FED: Bernanke: QE3 delayed until further notice - Jackson Hole speech

[swissaustrian]

Summary and full text at zerohedge:

Full Bernanke Speech: Nothing Now, But Wait For Sept 20 FOMC Meeting Which Has Been Extended To "Allow Fuller Discussion Of Tools
Bottom line: nothing now, QE3 now expected to be delivered Sept. 20? or not...
BERNANKE SAYS FED HAS LIMITED ABILITY TO ENSURE LONG-RUN GROWTH
BERNANKE DOESN'T SIGNAL NEW STEPS FOR PROMOTING U.S. GROWTH
BERNANKE SAYS EXTRA DAY TO ALLOW `FULLER DISCUSSION' OF TOOLS
BERNANKE SAYS FED TO EXTEND SEPT. FOMC MEETING TO TWO DAYS
BERNANKE SAYS FED HAS `RANGE OF TOOLS' FOR STIMULATING GROWTH
BERNANKE SAYS `FINANCIAL STRESS' WILL BE A `DRAG' ON RECOVERY

http://www.zerohedge.com/news/full-bernanke-speech

 

[swissaustrian]

Everything is rallying now - except treasuries

 

[cubical]

Pretty much expected that he wouldn't say much. QE3 will come sooner or later.

 

[hugolp]

Pretty much expected that he wouldn't say much. QE3 will come sooner or later.

He actually said very few, next to nothing, about monetary policy, that is actually his thing.

 

[jclay2]

QE3 on delay until further notice: That is until we have another market crash. It will be a miracle if we don't have more QE by the new year.

 

[billjones]

Should I buy PMs now or wait till next week?

 

[jclay2]

Should I buy PMs now or wait till next week?

Budget a certain $ amount / month that you are willing to spend and make pm purchases on pre planned dates. Don't look at the spot price and just make the purchases. Trust me you, will be glad you did later. You need to change your thinking to oz instead of $.

 

[Zippyjuan]

Pretty much as I expected. The Fed really can't do anything to further stimulate the economy on their own. They can't force people to go out and spend money and they can't do anything to get companies to hire more (which they won't do until people start buying more stuff again). They should give up on trying to target employment and focus instead on inflation as their target.

 

[Zippyjuan]

Budget a certain $ amount / month that you are willing to spend and make pm purchases on pre planned dates. Don't look at the spot price and just make the purchases. Trust me you, will be glad you did later. You need to change your thinking to oz instead of $.

Excellent suggestion. This way, you buy more when prices are lower and buy less when prices are higher. Nobody can tell you when prices will be higher or lower or when is the best time to buy or sell.

 

[swissaustrian]

Excellent suggestion. This way, you buy more when prices are lower and buy less when prices are higher. Nobody can tell you when prices will be higher or lower or when is the best time to buy or sell.

End of the month usually is a good time to buy because the cartel manipulates prices downwards when options, futures, and minis expire. This month is a perfect example. Additionally, if you´re a pm-"saver", you´ll have fresh capital at the end of the month, because your paycheck arrives.

 

[Seraphim]

Good advice.

I'd also recommend placing orders between 11am and Noon EASTERN time.

When the big east coast American investment banks start work around 9am, they sell off PM's like clock work before lunch time so that they can all pat themselves on the back for their job well.
Just look at the charts. There are TWO primary attacks on PM's almost every day, like clock work.

1am Eastern time and 10am eastern time. Shortly after London opens and shortly after New York opens.

By buying around these times, you're often going to save 50 cents to 1 dollar per ounce of silver that you purchase.

End of the month usually is a good time to buy because the cartel manipulates prices downwards when options, futures, and minis expire. This month is a perfect example. Additionally, if you´re a pm-"saver", you´ll have fresh capital at the end of the month, because your paycheck arrives.

 

[hazek]

Pretty much as I expected. The Fed really can't do anything to further stimulate the economy on their own. They can't force people to go out and spend money and they can't do anything to get companies to hire more (which they won't do until people start buying more stuff again). They should give up on trying to target employment and focus instead on inflation as their target.

Nice propaganda message right there, portraying the FED as a helpless friend, that is just doing all it can but unfortunately it's the people's fault that it isn't succeeding and completely ignoring that it is because of it's existence that we have this huge problem in the first place.

The FED should not focus on inflation as their target, the FED should not exist at all.

 

[Seraphim]

Shush you extremist.

You are not aloud to question the authority of your financial overloards. Get the fuck back in line. The Bread Line.

Nice propaganda message right there, portraying the FED as a helpless friend, that is just doing all it can but unfortunately it's the people's fault that it isn't succeeding and completely ignoring that it is because of it's existence that we have this huge problem in the first place.

