The U.S. Economy: Stand by for more worse news

[Billy T]

Sure, it's not like I haven't done it before. As pointed out in my last post, your claim the dollar would collapse in October of last year was wrong. Your claim the price of gold is fixed by "paper gold" is false. ...

I asked you to chose any fact I posted and show it was wrong. My prediction, made seven years into the future is not a "fact"

Likewise your CLAIM that price of gold is not set by paper gold trades is not a demonstration that it is not. You have not been able to demonstrate, as asked, that even one of my facts was wrong.

I will demonstrate that the price of gold IS set by paper traders - Here is one of their more gross manipulation:

Note they chose to dump paper gold at moment when there were essentially no buyers - to get maximum impact on the price:
30 seconds before the markets opened in Shanghai on Monday, July 20, at 9:30 a.m. local time (CST), gold fell $30 an ounce in a matter of four seconds, after which trading on the New York Comex exchange was halted for 20 seconds. It then plummeted another $40 before it was temporarily halted again.

Who did this is not known, but three or four of the world's biggest banks have paid fines and the London fix of the PoG has been admitied to be fixed - one German bank pulled out of the group manipulating the PoG.

SUMMARY: You claim that paper gold does not fix the price is simply false, BS, not a demonstration. It is only natural that if does as the volume traded is dozens of time larger than physical gold trade.

 

[joepistole]

I asked you to chose any fact I posted and show it was wrong. My prediction, made seven years into the future is not a "fact".

Oh, so now you want to cherry pick what are facts and what are not facts. Well the fact is for many years you have been predicting the demise of the dollar, and you went further last year to predict the collapse of the dollar on October 31 of last year. Well, as unpleasant as that may be for you, it didn’t happen. Instead the dollar was and remains incredibly strong. In your last post, you admitted you were wrong, but explained it away as just a minor wrong in predicting the date, just as numerous false prophets have done before over the years.

Likewise your CLAIM that price of gold is not set by paper gold trades is not a demonstration that it is not. You have not been able to demonstrate, as asked, that even one of my facts was wrong.

Unfortunately for you BillyT, your notions about “paper gold” do not trump the Law of Supply and Demand.

I will demonstrate that the price of gold IS set by paper traders - Here is one of their more gross manipulation:
Note they chose to dump paper gold at moment when there were essentially no buyers - to get maximum impact on the price:
30 seconds before the markets opened in Shanghai on Monday, July 20, at 9:30 a.m. local time (CST), gold fell $30 an ounce in a matter of four seconds, after which trading on the New York Comex exchange was halted for 20 seconds. It then plummeted another $40 before it was temporarily halted again.
Who did this is not known, but three or four of the world's biggest banks have paid fines and the London fix of the PoG has been admitied to be fixed - one German bank pulled out of the group manipulating the PoG.
SUMMARY: You claim that paper gold does not fix the price is simply false, BS, not a demonstration. It is only natural that if does as the volume traded is dozens of time larger than physical gold trade.

Where do I begin? First, you have plagiarized and article from a specious source. I’ll be kind, just because someone writes something and is published in a specious internet page, it doesn’t make it true.

This is what the main stream, responsible journalists reported, “Gold plunged to its lowest level in five years on Monday, triggered by heavy selling overnight and signs Chinese demand may be weaker than expected.”

The main stream press went on to report the reason for the sudden fall in gold prices was attributable to China’s announcement that it had slowed its pace of gold stockpiling and that has absolutely nothing to do with “paper gold" and every thing to do with supply and demand. And the main stream press went on to report,

“Analysts said expectations of higher U.S. interest rates made for a bearish outlook, but Monday's sell-off appears to have been sparked by news that China has been stockpiling gold reserves at a slower pace than previously thought.

The world's largest gold producer increased its gold reserves by 604 metric tons over the past six years, according to data from the People's Bank of China.

FXTM's Ahmad said reports that China's reserves were lower than expected hit investor sentiment when it was already fragile. “

http://money.cnn.com/2015/07/20/investing/gold-price-slump/

So the reason gold prices spiked downward on that day was because China announced it had decreased its stockpiling of gold. That has absolutely nothing to do with “paper gold” and everything to do with supply and demand. Sorry BillyT, it’s that old reality thing biting again.

 

[Billy T]

Oh, so now you want to cherry pick what are facts and what are not facts. ...

No "cherry picking" needed. Any idiot but you knows that some one's PREDICTION of an event to occur seven years after the prediction is made, IS NOT A FACT.

And no the 30, then 40 dollar down spike in the price of gold, in less than a minute, less than a minute before markets opened in Shanghai gold market opened, was not due to rapid change in "supply and demand of physical gold", but the result of large, well timed for maximum effect on price, dump of paper gold.

