve Notes in its deficit spending each year.

The graph you posted refers to said 'Treasury's'. Hence it is going up (with roughly an 80% correlation according to your estimates) simultaneously with the QE programs.
Click to expand...
Then somehow wrong charts were shown, not the ones I intended.
The charts I pasted are saved graphs on the Fed's site.
Maybe the links don't work for someone else.
So I'm gonna try now to paste the chart images themselves.

BASE (St. Louis Adjusted Monetary Base) and EXCRESNS (Excess Reserves of Depository Institutions) (pre 2008 and post 2008)
fredgraph.png

fredgraph.png

fredgraph.png


This is the EU side, showing about the same storyline:
http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=123.ILM.M.U2.C.LT01.Z5.EUR
quickviewChart

http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=117.BSI.M.U2.N.R.LRE.X.1.A1.3000.Z01.E
quickviewChart

Notice how the excess reserves jumped from near zero to over 400 billion, this year 2012, august.

That's where I talked about.
Here is another link I found, also explaining what I ment, with a nice graph showing the BASE minus EXCRESNS, thus reflecting the TRUE amount dollars that were added to circulation:
http://one-salient-oversight.blogspot.be/2010/12/using-monetary-base-as-recessionary.html
ZZddK.png

This chart illustrates my point: look how you only see a steady uptrend.
The QE peaks shown in the BASE chart are absent.
And why: because only 20% of the QEx dollars added to circulation since 2008.
What this chart thus shows is that 20% increase, which is 2008's pre QE1 monetary base of 875 billion + 40%.
So at most we can expect 40% general price increasings relative to 2008 pre QE1.
So silvers price did +200%, while the expectable inflation is barely 40%.
Get what I mean?
 
Very interesting Pirocco. I've graphed the most recent data as well as calculated what happens to the True Money Supply if you remove these Excess Reserves on the basis that they aren't circulating.

6824_m0.jpg


6824_tms.jpg


From the second graph you can see that the money supply excluding the reserves is essentially growing at the historical trend rate (except in the past 12 months) which would imply that we shouldn't have really felt too much extra inflation pain compared to what we were used to pre-GFC.

6824_aag.jpg


From the annual growth it is interesting that a clear deflation event happened in 2008 which is what the financial sector commentators would lead us to think (and I think makes sense).

No time for any real analysis sorry. Just presenting the numbers.

Edit: Actually. The total inflation from Nov-2007 to Nov-2012 is 72.9% according to the TMS or 45.4% according to the "Modified" TMS (i.e. excluding the reserves).
 
Many relevant points were made, and some ideas are really sound, but ... I like reading all the analysis where there is only one country in the world called US of A, there is only one monetary base that matters, and there's only one central bank that prints money ))

Do the countries behind the door (i.e. EU, China, Japan etc ) make the above analysis less reliable?
 
The USA is over 20% of the world economy (~23 last I checked) so it is not insignificant.

Trying to do any monetary analysis for China is a joke so largely I wouldn't bother.

Euro, Japan and the UK would be worth doing the same but I don't know where to easily grab the data. Maybe you could research and post?
 
worldbubble said:
Many relevant points were made, and some ideas are really sound, but ... I like reading all the analysis where there is only one country in the world called US of A, there is only one monetary base that matters, and there's only one central bank that prints money ))

Do the countries behind the door (i.e. EU, China, Japan etc ) make the above analysis less reliable?
Click to expand...
Basically the same happened everywhere in the world. For a central planning reason, imagine what would happen if only one country/currency would do so.
Today we face a worldwide cooperating central planning. They support/bail out eachother. For the same specific reason. Notice that every big and marketwide trend reversal sits around a big central bank operation. Google for "Werner Plan" and the "Snake In The Tunnel". It was a currencies strategy between central planners in the development stage of the currency fusion in the European Union, reaching its end goal with the Euro. The same method is now happening on a world scale, and its clear what the goal is now too: a world currency.
See, it's all about one thing: taking out alternatives. Leaving producing population parts no exit doors. Blocking speculation from becoming too succesful. Spreading their inflation uniformly over the world.
This element was the so far last (4th) I added to my silver target price strategy, and mid august I was spot on. The Euro 'snake' was approaching a multiyears bottom, and the central planning took indeed action (see the chart showing excess reserves on the ECB). I swapped my vacation money and all my saved euros to silver there. And now I sit again ready, with 5000 euro avail.
But I don't think the current price downtrend is a serious one. Because there is no currency 'snake' approaching a tunnel edge.
 
hotel 46 said:
pity about the snake, wouldnt mind seeing low 20's so i could buy a bit more. :)
Click to expand...
Well, the systemic entities that take part in the central planning operations to control the marketwide stories, reflect a part of the price, not the whole.
If other parts (alike those with silver ETF shares and stackers) sell, then they wipe out their part of the price, and to me it looks like this is what happened since october.
The price was $35; dropped down to $32, while the Comex futures market shows the same amount contracts.
I think that alot, with the experience of 2011-2012, expect yet again such price drop, and sold to buy back in lower.
This can be a good move, better to sell at $35 than at $26, BUT what if those futures market systemic entities do NOT dump their positions this time?
Because that is quite possible, at QE1 they started to accumulate positions to 50000 and held that level for nearly 2 years.
http://finviz.com/futures_charts.ashx?t=SI&p=w1
fut_chart.ashx

See that green trendline.
Maybe those systemic entities, with all the data they have access to, know that a next price inflation 'wave' is on the way.
That is possible, because prices can rise due to generally higher costs of companies (ex due to regulation, higher tax, etc), even without dollar creation & spending.
Some recent data from the EU side: officially inflation is lowest in two years, but this year I received notes and mails from every company I have some regular bill of (cable tv, internet, insurances, etc), announcing price increases.
In my country they again changed the way they 'measure' inflation. Since 2012 they select the cheapest products during bargain periods.
Since september 2011, every month sets a new record company failures (really, not a single month interrupted) and big companies fail, sending waves of additional bankrupties from their suppliers. Last week the EU central bank rescued an Italian system bank, the oldest they have.