The FED should not focus on inflation as their target, the FED should not exist at all.

 

[hazek]

I just can't stand the pretending and propaganda, and I will call him out every single time I catch him that I can. If it were up to me, he'd receive a warning followed by a ban if he continued to try and mislead readers of this forum.

 

[swissaustrian]

Good advice.

I'd also recommend placing orders between 11am and Noon EASTERN time.

When the big east coast American investment banks start work around 9am, they sell off PM's like clock work before lunch time so that they can all pat themselves on the back for their job well.
Just look at the charts. There are TWO primary attacks on PM's almost every day, like clock work.

1am Eastern time and 10am eastern time. Shortly after London opens and shortly after New York opens.

By buying around these times, you're often going to save 50 cents to 1 dollar per ounce of silver that you purchase.

Yep. Here is statistical evidence for that (this chart shows the INTRADAY average for gold from 1998-2008):

 

[Zippyjuan]

Yep. Here is statistical evidence for that (this chart shows the INTRADAY average for gold from 1998-2008):

Chart shows a forty cents difference on a $1000 commodity between the daily high and low. Not much of a gain for trying to time it right (0.4%). The dip itself is about 25 cents or one quarter of one percent.

 

[swissaustrian]

Chart shows a forty cents difference on a $1000 commodity between the daily high and low. Not much of a gain for trying to time it right (0.4%).

1000 is not the price, it´s the index.
This is the average of arround 2700 trading days (10 years * ~270 trading days = 1998-2008).
If you bought e.g. 1 oz every month at 10 am ET compared to 8-10 pm, you saved 0.4% on 120 occasions. If you additionally at the end of each month you saved even more money, because of the classical end of the month bang. These are the days when the manipulation takes place, so the difference between the intraday low and the intraday high is even bigger.

 

[Zippyjuan]

Thank you for pointing out that it is an index- it did not seem to specify that it was not in dollars (no link to the chart) so I assumed that it was. My mistake on that- but unless you are dealing with very large quaitities where you can make money off small differences, you won't really gain much at four tenths of one percent which is still the percent change. Let's use the rough current value of $1800 an ounce and say we followed your program of buying one a month for a year. At four tenths of a percent you saved $7.20 on each ounce- times twelve that is $86.40 out of the $21,600 you spent buying the gold. It will vary by much more than that from day to day.

UPDATE: I think I am off by a decimal point- you actually only saved $8.84 off the $21,600 you spent- not $88.40. You really only save four hundredths of a percent- not four tenths of a percent. But perhaps somebody can double check the math here. One percent gain off $1000 would have been ten dollars- one dollar would be one tenth of a percent. Ten cents gain is one one hunderedth of a percent off one thousand.

If the gap was significant enough, traders would use their computers to take advantage of it and the gap would close.

 

[Seraphim]

The difference is MUCH larger for silver.

Thank you for pointing out that it is an index- it did not seem to specify that it was not in dollars (no link to the chart) so I assumed that it was, but unless you are dealing with very large quaitities where you can make money off small differences, you won't really gain much at four tenths of one percent. Let's use the rough current value of $1800 an ounce and say we followed your program of buying one a month for a year. At four tenths of a percent you saved $7.20 on each ounce- times twelve that is $86.40 out of the $21,600 you spent buying the gold. It will vary by much more than that from day to day.

 

[swissaustrian]

Thank you for pointing out that it is an index- it did not seem to specify that it was not in dollars (no link to the chart) so I assumed that it was. My mistake on that- but unless you are dealing with very large quaitities where you can make money off small differences, you won't really gain much at four tenths of one percent which is still the percent change. Let's use the rough current value of $1800 an ounce and say we followed your program of buying one a month for a year. At four tenths of a percent you saved $7.20 on each ounce- times twelve that is $86.40 out of the $21,600 you spent buying the gold. It will vary by much more than that from day to day.

UPDATE: I think I am off by a decimal point- you actually only saved $8.84 cents off the $21,600 you spent. You really only save four hundredths of a percent- not four tenths of a percent. But perhaps somebody can double check the math here. One percent gain would have been ten dollars- one dollar would be one tenth of a percent. Ten cents gain is one one hunderedth of a percent off one thousand.

I think your calculations are right, but the underlying scenario is not.
I tried to point out that
1. the intraday volatility is higher when options, futures, minis expire
2. this is at the end of the respective month when prices usually come down from their monthly highs, so this offers even more potential to save.

But obviously you can save even more, if you´re leveraged (e.g. futures and options).
Silver usually trades like leveraged gold, so it has kind of a "natural" leverage - as Seraphim pointed out.