Normally that dozens of times larger volume of paper gold trading, does not produce such large and obvious effect on sub minute time scales, but does control the PoG more slowly during the day. It can as trades in actual physical gold are typically 50 times less than the paper gold volume traded most days. The ~ 2% real gold trades get lost in that paper gold trading noise.

I still wait for you to DEMONSTRATE any of my posted FACTS is wrong. - You CLAIMS that they are, is not a DEMONSTRATION. The 70 dollar "smack down" of the PoG in less than a minute when there was little trading (less than a minute before market opened) shown graphically in my 1181 is a DEMONSTRATION that paper gold traders do manipulate and control the price of gold but that is likely to end soon as the demand for delivery on paper gold contracts is soaring:

For those who thought June’s stacking strength was merely a fluke, well, let’s just say that July has put all those doubts to rest. The record amount of metal tucked away by stackers and big money in July is the absolute strongest seen in years. Everywhere you look around the world, in every precious metals commentary, you’ll see the words “record” or “unprecedented”…and it is putting enormous pressure on the crooked, fractional-reserve gold “exchanges”, like our good pals at the Comex!
In fact, it’s safe to say that the boys running that con are putting in long, sleepless nights, trying to figure out ways to stretch this thing out just a wee bit longer.

Following is reposted from my post 1163:

At end of July HSBC moved 72,022 ounces of its owned Eligible gold to Registered; and
JP MOrgan Chase moved 200, 753 ounces of its owned Eligible gold to Registered.
Without this aid, COMEX would have been unable to meet the surging demand for physical gold - the claims of the Owners of Long Side of future contracts.
See my source for the above here: http://www.silverdoctors.com/comex-august-gold-deliveries-heat-up/#more-56553
but there are many sources, including COMEX itself that tell the same FACTS.
I.e. COMEX publishes how much gold is in both the registered and eligible class, (daily I think) and usually month by month too, extending back several years.

 

[iceaura]

No, it wasn't. In many parts of California the problem was that there was no power, period. There were blackouts as utilities simply could not afford to keep power flowing. Those utilities went bankrupt.

Yes, it was.

The rolling blackouts were not a result of utilities being unable to pay legitimate prices and therefore their customers being cut off from otherwise available electricity. They were a result of deliberately created supply deficits targeted to black out the low bidders and drive prices for the remaining juice as high as possible by threat of deprivation Somebody was going to be outbid and - as lesson and threat - blacked out, by design. The entire situation was a calculated and deliberate extortion of the California electricity customer. Enron wanted money.

Any time you partially deregulate anything there are lots of potentials for abuse. With complete deregulation this doesn't happen, since market forces prevent abuses.

The central necessity for Enron's abuse of the California electricity buyer was Enron's ability to corner enough of a captive market, as is (and was) allowed by "market forces". It was getting control of the market, not "partial regulation", that set Enron up to rob the California consumer. That possibility was created by deregulation, not "partial regulation". The subsequent abuses were facilitated by slack enforcement of other laws, not their existence but their non-enforcement. At no point in any of this were regulations necessary to facilitate Enron's abuses, at no point did Enron take advantage of an existing regulation to facilitate its abuse - what regulations existed and were enforced acted to interfere with Enron's schemes and lower its payoff.

Gray Davis admitted this in a speech; he said he could solve the crisis tomorrow by deregulating _all_ the utilities as well.

And that makes sense to you - having Enron rob all the citizens of California, instead of just some of them, and boost its prices even higher in the process, "solves the crisis"? Is what the California governor said after allowing his constituents to be blacked out and ripped off by a Texas energy conglomerate supposed to be evidence of something?

Actually, no. The opportunity for corruption existed before deregulation.

Enron was formed for the express purpose of taking advantage of the new opportunities deregulation in the financial and energy markets had opened up. And that's what they did - both legally and illegally.

Meanwhile:

And I know you only want to selectively look at Enron's victims, but in the real world, the objective world, we look at all of Enron's victims. We don't' cherry pick as you are so fond of doing. And the fact is Enron's management victimized more than just the rate payers in California. They victimized their employees and their investors.

This rhetorical habit of yours is kind of ugly, but you obviously can't do anything about the way your brain works; so I usually just ignore it, but jeez man - compare your foul little attempt there with this quote from the exact same post you were referring to there:

Enron's failure was not a problem. Enron's executives's abuses and robberies of their employees, creditors, clients, and customers were problems. Enron's corruption of national politics via Republican Party influence was a problem. Enron's manipulation and damage of the US energy markets was a problem. Enron's failure was a good thing - it should have happened much sooner.

