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Tuesday with Rick Ackerman

Big Al
February 24, 2015

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66 Comments

    E …..AH…….EE II OO……………..this little pig, yellen went to the market, and when she got there, ….e i e i o………………lol

      Feb 24, 2015 24:22 AM

      Funny J….The Long.

      Good interview, and thanks Cory for asking Rick what he thought of the 1920 high in Sept 5-6, 2011 overnight trading…..whether it was a bubble or whether it was a parabolic move. It sounds like he agreed that it was not a major bubble and didn’t crash right afterward, but instead Gold had a standard correction for the last 4 years, where we haven’t even retraced 50 or 61.8 % yet.

      Good thoughts from Rick about how everyone expected that the ramifications of the money printing in 2008-2011 were that price inflation would accelerate, but that nobody really expected the inflation to stay focused in just the equity markets.

      I agree that the juggernaut of inflation is currently swallowing up asset classes from real estate to commodities like oil, gold, silver and base metals. There are so many currency plates spinning in the air, that there should be some intense fireworks this spring & summer, and that will mark the turning point in equities, dollar, and commodity cycles.

      **Question: Aren’t we getting near a debt limit increase or debt ceiling issue in just a few days. I am surprised we haven’t heard more about it or that there hasn’t been all kinds of political posturing about it. Could that be what causes gold to pop for a week or two?

        Feb 24, 2015 24:24 AM

        that should have said juggernaut of Deflation.

        thanks Shad…………………………ootb

          this entire market is a Joke……….

            Feb 24, 2015 24:20 PM

            Agreed…..but more like a tragic comedy.

            Feb 24, 2015 24:35 PM

            Here is the snippet from Bloomberg from last November that the debit limit debate actually has a March 15th date. So we got about 3 weeks for this to play out:
            _______________________________________________________________________
            “Congress last addressed the debt limit in February 2014 and suspended it until March 15, 2015. The U.S. government will be able to use tax receipts and intra-government payments to stave off default for at least a few months beyond that, said Shai Akabas, associate director of economic policy at the Bipartisan Policy Center in Washington.

            “It could be a decent amount beyond that point, depending on many different variables,” he said in an interview today. “There is a chance that it goes a significant period of time beyond midsummer.”

            The timing of the debt limit’s expiration matters. The March 15 date comes during the individual income-tax filing season, when government receipts are often higher than expenses. That cushion prevents the Treasury Department from needing to borrow more money.

            In addition, the government can use so-called extraordinary measures, including transfers from other accounts. In 2011, those steps staved off default for more than two months, and now that the U.S. government is running a smaller deficit, they could last even longer.

            Republican Mitch McConnell of Kentucky, who is poised to become Senate majority leader, said today he didn’t foresee a debt ceiling crisis.”
            ____________________________________________________________________

            I guess everything will go just fine in the next few weeks concerning the debt ceiling, as nobody is even discussing it anymore.

            Feb 24, 2015 24:38 PM

            A couple of years ago and then last year the debt ceiling was a big deal, the media was hyped, and then we even had a “Fiscal Cliff” that nobody wanted to go over.

            I am simply amazed at how long they’ve been able to kick the can down the road.

            Feb 24, 2015 24:15 PM

            Smaller deficit? Taking spending off the books does not prevent them from borrowing. Last year’s deficit was 1.11 trillion not 450 billion.

            Feb 25, 2015 25:46 AM

            Yes, I agree the article and some of its information is a bit dodgy, but alas, it was from Bloomberg so the main stream media never ceases to warp the truth. The main point I am bringing up is that the debt limit date is set for March 15th (for some reason I was thinking it was right around the corner but nobody has been talking about it). Everyone seems to think things are just fine, but we are going to ask for a limit increase on our unlimited government credit card once again. Simply amazing.

    AH…………RICK IS ON Matthews side………….TULIPS FOR EVERYONE………

      Feb 24, 2015 24:16 AM

      Well Rick is super smart. 🙂

        no birdbrains there……lol

          Feb 24, 2015 24:22 AM

          😐 …….lol!

            $$$$$$$$$$$$$$$$$$$$

            Feb 24, 2015 24:46 AM

            Matthew – What are your thoughts about the bottoming in gold yesterday and today?

