Re: Tonight. I Have No Idea.

492
122
Sun, Aug 7, 2011 - 1:26pm

It's Sunday in the U.S., a little after 1:00 EDT. The Globex opens in about five hours. There seem to be quite a few people who are interested in my opinion regarding how the metals will trade tonight and tomorrow. Frankly, I have no idea.

First of all, I've been on the record saying that I didn't think a ratings downgrade was coming. Oops. Shows you what I know. I am still stunned that it happened. Of course it needed to happen and AA+ is still too generous. A or A- would seem to be more fitting. However, since there is no principal risk in U.S. government debt (the Fed can print all the money they need to pay off bondholders), AA+ is OK, I guess. Now on the other hand, if S&P started taking inflation risk into consideration and began to factor in that you're really only getting 50c on the dollar back in principal purchasing power...well, lets just say that U.S. debt would be relegated to junk status. Regardless, U.S. debt is now rated AA+ and the effects of this will be far-reaching. We'll go into this in greater detail later this week when I have more time and can think more clearly. (For now, I'm a little hung over and I need a nap.)

As it pertains to the PMs...There is NO WAY that this news is not bullish. Extremely bullish. In the intermediate and long term. What you don't know about is tonight and tomorrow. As we saw last week, when everything else is being sold, the PM "baby" often gets thrown out with the bathwater. Gold should open UP at least $50. It should trade UP $100 tomorrow. Will it? Again, who knows? Gold may open higher and then get instantly battered lower in a global rush for liquidity.

Just watch. U.S. debt gets downgraded but the POSX and the long bond will both probably trade higher in a flight to safety. Oh well, it doesn't really matter. Like I said, gold may be down tomorrow. Who knows? But what I do know is this: Gold will be higher a month from now. It will be higher six months from now and it will be higher still a year from now. In that context, what happens tonight is of no consequence. 

I'll try to have an update this evening, after things have been trading for a while. Until then sit back, relax and enjoy the fireworks. TF

11:55 pm EDT UPDATE:

Too tired to type but I wanted to give you this update with these levels to watch overnight and into Monday.

paper_8-7pmgold.jpgpaper_8-7pmsilv.jpg

Turd nite nite now.

About the Author

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turd [at] tfmetalsreport [dot] com ()

  492 Comments

curly
Aug 7, 2011 - 2:55pm

The EE creeps will try to beat PM's down...

My prediction 1: The EE will attempt beat the metals down immediately after the Asian market opens, but they will be overcome by demand by the time the NY market opens.

My prediction 2: The AG price will be at $42 by Wednesday, $44 by Friday, and the $38 lows will NEVER be revisited again, EVER!

Anyone else care to take a stab at AG predictions? 

treefrog
Aug 7, 2011 - 2:57pm

what is a "dollar?"

from the coinage act of 1792 (u.s.)

"DOLLARS OR UNITS--each to be of the value of

a Spanish milled dollar as the same is now current, and to contain three hundred and seventy-one grains and four sixteenth parts of a grain of pure, or four hundred and sixteen grains of standard silver."

...just so we remember what we're talking about, a dollar is 0.7734 troy oz of fine silver.

all that other stuff (fednotes etc) is just bankster paper and/or politicians' promises.

C F
Aug 7, 2011 - 2:57pm

World Reserve Currency

It will be interesting to see what comes out of all these emergency G7 and G20 conference calls this weekend, and if we'll have a new world reserve currency soon.

pbreed
Aug 7, 2011 - 2:58pm

Sorry to disappoint...

On Friday before the S+P announcement I called my local PM shop and bought some gold. I then drove by and dropped off a check. (I pay by check so it sits in their shop till the check clears) 

So based on my personal investment karma gold will open down big time.

I've been purchasing some physical on a dollar cost averaging basis for about 9 months, I have not commented on this before as I use my real name and was uncomfortable with people knowing I had PM's. I finally accumulated enough that it was worth getting a safe deposit box at a local bank. I'm a little uncomfortable about having it in a bank, but I'm less uncomfortable about that than having it at home.

