A Good Start

How nice it is to have a week start with an UP move, for once.

Of course, it's early and anything can happen. By the time you read this, maybe all hell has broken loose and the metals are cascading lower. Let's hope not. In fact, I'd be very surprised if that was the case. The charts actually look pretty good and we have the final 2012 FOMC beginning tomorrow and concluding Wednesday. The shorts should be pretty defensive here and I expect dips to be bought early this week.

The key, obviously, will be the Fedlines on Wednesday. I'm actually a wee bit nervous about the "news". We've discussed here, at length, the need for more, unsterilized QE once Operation Twist ends at the end of this month. Through Twist, The Fed has been selling about $45B/month of short-term treasuries and using the proceeds to purchase long-term treasuries. Because this is utilizing funds that are not new and already in existence, the process is deemed to be "sterile". The only, overriding question for Wednesday is this: Will The Fed fully replace Twist with $45B unsterilized or will they announce something less, at least initially?

Everyone, including yours truly, thinks that The Fed will goose the new unsterilized QE program (announced back in September) to $85B/month. This would represent:

  • The $40B/month announced in September
  • An extra $45B/month to compensate for the ending of Twist
  • $85B/month is roughly what QE2 was in late 2010 and early-mid 2011.

But will they?? And that is my short-term concern.

What if The Bernank throws the market a curveball? Maybe he wants to send a signal to Washington regarding potential Fed "hawkishness" in the face of the Fiscal Cliff negotiations? What if, at least initially, he replaces Twist with just $25B/month? Would The Cartels use this news as an excuse to mercilessly raid the metals? Bet your ass they would! Who cares if an extra $25B/month unsterilized brings the total to $65B/month of brand spanking new greenback? It would be "less than expectations" and the metals would likely be hit...and hard.

So what's the point of all this?

  1. You've got to be prepared for this on Wednesday. Don't just happily whistle past the graveyard, expecting a big rally once the Fedlines are released.
  2. Get ready to buy the dip or buy the rally.
  3. "HUH?? No you've lost me, Turd."
  4. If Benny announces a total of $85B+/month in total, unsterilized QE, just back up the truck and buy. Of course there will be peaks and troughs along the way but every dollar-denominated asset will be about to begin another big surge higher.
  5. If Benny announces only $60-70B/month of total QE, just relax and stay calm. Let The Leghounds have their way with the metals and then get ready to BTFD! We'd still be talking about $800B/year of total, unsterilized quantitative easing. As Ruprecht would say: That's a lot!! And remember, there is no time limit and no program expiration. This is true QE∞! Do not be fooled by MSM goons who would try to convince you that this is somehow "disappointing". Again, just keep your wits about you and prepare to BTFD.

Here are your charts on this fine Monday. Again, notice that both metals have set reverse, head-and-shoulder bottoms AND they have both broken their short-term trendlines. As a result, both look very good and are primed for a very nice rally this week. Let's just see if The Bernank plays along.

That's all for now but please check back later as I will have another podcast that I will be releasing this afternoon. Have a great day!

TF

p.s. One of your rather industrious Turdite brethren came up with an idea to sell some T-shirts. They would definitely make an ideal gift for the Turdite or soon-to-be-Turdite on your holiday shopping list. Please check them out by clicking this link: http://www.ebay.com/itm/330840151512?var=&ssPageName=STRK:MESELX:IT&_trksid=p3984.m1555.l2649

254 Comments

Grublux's picture

Furst!

how sweet it is....

alphamorph's picture

Still holding

$1715 and $33.35

the_circle's picture

Second

Flat until the FOMC meeting Wednesday- then off to the races.

3rdsad

Revelation's picture

Above All Keep Stackin

¤'s picture

The Cliff

I agree that they'll let the automatic plunge over 'The Cliff ' happen except that they'll cut some smaller side agreements on certain parts of it.( no middle class tax hike).

I think if they mostly let the automatic cuts and tax hikes occur then nether party can take full blame or credit. I think allowing it to happen by inaction is the ignorant cowards (aka politician) way of getting business done in the these modern times. We've witnessed many important pieces of legislation or fiscal decisions get watered down or ignored for huge amounts of time only to be quickly and haphazardly worked upon at the last minute while some type of hard deadline is approaching.

And then we get some type of major decision (or lack of one) that sometimes doesn't even get read in it's entirety yet is enacted in haste regardless of it's impact. In the real business world those people would be fired for their poor decision making qualities.

