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.

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Mickey
Aug 7, 2011 - 10:59pm

Marc Faber on Bloomberg Asia

in the 11 PM hour Eastern time-should be interesting

Mario
Aug 7, 2011 - 10:53pm
Haole
Aug 7, 2011 - 10:53pm

Dollar death

@Shill

I was just thinking about that film when I read this post on ZH. ;)

https://www.zerohedge.com/news/china-isnt-exactly-floating-yuan

Cheers!

diegeiro
Aug 7, 2011 - 10:52pm

munis

Seems that a rating change on munis will only continue the destruction of our Republic by further weakening our states and is part of the plan by TPTB. S&P would like to make people believe their rating change is because of the Republicans and the Tea Party in spite of their decision to do it irregardless. However, I don't think the Tea Party or any of the Republocrats helped to prevent this decision. My guess is that is was politically expedient for a variety of reasons, none of which are particularly good for the majority of citizens.

I personally would like a (top) button at the bottom of the comments page to take me to the top of the page so that I can toggle between charts and comment pages without having to scroll all the way back to the top while getting caught up on comments . How hard can that be?

When a raid and/or waterfall starts it can happen very quickly. If you are in older comments you can miss the current warnings by fellow turdites.

RuNutsmrgneiss
Aug 7, 2011 - 10:50pm
Slickmrgneiss
Aug 7, 2011 - 10:50pm

???   James E.

???

James E. Staley

Chief Executive Officer of the Investment Bank

JP Morgan Chase & Co

New York , NY

Sector: FINANCIAL / Money Center Banks

Officer since December 2000 54 Years Old Chief Executive Officer of the Investment Bank since September 2009, prior to which he had been Chief Executive Officer of Asset Management. Jes Staley, CEO of the firm?s Investment Bank, will assume additional responsibility for overseeing and coordinating the firm?s international franchise across all of its businesses. https://people.forbes.com/profile/james-e-staley/46645
latcho
Aug 7, 2011 - 10:46pm

RE: In these environments, you need to throw away the technicals

Fair observation.
But for the entertainment factor, let's then rename them into the Small Sheeple-O-Panic meter and the Big Sheeple-O-Panic meter.
And hell yes, we love to chart them.

Dr Glatcho
Aug 7, 2011 - 10:42pm

These moves thus far aren't

These moves thus far aren't the moves we are looking for. Trust me.

Turdle GG
Aug 7, 2011 - 10:41pm

Gold approaching the important +2% level

I am not aware of any day where the "gold seldom "allowed" to rise more than 2%" in a day rule has been broken during Asian market hours.

Santa's $1,764 is not far away.

What hedge fund would put on more short positions in the miners in this environment?

Shill
Aug 7, 2011 - 10:40pm

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