Contrary to your explicit posting, Enron's failure was a solution, not a problem. Its years of longevity and growth in fraud and abuse was a problem. Its ability to acquire political protection and influence was a problem. It should have failed almost immediately after launching its predations, and taken its investors down with it. That's what is supposed to happen, in a working capitalistic market. It should have been placed under federal investigation as soon as the first blackouts rolled into California, its books and executives subpoenaed and examined, its operations shut down as soon as the facts were established. That is what is supposed to happen, under the rule of law in a modern Western civilization.

And the patterns of existence of Enron, Madoff, Worldcom, Lehman Bros, Halliburton, Goldman Sachs, etc and et alia, are the indications of more worse news to come. Not the presence of what regulations still obtain, or their occasional enforcement.

 

[joepistole]

Enron was formed for the express purpose of taking advantage of the new opportunities deregulation in the financial and energy markets had opened up. And that's what they did - both legally and illegally.

And you know this how? Enron was formed in 1968, that's 22+ years before California's deregulation. You are making shit up again Iceaura.

Meanwhile: This rhetorical habit of yours is kind of ugly, but you obviously can't do anything about the way your brain works; so I usually just ignore it, but jeez man - compare your foul little attempt there with this quote from the exact same post you were referring to there:

Well facts are not rhetorical devices, nor are they usually considered ugly if one is an honest broker. But you are not an honest broker. Facts are just facts. And your ad hominem isn't going to disguise the fact that your beliefs are just not consistent with reality, which is par for the course with you Iceaura.

Contrary to your explicit posting, Enron's failure was a solution, not a problem. Its years of longevity and growth in fraud and abuse was a problem. Its ability to acquire political protection and influence was a problem. It should have failed almost immediately after launching its predations, and taken its investors down with it. That's what is supposed to happen, in a working capitalistic market. It should have been placed under federal investigation as soon as the first blackouts rolled into California, its books and executives subpoenaed and examined, its operations shut down as soon as the facts were established. That is what is supposed to happen, under the rule of law in a modern Western civilization.

And the patterns of existence of Enron, Madoff, Worldcom, Lehman Bros, Halliburton, Goldman Sachs, etc and et alia, are the indications of more worse news to come. Not the presence of what regulations still obtain, or their occasional enforcement.

Well, you are moving the goal post here. The unfortunate fact for you is corruption preceded Enron's misdeeds. It existed before Enron and it exists post Enron. Regulation and deregulation had nothing to do with corruption. Deregulation was just a vehicle, a tool, which allowed Enron to manipulate prices. Price manipulation was just one of Enron's misdeeds as previously stated. Also as previously stated, the reason Enron no longer exists, is because it was a fraud. It cooked its books. And as I told you before, Enron California's rate payers weren't Enron's only victims. It hurt its employees, its suppliers, and its investors. But, hey, you only care about California rate payers. Many of Enron's investors were its employees, and pension funds. Many hardworking middle class families were damaged by Enron's fraud.

One more point, you are slandering a lot of other companies again, and you have ZERO evidence to support that slander. But, hey, like all extremists, you have no need of evidence or reason. Corruption is innate, it is part of they human psyche. The best we can do is control it with institutions. The time to control corruption is before it begins, not after the fact as you have advocated. As previously stated, that's why we desperately need constitutional reforms which removes the influence of special interest money from our polity. That's why we need governmental ethics reforms. In our current form of government, it is assumed elected leaders do not have interests which conflict with those they represent. Unfortunately, that isn't the case. Elected officials should be required to prove they have no interests which conflict with those they represent.

 

[Billy T]

... mainstream press will once again start paying close attention to the total, and especially registered, gold held at the Comex: at a pace of 25K a day, the gold vaults that make up the CME's vaulting system would be depleted in just under two weeks of daily withdrawals.

While the mainstream press has certainly not opined on the peculiar events at the Comex, we have been paying particularly close attention to the daily Comex gold updates, and is probably why we were less than surprised to see that just 2 days after our report, the Comex once again succeeded in sweeping default fears under the rug by boosting its eligible gold by a whopping 78% overnight, from 362K ounces to 643K, thereby pushing deliverable gold from its all time lows. ...

One must wonder how large the premium was which caused owners of Eligible Gold at COMEX, to give up their ownership of it (362,000 oz) to delay the default on claims by those who hold delivery contracts. Many now want the gold, not money equal to its current value.

JP Morgan has considerable interest in helping COMEX, not go bust/ default. It is after all only confidence that keeps them from doing the same. When more than 100 others, could claim the gold you were expecting to get, if you asked for delivery, that is strong inducement for you to claim / take delivery / of "your gold" before they do.

