Audacious Gold Manipulation

Mon, Feb 27, 2012 - 4:13pm

Look, we all know that gold and silver have been manipulated and suppressed for years. For traders and stackers, the ongoing manipulation has just become a simple fact of life. The suppression is so regular that it can be used as a sort solunar table for those only wishing to "hunt" at the optimal hour.

However, this regularity and predictability should gall you instead. At it's core, it is sheer lawlessness or, stated differently, an absolute indifference to the rule of law or the concept of free markets. In a "normal" course of events, one wouldn't dare attempt to manipulate a market for fear of being caught. This fear would undoubtedly cause someone attempting to manipulate a market to do so in darkness, so as to avoid detection and, ultimately, prosecution.

What are we to make, then, of blatant manipulation in broad daylight? The simplest answer, I believe, is that the manipulator has no fear of being caught. If the manipulator knows full well that he is acting on behalf of his sponsor and that his sponsor will never prosecute him, the manipulator will audaciously act in bright light and open spaces for he no longer has anything to fear. As an example, if you desire to rob a bank but fear the police and potential jail time, you might rob the bank late at night or over a long weekend. If, however, you have the police and the judge in your back pocket, you could just walk in during business hours and make off with the loot.

I point out all of this because of the two charts below. I posted the one on the left back on Friday afternoon. That The Cartel would "trim" price by $7, at 2:20 pm, two days in a row was audacious enough. However, you must also check out the chart on the right. Another $7 at exactly 2:20 pm today. Sickening.

Again, only a criminal with no fear of prosecution acts this brazenly and predictably.

So, what do we make of this. As a practical matter, the suppression has worked. Without three, consecutive days of $7 Globex raids, gold would be trading at $1790 instead of $1769. Every dollar counts, whether it's taken out on the Comex, the LBMA or the Globex. However, on the bright side, how close must we be to a breakout? If The Cartel feels so threatened that they have to resort to bald-faced Globex manipulation, how desperate must they be and how worried are they about gold moving to $1800+? This is The Battle Royale, everyone. Be prepared for more dirty tricks but do not be afraid. We are winning and they know it.

Gold found support overnight where where I'd hoped it would, namely 1765 or so. Now the question becomes will it hold that area overnight tonight? It's hard to say. I wouldn't be surprised by a dip to 1750 and, if it does, I'll be looking to add some.

Amazingly, silver remains stronger than mustard gas. The area between 35.15 and 35.30 looks like pretty good support but a concerted raid could drive price all the way down toward 34.50. If that were to happen, I'd be an aggressive buyer. The only concern is the continued drop in 1-month lease rates, which appear to have fallen today to -0.46%, though I haven't seen anything "official" yet. Again, these plunging lease rates in silver are not a 100%-certain indicator of impending doom. They are just a warning flag. Additionally, while silver traded down 21 cents on Friday, open interest actually expanded by 2,300 contracts. More EE naked shorting in an attempt to keep silver below the Battle Royale level of 35.50- 36.00? I think so. Also, the March12 OI only fell by 1200 contracts on Friday and entered today at 20,160. This left today, Tuesday and Wednesday as the final three trading days where longs could be persuaded to dump March for May. Can't wait to see the numbers tomorrow!

Here are two charts of questionable value. On the left is a daily POSX but, as you know, my Forex TA ability is dubious, at best. On the right is a 2-hour crude. My TA in crude is a little better but, in a market that is primarily being driven by geo-political events, TA is almost useless. That said, if you're looking to join the crude "party", a dip toward $106 might be your opportunity.

Lastly, I traded a few emails today with Jim Quinn of The Burning Platform. I thought I'd blown a little time writing up my Saturday missive but it turns out the Jim took it even farther. He worked all day Saturday and most of Sunday on his latest post. Again, Jim does this out of passion and a genuine desire to make a difference. I encourage you to support his efforts by heading directly to his site to read his latest blog as soon as you are finished here.

That's all for today. Keep an eye on things overnight and expect the usual 3:00 am London raid. Then, let's see what tomorrow brings ahead of the all-important, Wednesday LTRO expansion info. Keep the faith. TF

About the Author

turd [at] tfmetalsreport [dot] com ()


Feb 27, 2012 - 6:29pm

Kid with the picture

I would be interesting to know if the police got a warrant from the courts for this.

This cannot be called reasonable suspicion.

