Terrible Tuesdays

Tue, May 29, 2012 - 5:01pm

In a stunning development, gold and silver sold off today...just like last Tuesday, and the Tuesday before that, and the Tuesday before that, and the Tuesday before that. In all, that's five consecutive Tuesdays where price has fallen. Hmmmm. Why would that be?

Of course, regular readers and longtime Turdites know why. Tuesday is the day of the Commitment of Traders survey and, as we all know, great care must be taken to "paint" the CoT.

In the past, when The Cartel were active sellers, we referred to these days as "Happy Tuesday". After selling short all week, The Cartel would buy on Tuesday to "cover their tracks" ahead of the CoT survey. This resulted in UP days. Now, however, things have reversed. As I've mentioned here repeatedly, The Cartel is now actively covering shorts (buying) all week. Therefore, the attempt to "cover tracks" for the CoT survey now involves selling, not buying, and now Tuesdays are not so happy.

Regardless, in the grand scheme, this really doesn't mean much. In the end, both Cartels are still at work transferring risk from themselves to the specs (mgd money, hedge funds, etc). The Cartels are not quite net long but their net short positions have been dramatically curtailed. Expect this to continue (if they know what's good for them). In his latest newsletter, Uncle Ted estimated that JPM's net short position in silver is now down to near 10,000 contracts. This is a 75% drop from its peak. Many expect JPM to simply add shorts back on when price reverses. This time, I don't think they will. I've done a lot of homework and talked to a lot of people and this is what I believe. We'll just have to wait and see what happens.

In the short term, today's beatdown was insignificant. Gold shed almost $20 in the final 20 minutes of trading, losing $9 right before the bell. Ho-hum. We've seen it all before. Silver, of course, sold off in sympathy. Whatever. Let's see what happens tomorrow.

Here are some interesting items that I picked up along the way today. First up, some good news for the "Re-Elect The Great Leader" campaign. Remember, anyone that falls off of employment "insurance" is no longer even counted by the BLS. That person just disappears and is no longer part of the workforce. Therefore, less people "collecting unemployment" means that the unemployment rate will go down! Hooray! All our problems are solved! Vote to re-elect The Dear Leader! ( https://finance.yahoo.com/news/u-winds-down-longer-benefits-152809517.html)

But don't look now, the MENA is about to get more unsettled, if this Debka article is to be believed. Russia backing away from Syria would likely allow overt support of the "rebels" to begin. Remember, Syria is pals with Iran, Hezbollah and the like and any moves against them will inflame the entire region. Uh-oh. ( https://www.debka.com/article/22038/Russian-arms-ship-turned-away-from-Syria-President-Putin’s-first-misstep-)

And then you must read this. Not one of our usual sources but maybe it should be. Making gold a "Tier 1 Asset" would be a very good idea and a really big deal. Please read ( https://www.sharpspixley.com/comment/ross-norman-the-next-big-thing-in-gold-possible-purchase-of-1700-tonnes-gold/122544)

OK, that's all for now. Let's see if gold can hold and gain overnight and establish a third, consecutive higher low within the range. More on Wednesday. TF

About the Author

turd [at] tfmetalsreport [dot] com ()


May 29, 2012 - 5:01pm

Oh and I forgot to mention

The FB/Ag spread is now under $1. WOW! Maybe the contest will end tomorrow??

May 29, 2012 - 5:10pm
May 29, 2012 - 5:10pm

Turd: This is an interesting


This is an interesting observation. If you haven't, I would suggest a reading of "Freakonomics". Statistics can be used to find cheaters in any system with a very high degree of accuracy. I would like to see statistics run on metals prices on given days of the week, as well as the days surrounding opex and FOMC announcements.

It is easy to get away with cheating one time. Getting away with it all the time is impossible, when data is available to the public, and the some members of the public are knowledgeable about statistics.

May 29, 2012 - 5:11pm


1st? Well damn, I am. :o)

May 29, 2012 - 5:11pm
May 29, 2012 - 5:11pm


Turd, don't sweat the negative comments man. I've been in this game a very long time and it lasts longer than most think it can or will. Keep up the good work .