P.S. I use my real name, because anyone that really wants to find out who you are will anyway. Hiding behind an alias like many do on this site is really not secure IMHO. 

stingbee30
Aug 7, 2011 - 2:59pm

In these environments, you need to throw away the technicals

Today, it is all about fundamentals and what is happening around you. You have global reckoning happening on both sides of the Atlantic. You have the continued Arab spring which adds more stress and anxiety to the the world investor. You have protest in Israel, and riots in the UK. This Arab spring is the start of new movement to fight inflation, unemployment, bad leadership, greed, and injustice. This is going to reach other shores, it is just a matter of time...

Smart money is telling you that smart investors are slowly losing interest in the global currency market. You might have a few countries like Canada, Singapore, Australia who have better balance sheet, but there is not much liquidity. For smart investors, Gold is becoming an alternative means to protect their falling assets and currency debasement. In the US, we don't have the visionary leadership who will go behind their close-minded ideology, and start focusing what is good for America, not the lobbyist and special interest groups. We are hijacked by oil companies, banks, wallstreet firms, the strongest lobbyist from Israel, two wars without a sound resolution, and war-mongering lobbyist who still wants to keep the defense spending. We have to cut ties from our inflated egos and superficial claims to military dominance. We have to start thinking about America first, and then military spending. We need to cut defense spending by 40-50% just to survive. We have 50 million Americans on Food stamp, and about 25% or so underemployed/unemployed/discouraged workers. We have to understand the reality. We are not a super power like we are believed to think. It is just on paper. We have expensive military toys, but not enough money to help states continue battle unemployment benefits and other social causes. We were brains washed to think that Socialism is evil, and Capitalism is good. Well, today we are seeing what happens when we allow Capitalism at the expense of Social Democracy. Capitalism is only working for the few and at the expense of the masses. (btw, I'm not a proponent of Communism because it never works, sounds good on paper, but once again you give too much power to the government). We have to focus on a path to social democracy. It shouldn't be all about interest rates and how much i can leverage my investments. The Futures market in Oil is clear indication of greed and leveraging, and it is not about real delivery.

Back to Gold and Silver Story: Today, stop looking at the charts (yes, it gives us numerical benchmarks to follow). Today, it is all about what is happening around the world. It is not just the US, but Europe, the Middle East, two wars. I think you get the picture. There is a lot of anxiety and stress in the world. The classic safe-havens of US Treasury and dollar is becoming a thing of the past. Silver and Gold always had real value based on our history. It is a real hard assets. So, on Monday, we could easily see Gold passing the $1700 mark, and killing all the shorts with the buy-stops. Silver is going to follow it's big brother lead because Silver was used as a currency a while back. It really doesn't matter whether the dollar goes up or not. The reality is that it is for traders to make a few bucks. But, Silver and Gold will de-link or de-couple from what Oil is doing or Dollar. The reality is that smart investors are not going to pile-up on more dollars because the currency is worthless because it is not backed by anything. The idea of "Full Faith and Credit worthy" of the US has been challenged, and it is going to get worse. The idea that America was the savior of the financial market or the place of last resort has come to a climatic phase. There is always hope that as humans we will eventually learn from our mistakes and wake-up. We are in dire need of visionary leadership who don't prescribe to ideologies that seem outdated. The two party system is not working. It was working back then because people still believed in compromise and crossed their ideological base for the common good.

