SLV short 37 million oz of silver/silver comex OI holds/gold and silver rise

Thursday we will see the commencement of first day notice.  Friday is the first day of deliveries.  Also on Friday we have the jobs report and as is their custom, gold and silver will be raided the day before the number is released.








Jim Rogers on the greatest trade of the next 20 to 30 years
An update on the master investor's latest thoughts... 

Bank Of America To Pay $8.5 Billion To Settle Mortgage (Mis)Representation Suit With BlackRock, Pimco, New York Fed Et Al. 

Bank of America may be about to part with more money than it has earned since 2008 in what will soon be the biggest financial settlement in the industry to date According to the WSJ, the Charlotte, NC-based bank is preparing to pay $8.5 billion to settle mortgage (mis)representation claims (aka the Mortgage putback issue) brought on by such high profile figures as BlackRock, Pimco, MetLife and, of course, the Federal Reserve, previously discussed on Zero Hedge. "A deal would end a nine-month fight with a group of 22 investors that hold more than $56 billion in mortgage-backed securities at the center of the dispute, including giant money manager BlackRock Inc., insurer MetLife Inc. and the Federal Reserve Bank of New York." Keep in mind that this is actually not good news for the bank, contrary to what the company's stock is doing after hours, as this still keeps the company exposed to a multitude of other rep and warranty litigation (which will now be largely underreserved), not to mention fraudclosure issues, which are totally unrelated, and which will plague the bank for years and years. Lastly, BAC is largley underreserved (see below) for a settlement of this size which means its Tier 1 capital ratio will likely be impacted due to a major outflow of cash. 

 

 

 

 

 

Guest Post: “Fat” Tails 

Submitted by Tyler Durden on 06/28/2011 17:28 -0400

Making money is an objective task, either one succeeds or fails. Results are easily testable and outcomes are binary. A trade or investment matures or is closed in the black or red. A trader has never ended up permanently on the “street” (no pun intended) as a result of losing money on a popular trade. People in finance are incentivized to follow the herd. Behavioral economists have studied this idea in-depth and can shoulder the burden of explaining this phenomenon much better than I, so I’ll leave the rest to them. The herd is often blamed for causing the overshooting and mass panics that cause “fat” tails. What I suggest is a different dynamic at play that the ”godfathers” understand. 

 

 

 

 

 

Microsoft Stock Goes Nuts At Close On Unfounded Rumor Of Balmer Departure 

Submitted by Tyler Durden on 06/28/2011 17:03 -0400

A quick look at the below chart of Microsoft trading into the close would lead one to believe that i) SkyNet is now fully self-aware, of ii) Muddy Waters came out with a strong buy on the world's most "underappreciated" value stock. Apparently, neither of these happened (well, at least not at the close: after all SkyNet has been aware since April 19), and instead the stock responded so violently only due to a completely unconfirmed so far rumor that Steve Balmer is stepping down. And while broken markets on no news is one thing, at least one can blame overheated vacuum tubes for crop circle trading formations, the kind of ridiculous trading, amounting to nearly 15 million shares, on what for now appears unvalidated rumors (which may have come after the move to justify it), in one of the world's most widely held stocks, indicates that there is way too much "other people's money" sloshing around, and should truly put the fear of god in anyone who still picks the S&P over the Encore Las Vegas (and especially the Shore Club).

Guest Post: “This Time It’s Different”– The Four Most Expensive Words In The English Language 

Submitted by Tyler Durden on 06/28/2011 16:40 -0400

China boasts world-class infrastructure on a truly impressive scale. Beijing, Shenzhen, and especially Shanghai, have all become modern metropolises with facilities on par with any in the world. Every taxi driver from Melbourne to Manitoba, and every money manager from London to L.A., recite the same mantra: insatiable demand from China (and India) will guarantee decades of prosperity for countries such as Australia and Canada which are blessed with the raw materials that billions of Chinese and Indian consumers require to emulate western lifestyles. So the story goes… Thing is, once anything has become mainstream knowledge in financial markets, it’s usually a sign we’re nearing the END of the boom. Or, at the very least, that all the positive news is already baked in the price. That’s where we are today with China. 

 

 

 

 

 

Join GATA at Gold Rush 2011 in London in August -- we need you

 

 

United States of Denial

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