Just about everything that the automatic cliff will ensure (higher taxes/budget cuts) is exactly what both parties need to see happen but they don't have enough moral or patriotic fiber to stand up and take a position because their spineless and self-serving and worried about their party.

I agree with Pining in that I think it'll be bad for PM's and the markets overall because I see nothing good or positive about the situation. In all honesty, there seem to be few things these days that are instantly good for the PM's or the markets overall. Almost everything that used to signal impending PM strength (USD weakness/COT numbers etc.) for the most part no longer have any bearing on the PM's. That's not to imply that long term the PM's won't do well. That's why we continue to stack.

I think Pining's view is well founded and forward looking in that the uncertainty will keep some money on the sidelines just watching to see how it (post-cliff) goes and what direction it takes the markets.

IMHO, both sides let this cliff happen for the most part because neither can be fully blamed and in the end both parties realize that to some extent they need to raise revenues and cut spending and this whole baked in cliff deadline from (how long ago now?) has been nothing but another can-kicking exercise that has had everyone transfixed on some fictitious cliff that one can almost visualize because of the incessant fear mongering portrayal of how life will be the day after it happens. Comic tragedy is what it is.

Both parties suck and do not have our countries best interests in mind because the perception of the parties is what's important to them. To that extent they'll continually blame each other and pander to an increasingly divided/fearful/angry/mostly inattentive and uninformed constituency.

In the end it won't matter (to them) because they are detached and live/work everyday in a surreal place called D.C. and they're playing a game that has little to do with the citizenry of this country or their concerns. It's a game of fear and blame.

Stack when you can, as much as you can for the future.

Australia_CliffDiver.jpg

Hagarth's picture

UBS AG easing not priced in to Gold market

BS says more quantitative easing hasn't been priced in yet as central bank prepares to meet next week

UBS AG said its expectation of additional quantitative easing next week by the Federal Reserve is not priced in in the gold market, so "any aggressive move by the Fed would prompt a sizeable response."

Index rebalancing will also cause gold to be bought, UBS said in its daily precious metals report today.

The UBS note is reproduced in more detail at Barron's:

Looking further toward year-end, commodity index rebalancing will become a feature, with market participants typically taking pre-emptive positions. This year's rebalancing action should be interesting with gold to be bought this time around as opposed to being sold in previous years.

And of course, the firm is still holding out hold that the "fiscal cliff" could yield could things for gold:

Much of gold's response will depend on the details, and the price move could be quite powerful. A grand bargain, albeit deemed unlikely, would be negative for hold to the extent that it boosts the dollar, although we don't expect to downside to be extreme given gold has been acting more like a risk asset. Conversely, a less convincing deal would benefit gold inasmuch as this outcome weighs on the dollar, as it casts doubts on the US' ability to take on a more disciplines and sustainable fiscal path. Ultimately though, the fact that any deal -- grand or otherwise -- is likely to involve yet another increase in the US Federal debt limit entails considerable gold upside potential, given the likelihood that ratings agency action will follow.

http://www.blanchardonline.com/investing-news-blog/econ.php?article=5268&title=%22Any_aggressive_move_by_the_Fed_would_prompt_a_sizeable_response%22_in_gold

hammerman's picture

haze ... ur rite on target

fellow turdites be aware...  spin your seat away from your monitor or tv when then selloff starts cause it gonna get ugggllly....  but in the end the PMs is the only place you can be to survive...   boooyah!!!!   bobbay you up?

¤'s picture

Detached indifference during 'The Cliff': Big Party Afterwards

In shift, Obama accepts corporate funding for inauguration

U.S. President Barack Obama (C) is joined by his daughter Malia (R) and first lady, Michelle Obama (L) as they watch the show at the official lighting of the National Christmas Tree ceremony on the Ellipse in Washington, December 6, 2012. REUTERS/Larry Downing

U.S. President Barack Obama (C) is joined by his daughter Malia (R) and first lady, Michelle Obama (L) as they watch the show at the official lighting of the National Christmas Tree ceremony on the Ellipse in Washington, December 6, 2012.

Credit: Reuters/Larry Downing

 

WASHINGTON | Sun Dec 9, 2012 6:02pm EST

WASHINGTON (Reuters) - President Barack Obama's inauguration committee is accepting corporate donations to help fund the parade and other events associated with his January 21 inauguration after tapped-out Democratic donors spent huge sums helping him get elected.