The Euro/European Union sounded good on paper, just like communism. But in reality, it is a dysfunctional organization with so many different countries and ideologies. Germany the most stable country in Europe is supposed to save all the other countries. France (taking the lead) is another joke. In summary, the World problems are far much bigger than our daily charts and daily resistance or weekly levels. The Macro economic fundamentals are far more important. So, do me a favor, stop looking too much at the charts. You will be handsomely rewarded in the PM's area because of the global financial Tsunami, not because of charts. The World Story is much bigger than my charts or your respective charts. Good luck...

cpnscarlet beardeus
Aug 7, 2011 - 3:02pm

Gutsy $1700

Stand by it you will. And I would take a wager hoping you would win it.

stingbee30 curly
Aug 7, 2011 - 3:09pm

You are facing a tidal wave

You are facing a tidal wave of Investors who were waiting to buy Gold at a lower price because of the Summer months. Well, i think you are going to see many investors who are going to chase Gold and Silver because of the current financial situation. The chasing will start on the ASIAN Markets. I wouldn't be surprised to see many investors who have stayed on the sidelines to start chasing GOLD, and this will trickle down to Silver. The G-7 or G-20 or G-50 can do whatever they want to, but it will not fix the structural problems of a leveraged global financial system.

My assessment: Silver will gap-up, just like Gold. Gold will close around $1700-$1750. Regardless, it will cross the $1700 mark, and it should close above it on Monday. Silver will gap-up and close around $41.00-$42.00 area. Expect further gap-up on Tuesday. We could see Silver around $50.00 by the end of this week, and Gold around $1800. The Buy-stops are going to kick in because many shorts are on the wrong side of the trade, and the S&P downgrade caught many of them by surprise.

D.B. Cooper
Aug 7, 2011 - 3:09pm

Back the truck up!

All the phyzz that I purchased Friday is going to be backing up this week. Thanks for the cheaper prices, Blythe! *kiss*

C F curly
Aug 7, 2011 - 3:11pm

I don't know how high Ag will

I don't know how high Ag will go, but I'm with Curly in that I don't think we'll ever see it go below 35 again.

ewc58
Aug 7, 2011 - 3:12pm

Just remember this about Gold during crises the past 10 years

One thing Bill Murphy and any GATA person can attest to is how PM prices go (read: are sent) down at the very times we know they should rise. 

Among other things, what happens in the next 36 hours will also be a test of whether the EE still has any of that old Black Magic (BM: how odd) left in the cauldron, and whether it remains effective in stemming reflex rises in the PoG now that the Asian masses all get it now too. There could be a whole new playing field soon, maybe starting tonight.

Just don't underestimate what the EE has left. As long as the USD is the primary beneficiary of any "rush to safety" after Asia opens, I think the EE will hold back most of their own ammo until gold intrudes on the trend. Meaning, don't pop your head up to soon, you could lose it later. Or they may try to bury gold right out of the starting blocks, trying to prevent a momentum snowball by shutting 'er down early. Perception management. Or maybe gold just takes off like a Saturn V no matter what they throw at it, inspiring Tesla to be up all night creating and posting awesome PM Rocket Shots on Turd Town. Me? I'm sure hoping for the last scenario yes

Haole
Aug 7, 2011 - 3:14pm

Turd, even when you claim to have no idea...

... your commentary is gold. Thank-you on the eve of what could be a spectacular week. Good luck everyone! Damn I love this place...

Bay of Pigs
Aug 7, 2011 - 3:15pm

@DPH

Yes. The Morgue ever closes those shorts out and/or the COMEX implodes, the price of gold and silver could easily double overnight. I know that sounds crazy, but it could happen. The PM Lifeboat is very tiny.

Shill
Aug 7, 2011 - 3:16pm

Respectfully

I finally accumulated enough that it was worth getting a safe deposit box at a local bank.

Unwise. Read your history sir, when and if a bank holiday is declared your PM's will be confiscated as all safe deposit boxes will be emptied. Not Tin foil hat drama, at this stage anything is possible.

Be well

Dr G cpnscarlet
Aug 7, 2011 - 3:16pm

I agree with the $1700. My

I agree with the $1700. My guess is that we see gold up $50 within 10 minutes of Sydney/Asia opening, and silver up $1.50. What I don't know is what will happen for the brief time when Globex opens prior to the foreign trading. THAT will be an interesting 30 minutes.

jlee2027
Aug 7, 2011 - 3:19pm

1764 Gold

Santa says that is the key Gold number, the price rises possibility goes exponential after that. One would think Silver will ride along, like a rocket with Gold. And when Silver hits 60-70 one would also think the short positions have no choice but to cover...or go bust.

