Starting Tuesday

Tue, Dec 13, 2011 - 10:02am

No time for a complete post this morning but there are several items to which I'd like to draw your attention.

First of all, The Turd is like most everyone else...I enjoy a little notoriety. Someone emailed me a notice that I had been mentioned in FOFOA's latest column. Naturally, I went to the site and read it. It turns out that this is a very good piece and something you should definitely take the time to read.

The article makes several references to Santa's recent interview on KWN. Again, if you haven't yet taken the time to listen, I strongly encourage you to do so.

After the $50 drop yesterday, let's all be on the lookout for the OI numbers when they are reported this afternoon. If what I suspect is correct...namely that the "MFG Rehypothecation Awareness Program" and strongly negative lease rates were to blame for yesterday's drop...then I would expect to see a drop in OI on the order of 5000-10000 contracts, maybe even more. Why, you ask? The Cartel short position probably finished flat to down a little, day-over-day, as the new shorts that were added at the open yesterday were covered late in the session as gold moved off of its morning lows. The spec long position likely declined considerably for the reasons discussed back on Sunday night. Namely, in the wake of the "MFGRAP", why would anyone own paper metal???

One more thing on OI. Harvey has been drawing attention to the growing OI of the Dec11 contract:

"In another shocker, the front delivery month of December mysteriously saw its OI rise from 1356 to 1545 for a gain of 189 contracts despite 276 deliveries on Friday. Thus we gained 465 contracts or 46,500 oz of gold standing."

This is a very intriguing development and must be watched closely. As I understand it, to "jump the queue" at this point and purchase a Dec11 contract, an entity must immediately put up 100% margin with the intent to take delivery. To add 465 contracts this late in a delivery month is highly unusual. That's about $79MM in gold that someone is trying to buy, and take delivery of, as soon as possible...not wanting to wait for February. A very intriguing development, indeed.

More later. Be safe. TF

p.s. Several folks have asked me for a crude oil chart. Here you go.

And I forgot to include this. More fuel to the reports of US troops in Jordan. Do you think Assad believes they are "defensive" in nature after seeing Afghanistan, Iraq and Libya fall? What are the chances he just idly sits and hopes for the best?

About the Author

turd [at] tfmetalsreport [dot] com ()


StratajemaNick Elway
Dec 13, 2011 - 5:36pm

RE: Registering shares of CEF and PHYS

@Nick Elway, I am surprised to hear that Schwab does not offer direct registration of shares (electronically). I would check again with someone there to confirm the answer you first received.

Geez, even Wells Fargo allows direct registration:

Dec 13, 2011 - 5:31pm

Oil as input cost to gold

It seems everybody in the U.S. news references WTI oil as the oil price but not Brent Crude. The question becomes, which is the correct oil price to reference as an input cost to gold mining. I always assumed it was Brent oil. Of course this is meaningful because there is a divergence in price between WTI and Brent oil.

Dec 13, 2011 - 4:58pm

Thanks Tyler...

You, CaliLawyer and a few others rank up there with me as well.


Jasper PuddlemakerGoldMania3000
Dec 13, 2011 - 4:36pm

@ Peace Silver re: miners

Good points. I am diversified across the metals spectrum, and I hold miners and explorers as well as metals. But I am choosing carefully; only those companies that are undervalued, have cash, and have metals in the ground. I think the US-based folks who pound the table for "physical only" should not be ignoring our own history. If history repeats, and gold (or Ag too this time) ownership is banned, then they are not going to be happy. The last time that happened gold stocks became a proxy for gold, and went ballistic.

Physical-only seems to be predicated on the belief that the whole system is going down, and everything will be lost. I am not willing to bet my entire savings on that happening. I'm sure a lot of people were hiding their wealth under the mattress when Napolean and Wellington were at Waterloo determining the fate of western Europe. But Rothschild was down at the stock exchange getting ready to buy. I am holding a prudent amount of insurance to cover myself should the worst happen, but I'm betting it doesn't.

Dec 13, 2011 - 4:33pm


I was always enjoy your posts. Thanks for the one from survivalblog

aurum argentum
Dec 13, 2011 - 4:33pm

popcorn eating

How's this?

Dec 13, 2011 - 4:31pm

Ooops, duplicate

Sorry, I must have hit the mouse 2x.

Dec 13, 2011 - 4:28pm

An interesting morning...

I decided to take the day off, as I hadn't had a day off in about 6 weeks. Had some errands to run, some equipment to purchase and on the way back through town, several LCSs to visit.

The first stop was at my least favorite shop and proved unproductive, he had nothing to sell of significance except a Liberty half. I didn't bite and moved on to a shop I had never visited before.

The new shop proved to be very nice, clean and well organized. I have tried to stop there on a couple of other occasions, but they would be closed. They had quite a selection on display, Krugs, Maples, some GSEs and some other miscellaneous coins, lots of numismatics of which I'm not too fond. The owner had a lot to say about the markets, manipulation and TPTB. After a little talking, I asked if he had heard of the TURD, he had not so I gave him the website info.

The only thing he had that he was willing to sell today were some 100 Euro Republik Oesterreich gold philharmonikers at $50 over spot. I talked with him and his wife for a little while longer and then headed off to my last shop to se if they would sell.

The last stop was more of the same until I pressed a little and said I had cash if they had anything they wanted to turn. Out came a plastic tote from the safe with all kinds of bullion bars, coins and jewelry of the silver variety. The owner indicated that he only had a couple of things he might want to part with as he was underwater on most PM's right now.

I spied a couple of plastic sleeves and asked what was in them. He opened them up and poured some 1985 Englehard American Prospector rounds into my sweaty little palm. I asked how many he had and he counted them out onto the glass display case we were standing next to, 25 in all. After a little more discussion, he told me if I would buy them right then he would go check spot and add $2.00. Needless to say I couldn't say no as my 17yr old son has been asking me for a while to get him some silver bars or coins. I ended up counting out $825 for the 25 coins and headed home.

These are the first coins I have bought in a couple of years and the smallest quantity as well. I figured what the hey, I'll give them to the kids for Christmas. I will use it as seed to get my kids thinking towards accumulating real money and help them to think in those terms. They have been raised to understand the difference between fiat currency and tangible assets. This will put something real in their hands. They have seen the big green boxes, but I leave them sealed.

The metals have been biatch slapped today. When I bought the rounds this morning the LCS owner went over to check spot so we could agree on price, it was $31.20. I thought I was doing good at $33/coin, spot is $30.79 as I type, oh well.

Sometimes you just have to act...


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Nick Elway
Dec 13, 2011 - 4:04pm

Registering shares of CEF and PHYS

Went down the rabbit hole with Schwab today to see if I could get paper shares of CEF and PHYS with my name on them that the company(Central and Sprott) would have a record of. Neither participates in DRS ( a book-entry system that enables investors to register their shares electronically)

The Schwab person said they are getting lots of calls from people after MF Global

Yes, but..

$550 charge per certificate to get them from Schwab ($50 for Schwab, $500 for DTCC) see

Best quote from the DTCC link: Dematerialization advances:“This is all part of DTCC and the industry’s drive toward dematerialization,”(Industry suicide by War-Of-The Worlds disintegration ray or Shill's Red Planet robot?)

I talked to Marda at CEF 905-648-7878 and Glen at Sprott 877-403-2310, They are both getting lots of calls (Marda mentioned Jim Sinclair) and their 2 companies are both looking for some way around this rip off. We may hear something before January.

For now, it's $550 per certificate.

Dec 13, 2011 - 4:01pm

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