Absolute Advice for Relatives

Wed, Nov 23, 2011 - 9:41am

We'll continue our trip down memory lane in a moment but, first, some charts...

A very interesting rebound occurred yesterday. While global equities traded sideways to down, gold rallied $20 or so and silver exploded higher, reaching as high as $33 for a few moments. Why was this you ask? Primary driver #1 had to be the news that Eric Sprott is planning to add about $1.5B worth of physical silver to PSLV. At $30, that's 50,000,000 ounces or, roughly, 10,000 Comex contracts. Hmmm. That's interesting. That's almost the same amount of contracts that JPM is short. Coincidence??? (Recall that The Turd does not believe in coincidences, particularly in the PMs.) The article below sums things up rather nicely:


Yes, this is extremely positive, fundamental news. No, it does not mean that the coast is clear, as you can plainly see in the price action this morning. After being repelled from its old nemesis of $33, silver is back down today to $31.69 as I type. Over the past week, it has become quite clear that there are some BoS who are very interested in silver near $31. Will they emerge again today if price approaches that level. We'll see. IF silver can bounce again there and IF silver can then move through $33, it will THEN be time to get excited. Not yet, however.

Gold is in a somewhat similar position. Though it's tempting to buy it here, what's the rush? As long as its below 1705, there's a distinct possibility that it could head lower, perhaps all the way to 1600. Why risk it? Give it a few days. If gold can claw back above and move away from 1705, confidence will rise that this latest suppression battle is over. Until then, I'm sitting tight.


OK, back to the archives we go. I recall being rather fond of this post last year. Though we haven't seen hyper-inflation just yet, it is undeniable that prices are considerably higher this year than last.


At any rate, the advice is the post is still valid...particularly the part about the pinot noir.


Absolute Advice For Relatives

If you're like The Turd, you will most likely get peppered tomorrow with questions from pseudo-intellectual relatives regarding the current world/market environment. Your over-educated yet under-informed cousin or brother-in-law will seek out your current "wisdom" on investing, politics, etc. He or she will then feign interest while you speak but you will feel certain that, in the end, they just don't "get it" as your absolute conviction overwhelms their status quo mindset. You could probably talk for hours about the failure of Keynesianism, Quantitative Easing, the criminal political class, the fallacy of TBTF, POMO and the PDs, the infallibility of gold, etc...but why even try? Your cousin's husband doesn't understand any of this anyway and your show of intellect will only make him feel threatened. He'll quickly tune you out and run off to the family room to watch the Cowboys.

So what do you talk about tomorrow when someone asks? What kind of simple advice can give someone to prepare them for what is certain to be a very challenging year ahead? I plan to dial it back a bit and talk about one thing...inflation. And not just any old, run-of-the mill 3% inflation but serious inflation. I'm talking 20-30% inflation. Milk to $5/gallon kind of stuff. That is what's coming and its a topic most folks can actually get their arms around. Even the fuzzy-headed new boyfriend of your divorcee sister understands inflation and he might even be able to understand why its coming if you explain it well. (This is a chance for you to show off some of your worldly knowledge, too.)

Most folks with a high school-level understanding of economics (this includes your Fed governors) only understand and recognize demand-pull inflation. This is the classic demand side, Phillips Curve inflation that says rising wages, employment and wealth cause economic expansion which leads to more money chasing a static amount of goods. New, excess demand "pulls" prices up and the result is price inflation. Pretty simple stuff. What is coming in 2011, however, is the forgotten beast of cost-push inflation. This type of price inflation is caused by producers and merchants being forced to pass along through higher prices the rising cost of inputs to their products. Consumers, particularly the lower-and-middle income, bear the brunt of the pain. Your income isn't rising to keep pace with rising expenses and you get squeezed. Hard. And its not luxury items that are going up in price, its the staples. Bread, milk, gasoline, clothes, eggs, meat...the basics that no one can realistically live without. It's going to hurt and 2011 is going to be a mean year.

Why will input costs go up? Simple, they are all dollar-dominated and with our Fed now engaging in their final policy option, "QE to Infinity", all dollar-dominated assets are going up in price. Significantly. Your crazy uncle Henry may never take your advice to sell his stocks and buy precious metals but he just might take your advice to stock up now on essentials, before the prices skyrocket. Tell him that if he's going out to buy a new pair of pants, he should buy two. Tell your sister that instead of just buying her kids' winter coats for this year, she should buy coats for next year, too. Tell your cousin that instead of buying groceries every week to, instead, buy a whole dressed-out cow and put it in the freezer along with all the other dried and canned goods she can store.

