1650 and 42

169
Thu, Jul 28, 2011 - 4:25pm

I'm still confident we're headed there as soon as next week. Here's why.

The Turd is no civics professor but, as I understand it, there's a process which must be followed on Capitol Hill. As a refresher, I offer you this:

Video unavailable

IF The Republocrats in The House pass their bill tonight and IF The Republocrats in The Senate approve their's over the weekend, the differences must then be reconciled in a conference committee. Then, IF reconciled, both chambers MUST pass the new, singular version. By Tuesday. Our esteemed, illustrious and supremely qualified President must then sign the bill into law.

Hmmm. When you look at it that way, it sure doesn't seem likely that they're going to get it done. I'd say that the chances are now greater than 50/50 that The Regime raises the debt limit by Executive Order. If O'bottom goes this direction, you can bet your arse that he won't just piddle around with a puny increase. He'll raise that baby by at least $2T, enough to last through the 2012 election. This will result in two things:

1) A complete loss of confidence in the ability and desire of the U.S. government to address their disastrous fiscal "situation".

2) An inevitable downgrade of U.S. debt by the major credit rating agencies to AA+, at a minimum.

Both of these developments are extremely bullish for the PMs. Extremely bullish. They also signify a major signpost on the road to economic disaster. Remember, quantitative easing is, at its core, simply about buying time. The idea was that if, by buying treasuries, The Fed could keep rates down long enough, the economy would recover and tax revenues would increase sufficiently to sustain The Great Ponzi. To no one's surprise, it didn't work, and now Fed/Govt/TBTF Complex faces their end game.

In order to survive, The Fed MUST now continue QE at an even greater pace. The PMs and all commodities will see their multi-year rallies accelerate. Economic conditions will continue to worsen. Tax revenues will remain stagnant or decline. The annual U.S. budget deficit will widen. The dollar index will break down through the March 2008 lows of around 71. The ratings agencies will be forced to downgrade U.S. debt once again. To keep rates on current and past debt low, The Fed will have to engage in even more QE. The entire U.S. ponzi scheme will continue circling the drain faster and faster until the bottom finally falls out.

And this is all going to happen a lot sooner than what you might think. Some say 2030. Some say 2025. I think we'll be lucky to make it through 2013. Oh, and don't ever forget, the favorite tools of distraction for the Fed/Govt/TPTB Complex are wars and insurrections. Plenty of that on the way, too. As we like to say around here, prepare accordingly.

Onto the charts. Both of our metals ran into a double whammy today. First, there's a general reluctance to bid them higher in that everyone is now convinced that a debt ceiling deal will cause price to drop sharply. Second, The Cartel has clearly decided they'd like to keep a lid on things near 1625 and 41. However, it is very important to note that, even under these conditions, the metals never did truly roll over. Gold rebounded off of firm support below 1610 to close near 1615. Silver held support near 39.50 and is now back just under 40 at 39.80.

For tomorrow, there are more reasons to be long than short over the weekend so I expect an UP day. Ideally, gold will trade up and finish the day near the crucial 1625 level. Silver will rebound and finish somewhere in the neighborhood of 40.50. When the markets re-open Sunday evening and the "deal" has still not been reached, expect both metals to blast through the Cartel-induced resistance levels mentioned above.

That's all for now. I'd like to end this on a happy, upbeat note but I'm afraid I can't. I can give you this, however. My favorite schoolhouse rock. "Yow! That's unfair! Givin a guy a shot down there!" See you tomorrow. TF

Video unavailable

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  169 Comments

LongGoldLongSilver
Jul 28, 2011 - 4:26pm

My second first! Or?

My second first! Or?

bernard
Jul 28, 2011 - 4:40pm

As I stated previously,

As I stated previously, todays action of was an attempt to shake out weak hands. Silver is now primed (after a brief, healthy, 2-day sell off to a major triple line of support) for its next leg up towards $45.

https://preciousmetals.me/july-28th-silver-shaking-out-weak-hands/

worldend666
Jul 28, 2011 - 4:45pm

So when to trade out of paper

So when to trade out of paper metals and into the real thing? I have to admit I like the leverage and switching will make my gains/losses 1/3 what they are now.

I have about 25% of my money in bullion, 30% in miners and another position 5 times larger in XAU which I would like to keep in paper as long as possible.

FOFOA reckons the event will be binary with no time to switch. I'd say that's quite likely, but it's possible there will be a nice run-up before then as we are not at crunch time just yet.

robov
Jul 28, 2011 - 4:46pm

What Does One ,Make of This?

Hope your right Turd as I have started scaling in on the recent drops in some of the miners, yet I came across this today which if true is bearish for gold and silver.

In an attempt to cash in on an anticipated move lower for the Euro, options traders are buying puts (bearish bets on a drop in price) in both gold and silver. This can be seen both through the volume of the put contracts and the volatility, or premium over intrinsic value, options traders are willing to pay. This activity is more run of the mill for silver, which has become a trading vehicle in addition to a semi-precious metal than it is for pure, precious Gold

https://finance.yahoo.com/blogs/breakout/gold-silver-looking-heavy-trade...

duckwomanloulou LongGoldLongSilver
Jul 28, 2011 - 4:47pm

Hell in a handbasket

Only one of my 15 miners is in the green - sheesh it's a painful day even tho' Gold has recovered splendidly from the EE raids. Total insanity

One flew over the cuckoo's nest

"You will believe the MOPE!!"

