Otto Rock

The Latest Changes to SeekingAlpha.com

i like.

How to Explain Fiat Currency to Silverbugs

Truth hurts

Sorry, There Is No Silver Conspiracy

Indeed, Bron. Eloquently put. And that was the whole point of my article, really.

If........

1) I were sitting on the trading desk of one of those big two/four/eight anonymous banks that certainly play PMs both ways, and

2) I saw the ST structural weakness beginning to develop in gold due to a pending dollar rebound, and

3) I knew that Ag traditionally gives me leverage to Au, and

4) my boss agreed with my call, and his boss with him...you know what? I'd short the hell out of silver as well.

It may come as a shock, but it's not unusual for large financial institutions to trade assets to make paper gains. However, a single successful trade to the short side is not proof that there's a conspiracy. It's an asinine argument. What happened was that somebody was smart, made the trade and won. Period. That's what markets are designed for the last time I checked.

But as the last three years of spot silver vs COT clearly shows (and nobody has even bothered to try and refute this) is that there is no automatic relationship between "COT short up = silver down". In fact, for most of the last three years the situation has been "COT short up = silver up" (and vice versa).

Mikel makes a good point, too. If what happened really were illegal, the proposed Butler class action would be a pretty easy win for the oppressed masses. It may come late, as SEC should be swarming all over the Ag pit by now, shouldn't they?

Oh yeah...forgot...they'r... illuminati PTB, too. But all the same, the Butler cheerleaders should at least ask him if he's going to file some sort of action.

Sorry, There Is No Silver Conspiracy

Be careful breethedeep, you may get knocked over in the rush to judgement.

Meanwhile, after haveing read through the latest batch of huffing and puffing i note that no attempt to rebut the three main points of the article, so just in case somebody feels like enlightening me, here they are again

* 60% short position in COT is not that unusual

* In 2005, short interest dropped hard, but it didn't affect the price of silver in the slightest

* For a long time through 2006, 2007 and 2008, short interest moved in conjunction with the price of silver. That means that when there were more shorts on board, the price of silver ignored the commercial traders and just moved on up (and vice versa).

Or maybe you're waiting for Butler to do it for you?

Sorry, There Is No Silver Conspiracy

Thanks for all the ad-hom comments that only show your lack of decent, mature rebuttals. Meanwhile, would anyone like to address the three points made in the article....

* 60% short position in COT is not that unusual

* In 2005, short interest dropped hard, but it didn't affect the price of silver in the slightest

* For a long time through 2006, 2007 and 2008, short interest moved in conjunction with the price of silver. That means that when there were more shorts on board, the price of silver ignored the commercial traders and just moved on up (and vice versa).

...or will you just keep your collective heads in the sand about COT silver and its proven lack of influence on the metal?

Those that know me (not pretend they can guess about me) know that i'm happy to admit that I'm wrong about any issue. It's one of the things that makes me a successful investor. However, all i've seen so far from these comments are a bunch of peope who feel hurt that someone dared point out the obvious, and either

1) rely on words from their mentors (who, by the way, called silver and gold dead wrong when it dropped and then scambled to cover their tracks with conspiracy theories. All except, perhaps, Ron Rosen)

2) use personal insults to hide their impotence in the face of facts.

Sorry, There Is No Silver Conspiracy

Message to all serious investors who read the article and then read the comments left underneath: I rest my case.

Armageddon? Maybe Next Week.

good headsup

Junior Mining Companies To Benefit From LME Rule Change

187264 = otto

Junior Mining Companies To Benefit From LME Rule Change

kotika: you miss the point entirely, you have the right to do so, of course.

gmiki: nope, that's not the idea. The idea is for juniors to have a new, solid adjusted base case price.

Gold and Oil Price Limits

how's that southwestern call of yours doing, James?

Bernanke: Markets Are Still Far from Normal

dear seeking alpha

please permanently ban the commenter "fan"

Brazil: Let the Feeding Frenzy Begin

Most Brazil Stocks Fall as 3-Day Rally Fizzles; Banks Decline

By Paulo Winterstein and William Freebairn
Enlarge Image/Details

May 6 (Bloomberg) -- Most Brazilian stocks on the Bovespa index fell, led by banks and homebuilders, after a three-day rally made the stocks the most expensive since September 2004.

Banco Bradesco SA, the nation's biggest non-government bank by assets, paced declines among lenders after they had their biggest three-day rally in almost six years. Merrill Lynch & Co. said Rossi Residencial SA, the third-largest homebuilder, was expensive, sending real estate stocks lower. TimParticipacoes SA, Brazil's second-biggest mobile-phone carrier, plunged the most since January after saying revenue will grow 9 percent this year, not 12 percent as predicted in March.

