BLSBS Friday

Fri, Jan 6, 2012 - 11:19am

Well, it's BLSBS Friday once again. I could write another snappy missive regarding the bs and nonsense that is the latest monthly, wholly-manipulated government statistic but what would be the point? Instead, I thought you'd enjoy a video of Mrs F and I enjoying our coffee while listening to LIESman et al wax philosophic about the joys and wonders of delayed-reaction keynesianism.

Charlie Brown Teacher Speaking

Anyway, just read this and you'll get the real story:

The "market" for paper precious metal continues to be a joke. After having the audacity to trade up and through 1630 in the first hour of trading, gold was summarily crushed by the Forces of Darkness in the last 45 minutes or so. Whatever. The bad part is that I printed these charts an hour ago and now they're sort of obsolete. Sorry. I'd re-print them but my freaking printer just broke. UGH. It's going to be one of those days. Anyway, here are your charts.

First, here's an hourly gold. Again, gold rallied almost exactly to this line about an hour ago, only to be savagely attacked by the awaiting monkeys.

More significant are the daily and weekly charts. Here you can see that we are slowly making progress but now is still not the time to be extraordinarily bullish. When gold is finally allowed to clear 1640, I'll get interested. When gold then breaks back above 1700, I'll get wildly bullish.

At the risk of sounding like a broken record, silver continues to be actively suppressed. That said, let me state this clearly:

I am of the firm belief that the spike in April put the fear of God into the EE. They have manipulated the takedown ever since simply so that they can cover their massive short position and eventually transform it into a net long position. They are not yet finished with this project. We will be able to decipher when they are done by looking at the CoT reports and the charts.

Regarding the silver charts, you can clearly see a continuing desire to keep silver under $30. Why is $30 so important? A glance at these charts should tell you all you need to know.

Once silver breaks above the first downtrend line, confidence will rise that the forced "correction" is over and some spec money will begin returning to the pit. Breaking 30 will also set up the next stage, which would be a run toward $35 and the main, downtrend line that connects the highs of April with the highs of September. WHEN silver breaks back above that line, it's on! Until then, we can't be sure that the EE is ready to let it happen.

I must take a moment to update Pigatha, too. She is right back to the all-important 81.50 level this morning. Again, this level served to contain the rally last January. Will it do so again this January? Maybe. Since the euro makes up something like 55% of the POSX, further euro weakness will propel this index higher. As you can see, once through, 81.50, the next stop might be as high as 84.

Here are some items to add to your weekend reading list. First up, a 2012 look-ahead from Patrick Heller:

Next up, please take time to read this article from Jeff Nielsen. He covers in great detail one of the central theses of this site. Namely, that the Fed is actively stimulating the purchase of treasuries, through their primary dealers. The idea that there is currently no QE is absolute nonsense. The PDs are simply doing the covert dirty work of the Fed. Again, without the PD buying, where would rates be? Rates would have to rise dramatically from current levels to attract actual, organic, free market buying. The U.S. government debt service cost for fiscal 2011 was $454B. What would it cost to service service the debt if the 10-year rate was 5% instead of 2%? Would would it cost at 8%? Rates, therefore, cannot be allowed to rise as higher rates would only serve to accelerate the unraveling of The Great Ponzi.

Mr. Turk has weighed in on silver. He compares it to AAPL. I hate this comparison as it makes silver sound like some kind of fiat-based, wealth accumulation scam. However, his rationale and price targets jibe with mine, so, here you go:,_But_Silver_is_the_Next_Apple.html

I spoke with The Tech Team this week and we are beginning to build the site changes that I mentioned in the video earlier this week. The changes are designed to enhance the revenue of the site which will, in turn, allow me to offer significant new levels of content. I hope to have these changes in place by the end of the month and I will keep you posted in the progress and what I am thinking. In the meantime, do not forget that the only revenue that this site receives is from the advertisements. The generous Turdite donations help considerably and I am extremely grateful for them. However, please continue to give our sponsors your occasional attention.

Lastly, I discovered a few days ago that one of my all-time favorite bands had called it quits. (Well, actually, they're going to try to continue without one of the founders but it won't be the same.) I first discovered the BoDeans back when I was in college. They wrote rock-and-roll songs about love and angst and longing. I was immediately hooked. The guys tried for almost 30 years to gain a national following and they actually came close a couple of times. Now, they're just beaten down old farts like me. God bless you Kurt and Sammy. A heartfelt hank you for providing part of the soundtrack to my life.