May 29, 2012 - 5:11pm

Sort of

If Turd hadn't wanted first for himself then Punk you would have been it.

Syria. Makes all that spin about Libya and leaders who turn guns on their own citizens a really sad statement. Where are the Leaders of The Free World now?

May 29, 2012 - 5:15pm

From Santa. Uh-oh...?

I hope this answer from Santa is meant to be a general comment about margin, and not a specific comment about what is about to happen. :-)


Jim’s Mailbox

May 29, 2012, at 2:26 pm by Jim Sinclair in the category Jim's Mailbox | Print This Post | Email This Post

Hi Jim,

I know you don’t have a crystal ball, but in your mind how long do think gold and silver will head lower?

I appreciate any light you can shed on this.

Thanks in advance, CIGA Ted


If you are without margin, it is totally irrelevant. If you have margin, you are screwed.


May 29, 2012 - 5:15pm
May 29, 2012 - 5:22pm

Germany Has A Generous Proposal To The PIIGS: "Cash For Gold


Back in February, as part of the latest Greek bailout of European banks, we noted that the most subversive part of the German-led proposal was nothing short of a gold confiscation scheme.

the European bailout of Greece, is now formally a Greek bailout of Europe, funded by the country's already negative primary surplus, or better said - deficit (don't try to make mathematical sense of that - a scene out of Scanners is guaranteed). Hence, negative bailout. But the piece de resistance, and the reason why Greece is the in situ version of bankster heaven is the news from the NYT that Greece is also about to have negative gold.

Ms. Katseli, an economist who was labor minister in the government of George Papandreou until she left in a cabinet reshuffle last June, was also upset that Greece’s lenders will have the right to seize the gold reserves in the Bank of Greece under the terms of the new deal.

Well, they may be broke, and they may be bailing out Europe, but at least they'll have no gold: sounds like a sweet deal - it makes perfect sense that Greeks are taking every incremental humiliation from a syndicate of few fat, bald types who have access to a digital money printer, with the supine determination of an Oliver Twist.

Today, courtesy of The Telegraph, we learn that Germany is quietly reminding the world that the stealthy, but voluntary, accumulation of gold is what it is all about. As part of a renewed push for quasi-Federalism, whereby Germany would fund a "European Redemption Pact", in which Berlin would, in the form of Germany-backed joint bonds, be responsible for any sovereign debt over the 60% Maastrtich limit, but with a big catch. The catch is that "a key motive is to relieve the European Central Bank of its duties as chief fire-fighter. "We have got to get the ECB out of the game of distributing money, and separate fiscal and monetary policy. Germany has only two votes on the ECB Council and has no way to control consolidation," he said. Germany would have a lockhold over the fund, able to enforce discipline. Each state would have to pledge 20pc of their debt as collateral. "The assets could be taken from the country’s currency and gold reserves. The collateral nominated would only be used in the event that a country does not meet its payment obligations," said the proposal.

In other words: a perfectly legitimate, and fully voluntary scheme in which sovereign gold is pledged to a German "pawn broker" until such time as the joint bonds are extinguished, and if for some "unpredictable" reason, a country fails to meet its obligations, read defaults, all the pledged gold goes to Germany!


remember that name
May 29, 2012 - 5:29pm
May 29, 2012 - 5:31pm

Tmosley - They can get away

Tmosley - They can get away with controlled demolition of 3 skyscrapers on national tv and most bury their head in the sand: I doubt any attention will be given to statistics showing a manipulated market.

May 29, 2012 - 5:38pm

I think Santa is saying that

I think Santa is saying that he hasnt a freaking clue which imo would be the most admirable way to respond.

May 29, 2012 - 5:48pm

People w/ at least 2 years of PM experience ...

would not be bothered that much by all this movement. The whiners here are probably new and too much into the leverage and margin plays and get screwed (as Santa puts it above) as a result.

Don't carry too much leverage or margin. That's where EE sets the trap for you.

