Official Theme Song of Obamerica
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I may own 16 tonnes (sic) of No. 9 Silver by the end this downdraft.
So be it.
Yesterday, I took it up a notch, as reported in my comments section. Not only did I add yet again to my Silver Wheaton Corp. (USA) [[SLW]] call horde, with 40 more June $11’s at $4.10, but I also began to purchase my old friend [[AGQ]] , with 600 shs at $53.77 and later in the day, another 600 at $55.11. I may add to that double silver horde again this morning if I can get this post done.
(It’s troubling to me that sometimes the blogging gets in the way of trading and other weurth(sic)-while endeavours (sic).)
For those of you watching at home, I’m almost back up to my total pre-December concentrated position in Silver Wheaton Corp. (USA) [[SLW]] with 18k shares. Another 2k will finish that hording. I am also up to 14k on the smaller [[EXK]] , and 7.5k on [[CDE]] . Because of the selling I did in December, I still have a lot of dry powder, which I will employ if we get one more push to the $1,030 area in gold. As it is, however, we may not get past the $1,075 I’d mentioned earlier in the week.
The important datum in this scenario, however is the ratio of the prices of gold and silver — right now, the price of gold stands at a nosebleed 65.75 multiple of the price of silver. As I’ve mentioned before, recent historical price ratios are normally between 40 and 50 times. So yes, gold may drop from here, but even in a drop to $1,030 from here, gold is still at near-nosebleed 61.6x the price of silver (with silver at the $16.71 an ounce it’s at right now).
So yes, I’m accumulating silver, in the sixteen tonnes range — it’s a value play at this point, and indubitably so. As one of my colleagues in The PPT explained yesterday “I had a dream where everyone’s future wealth was determined by how large of a silver belt buckle they wore.”
I also added 2k of [[PAAS]] yesterday in the $21.65 range. That was a standing buy order that just got hit. That’s been happening a lot lately.
On the gold front, I will look to add to Eldorado Gold Corporation (USA) [[EGO]] and perhaps some Allied Nevada Gold Corp. [[ANV]] today, as I got my IAMGOLD Corporation (USA) [[IAG]] position up to 10k shares as of yesterday as well with a buy in the low $14’s. For the record, I am not adding any [[SLV]] or [[GLD]] here, as I still have half my positions left over from the December sales.
If anything, I will add more [[AGQ]] today, and judging by it’s price, that may be soon.
Best to you all.
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Update: Sorry for not mentioning the banks, which continue to look good, even as the Great Bankers (Geithner and Bernanke) continue to look bad (and mad) before the dopes in Congress. Odd, no?
BB&T Corporation BB&T Corporation [[BBT]] continues to be a top pick, and even the stalwart sons of the Confederacy down at Sterne Agee and Leech(es) have given it a “buy” with a target of $33 (my target is $38, as you know). Thanks to The PPT for that bit of information.
I also like Pacific Capital Bancorp [[PCBC]] on this weakness, just remember it is a lotto type pick, and go lightly, Holly. Fifth Third Bancorp [[FITB]] and Huntington Bancshares Incorporated [[HBAN]] continue on the Crosby Still Nash & Young theme of “Four Dead in Oh-hi-oh” — as Nat City and Provident are already dead, and these may survive, AND MORE.
Best.
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Jake ‘Fort Knox’ Gint
treasonous!
Treason against whom? The POTUS is not “the state.”
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Spare any cha cha cha CHANGE, mister?
Plus ça change, plus c’est la même chose !
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mot vers le haut
M-O-O-O-O-O-T-T-T!
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The ANVil ended up strong today.
Silver still a little shaky… maybe one more clear out to come.
Bring it.
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A sloppy h+s top in gold may be formed here – target below $900. That said, the most powerful of patterns during the 2009 rally was h+s failures.
I would love to see a statistical analysis on these H&S tops. Maybe it’s only been recently (since the advent of CANSLIM populism, maybe?) but it strikes me that they are coin flips at best these days.
If gold goes to $900, I will actually go out and buy more fizzical for the first time since 2001.