We could see hundreds of dollars an ounce for silver in the very near term. Probably won't happen, but possibilities keep rising. Eventually it will happen.

stoneeh
Aug 7, 2011 - 3:21pm

I don't care

My physical stays where it is and so does my paper position since I don't play around with much leverage and I don't have to react to a few % changes. And if my paper profits vanish, who cares?

Bring it on and let the world end. Let them have it. Everyone who has taken part in this completely amoral, antisocial, superficial society deserves exactly what is coming their way. The only ones I have pity for are the children, who were not yet offered the chance to not take part in our system/society. They are innocent and they will suffer. As for everyone else, you have looked the other way from enough injustice you could have helped prevent to deserve every bit that is coming to you. I hope a lot of people will soon find themselves under bridges, starving.

- Markus

Magpie
Aug 7, 2011 - 3:22pm
jlee2027 Bay of Pigs
Aug 7, 2011 - 3:23pm

@Bay of Pigs

@DPH

Submitted by Bay of Pigs on August 7, 2011 - 3:15pm.

Yes. The Morgue ever closes those shorts out and/or the COMEX implodes, the price of gold and silver could easily double overnight. I know that sounds crazy, but it could happen. The PM Lifeboat is very tiny.

​Jesse (https://jessescrossroadscafe.blogspot.com/) in his archives once posted the possibly of a 50x overnight increase when COMEX falls. There just isn't enough metal, compounded by the derivatives. Add in panic...

I know I know. But we can dream can't we?

ewc58
Aug 7, 2011 - 3:26pm

Gonna be a HOT time in the old town tonight!

They're gonna be taking a high number of G7 finance ministers and central banksters off the playing field on those whimpy-ass Soccer stretchers...

G7 Preparing Statement To Support Dollar, EU, In Fact Everything That Would Otherwise Collapse Tomorrow, Before Asia Open

Tyler Durden's picture

Submitted by Tyler Durden on 08/07/2011 13:40 -0400



Just out from Bloomberg: Finance ministers and central bankers are preparing a statement to release before the open of Asian markets, the Nikkei newspaper reported, without citing anyone. Japan may intervene in currency market if dollar falls. G-7 finance ministers, central bankers expected to express confidence in dollar, pledge liquidity. U.S. to explain fiscal rebuilding efforts." [so no more sniping at S&P and actually doing its job eh?] "Japan to express intention to maintain Treasury holdings. G-7 expected to show support for EU fiscal efforts." And while the G7 is about to realize that when faced with a $100 trillion (equities plus debt) market onslaught its printing powers are next to laughable, Dow Jones reports that the "ECB is weighing Italian, Spanish bond buying on a massive scale." Two take homes: i) the Fed has just lost its competitive advantage of doing idiotic things on a massive scale as the world wake up to tits trickery (unless of course the Fed resumes said thing on a massiver scale, which it will), and ii) tomorrow is the day when the infinite force of central planning meets the immovable object of capital markets. We will find out who blinks first in a few hours.

dmunjal
Aug 7, 2011 - 3:26pm

Short squeeze

There were a lot of folks shorting gold and silver on Friday who will be forced to cover on Monday. This could be the mother of all short squeezes. I'm predicting a 1700/42 close.

Tecumseh Sgt.Iria
Aug 7, 2011 - 3:26pm

$1821 GOLD

That number is astounding.

Haole Shill
Aug 7, 2011 - 3:26pm

"Unwise. Read your history

"Unwise. Read your history sir, when and if a bank holiday is declared your PM's will be confiscated as all safe deposit boxes will be emptied. Not Tin foil hat drama, at this stage anything is possible."