 

[billvon]

The rolling blackouts were not a result of utilities being unable to pay legitimate prices and therefore their customers being cut off from otherwise available electricity. They were a result of deliberately created supply deficits targeted to black out the low bidders and drive prices for the remaining juice as high as possible by threat of deprivation.

The fact that the utilities that could charge whatever they wanted did not experience blackouts demonstrates that that claim is false.

Somebody was going to be outbid and - as lesson and threat - blacked out, by design.

Not in the San Diego market. As prices climbed - and more importantly as consumers SAW those prices climb - they used less. Thus Enron was unable to drop enough generation to cause blackouts, since those markets were a bit more functional than the rest of the state's.

The entire situation was a calculated and deliberate extortion of the California electricity customer.

Where it was extortion from the customer (i.e. San Diego and LA) they were unable to cause blackouts or bankruptcies. Where it was extortion from companies, with those companies not free to raise rates, they easily caused blackouts and bankruptcies.

The central necessity for Enron's abuse of the California electricity buyer was Enron's ability to corner enough of a captive market, as is (and was) allowed by "market forces". It was getting control of the market, not "partial regulation", that set Enron up to rob the California consumer.

Enron was unable to "rob consumers" in (for example) the SCE service area, since SCE could not, by law, raise their rates. Instead they had blackouts and an eventual bankruptcy.

That possibility was created by deregulation, not "partial regulation".

Had the grid been completely deregulated, none of that would have happened. Enron would have taken their facilities off line - and other suppliers would have stepped in, happy to generate power for exorbitant fees. People would have paid more for power and complained bitterly. New generators, realizing that this was a golden opportunity, would have rapidly built new plants to cash in on the profit opportunity. And Enron would have been bankrupted, trying to "game the market" by not selling power - and eventually, not receiving any income.

The reason this happened is that many utilities were required, by law, to buy power at whatever price Enron charged through the CAL-ISO. This creates a dysfunctional market. Had the utilities not been required to do that, they would not have gone bankrupt.

At no point in any of this were regulations necessary to facilitate Enron's abuses, at no point did Enron take advantage of an existing regulation to facilitate its abuse

The state requirement to pay whatever Enron asks were in fact necessary to facilitate Enron's abuses.

And that makes sense to you - having Enron rob all the citizens of California, instead of just some of them, and boost its prices even higher in the process, "solves the crisis"?

Yes. (See above.)

Is what the California governor said after allowing his constituents to be blacked out and ripped off by a Texas energy conglomerate supposed to be evidence of something?

That he knew how to solve the problem - but didn't want to.

Enron was formed for the express purpose of taking advantage of the new opportunities deregulation in the financial and energy markets had opened up. And that's what they did - both legally and illegally.

Exactly. They saw an opportunity - "hey, we can charge whatever we want and they can't do a thing about it! They HAVE to buy from us." And that simple fact set the stage for an unethical company to manipulate a partially deregulated system to their own advantage.

 

[Billy T]

More on post 1186 (My ISP went down for 6 hours, before I could edit to add the following):
Although JP Morgan was the main "Rider to the Rescue" of COMEX, as discussed in post 1186, a small amount of help was provided by Scotia Mocatta. They let 5,021.13 oz of their owned "Eligible gold" transfer to the deliverable "Registered class." However, Brinks partially off-set this by taking delivery on 1,771.82 oz.

The real question is how long will owners of appreciating gold*, supply it to COMEX so it can avoid default if the current trend of holders of long side of contracts continue increasingly to ask for their gold?

* While the DOW dropped 0.93% today GLD went up 1.34% And US oil was down 4.3%.

Tomorrow should be interesting - will the sharp rise in PoG continue?

 

[joepistole]

No "cherry picking" needed. Any idiot but you knows that some one's PREDICTION of an event to occur seven years after the prediction is made, IS NOT A FACT.

And unfortunately for you BillyT your prediction is a fact. And unless you were just making shit up, presumably your prediction was based on what you thought were relevant facts. So which is it BillyT?

And no the 30, then 40 dollar down spike in the price of gold, in less than a minute, less than a minute before markets opened in Shanghai gold market opened, was not due to rapid change in "supply and demand of physical gold", but the result of large, well timed for maximum effect on price, dump of paper gold.

Oh and where is the evidence to support that belief? As I pointed out in my last post, the timing coincided with the announcement the Chinese central bank hadn’t purchased as much gold as expected. You have “paper gold” on the brain. You don’t seem to be able to understand the difference between derivative securities and the actual commodity. The two are different. The derivative doesn’t drive the commodity price though the commodity does drive the derivative price. Nor does “paper gold” explain away the huge drop in gold prices. And you cannot make a rational case for your beliefs.