            Is the 1190.70 it a kind of double-bottom from yesterday, or do you think we may still head down to test 1187 or 1181.40?

            Feb 24, 2015 24:08 AM

            Shad, I think the action today and tomorrow is due to Yellen. Their is a long history of pressure being put on gold when the Fed head speaks. So I have to think that a marginal new low is likely, probably 1186-1187.

            Feb 24, 2015 24:52 AM

            Oops, “there” not their. Btw, I still think 25-24.80 is the worst case for GDXJ at this time.

            Feb 24, 2015 24:05 AM

            Yes, I agree some of the gyrations lately are wake from the Yellen blather.

            I had a target of $24.79 for GDXJ that I thought would get hit if gold fell below 1200 but the miners have really held up better than I expected. I thought the $1190.60 getting touched twice and then bouncing off it showed some strength, but expected 1187 or 1181.40 get tagged before Gold pops. At that point I’d feel better wading back into the Jr miners for a short term rally.

          just joking bird…………………lighten up………….have a great day…………….jootb

          Feb 24, 2015 24:27 AM

          Well done guys – got in there first!!

          Feb 24, 2015 24:38 AM

          too funny j…a little fun bird 🙂

            Feb 24, 2015 24:20 AM

            I am always up for fun. But I prefer when someone makes a decent case if they want to assert “gold will rise because (insert any daft idea you choose)”. Most of the arguments from the gold bugs are limp wristed and feeble in my view. It’s always the same thing…..one day…one day…just you watch…..all the people will buy and then you will see we are right.

            I don’t know why I bother anymore. Like talking to rocks. Immoveable and fixed.

            Some of you need to start examining the facts more closely. Look at the damn charts!

            Feb 24, 2015 24:47 AM

            I don’t know why you bother anymore either. Every argument will remain “feeble” in your view as long as you don’t understand the basics.

            Feb 24, 2015 24:07 AM

            You got beaten again smarty. You could not mount a reasonable defense of your irrational thinking where bubbles are concerned and did not offer even a single valid argument against my assertion golds chart was clearly a bubble.

            That’s five for Bird and Zero for Matthew. 🙂

            And the latest news? Your followers are also fans of Harvey Organ!!!! Ha Ha Ha Ha!!! Too freaking funny for words. That explains almost everything.

            Feb 24, 2015 24:16 AM

            And since NPD Boy alone gets to decide what a valid argument is, I know I will never put forth a valid one. LOL…………………………..:) 🙂 🙂

            You’re too much.

            Feb 24, 2015 24:33 AM

            No Matty…what is sad is you made no argument at all. Nothing. And that is proof enough for me that you actually agree with what I wrote. We shall see soon enough anyway. If I am correct then gold will break down below the lows of 2014 and we will be confronted with the fact that even another deeper low is coming. Like I said before, after four years of declines it is time to reassess your entire thesis about gold still being in a secular bull.

            Feb 24, 2015 24:41 AM

            What price level do you think gold could get down to in the bottom Bird?

            There is a point where if the PMS drop too much, where they will not be economical to pull out of the ground anymore. For gold I’d say below $900-$1000 zone would shut down most of the industry, and below $12-$14 Silver.

            Feb 24, 2015 24:54 AM

            Nonsense. I showed you that gold has NOT followed the typical post-bubble path downward. Like I pointed out, the Nasdaq was down a huge 73% 18 months after it topped while gold was down just 19% 18 months later and 31% 19 months later. All bubbles give up much more of their gains than gold has and they typically do so quickly. Gold has simply not followed the pattern that can be expected after a bubble. This makes sense, of course, since it never reached a bubble-like valuation by any important measure.

            Bottom line: Only the clueless or disingenuous agrees with you.

            Feb 24, 2015 24:07 PM

            I did have a long standing call for gold to decline all the way back to 968 which was made when prices were substantially higher. That sounded preposterous back then but is again becoming increasingly likely.