The Bovespa Index of the most-traded stocks on the Sao Paulo exchange added 20.39 points, or less than 0.1 percent, to 70,195.27 as a late-day rally in commodities, led by state- controlled oil company Petroleo Brasileiro SA, pushed the index to positive territory in the last minutes of trading.

Of the index's 66 stocks, 39 fell and 26 rose, while 1 was unchanged. The index had jumped 10 percent since Brazil received an investment grade credit rating for the first time from Standard & Poor's on April 30.

``There was a bit of euphoria,'' said Augusto Lange, who helps manage $850 million at Neo Gestao de Recursos in Sao Paulo. ``You got the investment grade at a time Brazil is raising interest rates, so for companies that would benefit most, the effect will be moderate in the short-term.''

The Bovespa index traded at 17 times trailing earnings yesterday, the highest since September 2004, when the index's price-earnings ratio was at 19. Mexico's Bolsa rose 0.9 percent and Chile's Ipsa fell 0.7 percent.

Bradesco Gains

Bradesco dropped 3 percent to 39.09 reais. Banco Itau Holding Financeira SA, the second-biggest non-state bank, slid 4.3 percent to 47.61 reais after reporting first-quarter profit rose 7.4 percent to 2.04 billion reais. Itau was cut to ``hold'' from ``buy'' by Deutsche Bank AG analyst Mario Pierry, citing a recent stock rally and ``limited'' earnings growth.

``If Itau had come above expectations, maybe it would counter this general fall in banks, but as it came within expectations, earnings don't affect the market,'' said Aloisio Lemos at Agora Corretora in Rio de Janeiro.

Companies in the MSCI Brazil financials index yesterday traded at their most expensive levels since January.

Tim, which lost 8.1 percent to 5.24 reais and led declines on the index, said growth in handset sales slowed. Earnings before interest, tax, depreciation and amortization fell 19 percent to 535.4 million reais ($322.5 million).

Property Stocks Fall

Rossi led declines in real estate stocks, falling 5.1 percent to 18.82 reais. Merrill analyst Carlos Peyrelongue cut the company to ``neutral'' from ``buy,'' citing its 30 percent gain in three days and the possibility higher interest rates will hurt profit.

Cyrela Brazil Realty SA Empreendimentos e Participacoes, the biggest homebuilder, lost 3.6 percent to 27.95 reais after Deutsche Bank AG analyst Dan McGoey cut the stock to ``hold.'' Gafisa SA, the second-biggest homebuilder, was also cut to ``hold'' due to its ``sharp price rally.'' Gafisa fell 5.1 percent to 35.50.

Petrobras non-voting shares, the most heavily weighted stock on the index, gained 2.6 percent to a record 45 reais as oil traded at an all-time high in New York.

Steel companies gained, led by Usinas Siderurgicas de Minas Gerais SA, Brazil's second-largest steelmaker, after Deutsche Bank said the company will be able to raise prices to offset costs. Usiminas gained 2.7 percent to 82.75 reais. Gerdau SA, Latin America's biggest steelmaker, rose 1.3 percent to 70.81 reais while Cia. Siderurgica Nacional SA advanced 2.9 percent to 74.21 reais.

Mexico Gains

In Mexico, the Bolsa index rose for the fourth day as America Movil SAB gained after reaching an agreement to renew its license to operate in Ecuador.

``The market had accepted the fact last week that the license would not be renewed,'' said Arturo Espinosa, head of research services at Banco Santander SA's Mexico unit. ``It's less uncertainty for them.''

America Movil, the most heavily weighted stock on the Bolsa, climbed 0.7 percent to 30.89 pesos, and accounted for almost a fourth of the Bolsa index's point gain.

Argentina's Merval gained 1 percent while Peru's Lima General was little changed. The MSCI Latin America Index rose 0.8 percent to a record.

To contact the reporters on this story: Paulo Winterstein in Sao Paulo at pwinterstein@bloomberg... William Freebairn in Mexico City at wfreebairn@bloomberg.n...
Last Updated: May 6, 2008 16:55 EDT

Good Times and Bad Times in Gold

You like gold, understand gold trading but don't like the goldbugs.
You're my kinda person, Jeffrey!

Brazil: Let the Feeding Frenzy Begin

V winner,

Agreed on the long term hold. The "trade" comment is only for the very short term, as the rush to get in will cause a short term over-valuation of some stocks. So the advice is to take a short term profit, and then buy in on weakness and hold (particularly stocks like SBS, that will benefit anyone with the necessary patience).

Brazil long term? Absolutely! But the short term trade is also worthy of mention.

Otto

Brazil: Let the Feeding Frenzy Begin

chinstrap, i've also corrected my error on the original blog page entry. Thanks for pointing it out.