Two, you are being a more than a little dense or disingenuous when you claim the price downturn wasn’t due to supply. That’s a straw man. Of course the supply didn’t change in a matter of minutes, but the news did cause traders to realize the supply wasn’t as low as market participants expected. It also changed future expectations of supply which could influence current demand. If buyers felt supply and prices would be more favorable at a future date, buyers could forestall current demand in order to take advantage of the expected increased supply and better prices. So the news adversely affected the then current demand.

Normally that dozens of times larger volume of paper gold trading, does not produce such large and obvious effect on sub minute time scales, but does control the PoG more slowly during the day. It can as trades in actual physical gold are typically 50 times less than the paper gold volume traded most days. The ~ 2% real gold trades get lost in that paper gold trading noise.

No it doesn’t. The value of derivatives is based on the value of the underlying security. Derivatives don’t drive the value of the underlying security or in this case commodity. Your belief to the contrary is just shear and utter nonsense.

I still wait for you to DEMONSTRATE any of my posted FACTS is wrong. - You CLAIMS that they are, is not a DEMONSTRATION. The 70 dollar "smack down" of the PoG in less than a minute when there was little trading (less than a minute before market opened) shown graphically in my 1181 is a DEMONSTRATION that paper gold traders do manipulate and control the price of gold but that is likely to end soon as the demand for delivery on paper gold contracts is soaring: Following is reposted from my post 1163:

Hmm, didn’t you read my post? You wrote, “Please pick ANY of my facts (Your choice as to which) and demonstrate it is wrong.” I have. I cited your much vaunted predictions of a dollar collapse last year. I pointed out you and your specious source left out information and you have absolutely no evidence to support your assertion that somehow, magically, “paper gold” drove real gold prices downward. As I pointed out, there was no evidence of a cabal. There was however a major announcement from the Chinese central bank which adversely affected gold pricing for reasons previously explained. You have a penchant for cabals and conspiracies (e.g. US told Germany it had to wait in order to retrieve its US gold deposits because the US had loaned Germanys gold out, etc.).

At end of July HSBC moved 72,022 ounces of its owned Eligible gold to Registered; and
JP MOrgan Chase moved 200, 753 ounces of its owned Eligible gold to Registered.
Without this aid, COMEX would have been unable to meet the surging demand for physical gold - the claims of the Owners of Long Side of future contracts.
See my source for the above here: http://www.silverdoctors.com/comex-august-gold-deliveries-heat-up/#more-56553
but there are many sources, including COMEX itself that tell the same FACTS.
I.e. COMEX publishes how much gold is in both the registered and eligible class, (daily I think) and usually month by month too, extending back several years.

As I explained before this is yet another example of that movie I wrote about. Where a little bit of knowledge (i.e. the paramagnetic properties of aluminum) gets turned into an end of life on Earth event.

Comex does produce data, but it doesn’t say what you want it to say. You would be a lot better off BillyT if you lay off these specious sources you love so much and used more conventional and more credible sources. But they are not going to tell you all this nonsense.

 

[Billy T]

I copy the Kitco graph in post 1188 as it seems to be automarticlly up dating. Hope the copy below will not:

Joe's invented "fact" that on 19th the price of gold increased only 0.06% was easily exposed by the data from the 19th (an increase of slightly more than 1%)
As I type, the surge up in price of gold I predicted, based on the 300 million dollar single purchase of GLD seems to be continuing. PoG >1150 / oz now)

Note on 5 August PoG was 1085 and now 15 days later is 1150/oz or an increase of 6.66 dollars per day, while the Dow, S&P etc have fallen.

 

[Billy T]

And unfortunately for you BillyT your prediction is a fact. And unless you were just making shit up, presumably your prediction was based on what you thought were relevant facts. So which is it BillyT? ...

Yes it is a fact I made a prediction about 8 years ago that did not come true by last Halloween. You need to understand, especially in this case, that what I predicted is not FACT. Predictions are not "facts." I have several times explained why I expected that prediction to come true AND the main reason, I think, why it did not. IE I failed to recognize how big an economic problem more than two trillion dollars of "printing press money" creation could at least temporarily "paper over."

I am still waiting for you to DEMONSTRATE any, yes any, fact I stated in my posts 1168 & 1169 is false. You said they all were.
Again, your unsupported CLAIMS that they are wrong, is not a demonstration.

 

[Billy T]

BTW, the ETF GLD is up 3% in less than two days:

and gold itself is now above 1153/ oz. To be honest, I did not expect this rapid a rise when after Kyle Bass bought 300 million dollars of GLD in one day, I predicted the "surge" up but not that it would be this fast. Both Au & GLD going up more than 1% per day while stocks are falling is surprising to me. Here is what the DOW industrials have done recently:

Perhaps I picked the wrong Halloween for market collapse 8 years ago. It should have been 31October 2015, not 31 October 2014? The psychological level of 17,000 ought to give some support.