            Like others here though I got caught up in the appearance of a double bottom late last year and abandoned that target of mine because at that time there was still a hope that the bull might reemerge.

            At this point I am keeping an open mind. I do not know how deeply gold could fall in aggregate but am beginning to suspect it will actually be much worse than my 968 number. This has to do with a variety of reasons related to the chart that I explained yesterday in addition to what appear to be increasing deflationary forces.

            I think we need to remain flexible as new information arises so that we can be allowed to modify our positions and not get locked into rigid thinking that turns out to be costly.

            It obviously does not matter that price falls below production costs if we consider what crude has done. Strong mines will still produce but at a loss. Weak mines will shut down. Neither will immediately impact price though. Look at freight rates as another example. The BDI is so low that the whole shipping industry is in the critical ward and yet it keeps falling lower!

            Only a cleansing of the excess will bring about the desired results. In the case of shipping rates we will need to see a lot more bankruptcies or a whole lot of older ships being dismantled for scrap. So I would not hold out hope that cost of production creates much of a floor for prices as it only becomes valid once that low price has weeded out the poor performers.

            Feb 24, 2015 24:13 PM

            I tend to agree that Gold didn’t sell off hard enough (at 20-30%) to meet the normal “Bubble” definition (massive 100-200% rally with a 70-90% correction), but it was definitely getting ahead of itself and frothy in the summer and fall of 2011.

            Gold has corrected down for the last 4 years, but it didn’t spike straight down to the level it is at now in 2011 and did so in a more normal looking corrective pattern. If the Gold bull was about 11-12 years, then a 4 year correction is normal, and I could see it bottoming and going up for the blow off top for 3-5 more years into 2020. Just my 2 cents.

            Feb 24, 2015 24:14 PM

            Matthew says: “Nonsense. I showed you that gold has NOT followed the typical post-bubble path downward”.
            ———-

            No Matthew, what you showed me was that gold still has a long way to fall based on the numbers you provided. How do I know that? Because the bear is still alive and we are still in decline per the long term charts. You simplistically ASSUME gold must follow some predetermined timeline similar to a stock bubble. I think you are making an error. Look at the housing bubble as one example, the bond bubble as a second or the credit bubble as a third. These all take decades to play out which puts a great big fat hole in the hull of your argument. There is NO FIXED TIMELINE for any bubble to complete. What we do know for certain is that the longer it takes to build one the longer we need to see a final reversion back to the mean. Gold has only gone 41% of the way in four years….so how many more are needed for it to arrive back at its long term average?

            Feb 24, 2015 24:18 PM

            I agree completely, Shad, including your 3-5 years for a blowoff (though I lean toward 5).

            Feb 24, 2015 24:19 PM

            Whatever you say, Bird.

            Feb 24, 2015 24:20 PM

            Thanks Shad, what I am beginning to seriously consider these past days is that if gold did indeed have a ten year growth period before it formed its bubble top then we need at least a decade for that pattern to resolve itself. We can only take it month by month by I very much doubt gold will end this year higher than it began.

            Feb 24, 2015 24:38 PM

            Well, I think later this year will tell the tale of 2 paths for Gold:

            Path # 1 – Gold bottoms this Spring/Summer, finishes it’s 4 year bear (which would be a counter trend move) in an overall secular bull. The bull would resume and take out it’s old 1920 high and blaze on up into higher territory.

            Path # 2 – Gold corrects further and does end the year lower, in which case, the secular bull market in gold would be in rough shape.

            Bird – I hear what you are saying about the spot price falling below the cost of production, but those kind of events are temporary in nature (3-6 months) before major changes would occur. I would also argue that the oil industry has a huge marketplace with many producers, and gold would not be as resilient. Also the investment demand would be the primary mover for a continued bull in Gold (not jewelry); and that differs a bit from oil which has it’s demand from consumption.