Lou

atlee robov
Jul 28, 2011 - 4:49pm

option buyers

More interested in who was writing (selling) the options. Buyers are historically wrong the market.

sevin
Jul 28, 2011 - 4:52pm

Man i miss those days of the

Man i miss those days of the Schoolhouse Rock videos. I think the conjunction junction one was my favorite. I'm starting to think maybe the Bernanke wants the U.S. to get downgraded and a default would help this to rush along QE3 as others have pointed out. These next couple days should get interesting.

RockinJohnnyT
Jul 28, 2011 - 4:59pm

I think the Cartel

I think the Cartel has Models that run every possible problem they could run into, so they know exactly what is going to work to beat us down the most. I agree Obum-a will raise the ceiling to last until the 2012 elections are over, but i still see the EE killing the metals when he does that. They still have to much "Cheat" on there side to have what should be going on happen (metals should be sky high). I have been watching SLW and GPL (miners) they seem to tell you what is going to happen for the day - don't know why but they do.

Have a great evening.....

@ ewc58 - Have to laugh - but its the truth - he is destroying it all - I still do know he is just a puppet.

@DPH - https://www.tfmetalsreport.com/forum/guns-people-who-want-one-protection...

lots of gun info here. Good luck

C F
Jul 28, 2011 - 5:03pm

Subscribe or login to read all comments.

Contribute

Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

Key Economic Events Week of 8/5

8/5 9:45 ET Markit services PMI
8/5 10:00 ET ISM services PMI
8/6 10:00 ET Job Openings
8/8 10:00 ET Wholesale Inventories
8/9 8:30 ET Producer Price Index

Key Economic Events Week of 7/29

7/30 8:30 ET Personal Inc/Spending & Core Inflation
7/30 10:00 ET Consumer Confidence
7/31 8:15 ET ADP employment
7/31 2:00 pm ET FOMC Fedlines
7/31 2:30 pm ET CGP presser
8/1 9:45 ET Markit Manu PMI
8/1 10:00 ET ISM Manu PMI
8/2 8:30 ET BLSBS
8/2 10:00 ET Factory Orders

Key Economic Events Week of 7/22

7/23 10:00 ET Existing home sales
7/23 10:00 ET Richmond Fed Manu Idx
7/24 9:45 ET flash Markit PMIs
7/25 8:00 ET Count Draghi/ECB policy meeting
7/25 8:30 ET Durable Goods
7/25 8:30 ET Wholesale Inventories
7/26 8:30 ET Q2 GDP first guess

Key Economic Events Week of 7/15

7/15 8:30 ET Empire State Fed Index
7/16 8:30 ET Retail Sales and Import Price Index
7/16 9:15 ET Cap Ute and Ind Prod
7/16 10:00 ET Business Inventories
7/17 8:30 ET Housing Starts and Building Permits
7/18 8:30 ET Philly Fed
7/19 10:00 ET Consumer Sentiment

Key Economic Events Week of 7/8

7/9 8:45 ET Fed Stress Conference, three Goon speeches
7/10 8:30 ET CGP Hump-Hawk prepared remarks
7/10 10:00 ET CGP Hump-Hawk House
7/10 10:00 ET Wholesale Inventories
7/10 2:00 ET June FOMC minutes
7/11 8:30 ET CPI
7/11 10:00 ET CGP Hump-Hawk Senate
7/11 12:30 ET Goon Williams
7/12 8:30 ET PPI

Key Economic Events Week of 7/1

7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 10:00 ET Construction Spending
7/2 6:35 ET Goon Williams
7/3 8:15 ET ADP June employment
7/3 8:30 ET Trade Deficit
7/3 9:45 ET Markit Services PMI
7/3 10:00 ET ISM Services PMI
7/3 10:00 ET Factory Orders
7/4 US Market Holiday
7/5 8:30 ET BLSBS

Key Economic Events Week of 6/24

6/25 10:00 ET New Home Sales
6/25 1:00 pm ET Chief Goon Powell
6/25 5:30 pm ET Goon Bullard
6/26 8:30 ET Durable Goods
6/27 8:30 ET Q1 GDP final guess
6/28 8:30 ET Personal Income and Consumer Spending
6/28 8:30 ET Core Inflation
6/28 9:45 ET Chicago PMI

Key Economic Events Week of 6/17

6/18 8:30 ET Housing Starts and Building Permits
6/19 2:00 ET FOMC Fedlines
6/19 2:30 ET CGP presser
6/20 8:30 ET Philly Fed
6/21 9:45 ET Markit flash June PMIs

Key Economic Events Week of 6/10

6/11 8:30 ET Producer Price Index
6/12 8:30 ET Consumer Price Index
6/13 8:30 ET Import Price Index
6/14 8:30 ET Retail Sales
6/14 9:15 ET Cap Ute and Ind Prod
6/14 10:00 ET Business Inventories

Forum Discussion

by sierra skier, Aug 17, 2019 - 7:14pm
by sierra skier, Aug 17, 2019 - 8:30am
by Boggs, Aug 16, 2019 - 7:46pm
by Boggs, Aug 16, 2019 - 7:07pm
randomness