Still, most crazy relatives won't listen but at least, come next Thanksgiving, they'll remember that you were right. One down side, however. Because you'll end up being the only member of the family that will have prepared and, most likely, the only one with affordable food to eat, you'll probably have to host everyone at your house next Thanksgiving. Oh well, there's a cure for that, too. Wine. Lots and lots of wine. Keep a couple of good Pinots on reserve and you'll be able to handle just about anybody.

I'll leave you for now with another blast from the past. Have a great day. Be happy and joyful. TF


1:30 pm EST UPDATE:

The action today was certainly encouraging. Both metals were placed under some extreme pressure and both rebounded off of higher lows. On the surface, this portends good things for Friday. However, caution is still warranted. Last year, The Forces of Evil seized upon the light volume of Black Friday to attack and send the PMs lower.


Happy Thanksgiving everyone! TF

About the Author

turd [at] tfmetalsreport [dot] com ()
Does Feb19 Comex gold close above $1250 on Friday?
Total votes: 191


· Nov 23, 2011 - 9:46am

Turd, Happy Thanksgiving to

Turd, Happy Thanksgiving to you and yours, and to all the Turds in Turdsville.

FFF · Nov 23, 2011 - 9:46am
Marblesonac · Nov 23, 2011 - 9:51am


Am I the Thurd poster? 

Happy Thanksgiving!!!

ReachWest · Nov 23, 2011 - 9:52am

Sprott = 10,000 COMEX Contracts

Turd wrote:
Eric Sprott is planning to add about $1.5B worth of physical silver to PSLV. At $30, that's 50,000,000 ounces or, roughly, 10,000 Comex contracts. Hmmm. That's interesting. That's almost the same amount of contracts that JPM is short. Coincidence??? (Recall that The Turd does not believe in coincidences, particularly in the PMs.)

Have to agree with you there, Turd, coincidence? - no way, Karma? Absolutely.

Charles S. Hamlin · Nov 23, 2011 - 9:54am

Happy Thanksgiving

Happy Thanksgiving to all! Thanks for all you do Turd. 

A report from the field, I went to California Numismatic Investments (Inglewood, CA) yesterday to pick up some fractional gold eagles and talked with Ken Slater and he mentioned that of the walk-in/phone traffic they are seeing it is about 90% buyers and those that are selling (10%) are doing so because they need the money i.e. bills, etc...

RedRover · Nov 23, 2011 - 9:54am

Thank you.

I'm bullish, though feeling very lonely as a bull; lately. LOL.. right? Cheers, Turd!
Keep up the great work & happy thanksgiving! I keep thinking to myself, well how
long can this last... measuring graphs, looking at 2 hr, 4 hr, daily, weekly.

Interesting times, for sure.

Brotha Bob · Nov 23, 2011 - 9:56am

Happy Thanksgiving

Happy Thanksgiving to you, Turd, and everyone else. May we on reflect on all out blessings.

TitanAe · Nov 23, 2011 - 9:56am
swmnguy · Nov 23, 2011 - 9:57am

Happy Thanksgiving, Turd and All!

Of the many things for which I need to remember to be thankful, Mr. Turd and all the rest of you are somewhere fairly prominent on the list. Even the crazy S.O.B.'s in the group, and I think you know who you are.

(That's a joke, by the way. I'm guessing every one of us can see ourselves in that category).

Happy Thanksgiving, and here's to safety, prosperity and prudence for all of us and our loved ones going forward! And of course continued stacking (of PM's, canned goods, jumbo packs of toilet paper and that sweet cheap Costco coffee), and filling the freezer, and wearing our tinfoil hats, and all the stuff we find prudent.

TitanAe · Nov 23, 2011 - 9:57am

Guess not !!! 4th LOL

I have to learn to type faster !!!

ewc58 · Nov 23, 2011 - 9:59am

Nah.... for me, tomorrow will be pretty quiet...

For some odd reason I can't get a handle on, nobody seems to ask anymore wink

But at the same time, there are more Stackers around the table each year. For that, I give Thanks.

And Thank You Turd for giving us this place.

Happy Thanksgiving to All!

plata larga · Nov 23, 2011 - 10:00am

Ready to buy the dip

Inflation is a great topic for family discussion. Rather than warning of inflation to come, you can point out the inflation we have experienced already. Everybody gets it and you could talk about it for a long time without much debate.