May 29, 2012 - 5:48pm

Daily Silver for a year ...

https://finviz.com/futures_charts.ashx?t=SI Our Turd-like Hero of massive inate abilities seems to be onto something here. Now. How do we all get filthy, filthy rich? https://pennystockjournal.blogspot.ca/p/investigative-excellence.html

May 29, 2012 - 6:05pm

Never surrender

We will win this monetary war with perseverence no matter what the evil empire does.

"We shall go on to the end. We shall fight in France, we shall fight on the seas and oceans, we shall fight with growing confidence and growing strength in the air, we shall defend our island, whatever the cost may be. We shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall never surrender . . ."


tmosley lostinspace
May 29, 2012 - 6:12pm

I blow a raspberry at the

I blow a raspberry at the truthers.

9/11 was NOT an inside job, ffs. The buildings did NOT fall at freefall speeds, and the other buildings that collapsed were connected to the other towers by a tunnel, which turned into a natural blast furnace which undermined the foundation (undermined in the military/combat engineering sense, where a tunnel would be dug under a fortification and a fire set to collapse the above wall).

The full extent of any government agency involvement in 9/11 was that we created the al Qaeda to fight the Russians, and after the Russians were no longer a threat, we became their main enemy, and we killed enough Muslims to keep their recruitment up. It's just blowback.

And besides, that was a ONE TIME EVENT, which is very much different from something that is ongoing. If there was a 9/11 every time the market got to a certain point, then you would have a statistical basis for comparison. As it is, they are totally different subjects.

May 29, 2012 - 6:18pm

CFTC response...

In the last thread I posted that I had emailed the CFTC today. Well I've received a couple of responses from Bart Chilton that he has given permission for me to repost.


Bart: The investigation has taken too long. That said, if it was as simple as some suggest (concentrated power regularly manipulating prices) we would have either prosecuted it or said it wasn't there years ago. It isn't that simple. These are global markets (think foreign regulators, foreign holdings, various entities and trading partners to start off with) where things are traded and sliced and diced into physical and other myriad exotic products. These markets can sometimes be like giant shell games. Trying to figure everything out just is not as easy as one might think.

I expect we will conclude in the next few months. Btw, I've spoken many times about this. If you Goggle my name and King World, or Tom O'Brien, or Jim Paplava, something should come up.


My response:

I appreciate your quick response. I know more about the markets than most, but I can't pretend to descend to the level of complexity you refer to below. However much I understand, I know that there's 5x as much going on under the surface that I have neither exposure or access to. As such I appreciate your argument below. Answer me this one question though... is it not possible to pull the trades during various price waterfalls to determine if they are being created by the same entity? And if they are, is there not some simple threshold that can be applied to them that paints the line between regular trading and (illegal) manipulation?


Bart again:

To answer your question, yes, we can and have pulled the trades...and continue to do so. The investigation was for a time period certain, but as a matter of course, we constantly look at trades. There has been a deeper and more thorough examination of silver in the past 5 months than at anytime since I've been at the Agency (2007). Again, the investigation is separate from our normal surveillance. Like many markets, silver has changed a lot in recent years. There are new market participants and new technologies being used. Take a year ago May 1 when silver dropped 12 percent in as many minutes in after hours trading. One has to think about the cheetah HFTs in this regard, when a few milisecond trades in sparse liquidity can move a market so dramatically. We saw that in Nat Gas last June also, and it went down 7 percent in seconds. So, the markets are morphing and we have to look at things differently. I can't get into specific trader info or positions, that's prohibited. However, we are looking constantly and I hope the investigation will wrap soon. Finally, position limits will help. Those have also been delayed by the bureaucracy, not to mention a law suit that seeks to stop the limits implementation. I know it is frustrating waiting for the wheels of government to turn. We are human and government is a human institution. Some suggest I'm an apologist for the Agency. They can say what they want. I think I just have an understanding of how things work, and all too often don't work like they shoulda would or coulda. You can only do your best in life, and that's what I'm doing.
May 29, 2012 - 6:22pm

Ouch, I want to quit this

Ouch, I want to quit this game called life. But I don't want to quit stacking, so I guess days like this I should say the cartel is saving my life. I guess I'll buys some puts on JP and wonder what the tits index is at?

