The Fiat-Conversion Price

Tue, May 8, 2012 - 10:15am

And this matters how? And why, exactly, do you care? Seriously. You need to ask yourself those two questions.

Look, never forget that the point of of this entire endeavor is "preparation for the end of the Great Keynesian Experiment". Part of that preparation is the accumulation of physical precious metal. Gold to protect your worth and wealth. Silver to protect you ability to acquire everyday necessities.

Do you believe that the current global financial system is now so malignantly flawed that it will not survive? Do you believe that beacuase the U.S. government is so overwhelmed with debt, current and future, the U.S. dollar is doomed as a global reserve currency? Are you fearful that global governments, in their futile attempts to maintain power will stop at nothing, economically and militarily, to avoid collapse and that these efforts will ultimately lead to war, insurrection, massive price inflation and civil unrest? If you answered "YES" to any of these three questions (and I suppose you did), then you should continue to BUY precious metal. Selling metal and converting it back into fiat is simply out of the question. Most of all:

If you answered "YES" to any or all of the questions above, why in the world do you care right now if gold is $1610 and silver is $29.50?

I ask this with all sincerity. Again...why do you care? You should be rejoicing at the opportunity to add metal at these prices. Last spring, it took nearly $5000 to buy just 100 ounces of silver. Today, that same $5000 will buy you 170 ounces. Hooray! How fortunate are we?!? The absolute sham of the current Comex/LBMA system has allowed everyone this extra time to buy/add metal. Please don't waste this opportunity! Also, please take delivery and store your metal somewhere safe.

Please indulge me to state this as clearly and unequivocally as possible:


I provide technical analysis of the gold and silver markets solely to draw attention and readers to this site so that I might warn as many as possible. I will continue to do so, regardless of the criticism of TA in general. Though the current precious metals markets seem to have been fundamentally changed by the MFGlobal disaster, underlying demand for physical metal will continue to make TA a useful tool. To that end, I present today these two charts only. In gold, the long-term trend is still intact and, as you know, I'm a big believer in the long-term trend. In silver, you can plainly see that the "right shoulder" is being carved in a pattern similar to the "left shoulder" last fall.

Now, before you leave my site today, I want you to read this extremely important piece of analysis and then come back:

You should also read the latest from Jim Quinn:

And this nugget from Mike Krieger:

I'm going to stop here. After being out all day yesterday, much stuff has piled up on my desk and demands my immediate attention. I'm sure I'll be adding thoughts to the comments all day so please be sure to check them from time to time. Hang in there. Keep the faith and go add to your stack. TF

About the Author

turd [at] tfmetalsreport [dot] com ()


May 8, 2012 - 9:01pm

@PFFurn - Sorry to Hear This

I am sorry to hear that things are down for you as well.

Changing your business may not be feasible, but I would definitely try to see about
changing your investments if possible. In the long run, you may be able to take the
business hits but may not be able to take the investments hits.

I wish I could offer some wisdom to help make things better, but this is the best I can do for now.

Praying is always good and offers me hope when nothing else can.

May 8, 2012 - 8:43pm

Never "We Buy Gold" Shops If Possible

Interesting notes here, and I agree that the Achilles heel is for people to take physical delivery on their futures and the like.

As for selling my sterling and gold at a "We Buy Gold" place, I hope to never be in that situation. If I sell, my plans are Midwest Refineries or another reputable refinery that will smelt the metals and give a better price than can be gained on E-Bay or the like.
If I knew of a better method than the refinery, I would use that method.

Most of my sterling is in the form of jewelry, and I try to research my pieces to find the maker and history. Often, the maker and history make the piece worth much more than it's spot price. This can also hold true with gold sometimes but seems to be the exception to the rule.

May 8, 2012 - 8:39pm

@ John Galt

My apologies, but I wrote it to gauge people's reactions. I side with the Native Americans, actually, as I am mixed blood and an Ancient (two characteristics of the latter - linguistic isolation that shielded me from typical early language development past a certain critical age because of my deafness until nearly seven and a half, and lack of exposure to the idea of any religion until I was past eight years old). And I ought to have spelled out that SOME Native Americans would be watching closely the events happening now, and then would inform the others who don't know that it would be time to move, especially those who are living in non-native cultures such as hispanic cultures. My hope is that as many as possible are watching. If anything, it is time that white society looked at itself and begin to question why its lifestyle divides people from each other, harms them, and destroys the earth, and perhaps whites can look at the Red path as a means of returning to the Earth and sanity in their lives. We have to, or we'll lose the only home we have.