Here are the boys back in 1989, almost making it to the big time:

Video unavailable
BoDeans - You Don't Get Much - Live From the Pabst
BoDeans - Closer to Free (Live at Farm Aid 25)

As I close, I see that The Cartel counter-attacks have stopped and the metals are rebounding. Good. They'll probably be rangebound for the rest of the day. Enjoy your weekend. Check back tomorrow for release of the latest TFMR podcast. I had some technical difficulties in recording it but I think you'll enjoy it regardless.


About the Author

turd [at] tfmetalsreport [dot] com ()


Jan 6, 2012 - 11:21am

Removed comment

Removed comment.

Jan 6, 2012 - 11:22am



Ferd Torgerson
Jan 6, 2012 - 11:27am

How Did I End up Being only


And whatever became of the wisdom of Calvin from Calvin and Hobbes who said,

"If you do the job badly enough, sometimes you don't get asked to do it again."

Eric Original
Jan 6, 2012 - 11:28am

Just updated my spreadsheet

Just updated my spreadsheet and I calculate that I have 18 years worth of incandescent light bulbs in inventory. All this for a ban that may or may not come into effect! Ha Ha, I guess the joke's on me. Not the first time, won't be the last.

Jan 6, 2012 - 11:36am

Getting close?

JamesGRickards how far will allow EUR to drop before it intervenes?

27 minutes ago Jim Rickards Not much more. Watch the cross rate EUR/USD for greenlight 4 minutes ago via web
Dr G
Jan 6, 2012 - 11:38am

@Turd, thanks for the

@Turd, thanks for the analysis and for the videos. "Closer to Free" is an excellent song! With the Pig at 84...metals on sale (again!).

Jan 6, 2012 - 11:39am

Silver Eagle Sales Volume

This should say volumes about what's going on in the real world. The physical market seems to be going strong...stay long.

Pilfered from:

Dr G
Jan 6, 2012 - 11:39am

@Peace, he has always said

@Peace, he has always said 1.27-1.28 for the formal announcement of QE3, so I'm glad he is still sticking to that call.

1.2722 now.

Jan 6, 2012 - 11:42am

The Slog

EU CRISIS BREAKING: ECB’s Draghi ‘ready to go full-tilt at QE’ – sources.

ECB’s Draghi…calm in the face of a storm

US, Brussels sources question Merkel’s survival without policy change

The Slog has learned from sources in Frankfurt, Switzerland, Brussels and Washington that the head of Europe’s Central Bank (ECB) Mario Draghi is now “in a position to pursue full-scale QE, and will do so”, following deft political moves on the part of the Italian in recent weeks.

The Slog has been watching Mario Draghi’s performance in the chess-game between Berlin and the European Central Bank with some admiration since he took over. I don’t approve of what he’s doing, but you have to admire the bloke’s skill.

I reported two days ago on anger in Berlin following the ‘consensus’ appointment of Belgian Peter Traet to the role of Chief Economist – rather than replacing Jurgen Stark with another German. Now Mario is showing the strength of support he has on the ECB Council by eking a pro-Sovereign-bailout message out of another German ECB Chief.

European Central Bank Governing Council member Klaas Knot opined that Berlin should support a major increase in the proposed ESM, still currently the EFSF until April/June/August or never, depending on who you talk to.

“The most important obstacle lies in Germany, not in the Netherlands,” Knot said in an interview on Dutch public television last night. “I think that more money is needed and we will use the time to convince our German colleagues. We haven’t moved in the right direction and it’s also clear that measures needed are happening too slowly and too limited in size. A significant acceleration in decision-making is needed”.

This is a pretty direct side-swipe at Merkel, and her refusal to up the Stability Fund or deliver a eurobond prior to FiskalUnion.

If push comes to shove, I’m told, Signor Draghi will simply increase the scale of his current, thinly-disguised QE – and take the heat from Berlin on the chin. But his hope is that he can so increase the pressure on Chancellor Merkel – as the situation deteriorates – that the German leader will be forced to relent. He will then, as one informant puts it, “focus on funnelling every last red cent the banks need to weather the coming storm”.

The Slog’s favourite Bankfurt mole is of the exact same opinion. “Draghi is running rings round Merkel,” he told me last night, “and forcing Berlin into a corner. This man is a talented strategist, for sure. Above all, this shows the division between Brussels and ECB fiscal thinking on the one hand, and Berlin. But you also have the split between the risk-aversion of my colleagues here in general, and the seeming willingness of the Merkel leadership to go for euro survival by steaming ahead towards centralised fiscal discipline.”

