Gold demand drops 49%? “They” wish!

http://www.mydigitalfc.com/commodities/gold-q3-demand-dropped-49-088

To all; this is the type of garbage the media is putting out. Does anyone really believe that Indian demand is down 49%, yet the price rose 15-20% FOR THE QUARTER, HOW DID THIS HAPPEN? Amazing! The headline is “demand down 49%”! So this is the media news leading into the Dec. options expiration today and the Gold cartel is suffering a severe body blow with absolutely ZERO pullback. The cartel can only wish for a decline in demand. While this expiration month is small in both potential ounces and in Dollar terms it is in my opinion just a warmup for next month or the March/April time frame.

Could it be that next months expiration leads to a physical default? I think it’s very possible and I believe we are being “warmed up” for this possibility by CNBC. The outspoken Rick Santelli and another guest were asked their take on Gold’s rise. To my surprise, the guest and Santelli started talking about Larry Summer’s past writing’s about artificially suppressing Gold’s price to keep interest rates down and support the Dollar! (They used the word SUPPRESSION!) They went on to say that a strong Gold price is a negative “vote” on the Dollar. The guest (I believe it was commodity trader Philip Gottshelf) then went on to say that a study was done says that if you divide out the money supply by the 270 million “alleged” (my term) ounces of Treasury Gold you get $11,000 per ounce. He went on to say he actually did the math and came up with $50,000 per ounce and Rick Santelli agreed! CNBC is now allowing this sort of “tin foil conspiratorial” talk on the air? Say it isn’t so!

The next segment was an interview with Ron Paul regarding his recent “audit the Fed” bill that passed the House on Friday. If you recall, 2 years ago Becky Quick and Joe Kernan were “caught” on the air by mistake saying something like “oh my God, this guy Ron Paul is a lunatic” and Mr. Paul was routinely edited by CNBC whenever he was questioning Greenspan or Treasury officials. Apparently something has changed in the Orewellian game plan because Mr. Paul has gotten some traction and “us lunatics” are not so “far out there” anymore!

The next segment had another guest on regarding the Fed buying 90% of federal debt so far this year, I had to scoot out and don’t remember who it was but the caption below was “the Fed buys 90% of federal debt this year”. What the heck is CNBC trying to do? CAUSE a crash? This is truly a change of tone and I guess they are posturing for the “we told you so moment” in the courtroom.

It will be very interesting to see if or how many of the numerous $1,200 strike price call options that are outstanding get exercised with Gold some $25-$30 below the strike. In the past I only know of 2 instances where metals options were exercised when they were out of the money. Warren Buffet back in 1997 exercised some $5 Silver options when it was .30 cents or so out of the money because he wanted the metal. If the current move in the price of Gold is truly a scramble for physical and an assault on the COMEX inventory, then either this month or next we will witness options being exercised for metal. If this is the case, the moves we have seen recently in Silver and Gold will pale in comparison to what is ahead.

A default on the COMEX or elsewhere will be in fact a “run on the bank”. A physical default will lead to the loss of confidence in anything and everything paper. I believe you will see runs on banks, insurance companies, brokers, pension plans and many sovereign debt and currency markets including and especially aimed at the U.S.. The pieces to this puzzle were on the table some 12-15 years ago, some of us looked at it and felt we knew the “big picture”. Over time we became more and more sure as the pieces fell into place. NOW even CNBC is putting pieces together because if they don’t they will look like idiots to the sheeple. The problem for the establishment banksters is, the majority of “sheeple” are all reading newspapers, watching their TV’s and surfing the internet. The commoners are all beginning to see the “picture” of this puzzle at the same time. The mental picture I have is a bag full of Krugerrands, Maple Leafs, Eagles, and Bars (not tungsten) piled on the back of an exhausted and sprawled out Uncle Sam. I am sure others have a different but similar picture that is coming into focus more and more every day! “Truth” is becoming a very BIG problem. Regards, Bill H.

Ya think those discussing Larry Summers might have caught GATA’s Bloomberg interview in which he was brought up just the other day?