 

[joepistole]

I copy the Kitco graph in post 1188 as it seems to be automarticlly up dating. Hope the copy below will not:

Joe's invented "fact" that on 19th the price of gold increased only 0.06% was easily exposed by the data from the 19th (an increase of slightly more than 1%)
As I type, the surge up in price of gold I predicted, based on the 300 million dollar single purchase of GLD seems to be continuing. PoG >1150 / oz now)

Note on 5 August PoG was 1085 and now 15 days later is 1150/oz or an increase of 6.66 dollars per day, while the Dow, S&P etc have fallen.

Except, Joe didn't invent any facts.

 

[joepistole]

Yes it is a fact I made a prediction about 8 years ago that did not come true by last Halloween. You need to understand, especially in this case, that what I predicted is not FACT. Predictions are not "facts." I have several times explained why I expected that prediction to come true AND the main reason, I think, why it did not. IE I failed to recognize how big an economic problem more than two trillion dollars of "printing press money" creation could at least temporarily "paper over."

Well, that is huge minimization. The unfortunate fact is you did predict and you have consistently predicted right up until your prediction failed to come true (i.e. about 9 months ago). Your prediction failed because it was based on a set of fallacious facts and beliefs. It had nothing to do with "two trillion dollars of printing press money" as you now claim.

I am still waiting for you to DEMONSTRATE any, yes any, fact I stated in my posts 1168 & 1169 is false. You said they all were.
Again, your unsupported CLAIMS that they are wrong, is not a demonstration.

Well, the fact is I have. I have proven many of you facts wrong. You just refuse to acknowledge same. And actually, I never said every thing you represented as fact was wrong, that is another material misrepresentation on your part. What I said was, "Yes personal attacks do not cancel facts. And the facts are you have been demonstrably wrong in your prognostications over the years for reasons explained to you many times over the years." I also said you take a legitimate fact and build something totally illogical out of it. In no small part because you have a penchant for specious web sources which peddle conspiracies. And I gave an example to illustrate the point. Your prediction of the dollar's demise is one example. Your prediction of the dollars demise is well documented in Sciforums and its failure has been documented as well. The US Dollar didn't fail, it is stronger than ever as has been repeatedly pointed out to you. Those are the unfortunate facts for you BillyT.

 

[billvon]

Perhaps I picked the wrong Halloween for market collapse 8 years ago. It should have been 31October 2015, not 31 October 2014? The psychological level of 17,000 ought to give some support.

Are you changing your prediction date then?

 

[Billy T]

Well, that is huge minimization. The unfortunate fact is you did predict and you have consistently predicted right up until your prediction failed to come true (i.e. about 9 months ago). Your prediction failed because it was based on a set of fallacious facts and beliefs. It had nothing to do with "two trillion dollars of printing press money" as you now claim.

That is your opinion. Mine has it much more to do with the unprecedented (and unexpected by all) nearly three trillion dollars of fiat money issued since I made my prediction.

Yours explanation is false, as there are no "fallacious facts." I based the prediction on the rapid demographic shift the Baby Boomers would make (especially the rapid decrease in Social Security tax payers relative to SS benefit collectors - completely foreseeable 8 years ago); The growing income inequality; The shrinking or stagnations of middle class and its income, as "Big Mac" a part time jobs replace good paying 40 hour/week factory jobs; The growing per capita debt (even just counting the federal debt); The endless and increasing trade deficits; The growing welfare collection roles (more than 1 in 6 now getting financial aid and paying no income tax.); The dysfunctional Congress that flirts with defaulting on the bonds; and several factors I forget now - ALL OF WHICH ARE TRUE and continuing; and thus NOT "fallacious" but can be papered-over (hidden, by increasing the debts our descents must pay) WITH MORE THAN two trillion dollar of "thin air" money.

Well, the fact is I have. I have proven many of your facts wrong. You just refuse to acknowledge same. ...

Yes you repeatedly CLAIM you have but are unable to give, EVEN ONE, link to where you did that.

BTW, my prediction in post 1192 that the 17,000 level for the DOW industrials would be a "psychological barrier" proved to be false too. It was not as firm as butter. Dow fell right thru that level today. Closed at 16,990.64, down 2.06% with more than 350 point loss! and in contrast GLD was up 1.74% on the day.