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“I owe my soul to the company store”
Not much of a stretch to imagine debt bondage and the truck system as part of a “welfare solution” by a bankrupt government.
Not at all. Tennessee Ernie had himself quite the apt metaphor, ovah heah.
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Jake
At what point would you consider your strategy of averaging down into the precious metal sector as having failed, or ill-timed? I assume you have stop losses on these positions, and you’ve mentioned that you’re fairly close to full positions on several stocks.
As an example, what if SLW pulls back to $11 – would you still hold it or would you be out ?
If the dollar continues to strengthen, is it within the realm of possibility that gold and silver could pull back further than what is considered reasonable, or expected ? Look forward to your thoughts.
Thanks
No question gold and silver could continue to pullback.
I still have about 30% dry powder available in that event. I also retain my GDX , RGLD and SPY hedges, though I am out of the SLW sold calls.
I could see as much a a full week more of this pain, but I expect it will be more like a final ripping of my intestines out, followed by a quick “snip!” and then morphine cocktail.
I have talked about $1075 as a first stop, and then $1030. I really don’t expect it to get much below that level, but I’ve been made a fool before.
If SLW pulls back to $11, I will get out of my June calls, but not my stock position. I would likely add at those levels.
Again, I know this goes against the whole “Losers average losers” theorum, but you have to look at this as a longer term buildup, with an average original cost of below $5 in this name (remember, I kept 40% of that original position).
All that said, I would be extremely surprised to see SLW drop to $11 from here.
(Never say never, though).
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Jake,
The dollar is looking mighty bullish at the moment. While it may simply be a counter-trend rally in an overall multi-year decline, it has the potential to last for months. Does that not worry you given your over-weighting of PMs? The reason I ask is because I’m in the same boat. Thanks.
No, as I don’t see this as the end of the PM bull, no matter what, and I’m in for over nine years now.
We still have yet to get that speculative blow off top that marks the end of precipitous bulls like this. I just don’t see us drifting off from here, not with the fundamentals we’re looking at.
There may be a strengthening int he dollar, all the way to the $80+ mark on the DXY (as I’ve mentioned).
I don’t think it will have a huge impact on the POG or POS, even then.
So, short answer, I will put on the sackcloth (burlap potato bag?) and ashes, and suck it up, but I will not be giving up on this bullish picture any time soon.
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Boo Yah! A good 10 years left in this Bool Market!
At least until they re-Volkerize.
And I don’t know that they can, given the liabilities.
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I for one will admit, with Jim Gerahty, that I was all wrong about President Obama
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Give me a break. Having Republicans in office won’t change a damn thing for this country. In my eyes, they are just as bad as any Democrat. They’re all just a bunch of gutless politicians lacking any sort of long-term or strategic vision. With them, it’s always about the next election cycle and maintaining their “grip” on power no matter the cost (with the cost being the American people themselves more often than not). The truth is this country has been in a slow decline ever since the 80’s. Putting Republicans or “conservatives” in power won’t do a damn thing to change that.
Agree on saying “Republicans” in the common usage, disagree on “conservatives.”
There’s a difference, and if you really care more than making an occassional cynical statement on a blog, you would work to make sure more conservatives — or economic libertarians, at least — are winning your local primaries than your typical big gummint “Republicans.”
They all need a good scare.
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The best way to solve the problem is to get retro …. the forefathers envisioned a govt where all people served for a term or two rather than the current byproduct of professional politicians with no time constraints as long as they appease their constituents and the lobbyists providing the $ to fund the campaign. Time for a two-term limitation so those elected have only the interest of their country and the state they represent as priorities.
And what’s this crap about corporations being able to donate (at shareholder expense) for the candidate of their liking … forget about three parties or even two for that matter! More $ influencing politics and of a fascist nature for sure … this could turn into another AL vs NL domination that lasts for eons. WTF is the supreme court thinking aside from their Conservative bent? Even a staunch conservative has to see the potential ruination of a country by this decision, no?
Agree on that first para, although I think maybe you could take the 2 year reps to 5 or 6 turns to equal the two turns the Senate gets.