The move is a shift for Obama, who did not accept corporate donations for his first inauguration in January 2009.

Aides from the Presidential Inaugural Committee confirmed it would accept money from "individual and institutional" givers to help cover the cost of public events not paid for by taxpayers.

"Our goal is to make sure that we will meet the fundraising requirements for this civic event after the most expensive presidential campaign in history," Addie Whisenant, a committee spokeswoman, said in a statement.

"To ensure continued transparency, all names of donors will be posted to a regularly updated website."

The committee would not accept donations from lobbyists or political action committees (PACs), however, and would not forge sponsorship agreements with people or businesses, she said.

Obama has shifted his position on money in politics before. Earlier this year, despite his opposition to a Supreme Court ruling that allowed outside organizations to spend unlimited amounts in campaign advertising, Obama agreed to allow White House and other high-profile campaign aides to attend fundraisers for a Super PAC designed to support his re-election. Advisers said his shift came as a result of the success of Republican Super PACs.

On Inauguration Day, taxpayers fund the official swearing-in ceremony on Capitol Hill and related congressional lunches, but the inaugural committee must pay for the parade, balls, and other events.

According to fundraising documents linked to a story by the New York Times, donors have been offered perks including tickets to an inaugural ball, seats for the parade, and access to donor receptions for $250,000 in individual donations or $1 million in institutional or corporate contributions.

Perks are also offered for lesser amounts, down to $10,000 per individual and $100,000 per institution.

A committee aide said there would be no limit on the amount of contributions as long as legal guidelines were met.

The festivities on Inauguration Day will be toned down to reflect the still fragile U.S. economy, a committee aide said. A concert will not be held on the National Mall as it was in the lead-up to the ceremony four years ago, and the number of official Inaugural balls will be whittled down.

http://www.reuters.com/article/2012/12/09/us-usa-obama-inauguration-idUSBRE8B80HX20121209

Nana's picture

Wake Up And Take Control

Remember, it"s NOT our debt and NEVER was.

Escape the system and choose to opt out, buy physical only and stop playing their game. It's their game and they make the rules.

The only way to win is not to play..........

Teach's picture

C.O.T. News...

I can read the words...but am guessing a bit as to the meaning: http://www.goldmoney.com/gold-research/alasdair-macleod/gold-futures-market-heading-for-crisis.html?gmrefcode=dollarc

I have always expected prices on the metals exchanges to drop significantly..or disappear for a while...in the event of a force majeure.  Is that the message here?  I am in for the long haul anyways..and still buying the dip when I have the paper to do so...keep stackin!

rl999's picture

TF..very sneaky

That early post has allowed me to claim a spot in the top ten.. Victory is mine!

<iframe width="640" height="360" src="

" frameborder="0" allowfullscreen></iframe>

& Goldman smashed with massive fine...

Goldman Fined $1.5M for 'Supervision Failures'

Goldman Sachs Group Inc was fined $1.5 million to settle charges it failed to supervise its traders and allowing one futures dealer to hide billions in dollars from sight and causing a $118 million loss.

Ex-Goldman trader Matthew Marshall Taylor in 2007 camouflaged an $8.3 billion position, manually entering fake trades, the Commodity Futures Trading Commission (CFTC) said on Friday.

"Goldman failed to have policies or procedures reasonably designed to detect and prevent the manual entry of fabricated futures trades into its front office systems," the top U.S. derivatives regulator said.

"As a result, on seven trading days in November and December 2007, Taylor circumvented Goldman's risk management, compliance, and supervision systems," the CFTC said.

[Let's see here... 1.5million from a 118 million loss...on a 8.3 billion position..gee, I wonder if this will cause them to stop..]

ancientmoney's picture

@Nana re: take control

Agreed.  Playing the paper games may win some fiat, short-term, but it helps the bankers more than anything. 

Buying physical does two things--it reduces their ability to manipulate in the paper market, and it takes away from them ounces of real physical, which hurts them at a rate of 100x what you buy, in paper.

The Watchman's picture

TRUE

united-states-debt-limit-300x227.jpg

hammerman's picture

teach... yes i think you got the jist

although some too terrified to admit the big drop or even the exchanges going down....  they just caint get their mind out the box and around such a move....     where is turd today?   good call on the broncos....   hehe

So It Goes's picture

Hey Benny

Print you MFer ---  print.

old tradesman's picture

@nana

totally agree

Turd Ferguson's picture

Teach, great job!!

