CFTC to discuss position limits Dec 16.2010/Kirby's paper--massive silver derivatives/bonds continue to decline

Deflationists Take Note: Bernanke Succeeds In Offsetting Shadow Banking Collapse

 

CFTC to discuss position limits Dec 16.2010/Kirby's paper--massive silver derivatives/bonds continue to decline

 

Guest Post: Product Over Process: Balance Complexity With Liquidity

 

Imitation is the Sincerest Form of Flattery

Posted: Dec 11 2010     By: Jim Sinclair      Post Edited: December 11, 2010 at 4:49 pm
Filed under: Jim's Mailbox

Subject: UBS is reading JsMineset!! – USD 1,650/oz in UBS Global Outlook for 2011

Dear Jim,
It gives a price target of USD 1,650/oz for 2011! It says so on page 20
Best regards,
CIGA Christopher

”As such, commodity prices across all sectors are expected to rise further (see Fig. 21). We favor commodities where supply growth is limited, such as gold, copper and corn, and where prices haven’t seen exponential increases, such as cotton and silver. The reduction in OPEC spare capacity on the back of firm Asian oil demand should pave the way for price moves to USD 100/bbl over the next 12 months. As a consequence of a lack of trust in the major currencies and inflation concerns, further price rises are likely, with gold seeing peak levels at around USD 1,650/oz, in our view.” (See report).


Dear Jim,
As you have said Volcker won it all, Bernanke gave it all away!
David Stockman, former director of management and budget under Ronald Reagan:
 http://watch.bnn.ca/#clip384325


Jim Sinclair’s Commentary 
Dear HC, 
Minor correction! Volcker won it all and Greenspan gave it all away. Bernanke is Greenspan’s Bag Man and maybe the last fully functioning Chairman of the Board of the US Federal Reserve.
Regards, 
Jim

Be Right and Sit Tight

Posted: Dec 11 2010     By: Eric De Groot      Post Edited: December 11, 2010 at 3:27 pm
Filed under: General Editorial

A lesson from Jesse Livermore’s Reminiscences of a Stock Operator:
" There I was, short five thousand shares of UP (Union Pacific). on a hunch. That was a much as I sell in Harding’s office with the margin I had up. It was too much stock for me to be short of, on vacation; so I gave up the action and returned to New York that very night. There was no telling what might happen and I thought I’d better be Johnny-on-the-stop…
The next day we got news of the San Francisco earthquake. It was an awful disaster. But the market opened down only a couple of points…
I was short five thousand shares. The blow had fallen, but my stock hadn’t… He told me: "That was some hunch, kid. But, say, when the talent and the money are all on the bull side what’s the use of bucking against them? They are bound to win out."
"Give’em time," I said. I wouldn’t cover because I knew the damage was enormous and the Union Pacific would be one of the worst suffers. But it was exasperating to see the blindness of the Street… I wasn’t not betting blindly. I wasn’t a crazy bear. I wasn’t drunk with success or thinking that because Frisco was pretty well wiped off the map of the entire country was headed for the scrap heap. No, Indeed.
They’ll tell you that it was because the first dispatches were not so alarming, but I think it was because it took so long to change the point of view of the public towards the securities market. Even the professional traders for the most part were slow and shortsighted.”
Livermore’s essential message of “Be Right and Sit Tight” as described by the impact San Francisco’s Great 1906 earthquake had on his short position in Union Pacific draws a close comparison to that of the Great failure of the OTC derivative market in 2008 and the price of gold. For gold holders, it is exasperating to see the blindness of the Street as the damage incurred. Foreign debt held by foreigners and international investors as a percentage of GDP (national income), shown below, has climbed above 28%. The magnitude and acceleration of this trend is both staggering and dangerous.
The Street, nevertheless, following historical precedence remains largely blind to the message contained within the trends. While professional traders for the most part are slow and shortsighted, history suggests that they will react swiftly when blindness transitions to sight. If you thought “Be Right and Sit Tight” is easy, it’s a lesson that many will never learn.
The equilibrium price of gold continues to rise to unbelievable levels.
Federal Debt Held by Foreign & International Investors As a % of GDP (FDHBFINGDPR) and the London P.M. Fixed Price of Gold (GOLD):
 

Jim’s Mail Box

Posted: Dec 11 2010     By: Daniel Duval      Post Edited: December 11, 2010 at 4:54 pm
Filed under: Jim's Mailbox
Greetings Jim!
Gold closed near unchanged yesterday, holding below recent all-time highs of the secular bull market. Price action has been characterized by volatile swings higher and lower during the past two months as the long-term uptrend has consolidated recent gains of the rally from late July.

Cycle analysis indicates the gold market is attempting to form a short-term low near the $1,380 congestion support area.

On the weekly chart, the intermediate-term cycle has also entered the window during which the latest Intermediate-Term Cycle Low (ITCL) is most likely to develop.

The ITCL may have already occurred on November 19, and a strong move higher during the next few weeks would both confirm that the latest intermediate-term low is in place and forecast substantial gains during the coming months. The positive divergence between the Gold Currency Index (GCI) and gold in US dollar terms remains in place as technical indicators are moderately bullish overall on the GCI weekly chart.

A subsequent close at new all-time highs on the GCI weekly chart during the next few weeks would reconfirm the secular uptrend and predict additional gains during early 2011.

Best,
CIGA Erik
Prometheus Market Insight
http://www.prometheusmi.com