Disagree wholeheartedly on the second para — what part of the First Amendment don’t you understand?
Congress shall make NO LAW respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech…
Pretty clear, I think.
And right.
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Right, except the First Amendment guarantees freedom of speech to the general populace … what part of the constitution explicitly refers to institutions when it comes to freedom of speech other than the press (newspapers, tv, radio, etc.) and religious institutions. How can a corporation ruled by a board of directors “speak” for the entire corporation (stockholders, employees & officers as well as their customers) really be protected by the 1st amendment when indeed any opinion expressed by that corporation via advertisement or pronouncement is really the philosophy of that board or its’ officers?
Justice Anthony M. Kennedy wrote: “First Amendment freedoms are most in danger when the government seeks to control thought or to justify its laws for that impermissible end. The right to think is the beginning of freedom, and speech must be protected from the government because speech is the beginning of thought.”
Extrapolating Kennedy’s (liberal?) quote, the 1st amendment wasn’t intended to apply to an inadament object or institution incapable of thought. Clearly the amendment addresses the press and religious institutions (as well as the right to assembly) as their principles coincide with personal freedoms of the “populace”. No doubt this is open to ridicule as entities advertise and influence employee and public opinion directly and indirectly all the time though there has been rulings on commercial speech as well.
Types of Speech
A) Core Political Speech
This is the most highly guarded form of speech because of its purely expressive nature and importance to a functional democracy. Most simply, core political speech is interactive communications about political ideas or issues that are not motivated by profit. Restrictions placed upon core political speech must weather strict scrutiny analysis or they will be struck down.
B) Commercial Speech
Not wholly outside the protection of the First Amendment is speech motivated by profit. Such speech still has expressive value although it is being uttered in a marketplace ordinarily regulated by the state. Restrictions of commercial speech are subject to a four-element intermediate scrutiny.
No doubt $ given to political campaigners comes with the intent to profit (lol) and hence we have political campaign laws regulated by FECA. If the corporation is to be given the same rights as people then I think it’s about time that we have separation of business & state just as we have separation of church & state to avoid drowning out the free speech of the people.
No corporation has ever been imprisoned, enslaved or tortured for their views, opinions, actions or inactions. The only punishment other than the court of public opinion has been the ability to fine them or force them into bankruptcy for tax evasion or fraud with the exception of the few instances of officers being found directly responsible and imprisoned (Enron-Tyco- WorldCom). Hence they are not entitled to the same rights and freedoms as people.
So again, I say other than the media or religious institutions that clearly represent the freedoms of individuals, where does it say that the constitution or 1st amendment was written to protect anything other than “people”? Haven’t read it lately and not being a law scholar I defer to those who are ….
Curious also why one Supreme Court would overrule a prior Supreme Court decision other than the fact that the new court was made up of more conservative justices and didn’t like the prior courts’ ruling … so when the court gets dominated by liberals in the future they take up the issue again and overrule the current decision … so this is what common sense has come to?
What part of “Congress shall make NO LAW … abridging freedom of speech…” don’t you get?
There’s no mention of “who” or even “what” — it’s a direct injunction on the Congress to never disallow speech of any kind (save of course those specific “physical harm” instances like yelling “fire” in a crowded theater).
Why are people afraid of free speech from anyone? And why are liberals specifically afraid of free speech from corporations (made of people) that are not specifcally media corporations?
It’s just silly.
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Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
Seems to me that the framers made explicit mention to Church, Press and People … no mention of other entities from a group of business owners who started the Constitution with the phrase “We the people” ….
And no, again I’m not a liberal (a tag you hand out far to readily to any free thinking moderate or independent) and certainly place free speech at the top of rights but come on Jake, your fascist side is starting to show supporting unlimited monetary contributions by for- profit businesses (to the candidate of their choice) in the name of freedom of speech (???). Who needs “We the People” when you can have “We the Corporations of the United States of America” to be in charge of society/civilization, right?
ROFL…
My “fascist side?”
From a dork whining about the right to assemble and speak?
