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

¤
Jul 29, 2011 - 9:10am

Blythe today?

We can only hope...

I'm Melting! - The Wizard of Oz (7/8) Movie CLIP (1939) HD
Tom L
Jul 29, 2011 - 9:12am

$1625

They are still defending $1625 coming into the COMEX open. Today's going to be interesting.... and I mean that in the Chinese sense of the word.

"may you live in interesting times."

Ta,

ewc58
Jul 29, 2011 - 9:12am
atlee
Jul 29, 2011 - 9:18am

Congress fiddles while the nation burns

Anyone else feel like they are living in a John Steinbeck novel?

Is it time to climb on the truck and head to the field to pick fruit yet?

Tom L atlee
Jul 29, 2011 - 9:22am

@Atlee

@Atlee: I milked my goats this morning before stopping by the thread, does that count?

We're going to need people providing a real, local economy when Caligula's Barn Raisin' finally culminates.

Ta,

Tom L atlee
Jul 29, 2011 - 9:22am

@Atlee

@Atlee: I milked my goats this morning before stopping by the thread, does that count?

We're going to need people providing a real, local economy when Caligula's Barn Raisin' finally culminates.

Ta,

ewc58
Jul 29, 2011 - 9:23am

Turd, the countdown to QE3 begins...

Courtesy of our friends at ZH:

6...5...4...3...2...

https://And Scene: Q2 GDP 1.3%, Gold Surging On Imminent QE3 Resumption

Anyone who had the stones to buy yesterday: good on ya. We may not see those prices again for a while.

BlackHawk
Jul 29, 2011 - 9:25am

Stroking

I'm stroking the pet mouse in my pocket right now, hopefully not tooo hard.

ewc58
Jul 29, 2011 - 9:25am
Tesla
Jul 29, 2011 - 9:26am

Morning Gang!

Woa! Check the drop in WTI and Brent out if your not watching these - WOW! Worth a quick look!!

(Hi LaMachinnaGina)

LaMachinna
Jul 29, 2011 - 9:28am

Memo from QE3456789

Signed Adoringly, QE#

BlackHawk
Jul 29, 2011 - 9:28am

Cramer Squawking

Cramer Squawking says treasury can raise money by selling the gold in Ft. Knox. High drama at the bell.


Jul 29, 2011 - 9:32am

Holy breakthrough, Batman!

Resistance at 1625 obliterated in seconds. Turdites deliriously happy. Film at 11.

Tesla
Jul 29, 2011 - 9:32am
Tom L
Jul 29, 2011 - 9:34am

The Miners

The Miners, though, refuse to participate, categorically. This is killing me.

Ta,

atlee
Jul 29, 2011 - 9:35am

Everyone is watching

to see what you will do

Click-Everyone's Watching
bullwhip29
Jul 29, 2011 - 9:37am

Obama @ 10:20am

A last desperate plea...OR...a curve ball coming?

Shill
Jul 29, 2011 - 9:39am

One word

YIKES!!!!!!!!!!!

Tesla
Jul 29, 2011 - 9:41am
LaMachinna bullwhip29
Jul 29, 2011 - 9:41am

Bullwhip, I call it

CHR -- Covering his rear...

ewc58
Jul 29, 2011 - 9:43am

Q2 GDP: 1.3

Think that sucks? Wait a few weeks for the downward revision

LaMachinna
Jul 29, 2011 - 9:43am

Ewww pretty

stars at warp speed, Need thy shades for them stars. Top o' the morning to you too.

Harald
Jul 29, 2011 - 9:43am

Sounds like Cramer

If "we" still have some gold, selling it now would be the worst move possible. There would be plenty of buyers. I like the farfetched idea that the U.S.A. keep it's gold (and even acquire more) and when the price of gold gets high enough to pay off the debt in dollars, then sell it. In the meantime, stop adding more debt. That's assuming there is anyone in Washington with half a brain.

Titus Andronicus
Jul 29, 2011 - 9:44am

Oh, Yea!

Glad I didn't sell my paper silver last night.

But I wish I had not swapped my paper gold for paper silver a couple days ago.

ewc58
Jul 29, 2011 - 9:45am

Gold at 1632+

'Cause it heard Obummer is approaching the mike for his latest read at 10:20.

gold said: yeah baby CAN'T WAIT!

Rui
Jul 29, 2011 - 9:46am

Mining shares gone full-blown retard again

It's almost as if EE was so pissed off and yet unable to cap the metal price that they unleashed their frustration on the miners.

Tom L
Jul 29, 2011 - 9:53am

Bloodbath

This is a criminal bloodbath in the mining shares this morning. This had better bounce soon.

Ta,

duckwomanloulou Rui
Jul 29, 2011 - 9:54am
ewc58
Jul 29, 2011 - 9:57am

Aww, my heart's just breaking for O'bottom

Jeez, I mean, what's it been, like 6 days since his last "vacation"? And this is from Valerie Jarret, a power behind the throne and wife of the awesomely loathsome Cass Sunstein... We'll all rue the day this group of wacko Central Committee members seized power. Bit it sounds like their clowny boy may not hold up to the job.

I'm sure his endurance and resilience are every bit as weak as his character.

https://washingtonexaminer.com/blogs/beltway-confidential/2011/07/valerie-jarrett-obama-getting-absolutely-no-sleep-because-debt-cr?utm_source=feedburner+BeltwayConfidential&utm_medium=feed+Beltway+Confidential&utm_campaign=Feed%3A+BeltwayConfidential+%28B

¤
Jul 29, 2011 - 9:57am

Chin music by Obama at 10:30 a.m.

I'm pretty sure this is where he will make the market decline accelerate by design. I don't see this as a market calming type speech but a high and hard fastball at the face of the "fear mongered" public.

No Social Security checks will be rolled out as a possibility again blah blah blah.

Where's Obama's plan? His own personal plan for all of this?

His plan is to veto and /or evoke the 14th for a Grand Plan to take place.

All chin music to brush everyone back.

Best baseball fight ever

Contribute

Donate Shop

Get Your Subscriber Benefits

Exclusive discount for silver purchases, and a private iTunes feed for TF Metals Report podcasts!

Key Economic Events Week of 4/22

4/22 10:00 ET Existing Home Sales
4/23 10:00 ET New Home Sales
4/25 8:30 ET Durable Goods
4/26 8:30 ET Q1 GDP first guess

Key Economic Events Week of 4/15

4/16 9:15 ET Cap Util and Ind Prod
4/17 8:30 ET Trade Deficit (Feb)
4/17 10:00 ET Wholesale Inventories
4/18 8:30 ET Retail Sales (March)
4/18 8:30 ET Philly Fed
4/18 10:00 ET Business Inventories (Feb)
4/19 8:30 ET Housing Starts and Building Permits

Key Economic Events Week of 4/1

4/1 8:30 ET Retail Sales (Feb)
4/1 9:45 ET Markit & ISM Manu PMIs
4/1 10:00 ET Construction Spending (Feb)
4/1 10:00 ET Business Inventories (Jan)
4/2 8:30 ET Durable Goods (Feb)
4/3 9:45 ET Markit & ISM Services PMIs
4/5 8:30 ET BLSBS

Recent Comments

by Joseph Warren, Apr 25, 2019 - 5:51pm
by Dr Jerome, Apr 25, 2019 - 5:13pm
by chrtoo, Apr 25, 2019 - 4:59pm
randomness