The complexity of the politics is confirmed by a State Department source in Washington. But this American goes further:

“Mario Draghi has to think about US, French, German, Greek, Italian and German banking sensitivities more than ever right now,” said the informant, “Our guess [he refers to a section, not the whole of State] is that he risks destabilising Merkel’s position to the point where legislative maneouvres and voter sentiment in Germany end up kicking her out. That’s the last thing we want”.

I think Washington could be overstating the danger to Angela Merkel: I’ve maintained for some months that her survival is central to US foreign policy on Europe, and the Americans are moving to cement any financial alliance they can with Germany. But a mole in Brussels offers this time-worn view:

“Remember that the gameplan here is to keep Germany in the cage – it is the Commission’s chief raison d’etre. There is no doubt that machinations both here and in Paris are at work destabilising Merkel – with the objective of, at worst, bending her will on bailout and stimulation. Berlin is seen increasingly as blind to reality, while the French remain terrified of Greek and Italian default.”

Yesterday, Sean Darby, global head of equity strategy at Jefferies Group Inc., talked from Hong Kong about the next moves in the eurozone on Bloomberg TV. The gist of his view was that Draghi’s ECB would “pile in with upweighted QE at some in the first [2012] half”. This suggests to me that Mario’s intentions are being still more widely leaked.

Stay tuned: this one will accelerate towards a conflict quite quickly from here on.

Jan 6, 2012 - 11:43am

It's Hard...

to not look at today's action and not think about life when the dollar was at this level the last time. Next, it's also hard to not imagine another three years from now with Au at $3K+ and Ag at $80. However, the other thing you can't help but remember is that Europe is much closer to the end game than it was at the beginning of 2009. The EURUSD is getting beat to a pulp and watching the cross rates almost makes me feel like Willy Wonka watching Gustav in the chocolate suction tube - "The suspense is unbearable...I hope it lasts." I'm feeling rather antsy today, so I'll go out on a limb for a prediction of my own - At the end of the 2012, Au will be $2200 and Ag will be $45 if there are no "big" news events. If Greece formerly defaults or if there is war with Iran, we'll see a high in gold at Alf Fields' $4500 and Ag at $120. I don't have a set reason for these numbers, just my neural net giving these outputs from all the current inputs.

PS - I'm really enjoying the Reggie Middleton article at ZH - take a moment to play that vid.

PPS - The BoDeans - finally took some time to listen to their music. Sounds like a nice cross between REM and the smithereens. Nice folksy rock.

Jan 6, 2012 - 11:43am
Jan 6, 2012 - 11:43am

@ Peace Silver

I've been keeping my eye on the EUR since Rickards mentioned it would be a sign of QE3.

What does he mean by cross rate though? Just the EUR measured in USD?

Be Prepared
Jan 6, 2012 - 11:47am

Definition: Turdiness

Tur·di·ness \ˈtərd-dē-nəs\


1. the act of a person who avidly pursues anti-Keynesian activities, gold and/or silver endeavors, constitutional knowledge, or other prepping interests, rather than engaging in the belief that the government has our best interests at heart.

Jan 6, 2012 - 11:53am


Well it didn't take our former Goldman Sachs capo and current ECB banker long to grab whatever power he needed to allow the ECB - against all treaties mind you, but they will spin that one easily - to start unlimited QE in Europe.

Bay of Pigs
Jan 6, 2012 - 11:54am

There it is...

The idea that there is currently no QE is absolute nonsense. The PDs are simply doing the covert dirty work of the Fed. Again, without the PD buying, where would rates be? Rates would have to rise dramatically from current levels to attract actual, organic, free market buying.

Thanks for putting it out there TF. That needed to be said, in my opinion.

Jan 6, 2012 - 12:04pm

Who does the Government have at heart ?

It's rediculously simple...their BASE ! 1. Themselves....all who feed at the slop trough ! 2. Their clients....everyone whose votes are bought with OPM ! Everyone else......shut up and pay your taxes ! Monedas 2012 Joke du Jour Tour ! Latest Obama ploy is to buy votes with mortgage and student loan forgiveness.....better be a minority registered as a Democrat !

Jan 6, 2012 - 12:04pm

First Post

Be gentle!

Has anyone noticed the growing spread between PSLV and SLV since mid-November? PSLV has outperformed SLV by 13.5% since Nov 17. A smaller divergence has happened with PHYS and GLD. I'm not convinced of the paper-physical disconnect yet, but it's looking to me like MF Global destroyed a good bit of demand for hypothetical silver.

On another note, thanks for the warning before the crash late last year, Turd. Saved me a decent chunk of fiat.

Good work, all. Back to lurking.

Jan 6, 2012 - 12:04pm


If Rickards is right I doubt they'll let the Pig get to 84.