Only fascists (and other illiberal types like socialist authoritarians) are afraid of speech, and want to clamp down on it.
Again answer my question — why would you have no problem with Disney or GE having the right to free speech (they own media outlets), but have a problem with other corporations (again, these are just people, not robots, over here) making their thoughts know to their fellow citizen?
What thoughts do you seek to control?
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And further, since when is the Constitution a “dispenser” of rights? The Constitution puts a fence around the GOVERNMENT, not the sovereign people, who have rights inalienable.
Seriously, you’ve been fed a bill of goods. You are not displaying any aspects of “free thinking” but rather one conditioned by lazy leftish shibboleth and prejudices.
Think it through for yourself. What are you afraid of?
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I’m whining about the right to assemble and speak … as you always say, must be that public schooling you had in Reading …. your prejudice belittles your reading comprehension …. time to let your mind expand from the narrow back roads of the south to the open expanse of the autobahn when it comes to reasoning.
Re Media outlets, we know who owns them and their political leanings so we can take it or leave it or move on to one that’s aligned with our own philosophies (though I prefer both sides of the story) as we see fit .. at least we have representation there from both parties, eh?
Correction … “We the Corporations of the World” …. didn’t realize that this new ruling applied to foreign corporations as well …. Niiiice!
Can’t wait for elections influenced by Asian, Indian & European corporations to get underway …. Heil Hitler!
Your first response is 100% pure gibberish. Really, go back and re-write the whole thing, it makes zero sense.
As for your second attempt:
It doesn’t apply to foreign corporations. Now I can tell you’ve really been deep sixing in the left wing blogs.
Do yourself a favor and read the actual ruling, which specifically does not rescind the foreign bans.
Not that I have a problem with foreigners who have vested interests speaking in the open, either. As long as it’s disclosed as to the sources, wouldn’t you rather that than them paying lobbyists under the table?
Really, your reductio ad Hitlerum is just a reflection of your ignorance. Hitler wasn’t exactly a huge fan of free speech either.
But that’s history, that’s stuff that takes some reading.
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1) The Hitler reference was tongue in cheek reference to the German automakers on there way to US shores for mfg and potential campaign contributions.
2) I’m sure you’ve read the ruling, huh? Then why is there all this talk of loopholes allowing domestic corps controlled by foreign interests the ability to make unlimited contributions?
http://www.examiner.com/x-15870-Populist-Examiner~y2010m1d24-No-one-likes-last-weeks-Supreme-Court-decision-on-campaign-contributions-Except-Lobbyists
3) If you have read the ruling then what say you about Justice Stevens opinion …. have you read that?
http://www.supremecourtus.gov/opinions/09pdf/08-205.pdf
The court was not asked to make a ruling but simply decided it was up to them to revisit the original case and reconsider that courts’ ruling.
The only relevant thing that has changed since Austin and McConnell is the composition of this Supreme Court.
“First, the Court claims that Austin and McConnell have “banned” corporate speech. Second, it claims that the First Amendment precludes regulatory distinctions based on speaker identity, including the speaker’s identity as a corporation. Third, it claims that Austin and McConnell were radical outliers in our First Amendment tradition and our campaign finance jurisprudence. Each of these claims is wrong.”
“First Amendment provides that “Congress shall make no law . . . abridging the freedom of speech, or of the press.” Apart perhaps from measures designed to protect the press, that text might seem to permit no distinctions of any kind. Yet in a variety of contexts, we have held that speech can be regulated differentially on account of the speaker’s identity, when identity is understood in categorical
or institutional terms. The Government routinely places special restrictions on the speech rights of students,
prisoners, members of the Armed Forces, foreigners,
and its own employees. When such restrictions
are justified by a legitimate governmental interest, they do not necessarily raise constitutional problems.”
Corps have not been denied free speech via the use of PAC’s.