            I could see Gold coming down to $993 (my target), or $968 (your target) or even the discussion we had yesterday about the old 1980 peak of $890, (discussed yesterday on Doc’s blog) and it would be the 61.8% retracement of 252 – 1920. However, if these levels below $1000 are touched, I personally would expect a snap back rally and not for pricing to stay down there very long.

            thanks …glenfidish……………………….j

            Feb 25, 2015 25:28 AM

            There is a really interesting interview with Jordan Roy-Byrne on Palisade Radio from Feb 23rd, that has a slide showing all the Bear markets in Gold for the last 100 years, and it is interesting that the current Bear market in Gold is the 3rd lowest price decline and the 2nd longest out of last 7 on record.

            This leads me to believe that we are going long in the tooth on the bear market, and have had a pretty steep price decline. This is why I feel that that bear market will resolve itself this Spring/Summer and that the Gold bull will resume. My gut, my charts, and my brain tells me this is the most likely track things will take, but the market doesn’t care about any of that and will do what it does.

    Feb 24, 2015 24:16 AM

    Al,
    Nothing is going on in the financial markets? Really??
    So the dollar not being the worlds reserve currency any longer and gold back some sort of gold/asset based currency standard is nothing going on?

    Why do you think all these assets have dropped in value?
    The only reason why the dollar is up is because all of the other countries holding the dollar have dumped the dollar. Less dollars in circulation means a rising dollar. ( coming to an end soon, BTW )

    Feb 24, 2015 24:19 AM

    ******* HEY BIG AL******* DO YOU THINK that you can get the one and only HARVEY ORGAN as a FUTURE WEEKEND guest……I would and I’m sure others would like to hear what he has to say about this GOLD market now, and what his analysis for GOLD is for the FUTURE……………….No one has HEARD from him in a while………the GOV’T took down his website and it looks like they are trying to SILENCE him, WHAT DO YOU THINK.

    Feb 24, 2015 24:30 AM

    I agree Al it is both intriguing and terrifying at the same time., A

    Feb 24, 2015 24:31 AM

    Agree with Mark btw. Harvey Organ deserves a hearing.

      Feb 24, 2015 24:34 AM

      Yes he dose.

        ok , let’s get him on…………………

          Feb 24, 2015 24:51 AM

          I agree with the title, that’s why…
          On February 22, 2015 at 4:02 pm,
          Matthew says:

          Keep this in mind…
          http://asianmarketholiday.blogspot.com/2015/02/chinese-lunar-new-year-2015-holidays.html

          Feb 24, 2015 24:59 AM

          How about this one instead CFS? It is a Harvey Organ classic from September 2014 where he assures the bugs that gold will rocket to 10,000 dollars before the year is out and silver will trade at no less than 500!!!…… WOW!

          Shanghai Drained of Silver! Bullion Banks Are About to Attack the COMEX!
          http://www.maxkeiser.com/2014/09/harvey-organ-shanghai-drained-of-silver-bullion-banks-are-about-to-attack-the-comex/

          🙂 Maybe Al will ask Harvey what possibly went wrong with is call….ha ha ha!!!!

            bb
            Feb 24, 2015 24:10 PM

            Hilarious actually.
            I still contend we don’t know the supply side.

            One thing, I believe the Swiss built a refinery, I cant see them doing that as well as working 24/7 to meet demand if they figured they couldn’t get supply.

            Feb 24, 2015 24:23 PM

            It was kind of funny. I can’t believe we all seriously discussed it on this site back in September. It was a preposterous call. But then, Harvey wasn’t trying to be serious. He just likes the attention he gets!

            Feb 24, 2015 24:05 PM

            Wow, that was a ” Harvey wall banger “

            Feb 24, 2015 24:20 PM

            I STILL THINK that with all that is going on now HARVEY deserves a new UPDATED interview.

            Feb 24, 2015 24:30 PM

            ******* YOU CAN DO IT BIG AL ******** YOU CAN INTERVIEW HARVEY ORGAN……..maybe a three segment or more show…………you would be the MAN BIG AL !!!!!!!!!!!!

            bb
            Feb 24, 2015 24:47 PM

            Talking of possible interviews, I’d like to hear from the people in the process of making PMs currencies, I’m sure updates in that regard would be interesting.