May 8, 2012 - 8:36pm



Do not clear ALL of your trees. Your trees will provide shade and pull up minerals from several feet under the top soil, depending on the soil composition. You'll probably have to remineralize the topsoil if it's typical subdivision property.

May 8, 2012 - 6:20pm

WHY Fiat-Conversion Price Matters (To Me) Right NOW...

There has been so much rain this spring that the woods next to the house has grown tremendously, shading our garden spot. I want to have about 1/3 of of our backyard cleared of trees SO WE CAN GROW MORE FOOD! Not GMO or pesticide-ridden cr*p -- organic, hyper-mineralized NUTRITION. Like goji. For more self-sufficiency. And the wood can help heat our home for the next several years.

This is a large unexpected expense, but seemingly needful and not time-shiftable, and some stack needs to be sold off. At the lowest point, naturally.

FORECAST : So, look for LOW PRICES through the end of this week, and a B-I-G MAJOR UPSWING next week, say on Wednesday, right AFTER I sell a bunch to pay the tree guys....

Single handedly, I move markets.

You can thank me later.

BobbejaanGeorge Clooney
May 8, 2012 - 5:09pm

You go, girl !!!

Xty said :-

I am not a blood-thirsty person, despite my quick tongue - but one begins to understand why the peasants have been so revolting in the past, if you get my drift.

You don't have to go all that far back in the past, either ... I've been a pretty revolting peasant most of my life.


& BTW ... A pitchfork is better than a drift (= Revolting Peasant's Academy 101)

May 8, 2012 - 4:44pm

The SHFE .... AKA The "Shit Hits Fan Exchange"

Tailwind said :-

I am a relative newbie to all this, but I could not help but note the timing of this smash down in relation to two things: 1) the opening of the Shanghai facility for PM's and 2) the massive maneuvering of paper contracts on the Crimex in the weeks prior to this event. This is pure speculation on my part, but it seems to me that this move is part & parcel of an attempt to provide one last massive shake of the tree ('one last hurrah' if you will) prior to the end the Evil Empire's domination of the PM markets. Or am I just dreaming?

If you are dreaming ... You're NOT the only one


I have wondered the same myself many times over recent months.... perhaps it's a sign that the SHFE also coincidentally translates in my warped mind into the "Shit Hits Fan Exchange"


PS & BTW ... Welcome to the site ... Kindly try to avoid tripping over lemmings when walking near the cliff edge.

May 8, 2012 - 4:22pm


rather than giving a history of where your money is put best to use....why not advise today

It's easy to point out these hindsight predictions that you are not on record for.

Question: What is today's best investment?

Visit the FAQ page to learn how to track your last read comment, add images, embed videos, tweets, and animated gifs, and more.

May 8, 2012 - 3:57pm

David Rosenberg on Gold at 65th CFA in Chicago

65th Annual CFA Conference, Monday morning, May 7th

John Mauldin, Moderator,

David Rosenberg (chief economist and strategist at Gluskin Sheff + Associates Inc)

(54:24 into the panel discussion)

John Mauldin: "Rosie, question for you. Your singular expertise and god-like wisdom, tell us what your outlook on gold is (beside the fact that it's yellow)?"

David Rosenberg: "Well, okay, the most important determinant, or one of the most important determinants of the gold price are real short term interest rates. And so long as they stay negative, in most parts of the world, the secular bull market is going to remain intact. Its not going to be a straight line, we're going to go through multiple periods where it corrects, and it pauses. Those will actually be great periods to accumulate.

You have to normalize gold by something, right, I mean if you look at the stock market, so 'price-to-book', 'price-to-earnings', 'cash flow yields', you look at the bond market, you look at say real interest rates or the yield curve, we could debate that, but you have to normalize gold by something. And gold's complexion has changed over time, trading less as a commodity and more and more like a currency. But a currency of course that's no government's liability.

So you take a look at the total value of gold and you normalize by say global monetary base, or currency in circulation and then you invoke Bob Ferrell's rule number one, which is that ratios are inherently mean-reverting, I think that gold will ultimately go to, and I won't give a date, but I think the peak in gold will be $3,000 per oz before the cycle is over, either that or up until such time as I change my name from Rosenberg to Goldberg, then the story will be over"

Peace and stay frosty,


Subscribe or login to read all comments.


Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 8/10

8/10 10:00 ET Job openings
8/11 8:30 ET Producer Price Idx
8/12 8:30 ET Consumer Price Idx
8/13 8:30 ET Initial jobless claims
8/13 8:30 ET Import Price Idx
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Unit Labor Costs
8/14 8:30 ET Cap Ute and Ind Prod
8/14 10:00 ET Business Inventories

Key Economic Events Week of 8/3

8/3 9:45 ET Markit Manu PMI July
8/3 10:00 ET ISM Manu PMI July
8/3 10:00 ET Construction Spending
8/4 10:00 ET Factory Orders
8/5 8:15 ET ADP employment July
8/5 9:45 ET Markit Service PMI
8/5 10:00 ET ISM Service PMI
8/6 8:30 ET Initial jobless claims
8/7 8:30 ET BLSBS for July
8/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 7/27

7/27 8:30 ET Durable Goods
7/28 9:00 ET Case-Shiller home prices
7/29 8:30 ET Advance trade in goods
7/29 2:00 ET FOMC Fedlines
7/29 2:30 ET CGP presser
7/30 8:30 ET Q2 GDP first guess
7/31 8:30 ET Personal Income and Spending
7/31 8:30 ET Core inflation
7/31 9:45 ET Chicago PMI

Key Economic Events Week of 7/20

7/21 8:30 ET Chicago Fed
7/21 2:00 ET Senate vote on Judy Shelton
7/22 10:00 ET Existing home sales
7/23 8:30 ET Jobless claims
7/23 10:00 ET Leading Economic Indicators
7/24 9:45 ET Markit flash PMIs for July

Key Economic Events Week of 7/13

7/13 11:30 ET Goon Williams speech
7/13 1:00 ET Goon Kaplan speech
7/14 8:30 ET CPI for June
7/14 2:30 ET Goon Bullard speech
7/15 8:30 ET Empire State and Import Price Idx
7/15 9:15 ET Cap Ute and Ind Prod
7/16 8:30 ET Retail Sales and Philly Fed
7/16 11:00 ET Goon Williams again
7/17 8:30 ET Housing Starts and Permits

Key Economic Events Week of 7/6

7/6 9:45 ET Markit Service PMI
7/6 10:00 ET ISM Service PMI
7/7 10:00 ET Job openings
7/9 8:30 ET Initial jobless claims
7/9 10:00 ET Wholesale inventories
7/10 8:30 ET PPI for June

Key Economic Events Week of 6/29

6/30 9:00 ET Case-Shiller home prices
6/30 9:45 ET Chicago PMI
6/30 10:00 ET Consumer Confidence
6/30 12:30 ET CGP and SSHW to Capitol Hill
7/1 8:15 ET ADP Employment
7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 2:00 ET June FOMC minutes
7/2 8:30 ET BLSBS
7/2 10:00 ET Factory Orders

Key Economic Events Week of 6/22

6/22 8:30 ET Chicago Fed
6/22 10:00 ET Existing home sales
6/23 9:45 ET Markit flash PMIs for June
6/23 10:00 ET New home sales
6/25 8:30 ET Q1 GDP final guess
6/25 8:30 ET Durable Goods
6/26 8:30 ET Pers Inc and Spending
6/26 8:30 ET Core inflation

Key Economic Events Week of 6/15

6/16 8:30 ET Retail Sales
6/16 8:30 ET Cap Ute and Ind Prod
6/16 10:00 ET Chief Goon Powell US Senate
6/16 4:00 pm ET Goon Chlamydia speech
6/17 8:30 ET Housing Starts
6/17 12:00 ET Chief Goon Powell US House
6/18 8:30 ET Initial Jobless Claims
6/18 8:30 ET Philly Fed
6/19 8:30 ET Current Account Deficit
6/19 1:00 pm ET CGP and Mester conference

Key Economic Events Week of 6/8

6/9 10:00 ET Job openings
6/9 10:00 ET Wholesale inventories
6/10 8:30 ET CPI for May
6/10 2:00 ET FOMC Fedlines
6/10 2:30 ET CGP presser
6/11 8:30 ET Initial jobless claims
6/11 8:30 ET PPI for May
6/12 8:30 ET Import price index
6/12 10:00 ET Consumer sentiment

Forum Discussion

by argentus maximus, 9 hours 30 min ago
by argentus maximus, 12 hours 46 min ago
by jack3617, Aug 7, 2020 - 5:51pm
by Titus Andronicus, Aug 7, 2020 - 5:13pm
by jack3617, Aug 7, 2020 - 5:06pm
by Steve S, Aug 7, 2020 - 1:59pm