MODERATOR

I had not seen Alasdair's new report and it is a MUST READ FOR EVERYONE!!!

http://www.goldmoney.com/gold-research/alasdair-macleod/gold-futures-market-heading-for-crisis.html?gmrefcode=dollarc

Response to: C.O.T. News...
CaribSurfKing's picture

Another possibility

He announces nothing, twist ends and thats that.

Everything tanks, just in time for the Mayan prophecy , hahaha!

Just A Regular Guy's picture

An interesting article

I quote paragraph 3:

"Those major trends are the end of U.S. global dominance, the rising power of individuals against states, a rising middle class whose demands challenge governments, and a Gordian knot of water, food and energy shortages, according to the analysts."

http://www.bloomberg.com/news/2012-12-10/u-s-intelligence-agencies-see-a-different-world-in-2030.html

Glad these lads are in intel. they are smart, S-M-R-T Homer style.

Oh yea as turd says, BTFD! I can't wait for FOMC, gonna be le epic!
Peace boys and girls

AlexCojones's picture

Stacking, Prepping, BTFD

Turd, the Stacker T-shirts are kinda cool, but I believe Pining 4 The Fjords could create a more appealing "stack." I liked the BTFD on the back, which would be a great conversation starter at social gatherings.

Speaking of graphics, awhile back my younger brother, a fellow silver stacker to a small degree, wanted me to print out a list of preps, since he's worried about the fiscal cliff. So with a little Googling, I found a list for 37, 55 and 100 items that top survivalist suggest you hoard. My brother Pete brews beer in his spare time from his blue collar job. I suggested he prep beer-related items. So I made him a beer label for him (which anyone can use BTW).  I do hope we never get to Zimbabwe conditions, but if so, I hope brewers are prepared.

Another good label would be "Silver Dime" beer, since that would be the price- one silver dime. Despite inflation, a silver dime would probably always be sufficient to buy one.  $2.41 today on Coinflation.

rl999's picture

Brent New Day: US dump WTI as crude oil benchmark

[If memory serves the gap in prices was discussed here long ago]

Brent New Day: US dump WTI as crude oil benchmark

The US Energy Agency has adopted North Sea Brent crude as its benchmark for oil forecasts, abandoning its domestic West Texas Intermediate (WTI) as the agency says it no longer reflects accurate oil prices.

­The Brent and the WTI futures have traded at a difference of more than $20 since October, according to market data.

"This change was made to better reflect the price refineries pay for imported light, sweet crude oil and takes into account the divergence of WTI prices from those of globally traded benchmark crudes such as Brent," the Energy Information Administration (EIA) said in a statement.

The WTI prices had lagged other benchmark crude prices as Canada and US states such as North Dakota and Texas increased output rapidly over the last two years, the EIA explained.

The increased production overwhelmed the transportation infrastructure needed to move crude from Cushing, Oklahoma, where the WTI price is set, to the US Gulf of Mexico.The EIA said retail prices for fuels such as petrol and diesel now follow Brent more closely than WTI. Traders also turned to Brent futures volumes, dropping the WTI, boosting the amount of Brent futures on the ICE Futures Europe exchange up 12% in the year to date.

However, Brent also faces problems such as declining production in the North Sea, which push up the prices. The Middle East unrest also contributes to a price hike.

Meanwhile, experts are also concerned with the divergence of Brent and WTI futures. Earlier the Wall Street Journal issued a list of potential new oil grades in the international market, which included Russia’s ESPO and Dubai’s DME.

silver66's picture

@prize fighter

http://www.tfmetalsreport.com/comment/245136#comment-245136

I agree, I listen to Lindsay Williams occasionally when I am feeling particularly conspiratorial and want to test my patiencesmiley. He says that the elite feel compelled to tell us what they are going to do before they do it. I wonder if all these references are "inside info...lol" to people not in the inner circle but are awake??

When I have more time, I have a interesting buy gold story that happened to me at the Berkshire AGM a few years ago.

Silver66

SIlverbee's picture

Its oh so quiet....

Its oh so still...

I am still planning to swap G for S on Wednesday. I got in at $32.83 last dip. Not quite covered my costs yet.

Xty's picture

re the inaugural funding

From the article DPH quoted:

the number of official Inaugural balls will be whittled down

Hard times indeed - gotta hate having your balls whittled.  But semi-seriously, how pre-French revolution is that kind of talk?   Excuse me while I go butter my brioche ...

rl999's picture

Bitcoin going mainstream.