 

[joepistole]

BTW, the ETF GLD is up 3% in less than two days:

and gold itself is now above 1153/ oz. To be honest, I did not expect this rapid a rise when after Kyle Bass bought 300 million dollars of GLD in one day, I predicted the "surge" up but not that it would be this fast. Both Au & GLD going up more than 1% per day while stocks are falling is surprising to me. Here is what the DOW industrials have done recently:

Perhaps I picked the wrong Halloween for market collapse 8 years ago. It should have been 31October 2015, not 31 October 2014? The psychological level of 17,000 ought to give some support.

Well, here is the likely reason for gold's recent 3% increase and it has nothing to do with “paper gold” or any other conspiracy. Speculators are speculating the Fed will loosen monetary policy in response to China's slowing economy and recent currency devaluation, because a slowing Chinese economy and China’s currency devaluation will slow the US economy. As a result, they speculate the Fed will be forced to loosen US monetary policy and that loosening will increase US inflation rates. That thesis hasn’t worked for the last 7 years.

Year to date, the US inflation rate has been slightly negative and the Fed has a targeted inflation rate of 2%. So there is plenty of room for the Fed to loosen monetary policy. But the Fed has some hawks on the committee which determines interest rate policy. Member banks really want a rate increase. Low interest rates have been adversely affecting bank profitability for 7 years now. So it all boils down to what the Fed will do in a few weeks. It’s a gamble. If the Fed increases interest rates as has been widely expected, it will tear a huge hole in this trading thesis and gold prices will fall faster than they have risen. If the Fed doesn’t increase rates, then these recent gold price increases may hold for a time. But they will not be sustainable unless the anticipated economic slowdown worsens and the Fed begins quantitative easing again, and maybe not even then, depending on circumstance. It’s all about the numbers.

At any rate, this is a trading thesis. It’s not an investment thesis. Last week I bought some rare gold and silver coins. Numismatic value trumps bullion value, time and time again. But as with anything, buy in increments over time and know something about what you are buying and selling, and be diversified. Coin prices have been depressed since the Great Recession, so I think savvy investors can find some good buys.

I see you are doubling down on your prediction. Well come October of this year you will once again have egg all over your face again and you will have to invent another excuse. Like I have repeatedly written, you taken one piece or a few pieces of information and through ignorance constructed a huge fiction, just like the film I previously mentioned. You like the many prophets before you are excusing away your mistakes rather than learning from them and are doubling down on them.

 

[joepistole]

Are you changing your predicted date then?

By my count, this is BillyT's 3rd predicted date. Now BillyT will insist this is his second prediction date.

 

[joepistole]

That is your opinion. Mine has it much more to do with the unprecedented (and unexpected by all) nearly three trillion dollars of fiat money issued since I made my prediction.

Well no it isn't. It's a fact. That's one reason why no economist worth his salt agrees with you. Two, where are you getting this 3 trillion dollar number? Did you just make it up? Because that isn't what the data says. As repeatedly pointed out to you over the years, there are two measures of money supply, M1 and M2. M1 is actual cash and demand deposits (e.g. checking accounts). M2 includes savings accounts and other items that are a little less liquid.

Below is a chart showing the increase in M1 over the period in question and it is nowhere near 3 trillion dollars.

Below is chart of M2, the broader measure of money. It shows an increase of nearly about 5. trillion dollars over the course of the last 8 years. That too is nowhere near 3 trillion dollars. So are you now going to revise your prediction once again?

Yours explanation is false, as there are no "fallacious facts." I

buased the prediction on the rapid demographic shift the Baby Boomers would make (especially the rapid decrease in Social Security tax payers relative to SS benefit collectors - completely foreseeable 8 years ago); The growing income inequality; The shrinking or stagnations of middle class and its income, as "Big Mac" a part time jobs replace good paying 40 hour/week factory jobs; The growing per capita debt (even just counting the federal debt); The endless and increasing trade deficits; The growing welfare collection roles (more than 1 in 6 now getting financial aid and paying no income tax.); The dysfunctional Congress that flirts with defaulting on the bonds; and several factors I forget now - ALL OF WHICH ARE TRUE and continuing; and thus NOT "fallacious" but can be papered-over (hidden, by increasing the debts our descents must pay) WITH MORE THAN two trillion dollar of "thin air" money. Yes you repeatedly CLAIM you have but are unable to give, EVEN ONE, link to where you did that.

Actually, no. The fact is you were very clearly wrong. Therefore, the "facts" upon which you based those predictions were also wrong or wrongly interpreted by you. This is really an excellent example of what I have been telling you. It's a perfect example of someone taking a few facts (e.g. the paramagnetic properties of aluminum) and constructing through ignorance or design creating an end of the world thesis or in your case a collapse of the dollar thesis.