Completely nuts.

victorthecleaner TF
Feb 27, 2012 - 6:35pm

there will be no short squeeze


I still think you are having this backwards. The OTC gold market consists of perhaps 95% paper and 5% physical (in terms of bank balance sheets). If someone buys the paper long (a future, say, or unallocated), there is some short who takes the other side. The point is they have more funds than you, they can just wait until you are unlucky one day and until you have to close out. If someone buys the physical, they don't care. This perhaps raises the price, but they are not short gold in $ and so why bother.

What you need to worry about is the following: 95% of the gold market is paper, and this paper has counterparty risk. If there is a general risk aversion and investors mistrust the banking system, they will drop these paper investments and rush into cash (I am not saying this is clever, but that's what will happen). The gold price in $ will drop like a stone. At the low price, however, there is not enough physical gold, and people will have to wait longer and longer, and perhaps eventually the market breaks.

The Achilles' heel of gold market is a liquidation of paper 'gold' with a sudden collapse of the price. It makes a lot of sense not only to prevent the price from rising in a chaotic fashion, but also to prevent it from dropping too much. Perhaps you can use the lease rates in order to estimate whether the other side has a sufficient flow of physical (at the current price) or whether they need to raise the price to make the existing physical last longer or whether they have enough flow of physical and can afford to take the price down.

The silver spike and drop in April/May 2011 may fit nicely into this theory. I would just not look at the published lease rates because that is LIBOR minus GOFO (or SIFO), and LIBOR is definitely dubious (you can google my 'Negative Lease Rates Revisited'). You would have to work directly with GOFO/SIFO and find a way of interpreting it in a way that is independent of the absolute interest rates and that does not need LIBOR. Perhaps look at something that involves only the rate of change.


Pantherskin Creek
Feb 27, 2012 - 6:38pm


Good Evening All,

Have been lurking since the Watchtower days and hat tips to everyone for all they contribute in so many ways, (the scales have fallen off the eyes) and a bow to the yellow-hatted one.

Like many, decided to finally join in....perhaps due to an increasing gnawing feeling of unease as events unfold around us?

Call me paranoid....but I have been following this development with growing horror: The military will get their funding on this, hundreds of millions....what will they do with them? With every house in America now on GPS coordinates, and technology dramatically advancing on these drones in the next few years, as the empire continues to crumble, what is to keep them from say entering the addresses of everyone who owns...guns...or gold....or who holds a certain political viewpoint....and logging them into a computer one night and VOILA, puff, a swarm, or even a single drone visits your house and eradicates it from on high over night? Who cares how many guns you own. Drones operated from afar make it a moot point. Far cheaper than camps. Very efficient on many levels. Call me crazy.....but can't get this evil scenario off my radar.
Feb 27, 2012 - 6:40pm


If they did have a warrant, the judge who signed it needs to be impeached


Feb 27, 2012 - 6:55pm

Somebody help me...

So at 2:30ish in the afternoon for the past two days, the price of gold has fallen 7 dollars. And if I had bought a GLD March 171 put today at 2:15 and sold it at 2:40 I would have made about 12%.

And why am I not doing this every day? Well last Wed and Thu the price actually rose at that hour. They sure keep one on their toes, no? I think I should stick to stacking.

Feb 27, 2012 - 6:55pm

Harvey's latest commentary is out

Silver volume super strong! Strong OI for first delivery!! Expect more raids by the criminals to shake the weak hands. Gold volume weak. Something is going on at the comex vaults. I think the specs are trying to do a reverse raid and squeeze those f'ing cockroaches!!

It is afterall, the one year anniversary of Wynter Benton. LOL

Feb 27, 2012 - 6:59pm

The irony of manipulation

The ironic part of all of this is that if these markets and life itself wasn't manipulated, there would be no need for gold or silver AS FINANCIAL INSURANCE/CURRENCY.

I mean do you people not think that all the QE's and stimulus programs had no effect on raising the price of all commodities? That itself is huge manipulation. Yes, it sucks being a victim of it when you're leveraged out. It's happened to me many times.. specifically the massive waterfalls early AM time.

But reality is EVERYTHING IS MANIPULATED. We live in a manipulated world. Best to just figure out how to profit off of it and that's the end of it. Easier said than done.. I know.

Feb 27, 2012 - 7:09pm

here is more audacious behavior

but it's the fed this time.

Video unavailable

Hugh Hat Tip to Ratigan for speaking the truth on MSM.

Katie Rose
Feb 27, 2012 - 7:11pm

I became a conspiracy theorist

I became a conspiracy theorist at 19 while attending the Republican National Convention in 1968. I was a Repub, my Folks and Grandparents were Repubs, going back for generations. What I saw and experienced there changed my life forever.