So if those systemic entities, for a change (in 2 years) this time HOLD their positions, then all those that sold to buy back in lower, will be sitting there, in doubt, and likely ending up buying back in higher. I've seen it happening enough times on forums. In other words, a similar event as 2008 may happen, as a next step on the ladder to Depression, and remember those that paniced or hoped to buy back in lower, even from $9?

But I can say whatever here, I'm not the market, if people sell, the price goes down, and instead of complaining about manipulation and whatever, I take things as they are. During this summer I bought junk silver from many people, when spot was $27. Based on the market situation (even a 10 years record low futures position) I considered it a good price to buy. They considered it a good price to sell. But I don't have reasons to regret now, and they do. The market, like it is.

So in short, that 'snake' story is not the whole story. Don't judge things on it alone.
 
1,5 months later.
Some snapshots from the Comex stock evolution:

Activity date 19 december 2012
42.536.045,323 ounces registered.
103.526.926,029 eligible.
146.062.971,352 ounces total.

Activity date 02 januari 2013
40.436.354,003 ounces registered.
108.368.633,091 eligible.
148.804.987,094 ounces total.

Activity date 15 januari 2013
37.975.641,851 ounces registered.
114.285.110,187 eligible.
152.260.752,038 ounces total.

Activity date 29 januari 2013
38.061.252,164 ounces registered.
116.234.424,614 eligible.
154.295.676,778 ounces total.

On themselves, these figures are meaningless. They show no relationship to any trend (price trend / #contracts / demand)
The Comex stock can be seen as a silver buffer close to the market, silver of which can be decided to make available for sale that then instantly happens.
So for some reason, there is more and more silver being moved close to the market. 8 Moz more in 1,5 months.
 
Another month later: 163.425.065,933 ounces.
Since at least april 2012, the stock hovered around
140 Moz.
End november 2012 it started to rise in a steady gradual fashion. And now it's already over 163 Moz.
In the past 24hgold had a chart showing multiyears evolution. But it stopped working. Is there another source for historical data?
 
If I see sub $1400 Gold and sub $27 Silver after 5th April should I buy gold or silver or mix? I'm thinking 50 / 50

Thanks to all those in the above thread who are passionate about your interests. If I agree or disagree it does not matter, it makes for a good read and a balance is in there...somewhere

Regards
 
If you see $1400 you could possibly be looking down the barrel of $1100....a full retracement back to the 2008 peak....there will be no support down to that level....if this was to occur it would wash out most weak hands..
 
Oh, and I thought most weak hands were already washed out since I bought 6+ kilo various silver from them during recent weeks.
So there will be more?
Nice!
So far it doesnt look like though, because I started to bid lower (my ammo is near zero) and they refuse.
So let's hope!
 
I'm inclined to think That there is VERY strong support between $1100 and $1400 as the Asains know a bargain...mining costs...etc etc

If Gold goes below $1200 even I will be shocked.

The Chinese were not allowed to buy gold untill recently so they are just getting started.

My finger will be on the trigger on Monday 8th April if the price is right.
 
no takers just yet......have a little patience.....this $1500 defence will be fierce and if it doesn't hold....it will be as Scooby Doo says all too often....." Lets get outa here..arooooo..." They will be begging you to take it from them....
 
Alas nearly every analyst in the business is ready to back the truck up....the best of the best are now showing every valid reason why it is a screaming buy......but what if it isn't ??????.....
A collective voice will be issuing forth an almighty "..*uck..".....they will be like battery hens in a paddock for the first time....it will take them some time to overcome the fact that they are horribly wrong and they will panic for the next safest place....a full retracement.

It is all about "if" of course.....but that "if" is currently a real possibility
 
It could easily go back near 1200 since that sort of retracement happened in the last bull market. But this time it's a paper game. If anyone can actually find physical at 1200 then tell me where.
 
If it goes to 1200 which I doubt, mints and large dealers could stand for delivery on COMEX and receive their gold for 1200.
Also dealers who hedge their stock on COMEX will be able to sell it for 1200 + their markup.

However this standing for delivery is the support of the price and that's why it's not that easy to manipulate the price down, remember JPM has practically unlimited fiat at their disposal, physical - not so much.

Just Chinese government alone could crush COMEX if they decide to stand to delivery with their billions in US bonds.
I guess they prefer to buy the stuff quietly and at the low price instead.
 
I don't know why the subject suddenly became gold, but this was about the Comex futures markets silver stock.
Since I couldnt find any relation of Eligible/Registered/Total with something else (not with price, not with amount futures positions), I wondered what its trends were in history / longer term.
As said, the 24hgold website showed longer term trends but cant locate it anymore, or it doesnt work here due to software.
For ex, end 2011 the stock was the lowest Ive seen, a 112 Moz. Now its 163 Moz. End 2011 (mid december it was) on the same day as the stock report, the total # futures market positions was 20000. Lower than today despite the much higher #positions. The price was $29,47, thus about the same as today.
What can explain this stock growth? There is more silver moved towards the stocks of the Comex silver market. What happened in history when/after that happened? That's what I want to find out. Without understanding the why, not any conclusion can be drawn from this.
 
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