Well, virtually all of that is irrelevant to your prediction. As I have told you for almost 8 years now. Your only hope for success rests on Republicans causing an unnecessary debt default, and the odds of that happening on Halloween or close to Halloween are pretty long. I don't think Republicans will try that stunt again for at least another 2 years because we have an election coming next year. Now while I think Republicans are crazy, I don't think they are that crazy. But you never know, if there is one thing I have learned over years it is to never under estimate Republican capacity for stupidity. I might add that you made your prediction years before Republicans attempted to engineer a US debt default. Are you telling me you have a crystal ball?

BTW, my prediction in post 1192 that the 17,000 level for the DOW industrials would be a "psychological barrier" proved to be false too. It was not as firm as butter. Dow fell right thru that level today. Closed at 16,990.64, down 2.06% with more than 350 point loss! and in contrast GLD was up 1.74% on the day.

What you are attempting here is to voice a "technical opinion" or belief. Technicians are common on Wall Street, but they are also commonly wrong. They are the investing equivalent of a shaman. Every once in a while their predictions come true. But when academicians have studied technicians they are often wrong more than they are right, in no small part because they are using historical data to predict future events and that just doesn't work in a nonlinear world. You only get points if you can beat the market on a consistent basis and doing better than a random walk. Like Jim Rogers who said, “I haven’t met a rich technician.”, neither have I. It's pretty easy to predict a trend will continue.

https://en.wikipedia.org/wiki/Random_walk_hypothesis

I can point to any number of successful fundamentalists investors including Warren Buffet. I cannot think of even on successful technical investor.

It's hubris to think you, a person with no formal education in economics, can do economics better than any reputable economist. And not a single credible economist shares your beliefs. You should ask yourself why.

 

[Billy T]

... where are you getting this 3 trillion dollar number? Did you just make it up? ...

No. More than two and less than three trillion is how much the Fed has expanded it balance sheet in the 7+ years of my prediction. IE Added in QE et.al. treasury bonds it bought, mainly directly but also by telling major banks to increase the Fed's deposits in them. In most cases they used this increase in deposits to buy Treasuries too. With the tougher loan restrictions, and over capacity in production facilities there was not much demand for plant expansions, etc. IE most of the QE created money did not get into the economy.

I agree that M1, a measure of the money in the economy has only grown about 10% as much. That is why the QEs did not get the economy back functioning well. (Longest and slowest "recovery" ever.) Most all of that more than two trillion of thin air money just sat on the books or the bigger banks or at the Fed.
It was the FED's balance sheet expansion I spoke of, not M1 or M2.

Sorry, this only goes to near start of 2010 - it is much worse now. I'll try to find graph showing how bad it is now, but here is text telling that (as of November 2014):

When the Great Recession hit, the Fed’s balance sheet was approximately $700 billion dollars, and over the course of the recession and recovery, the asset purchases the Fed made through its various quantitative easing programs expanded the balance sheet to over $4.4 trillion at the end of October of this year....

See: http://www.heritage.org/~/media/infographics/2014/08/bg2938/bg-fed-balance-sheet-chart-2-825.ashx but it will not copy here

Finally one that will post, but not sure what it tells - think it is not only showing the debt, but its maturity.

Below from the Fed itself, is data just released. See it properly formatted at: http://www.federalreserve.gov/releases/h41/current/h41.htm#h41tab1

But the "punch line" is as others have stated that Fed's balance sheet now stands at 4.4 TRILLION DOLLARS. (This link is updated every Thursday after markets close - it is "hot off the press," now). First data in each block of four is the 19Aug2015 CoB value. EG total credit on fed's books was 4,460,579 million dollars at end of 19 August 2015.

Condition Statement of Federal Reserve Banks August 20, 2015
1.Factors Affecting Reserve Balances of Depository Institutions
Millionsof dollars
Reserve Bank credit, related items, and
reserve balances of depository institutions at
Federal Reserve Banks
Averages of daily figures
Wednesday
Aug 19, 2015
Week ended
Aug 19, 2015
Change from week ended
Aug 12, 2015
Aug 20, 2014
Reserve Bank credit
4,460,579
+ 10,445
+ 87,106
4,449,179
Securities held outright1
4,246,889
+ 15,264
+ 91,419
4,244,953
U.S. Treasury securities
2,461,752
+ 91
+ 31,656
2,461,785
Bills2
0
0
0
0
Notes and bonds, nominal2
2,346,641
0
+ 30,752
2,346,641
Notes and bonds, inflation-indexed2
98,534
0
+ 779
98,534
Inflation compensation3
16,577
+ 91
+ 125
16,610
Federal agency debt securities2
35,093
0
- 6,469
35,093
Mortgage-backed securities4
1,750,045
+ 15,174
+ 66,233
1,748,075