            Feb 24, 2015 24:38 PM

            You mean like Combi-Bars? They will make nice collector items one day. Probably about the extent of it though. No government today wants to see public transactions done with metals. They don’t know how to tax it. Probably the only metal based currency that would fly would be one that is actually gold-backed but traded electronically in dollars. You know, all the gold vaulted in one location and theoretically redeemable by the vendors who sold goods. They have that already but it seems to me its about as popular an idea as flights on a Zeppelin! Personally I think it is a step backwards. Like trying to return horses and buggies to the streets of New York. And most these experiments will only appeal to a cult of followers who appear as sensible to most as Star Trek fans at the annual Trekkie gathering. Lets just say I am not optimistic about the idea bb. There are a whole lot easier ways to make money and preserve wealth. Most of those other ideas start with making a lot of dollars though. You can buy whatever you please once you have them. Even Combi-Bars.

    Feb 24, 2015 24:32 AM

    Rick
    Looks like TLT is starting it’s move

    Feb 24, 2015 24:20 PM

    ***** THIS WAS HARVEY ORGAN LAST INTERVIEW ****** IT TOOK PACE on NOV 25th 2014, two days before THANKSGIVING………..I know that a lot of you did not hear this interview……………but BIG AL, if you do interview HARVEY ORGAN listen to this first, the host ran out of time with HARVEY, but BIG AL you can pick it up…………NOTE the interview starts with HARVEY AROUND THE 34:00 mark. CHECK IT OUT:
    https://www.youtube.com/watch?v=atGbKSKQ63w

    Feb 24, 2015 24:57 PM

    Harvey is right here daily…..

    http://harveyorganblog.com/

    You can save Big AL’s business from losing all credibility.

    Greg Hunter is still lickin his wounds with this looney tune.

    Feb 24, 2015 24:58 PM

    I sure took a lot of heat from some of you. Not you Mark .

    Regarding the possibilities of nuclear war.

    Now some of you want Harvey Organ to tell you the precious metals
    are going to Uranus. WOW….talk about incompetence and desperate.

    Harry Dent might be right. Right now the condition of things gold could
    go either way. A strange event or even nuclear war could cause everything
    to collapse. Who knows but to keep up this hope and dreams is just not
    a way to live. I can say with almost a 100 % certainty that even if goes
    ballistic to the upside your not going to reap the benefits you put in your
    minds. Regretfully, this path you are taking is path that ultimately leads
    to a dead end road in life. You will disagree but these pipe dreams will
    almost never come true. Something will always get in the way.

    Its dwelling on it constantly that self destructs a person. Its not the
    dream its having to much of your life in it. When it goes that far its
    never going to work out for any of you. The boulevard of broken
    dreams.

      Feb 24, 2015 24:21 PM

      Or some people need to go through a tragic near death experience
      to get back on track with life. Fame and money drove this person
      to realize life was much more than all those things. Its never enough.
      Its always more.

      http://www.youtube.com/watch?v=dXBUdCvqpNg

    Feb 24, 2015 24:46 PM

    THE WHOLE WORLD IS…CRACKIN…UP !!!!!

    Fox News Bimbo goes off on Westley Clark

    https://www.youtube.com/watch?v=Y-id_x6Fh3c

    At the 3.30 minute mark. She’s blonde too.

    Feb 25, 2015 25:37 AM
    Feb 25, 2015 25:49 AM

    Until everything implodes the banksters will cap gold.

    They dropped oil. They can raise taxes.

    Until it all collapses they can do anything they want.

    When it does collapse who knows what gold will be worth.

    Tyrannical governments will impose anything.

    This is a new paradigm now. Lots changed last 6 months.

    Wake up….this is a police state and accelerating everyday.

    Precious metals are the enemy to The West.

    Proof…Operation Choke Hold. Price fixing by all the banks too.

    What more proof do you need.

      Feb 25, 2015 25:59 AM

      I’m not saying gold is doomed. The forces and powers in
      charge are definitely keeping anyone from thinking about
      precious metals. Its worse now than ever.