Turd: Thanks for the advice to sit tight a little longer. I am in position to make my first physical purchase since Turd's bottom earlier this year. My spiders sense tells me that we are at or near the bottom of this dip and I am itching to place an order this morning.

Happy Thanksgiving everyone. We have much to be grateful for.

cpnscarlet · Nov 23, 2011 - 10:14am

Happy Turkey Day

I hate posts like "I feel that ..." or "My gut tells me ...", but here I go like a jerk anyway:

I think the action in the last three days in PMs is a result of great tensions in the pits. The short selling goes on and on, but looking at the numbers from Harvey post last night makes me think that this type of manipulation really isn't working anymore and the cartel must do something different to 1) get themselves out of the mess they are in and/or 2) do the bidding of the Fed to keep PMs down. I'm thinking the MFG event may be giving the Fed's trolls an opportunity for "something different". But it's sure doesn't appear to be a reliable process.

Could Sprott's move to get more phyz finally be a move in the markets in our favor? I hope so because I don't see any other big player coming in during COMEX sessions who can move the market up and keep it up. It sure seems there are folks in the Asian markets moving things up, but as we see this AM, it can be easily smashed down again. More naked shorts - that's the only thing that can be causing this massive oscillation. Okay, MAYBE it's European liquidation.

And now "My gut tell me ..." that we are going to see some significantly positive action in the next few weeks. Gold to 1850 and Ag to 38 by the end of the year. Put me on my prediction calendar. It just seems to me that the OI numbers for Dec Au and Ag are huge and there will be problems with those standing for delivery. Of course, we've heard it all before. Maybe this time will be different. The jerk has spoken.

BUDDHA PRINCESS · Nov 23, 2011 - 10:16am

From Richard Russell that BIG GOLD editor Jeff Clark

Richard's been in this business for 63 years...the same age as I am...so I have a tendency to listen to what he has to say...

"My advice: We are moving closer and closer to what I call "survival period" -- the period where the magic of compounding turns into what will be the poison of compounding. This isn't a time for timing. This is a time for action. Reduce your exposure to bonds and all items that provide fixed interest rates. Similarly, reduce your exposure to stocks except the gold miners. Look to expand your positions in inflation-protected assets, especially gold."

"Those who are holding stocks in the hopes of the usual rebound are going to be terribly disappointed in the years ahead. This bear market is going to be unlike anything we've ever seen before. In the end my survival vehicle will be gold. I say again, timing is hopeless. Gold will have purchasing power and true wealth as almost everything else is destroyed by this unprecedented bear market. The US Government is now so loaded with ever-growing debt that it has become a mathematical freak. We return to different times, when rising interest rates will eat up the US government. With $55 trillion in assorted debts, the US is in no shape to deal with rising interest rates. We are in a state of reverse compounding, leading to inevitable bankruptcy on a massive scale."

· Nov 23, 2011 - 10:21am

How high is inflation?

Random thoughts on a day off, watching the markets tank.

I just got off the phone with an old friend. We have known each other since the 70s. He is a bona fide genius--IQ somewhere in the 200s and has a memory like a steel trap--a man of extreme habits. He just explained to me how 4 years ago, his grocery budget was $60 per week and now it is $150 each week for the same exact items. I trust his memory. He may as well have written down the prices of each item. Part of the rise, he explains, is due to fewer ounces of vegetable products in the same sized can, balanced by more water and sugar (they can call it syrup then and legally claim the same number of ounces of product). Everyone here know all this... but he finally put a number to the food inflation for me:

2.5x price increase in 4 years = 62% inflation per year for food.

Does this resonate with all of you out there? 

I've posted this before--every culture has their sacred commodity that if its price goes too high there will be blood in the streets. India=onions, Asia=rice, France=bread, USA= gasoline. Prices of gas have been suppressed here to keep us docile. So while they hold down our gas prices, food prices have gone through the roof. Because we live in a food-glutted country, we just don't notice as much. But all those extra dollars still come out of our paychecks! God forbid if gas rises to European levels.

I just found 11 acres of good farm land for sale--nine tillable and two acres of hardwood forest at the rear. Its located on a country road that leads nowhere except other farms. At this point, I am debating internally whether to buy PMs on this dip or move toward land that will produce food.

Happy stacking!

PM Stackin' Fool · Nov 23, 2011 - 10:22am

Sprott is Awesome!

