So, I am pulling in the driveway yesterday afternoon and who to my surprise is waiting eagerly to meet me but a full bred Soft-coated Wheaten Terrier. Hmm? I park the car and get out and he comes jogging over to me like he owns the place. I bend down to greet my new friend and grab his collar to check and see who he belongs to, but there’s no tag. About this time my wife comes around the side of the house and says “Did you meet our new friend?” I’m thinking this must be some sort of play date with my son’s wife’s friend’s dog, but I don’t see another car and when I ask my wife about the origins of the interloper she says “He just showed up in the yard.”
I said “You can’t let him run loose, he’s going to get run over by a car.” So I went inside to get a leash and was greeted by another more recognizable breed who was attempting to break down the door from the inside to get at his new playmate. I came out, put the dog on a leash and told my wife I was going to walk to the nearest subdivision and see if there was anyone driving around looking for this dog or maybe someone would recognize him. I’ve got news for you. There is almost no one in a subdivision at 4 p.m. in the afternoon.
I walked about a mile and did spot three kids playing in their driveway. I felt kind of weird questioning them, but their dog was a huge lab and it had launched a verbal attack from behind their fence so they were safe enough to talk to some stranger and they had never seen my sidekick before. How many times has someone walked past your house with a dog and said “Hey, is this your dog?” You get the picture.
I saw one other lady who was walking to her car and appeared to be going to her job in healthcare because she had on a uniform. When I called out to her from the street, I definitely surprised her and she hadn’t seen the dog but told me to expect her dog to show up in my yard to because she said her dog runs off all the time. Hopefully he has a dog tag because I’m getting close to my dog limit.
Next it was time to call the Humane Society, take the dog to our veterinarian and see if had one of those Bourne Identity 666 chips installed under his skin. No such luck. I even drove to a nearby horse farm because the Wheaten was pretty dirty and he looked like the kind of dirty and expensive dog that would hang out on a horse farm with rich people. I think these dogs cost in excess of $1,500 so you either rich or crazy or both to buy one. I talked to the lady of the farm and she said “I just got back and my dogs are still in the kennel.” It’s not that comfortable of an idea to drive up to people’s houses and holler out to them “Hey, did you lose your dog” and my wife said “You can’t take the dog with you. You have to make people describe the dog to you. Otherwise they might just lie and say ‘Yeah, that’s my dog… hand it over.’” Good point.
When I got back to the house I told my wife, “Surely someone has come up with a tech solution such as Facebook facial recognition combined with a catchy URL such as “ILostMyDog.com.” Can’t you see someone selling that idea on Shark Tank? It would be worth millions (at least to those guys). You pay 10% to get your $1,500 terrier back. So at this point, we start trying to figure how to get through the night with two fiesty breeds under one roof, not to mention the two Guinea pigs and more than a little jealousy over our single set of dog dishes.
As I considered the value of a fifty cent dog tag to maintaining the value of your fifteen hundred dollar dog, all I could think about was another mammal, namely a whale… the London version. You see, all along Dave has taken the position that the so-called market manipulation of precious metals (particularly that of the paper SLV ETF market via the Comex) was been connected through JP Morgan directly to the hurricane-sized tempest in a teapot known as the Chief Investment Office, Ina Drew and the London Whale. You see if you want to control the price of gold, just like if you want to control a dog, the easiest and cheapest way to do it would be to control the price of silver.
Let me give you an example. Take an American Silver Eagle and flip it over. What does it say? 1 OZ. FINE SILVER~ONE DOLLAR. Take note of the little squiggly line. It’s called a tilde. In mathematics a tilde means that something is similar. In logic a tilde negates what ever follows the tilde. It’s like a negative sign. I leave it to you to decide if the tilde on a Silver Eagle means that 1 OZ. equates to ONE DOLLAR or negates ONE DOLLAR. Right off the bat, you’re a winner with your silver eagle because you get an extra 2.75 grams because technically it’s a troy ounce even though it’s only .999 actual silver. Chalk those distinctions up to technicalities of the precious metals game.