Jan 6, 2012 - 12:19pm

william banzai

what outrages me is when people show no respect for the President -

this is our Commander in Chief for god's sake

Jan 6, 2012 - 12:29pm

Re: The BoDeans...and more for Turd

Turd, I am sure you will find the value in this... ;) I almost got the pleasure of seeing the BoDeans open for U2 back on Oct 31st of '87 on the Joshua Tree tour but for some reason they did not make it in and I had to listen to some group call the uhhhh..uhhhmmm.... "Dalton Brothers" ;) Apparently this was only their second time playing live....EVER...and they got to open for ;) Now that was a treat worth the trick!

balz SilverWealth
Jan 6, 2012 - 12:34pm

Respect goes both way

What kind of respect has Obama given to the American people lately?

Why should one respect the president when the president is only concerned with his buddies at Wall Street?

Just saying...

Jan 6, 2012 - 12:34pm

Gold standard...

Thanks TF! Looking forward to hearing about the site enhancements.

Something I am finding very interesting is that in the last few days, I have heard chatter on Fox about returning to a gold standard. For example, on Freedom Watch last night the judge had this to say:

Andrew Napolitano - Return To Sound Money

Now I know that Judge Napolitano has talked about it before, but I have heard others on other shows, maybe David Aslan? Can't remember. Anyway, didn't hear this a year ago.

Jan 6, 2012 - 12:36pm

Eric (on light bulbs) a little ot

I am having a heck of a time finding decorative bulbs--fancy ones for decorative lamps.

I have plenty of recessed bulbs (which is a joke around my house) just not decorative--and the bathroom vanity ones are getting hard to find

its like going to europe or mexico where you cannot see anything in rooms

Jan 6, 2012 - 12:36pm

Love and Hope and Sex and Dreams

I remember the Bo Deans blowing the doors off the headline act at my college's annual spring blowout back in the 80s.

Awesome band.

Thanks for jingling the memory Turd.

Jan 6, 2012 - 12:42pm
Jan 6, 2012 - 12:45pm

@SilverWealth - Even after

@SilverWealth - Even after the first 12 months of this administration, I would have agreed. But at this point (especially with AG Holder's behavior), not only does common decency not apply at this point, neither does Romans 13.

Bible scholars please comment.

Jan 6, 2012 - 12:45pm

And Shill, who is footing the bill

for the PD's to buy leveraged up treasuries with zero pc financing

the entire thing is a lie and fraud.

the surprise is when you can find something said you can depend on (from govt)

Jan 6, 2012 - 12:49pm

The idea that there is

The idea that there is currently no QE is absolute nonsense. The PDs are simply doing the covert dirty work of the Fed. Again, without the PD buying, where would rates be? Rates would have to rise dramatically from current levels to attract actual, organic, free market buying.

Of course its covert. Interest rates on the 10 year T wanted to explode higher this morning, this is why the Market was taken back and the dollar allowed to rise as the T's were ready to bust a nut due to the so called Good data. But were not allowed to go sub 2%. Its all manipulated folks I was watching all three this morning Dollar, stocks and T's.

They can turn these Markets in a direction they see fit folks...ANY DIRECTION.

Smiddywesson Excalibur
Jan 6, 2012 - 12:52pm

Great Article Excaliber

The Slog article was great, but I have different conclusions than their informant. He is either manipulating the Slog reporter, or isn't high enough in the conspiracy to know what's going on. He said:

“Mario Draghi has to think about US, French, German, Greek, Italian and German banking sensitivities more than ever right now,” said the informant, “Our guess [he refers to a section, not the whole of State] is that he risks destabilising Merkel’s position to the point where legislative maneouvres and voter sentiment in Germany end up kicking her out. That’s the last thing we want”.

This thing is being very deftly handled, and the degree of cooperation needed to have kept it going this long tells me there's not a darn bit of difference between US, French, German, Italian, or Greek bankers. It's all show. They know they have to print, and they know they have to devalue. The show is for the benefit of the electorate. They are all going to issue their own domestic currency and retain the Euro for international trade, and trade between EU nations. The Germans will do it because they think their own mark will protect them from the Greeks. The Greeks will do it because they will believe it will get them out of debt. They will all do it, but the truth is all it will do is keep their eyes off gold. Anybody without gold is going to take a haircut whether they hold the "strong" German mark or the weak Greek drachma, because only gold will matter as money at that point.

Jan 6, 2012 - 12:56pm

@ SilverWealth

Go to hell! Obama deserves no respect nor do any who defile the Constitution.


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