I met the EE. They thought I was "cute" and invited me into many of their smoke filled rooms. I met Nixon and Agnew, attended their "private" celebrations after receiving the nomination. What I saw "blew my mind".

Miami Beach was hot that Summer, yet the delegates wives were decked out in full length mink coats, that barely avoided the pavement. Diamond earrings, diamond bracelets, diamond necklaces, millions of dollars of diamond jewelry was on display. It was as if the women were having a contest! I've never witnessed so much wealth in my life!

The men without their wives had two very beautiful call girls, one of each arm, accompany them to the parties. It was all very accepted.

Smoking in public was still legal, and delegate after delegate blew smoke rings from their expensive Cuban cigars. They rarely paid attention to what was happening on stage, they just lounged in their chairs and blew smoke rings. Now I know that they didn't have to pay attention, they had scripted the entire convention.

So much happened that week that I cannot begin to convey it all. But this young econ/political science major came home in shock! I remember asking myself over and over, "Who are these people???????"

And so when I read folks saying that we "have them on the run" I just chuckle. I don't think so. These folks control the world. They control everything. You and I are little ants to be stepped on. The only significance we have to them is to fleece us of the little we have, thereby adding to their own wealth.

I believe silver and gold will rise when they allow it to. Not one second before.

Their current manipulation is a gift. It gives us a fabulous opportunity to keep preparing for the insanity we all see on the horizon....

edit to add:

These men took us off the gold standard, thereby impoverishing our nation and greatly adding to their personal and corporate wealth. These men designed the Viet Nam War. I suspect that most of them are now dead, but their sons and daughters have taken over the reigns of control, and are bringing us closer and closer to another hideous war.

That is why I appreciate each and every day. I like planting flowers and a garden. I like tending goats. It helps me to remember who ultimately is in charge.

Feb 27, 2012 - 7:12pm

Simply Great

Simply put, yet another great post TF! The linked article was also good but I really have to look these days for any good news or something to cheer me up knowing that a good deal of people still don't quite understand the enormity of what we're looking at.

I did enjoy this sentence from the article though;

"Anyone with their eyes open as they drive around today would think Space Available is the hot new retailer."

Now that would be a catchy name for a new night club lol

@ Doc1800 - you mean these priceless gems, right?;

Feb 27, 2012 - 7:14pm

Victor, it's funny that you

Victor, it's funny that you mention this as I was thinking about this exact thing over the weekend.

Back in December, I was pondering whether the flight from The Comex due to MFG might cause a complete separation of paper from physical and render the Comex obsolete. In hindsight, though, that is the last thing that The Cartel would want. A complete de-coupling of physical from paper would destroy them and cause them to lose the power to control physical price through the paper market.

Is this why they've allowed such a sharp rise YTD?

Is this why the CME lowered margins 3 weeks ago?


Feb 27, 2012 - 7:21pm


Gold sells off at the end of last year because a jerk hedge fund manager named Paulson did a heavy liquidation of GLD and other paper instruments. Gold has since risen over $200. Is that manipulation? But somehow you focus on the $7 beat down and call that manipulation. In the days following the Bernak's speech this Wednesday, gold will likely sell off by $100. You've got hedge funds playing the long-side of paper gold and silver and its time they get their arses kicked again.

You think you are seeing manipulation in the price action of gold and silver. But the true source of the manipulation is the fractional gold and silver supporting paper transactions on the Crimex. Those $7 moves are just computer algos making fast and furious bets because the fractional system allows them to.

Feb 27, 2012 - 7:23pm

At the exact same time, for

At the exact same time, for the exact same dollar amount, three days in a row?

Whatever, dude.

Feb 27, 2012 - 7:24pm

It's been pretty well

It's been pretty well concluded that the manipulation is really "price appreciation management".

But yeah, the source is non-backed paper and hypothication.

Stratajema TF
Feb 27, 2012 - 7:29pm

Paper and physical price separation

>>Back in December, I was pondering whether the flight from The Comex due to MFG might cause a complete separation of paper from physical and render the Comex obsolete.<<

Paper metal prices on the Comex and the physical metal price (from coin dealers) did separate at the end of 2008 for several months. That is why the premium to NAV on the GTU physical gold fund went to +28%. No one at the Crimex seemed to worry back then. Why would they worry now?