So, now that we are sufficiently confused by an ounce of $30 spot silver being worth “one dollar”, we can build on that concept with a gold buffalo coin that has the distinction of being stamped with $50 1 OZ. .9999 FINE GOLD. You get a bit more truth in advertising on the gold content (I guess that comes with the high-priced $1,600 per ounce territory) but you now have a government-established ratio between gold and silver at essentially 50:1. Although the government established their own albeit fictional link between the values by stamping them right on the coin (beware the Sacagawea “golden dollar” also stamped with $1 for those Dave readers who just came today to help find the dog’s original owners) you can see by the chart below from Seeking Alpha that the ratio between gold silver is quite volatile and that’s really what this blog post is all about.
Just how effective is it when you put a collar on silver at containing the price of gold? Dave would say that putting a collar on silver may not guarantee that your gold doesn’t run off, but it does give you some reasonable assurances that you can get it back or at least that you can find out who the original owner of the concept of $1 truly is. In the case of this blog post, we’ll assign that value of the U. S. Dollar to the owners of the banking empire known as J. P. Morgan (arguably the second largest public company in the world) which according to Wikipedia at least was (and probably is) primarily owned by the Rothschild family. and what was the logical basis for printing $1 on the silver and $50 on the gold when there
As you can see from the chart above, that 16:1 historical ratio of silver to gold coin equivalence held up for a fairly long time until about the time that J. P. Morgan and Co. backed the U. S. government with $62 million in gold so that they could restore the U. S. Treasury by floating $100 million in bonds. You’ll notice that was the same time that the ratio started making its initial move. According to Wikipedia, J. P. himself only owned 19% of Morgan assets while the Rothschild family owned the rest, but what does Wikipedia know. They can’t even explain the what the CDX IG 9 (the focus of the so-called teapot tempest) actually is without outsourcing you to an article that calls it “an obscure index” and a “derivative of a derivative.”
If you’re wondering just how much it will cost to replace the teapot of boiling whale oil, the cost estimates rise faster than the value of the dollar to a gallon of gasoline fell in the past week.
“Major losses, $2 billion, were reported by the firm in May, 2012 in relationship to these trades; on July 13, 2012 the total loss was updated to $5.8 billion with the addition of a $4.4 billion loss in the second quarter and recalculation of a loss of $1.4 billion for the first quarter. A spokesman for the firm projected total losses might be more than $7 billion. The disclosure, which resulted in headlines in the media, did not disclose the exact nature of the trading involved, which remained in progress as of May 16, 2012 as J.P. Morgan’s losses mounted and other traders sought to profit or avoid losses resulting from J.P. Morgan’s positions. As of June 28, 2012 JP Morgan’s positions were continuing to produce losses which could total as much as 9 billion dollars under worst case scenarios.”
But this is old news. So why is Dave barking up this tree, or waking up to a dog barking in the laundry room soon to be tied to a tree (can’t let him run off now can we?) when Jamie Dimon was so successful in distilling down the billion dollar tea leaves into a relatively minor reduction in his bonus?
As you know, this isn’t Dave’s first rodeo, but then again it is a dog and pony show and Dave has been searching long and hard for the pony in this room because it is overflowing with pony externalities. So tune in tomorrow for the second entry in the search for the missing silver dog collar (aka The Brooksley Bourne Dog Identity) and discover for yourself whether or not Lehman Brothers plan to metaphorically harpoon Bruno Iksil (http://www.bloomberg.com/news/2013-02-14/lehman-seeks-to-question-ex-jpmorgan-london-whale-.html) could release the hounds on the precious metals manipulation once and for all. Dave’s got to run. I’ve got a dog in this fight. Correction, I have two dogs in this fight and the uninvited one that just showed up unexpectedly is ironically worth $50 in buffalo gold.
(Tune in tomorrow for part 2, when we reveal if the House of JP Morgan is housebroken).