The court majority’s “assumption that the identity of a speaker has no relevance to the Government’s ability to regulate political speech would lead to some remarkable conclusions. Such an assumption would have accorded the propaganda broadcasts to our troops by “Tokyo Rose” during World War II the same protection as speech by Allied commanders. More pertinently, it would appear to afford the same protection to multinational corporations controlled by foreigners as to individual Americans: To do otherwise, after all, could “‘enhance the relative voice’” of some (i.e., humans) over others (i.e., nonhumans). Ante, at 33 (quoting Buckley, 424 U. S., at 49).51 Under the majority’s view, I suppose it may be a First Amendment problem that corporations are not permitted to vote, given that voting is, among other things, a form of speech.”
“In short, the Court dramatically overstates its critique of identity-based distinctions, without ever explaining why corporate identity demands the same treatment as individual identity. Only the most wooden approach to the First Amendment could justify the unprecedented line it seeks to draw.”
“To the extent that the Framers’ views are discernible and relevant to the disposition of this case,they would appear to cut strongly against the majority’s position. This is not only because the Framers and their contemporaries conceived of speech more narrowly than we now think of it, see Bork, Neutral Principles and Some First Amendment Problems, Ind. L. J. 1, 22 (1971), but also because they held very different views about the nature of the First Amendment right and the role of corporations in society. Those few corporations that existed at the founding
were authorized by grant of a special legislative charter. Corporate sponsors would petition the legislature, and the legislature, if amenable, would issue a charter that specified the corporation’s powers and purposes and “authoritatively fixed the scope and content of corporate organization,” including “the internal structure of the corporation.” J. Hurst, The Legitimacy of the Business Corporation in the Law of the United States 1780–1970,pp. 15–16 (1970) (reprint 2004). Corporations were created, supervised, and conceptualized as quasi-public entities,
“designed to serve a social function for the state.”Handlin & Handlin, Origin of the American Business Corporation, 5 J. Econ. Hist. 1, 22 (1945). It was “assumed that [they] were legally privileged organizations that had to be closely scrutinized by the legislature because
their purposes had to be made consistent with public
welfare.” R. Seavoy, Origins of the American Business Corporation, 1784–1855, p. 5 (1982).”
This ruling is nothing more than one branch of government trying to utilize it’s majority position to help it’s own party regain control of its’ political power by leveling the playing field or in this case tipping the scale to the right when it comes to funding campaigns. Not much different than one party controlling both branches of congress and passing legislation at will. So there is no doubt the score is 2 – 1 Dems but slipping when it comes to control of Branches of the Government.
It’s not a question of free speech, it’s about ensuring “that public officials are sufficiently free from improper influences.” Lord knows we already have enough corruption ….
Yo, I read something today about the CFTC possibly following suit of the Volcker rule in regards to speculation in commodities by investment banks, although it preceded Bama’s marionette dance. The article mentioned that de-leveraging risk by the firms wouldn’t be apparent until Q4’10. I personally think that this will not have a longer term material effect on the commodities markets, but could create an increase of implied volatility at the time of legislative debate.
Besides, traders will find a way to speculate on commodities one way or another through ETFs, OTC swaps, or whatever. I hate politics like I hate fast food, no substance and full of shit.
It’s not going to be speculation that drives the silver and gold markets up (at least, not in the near term), it’s going to be simple supply and demand.
Thanks to the printing machines.
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Gint, you eyeing the $VIX? Looking good for the bulls, no?
The sudden rush down in the price of silver was rather unexpected. I’m caught off guard by it. I may stock up on some of your calls, or else SLV.
I like AGQ for pure silver speculation. But SLV calls could add leverage w. capped risk as well.
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I like your thinking. I have been adding SLV for months now. Silver has quite a way to go IMO.
silver production has peaked, while usage continues to grow. Historical prices for silver are still well below the inflation-adjusted average. something like 50%
Noted. VIX can be quite a lagger, however, as we’ve seen already.
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Can the QQQQ’s break 44 and start shitting all over the place. We shall see. Just for the fuck of it I am going to buy a few out of the money puts on the QQQQ’s looking for a break down. Front month and roll the dice. Going to take down just a few contracts to see what happens
Caution — I’ve got $43.61 as the 61.8% retrace of the intermediate term move — that’s usually a pretty strong line.
I’ve got QID, but my trigger finger is itchy.
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