I think Shill provides great advice on this whether or not something like a bank holiday occurs, etc.

I don't know about the terms of use at your bank but when I read mine after getting a box to store important paperwork temporarily, it stated that the bank is not responsible for anything contained within. No insurance, no responsibility for theft, loss, etc. I'd rather keep mine in the cookie jar given the choice. I'm sure you can find a better place as a bank safety deposit box cannot be thought of as safe and secure for PM storage, especially in these times and circumstances we find ourselves. Good luck and best wishes.

Dr Durden
Aug 7, 2011 - 3:30pm

Whatever happens I'm still

Whatever happens I'm still long wheelbarrow sales.

Magpie Shill
Aug 7, 2011 - 3:31pm

CA is confiscating "abandoned" boxes

even when the payments on the boxes are current, and the owners are very much alive. Get a wall safe. Put a loaded bookcase in front of it.

https://abcnews.go.com/GMA/story?id=4832471&page=1

Not-So-Safe-Deposit Boxes

San Francisco resident Carla Ruff's safe-deposit box was drilled, seized, and turned over to the state of California, marked "owner unknown."

"I was appalled," Ruff said. "I felt violated."

Unknown? Carla's name was right on documents in the box at the Noe Valley Bank of America location. So was her address -- a house about six blocks from the bank. Carla had a checking account at the bank, too -- still does -- and receives regular statements. Plus, she has receipts showing she's the kind of person who paid her box rental fee. And yet, she says nobody ever notified her.

TexAsh
Aug 7, 2011 - 3:33pm

S&P making up for 2008

I tend to agree with those who suggest that the recent historical downgrade is S&P's attempt to exonerate itself from the shabby reputation it got for spurious ratings in the financial services crash of 2008. If that is true, then it is reasonable to interpret this move as an attempt to be on the right side of impending changes of historical proportions and a forecast of those kinds of events.

ReachWest
Aug 7, 2011 - 3:39pm

Silver Selling for $105/oz this afternoon

I just posted some screenshots and a link in the Forums - the site I purchase bullion from has raised silver to $105 today and gold to $3880.

This is crazy! Should be very interesting tonight and tomorrow.

https://silvergoldbull.com

NOMAX
Aug 7, 2011 - 3:42pm

Where to store the Physical

I agree it's a no brainer - DON'T want any physical in any vault or depository box in a bank or trust company holding your physical. That at best is just creating one additional barrier you'll have to get through to get the stuff back into your hands. Why would you do that given how desperate the banks and government(s) are in these times?? I take my physical on a nice sunny day out to the forest or mountains and look for a nice spot to put it where no man has ever been before. It costs me nothing. I don't visit it often - why call possible attention to it? And I spread it around. I can get back to it when I need it. Nobody knows it's there and I tell no one. I'm single and I don't particularly have to leave it to anyone after the bus finally runs me over, but maybe if on my death bed I happen care to share with a most important person in my life someone might finally get to know where it is. If that's not OK for your situation, then let the one you love and trust know where it is, but limit it at that. Nobody can tell me there isn't a plethora of good hiding places out there (especially for compact stuff like gold). Even if you got it in a personal safe or stashed in the wals of your home your better off than a traditional hiding place. If the world doesn't know of it, it'll tend to stay where you stashed it.

Haole ReachWest
Aug 7, 2011 - 3:44pm

That is awesome ReachWest! 

That is awesome ReachWest! 

ewc58
Aug 7, 2011 - 3:45pm

Never never never never NEVER store your Gold

in a Safe deposit box. DHS procedures already in place with all the major banks to both limit your access and possibly confiscate the contents of them. Argue or don't listen at the peril of losing your metal.

NEVER store PMs, especially gold, in a bank. Especially NOW.

brad_pitts_betterlooking_brother
Aug 7, 2011 - 3:54pm

i put some silver mousetraps

i put some silver mousetraps waaaay in the back of mine.

look like silver bars.

yeah, they're set.

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