Bitcoin, in deal with French financial firms, gets officially recognized under EU law as a "bank"

12-10-2012 • BBC News
 

As a Payment Services Provider it will be able to issue debit cards, carry out real-time transfers to other banks and accept transfers into its own coffers.
 
It also means that deposits held at Bitcoin-Central would be backed by the same compensation laws and schemes that apply to cash held in other bank accounts. However this protection only applied to balances held in euros rather than bitcoins.
 
The move could convince many organisations and businesses to start accepting bitcoins as payment.
 
"The more we see governments and banks being willing to deal with Bitcoin, the more comfortable a lot of organisations are going to be making the step forward themselves,"said Vitalik Buterin, technical editor of Bitcoin magazine.

Also read a critique of this move in FORBES that is not so positive here http://www.forbes.com/sites/jonmatonis/2012/12/09/bitcoins-greatness-not-realized-by-succumbing-to-regulation/

Read Full Story

Here
 

[Time to short? Time to find the next thing? I was just starting my research and getting ready to buy in. Not so sure now.]

Keg's picture

What is the schedule Wednesday?

Need to make sure I am tuned in at the right time to BTFD.

Beastly Stack's picture

STACK'IN Tee Shirts

Good Day to all and Happy Holidays!

At the end of this thread Turd posted a link with a Tee Shirt located here againhttp://www.ebay.com/itm/330840151512?var=&ssPageName=STRK:MESELX:IT&_trksid=p3984.m1555.l2649

I have these shirts made and hope that they will be a big hit with everyone.I am using ebay,because it is trustworthy and easy to setup quickly.On ebay it is only letting me list 5 as a quantity.

I want everyone to know that I can get as many of these shirts as needed from sizes small through 5xl in colors Royal Blue or Black.

I am wearing one right now and I love it and I think it is a great way to strike up conversation and spread our word among the many.

I got together with Turd on this and he will recieve $5.00 towards this site for each shirt sold.Please any questions on ordering these please email me @mconnolly74@aol.com and I will make sure you get what you need.

Thanks Everyone and thank you again TF for all you do!

Beastly

Sisyphus's picture

@Keg - Wednesday

Insiders tipped off - c. 12.15 EST.

FOMC official announcement - 12.30 EST.

Nigel Black's picture

Question about GoldMoney article

Thanks for posting that GoldMoney article.

I have a question (please excuse my ignorance on this subject):  If the COMEX does declare "force majeur" with respect to silver and its delivery, what happens next?  Does that mean trading of silver halts immediately (and for a long time)?

Something tells me I need to buy more popcorn.

Thanks.

Nigel

SRSrocco's picture

WORDS GETTING OUT...

Silver surplus – what silver surplus?

Author: Lawrence Williams
Posted: Monday , 10 Dec 2012
 

LONDON (Mineweb) -

One of the biggest difficulties facing serious silver analysts, rather than those who just interpret data without looking at, or understanding, its true background is that many of those conducting 'independent' (i.e. those who are not themselves 'silver bugs') analyses mostly predict a weak silver price ahead because of what they see as a large silver production surplus.

....Indeed the graph below (from silverseek.com where it formed part of an article entitled The forces that will push silver over $100, perhaps demonstrates silver’s reclassification quite dramatically in that when silver supply was genuinely in deficit the metal price languished, but when it moved into 'surplus', totally contrary to normal expectations, the price rose dramatically thus apparently defeating what should perhaps be called the first law of economics.

For the price to rise so dramatically, true demand had to be exceeding supply, no matter what the analysts were saying.

The graphic thus indicates that although silver is technically in surplus, in reality it is nothing of the kind with huge pent up investment demand more than taking up the available supply.

This does mean very definitely that those banking entities holding enormous short positions in silver are playing a very dangerous game indeed.

They are prepared to gamble big with large futures sales of paper silver to keep the price under control, but the writer is seriously beginning to believe that the views of some of the ardent silver bulls are not the crazy ramblings of fanatics, but express the reality of the situation.

(MineWeb article)

------------

Well, it looks like the WORD is getting about concerning the TRUE SITUATION in the silver market.  It was nice to see Lawrence Williams, Editor-in-Chief at Mineweb include my title of my article and a graph in his piece today.

Mineweb is one of my daily sources I read.

This goes to show that physical silver holders beware:

MUCH HIGHER SILVER PRICES ARE COMING...

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