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.

Turd nite nite now.

About the Author

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turd [at] tfmetalsreport [dot] com ()

  492 Comments

Physical_onlyewc58
Aug 7, 2011 - 5:42pm

Simply Beautiful

Nuff said..........

pailinkenklave
Aug 7, 2011 - 5:42pm

@kenklave

You mean the one I just accidentally dropped through sewer grate into rushing slime. I'll miss 'er :)

Prize Fighter
Aug 7, 2011 - 5:43pm

Well......we're waiting!

Classic Movie Line #51
Shill
Aug 7, 2011 - 5:44pm

guerrillacapitalist

Guerrillacapitalist, first off thanks to you and your son for your service. I have set certain people on this forum
( not many but some ) on mental ignore as that feature is not available yet. So those who are on this list I bypass their readings.

Again thank you for your service.

Kumanari
Aug 7, 2011 - 5:50pm
Tesla
Aug 7, 2011 - 5:52pm
stoneeh
Aug 7, 2011 - 5:52pm

guerrillacapitalist

Then please go on in your belief that there can be a solution to all of this that will be pleasant.

- Markus

Save_America1st
Aug 7, 2011 - 5:53pm

Greenspan: we can just print more money...

I'd say that's bullish as usual for PM's, wouldn't you?

The look on Goolsbee's face when Mr. Andrea Mitchell says that is hilarious. These assholes really piss me off. If we can always just print trillions then why in the hell does anyone even bother paying taxes? To make us feel good about ourselves that we're being ripped off and stolen from to "contribute" to the entire rotting system that these aholes created? What a joke.

https://www.youtube.com/watch?feature=player_embedded&v=-_N0Cwg5iN4

Kumanari
Aug 7, 2011 - 5:53pm

T MINUS 8 MIN KEEP YOUR HANDS

T MINUS 8 MIN

KEEP YOUR HANDS ON YOUR PMs AT ALL TIMES

DO NOT DISEMBARK TILL THE MARKET HAS COME TO A COMPLETE STOP

Silver bear of very little brain
Aug 7, 2011 - 5:59pm

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