The Vet Logiwave
Feb 27, 2012 - 7:30pm

Bart Chilton is only one of five...

and from what he says publicly he seems to understand the situation with the silver manipulation. However he is only one, in a panel of five. Who has heard a peep out of the other four... Not me. Obviously they are in possession of the same facts and figures as Bart is, so why do they remain silent and continually outvote him to allow the scam to continue?

Just curious, but there is an obvious conclusion to be drawn from this.....

Stratajema TF
Feb 27, 2012 - 7:32pm

RE: At the exact same time

>>At the exact same time, for the exact same dollar amount, three days in a row?<<

Yes, that is what COMPUTER programs have learned to do. When that trick no longer works, the computer programs will learn a new trick that moves price to the upside or downside to make their position profitable.

Doc1800 Katie Rose
Feb 27, 2012 - 7:38pm

Katie Rose-

Katie- I have learned over the years that you are exactly right, the ones who will gain the most from the financial fallout coming will be those that created it. I do not think they are dumb- I know they are arrogant and that pride will get them resistance which in turn will lead them astray. Anyway , the wife and I are looking at adding a few goats - Nubians i think the wife wants. Green chiles up and growing and ready to move to the greenhouse- good time of year

Big L
Feb 27, 2012 - 7:40pm


I saw a boat hit a channel marker in Sarasota, and my dad had a friend who was seriously injured in a boating accident when he hit a channel marker.

Beats me too, but it happens, apparently a lot. Makes me wonder how they keep those buggers upright.

Big L

Feb 27, 2012 - 7:55pm

Pantherskin Creek

First off, welcome aboard!

I hear your concern on the domestic drone surveillance program. I don't agree with the part about houses getting bombed for gold or guns etc. Will it happen in the future? Maybe. You never know what things might look like 20-50 years from now at this pace.

Overall, the whole concept of domestic drone surveillance leaves me uneasy. I used to think we were really free and not under suspicion (of what?) for just being citizens but that seems naive at this stage. My belief is that we'll eventually see military type patrols in large population centers like we see abroad in other countries in 5 years. Not in a huge way, just a presence. I'm pretty sure that's already happening in parts of this country to some degree (OWS) and I just haven't seen it like some of you have where you live.

George Orwell's 1984 is already here or rapidly approaching.

Video unavailable

Feb 27, 2012 - 7:55pm

Bottom line we are constantly

Bottom line we are constantly being urinated on and defecated on... All of us. Stackers or not. What's worse is that it's being allowed, permitted, condoned, by those very same people elected, chosen, whatever, that supposedly protects the very citizens and laws of this country. Yes it's in your face corruption. It's a boot on our necks that is face deep in crap. This country has been conquered and it's time the masses wake up to the fact. Boil the bullfrog? We are well done!

Big L
Feb 27, 2012 - 7:58pm

Katie Rose

You're right, I've met the financial side of TPTB, and you're right.

They are a higher class of people than you describe, but the end result is the same, we're of no consequence really.

Sad for us, but true.

Big L

Big L
Feb 27, 2012 - 8:10pm


We're not being urinated on by the powers that be, we just don't figure into the picture.

The difference is whether we've been selected as a target: urination.

Or whether we haven't been considered at all: inconsequential.

We have let ourselves become inconsequential.

We've given away our power, it's gone.

Big L

Big L
Feb 27, 2012 - 8:22pm

The maniupation will stop

when the balance of power shifts.

The power is now with those doing the stealing. They have the power, they can't be stopped.

Except by someone with more power.

Big L

Big L
Feb 27, 2012 - 8:25pm


Ya, that wasn't just a ding in the gel coat. I figure they were doing about 60? Maybe more.

Big L

Feb 27, 2012 - 8:26pm

Removed comment

Removed comment.

Feb 27, 2012 - 8:30pm

Removed comment

Removed comment.

Feb 27, 2012 - 8:31pm

boating obstacles

Those posts are real tough to see at night when you are all hammered up on champagne and are busy impressing the girls with your fast boat. On a more serious note that accident probably had fatalities.

Feb 27, 2012 - 8:45pm


I see people writing that PAGE is coming this summer.

But I remember a post here a month or more ago from somebody in China knowledgeable about it listing many reasons why it wouldn't open until 2013 or later.

Anybody have any current info on this?

Feb 27, 2012 - 8:55pm


told you deep down inside 'they' like gold.


Some decent news came late in the week whereby the gold bearish Warren Buffet bought a precious metals business. He knows well the merits of physical gold but won’t voice those opinions publicly.



Fried(e)...sssshhh, they love *secrets*


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