If this is true and Sprott purchases $1.5 Bil in Silver, we will see an immediate impact. This $30 price range will not last long....we will be in the $60's in no time. All of the fundamentals are on the side of Silver already and add to it this massive purchase we will see a major shake up in the market. Could this be the start of true price discovery? **Beware in the short term JPM will be looking to manipulate and dump a major portion on their shorts (if Sprott intends on actually making the purchase)**

Have a great Turkey Day to all. 

cavalier · Nov 23, 2011 - 10:27am

Sprott Plus MF Global Create Potential for Silver to Explode

Sprott's decision to file a prospectus for the purchase of up to 1.5 billion ounces of silver combined with the effects of the MF Global meltdown create the potential for silver to explode.

Harvey organ noted that massive amounts of silver (2,759,596 ounces) left eligible (customer) vaults yesterday because "nobody deems their physical safe in a comex-banker vault". If this trend continues it will put more pressure on the comex.

JPM will have to cover their shorts soon. Anyone have suggestions when this will occur? Within 2 months? If JPM covers their short and goes long the sky is the limit.

Wizard · Nov 23, 2011 - 10:27am

Being Thankful

Tomorrow we have set aside a day to be thankful for the good things that we have in our lives. Family and Friends.

To this I add the good fortune to be living in a time in history that we can easily extend our circle of friends to every corner of the globe, and be able to educate ourselves and share with our friends and family the ability to help shield those that we love from the full impact of the economic distress that is here and what ever is to come. (Those that will listen LOL)

Thank You Turd!! for your hard work and effort in building this forum that helps make it so easy to share information with others that find these financial times that we live in so fascinating. I personally feel that we are truly living in historic times.

To everyone on this forum I wish one and all a very Happy Thanksgiving

ReachWest · Nov 23, 2011 - 10:27am

Turdville Cartoon

Here's a quick little cartoon put together for Turdville residents. This is Episode 2 and focuses on MF Global. It's a bit silly, but fun. Enjoy.

The SpeakEasy - MF Global - Ep 2

Episode 1 (for those that missed it) is here.

Robespierre · Nov 23, 2011 - 10:31am


Happy thanksgiving Turd. Thanks for all the hard work and help throughout the year!!!

themarkmonster · Nov 23, 2011 - 10:32am

@ Cleburne61


Swampfox · Nov 23, 2011 - 10:33am

Sprott Purchase

Hi Guys,

Some one correct me if I am wrong but isn't Sprott's new expansion of PSLV a window to allow more shares to be bought and not necessarily a blanket purchase of physical itself? Do I misunderstand how this works or am I right? A little enlightenment please??

Tesla · Nov 23, 2011 - 10:36am

Thanks Turd!!!


Remember the CFTC's "Temporary Relief from Large Swap Trader Reporting

Interesting that this first phase of suspended reporting on 'cleared swaps' being over (11-21-2011) coincided with ~6% sell offs in AG/AU (Monday. 

Funny that CFTC finally defined the term 'swap' the previous business day (just in time) as Cleburne61 points out above...

Cleburne61 · Nov 23, 2011 - 10:36am

CFTC Finally does it!

Hey Turd, don't know how we all missed this....as I've been looking everywhere for some news on it, but it seems the CFTC has at long last defined the term "swap"....last Friday! How on earth did we not see that?


Soooo, first that, and now ERIC FREAKIN SPROTT! taking up to 5% of all the investable silver in the world off the table in one huge homerun swing....has the potential to put these guys in Chapter 11 in 55 more days. Talk about the ultimate Pincer Movement!

Can you feel it Turdland? The desperation? The panic that must be going on in the corridors of power, especially the top few floors of the "Tower of Orthanc"?

God bless Mr. Sprott, and protect him. He's trying to be our new Nelson Bunker Hunt, but doing it with physical instead of leveraged futures! He needs to watch his back, lest he be Andrew MacGuire'd, and we should support him and pray for his safety!


Furthermore, I propose we start a digital clock...ticking down the days til D(death) Day...for the Morgue. Fitting, since a morgue is a place of death in the first place...

¤ · Nov 23, 2011 - 10:36am

Thanks for the post/ Tryptophan awaits us all

I like the idea of "classic" TF posts from a year ago.

It's true that they are only a couple clicks away to go and find but usually some very good material eventually just gets left in the dustbin of the archives. Some great stuff should be resurrected just like your doing.

The Sprott thing would seem to be positive all the way around for silver. I just wonder if he can pull it off or will he encounter some type of resistance from anyone who might not want it or even allow it to happen. I would be surprised if it goes off without a hitch and you have to wonder if some type of B.S. doesn't get in the way from somewhere. If it's true about the silver markets and JPM and others controlling it like most of us believe, then it seems unlikely they will let a very publicized and massive silver purchase just happen while they stand to lose money possibly on a large scale from their short positions.

About hyperinflation...it hasn't started yet and they'll just downsize every product there is to the point of it getting ridiculous. Almost everything I see has been re-packaged or redesigned to make things look bigger. Coffee is a big thing if you've been watching the big cans that used to be 5 lbs. and about $7 years ago to about a 2-3 lb. can for about $8-10 if you catch a sale. Pizza's are getting smaller and pretty expensive. Everyone knows a big pizza for the money when they see one and I'm not "feeling it" like it used to be and for a lot less money. 

That's too negative to end with so I'll just say thanks for everything TF and hope everyone here has a great Thanksgiving and plenty to eat. I have much to be thankful for also and I know most of you probably feel similarly.

Adam Sandler can't help but bring a smile to your face if you need one.

The Water Boy does it for me. Love that silly movie. Every time he launches into someone before he tackles them and makes that sound....Lol! laugh

Happy Thanksgiving! Sleepy

johnboatcat · Nov 23, 2011 - 10:41am

Premiums have skyrocketed since Monday at many online

dealers. Coins I bought on Monday just above 1700 gold are now more expensive at current 1682. Watch out for those "sale" ads that are not sales!

tmosley johnboatcat · Nov 23, 2011 - 10:50am

@johnboatcat: APMEX is having


APMEX is having a nice sale on 1oz Ag bars, 99 cents over spot. I was going to buy yesterday, but held off when spot rose significantly. I will be calling my local dealer to see if he can undercut them on that, if he ever has anything. He made me a nice offer on some junk silver in great bulk, but I still haven't gotten my windfall yet. Hopefully he will still be able to get it to me at the prices we were discussing, something like spot-$1. That's a deal and a half right there, especially considering APMEX has raised their premiums on the $1000 face value bags from spot-$0.20 to spot+$0.65.

BUDDHA PRINCESS · Nov 23, 2011 - 10:50am

TD BANK CANADA-First canadian bank to go down

There was apost couple of days ago saying that TD Bank will be the first Canadian bank to go.

Can you please repost the article or the link for this information.


Happy Thanks Giving Turds!

SilverFocker · Nov 23, 2011 - 10:51am

Ahh Inflation

We know the the guberments CPI numbers are a farce and the real inflation rate for 2011 was near 9% yet those on SS and such get a little over a 3rd of the real number.

Yesterday I had to go get a small piece of drywall.....ended up with a full sheet. Big note on the door, Jan 1st price goes up 35%. 35 friggin % , then local paper comes out with new sewer and water rates 17%, now the power company is crying for a 20% increase after last years 18%.

The momo's on the hill are getting rid of the middle class through inflation, they are squeezing granny's SS check to the point soon it wont mean much in buying power. They are relieving themselves on all of us, but yet most of the sheep does not know what that warm fuzzy feeling is yet.

Given we have almost made it through another year in zombie land , I look forward to see how TPTB can top 2011's circus act and keep the sheep at bay at the same degree. I personally see 2012 turning violent at some point.

On this Thanksgiving day, enjoy your family, enjoy your feast.....make memories!

ScottJ · Nov 23, 2011 - 10:52am

Hey All!

My advice for relatives, Turdville, and myself.

Be thankful for all that you have because there are billions in this world who have nothing.

Happy Turkey Day Turdville!


Sincerely, Humbly, Respectfully...

Scott J


Become a gold member and subscribe to Turd's Vault


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 12/17

12/17 8:30 ET Empire State Fed Manu.
12/18 8:30 ET Housing Starts and Building Permits
12/19 8:30 ET Existing Home Sales
12/19 2:00 ET FOMC Fedlines
12/20 8:30 ET Philly Fed
12/21 8:30 ET Q3 GDP final guess
12/21 8:30 ET Durable Goods
12/21 10:00 ET Personal Income, Personal Spending and Core Inflation

Key Economic Events week of 12/10

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

Key Economic Events week of 11/26

11/27 9:00 ET Case-Schiller home prices
11/27 10:00 ET Consumer Confidence
11/28 8:30 ET Q3 GDP 2nd guess
11/28 10:00 ET New home sales
11/29 8:30 ET Personal Income and Spending
11/29 10:00 ET Pending home sales
11/29 2:00 ET November FOMC minutes