May 29, 2012 - 6:23pm

@Rui - I have been stacking

@Rui - I have been stacking PMs since 1988. This downturn has been the longest yet in the bull market and it is solely due to blatant manipulation as the Fed, the EE, the cartel, and int'l central banks operate in criminal fashion with the CFTC and CME being complacent. Although this is similar to the London Gold Pool, it is happening in the US and the government is complacent in this activity.

Sorry, but I am bothered very much when any semblance of investing fundamentals is met with a specific plan to establish cognitive dissonance in investors. Scratch that. I'm not bothered, I am pissed off and burning with anger.

I also agree with Punk-A about Santa at this point. He is as flustered as we are, but his large asset base and politeness keeps his comments in check.

Thanks also to tmosely about for his comments about 9/11. After a year of looking at the writings of the WTC7 crowd, I am convinced that the few sincere ones are not smart enough or sufficiently un-biased enough to see the obvious flaws in their assessments and the rest are useless loonies.

May 29, 2012 - 6:34pm

Good day for the Army

...Looks like Tuesday's just became a good day to buy the dip on SLV, and exchange the profits for phyz on Friday eh Turd Army??? Fuck I wish I knew enough about trading to join... But, nevertheless, this civilian will keep stacking...

May 29, 2012 - 6:34pm

Dollar backwardation

I finally finished this weekend's podcasts - spent the weekend doing manual labor and playing poker - and I have a question regarding Jim Willie's comment about the backwardation of the dollar. Do you (addressed to the group as a whole) think this would be a temporary situation while there were not enough physical dollars to chase the amount in digital bank account balances and it would be remedied once more actual physical currency was literally printed or is there a bigger trend that I am missing and it only has to do partly with the physical existance of currency?

May 29, 2012 - 6:43pm


Santa has always said do not use margin to trade. He is not alluding to any dark clouds looming on the horizon.

May 29, 2012 - 6:47pm

Good brief article

This should serve as a reminder of the reasons we come here, should attempt to build a community and keep the sniping to a minimum:


May 29, 2012 - 6:58pm


such as "truthers", "birthers", "tea-baggers" & etc… are simply ways to demonize individuals by lumping them in with a group and ascribing the so-called tendencies of the group onto the individual, which is disingenuous to say the least.

So-called "truthers" blow raspberries all the time but they have good reason to. They don't believe what they are told, they believe the evidence of their own lying eyes and the evidence of witnesses paints a different picture, and, they believe people who poo-poo them generally have spent very little time looking into the events of that day, AND they believe it is the complacency of the poo-pooers themselves that has allowed the real criminals to escape justice.

Sadly, building 7, not hit by any aircraft, also fell straight into its footprint, defying all but the most obtuse explanations for this unique event. Occams razor says if it has webbed feet, a bill, waddles and quacks, it's probably a duck. In this case, if it falls at, essentially free fall speed, dimples in the middle first, shows strings of explosions out the side, and collapses into its own footprint, it's probably a controlled demolition. Especially when it only had a few fires on some floors, and historically no steel framed building has ever collapsed that way from such damage. If they fall, they tip over.

Look, I don't want to get yet another tiresome 911 diatribe started here, it never seems to change anybody's mind about diddly, but it seemed to me a few of the posts begged a reply.

May 29, 2012 - 7:08pm

Tier 1 What?


The Basel committee's rule changes have been going on for a decade with most changes unseen by the avg. Joe. Big deal. What do they have to show for it besides more banker shennanigans?

Basel I, Basel II, and now Basel III. Each one hyped as THE rule change to set things straight in the world of accounting and banking. (but we all know that there's no accounting in modern banking) So pardon me if this latest announcement(?) doesn't excite me. 1700 tonnes is a joke in and of itself.

The Jan. 2013 date for classifying gold as a Tier 1 asset doesn't pass the smell test. Jan. 2013, just in time to save Obummers ass. Coincidence? Not likely. I wonder what the reason for a delay will be when he loses the election to Ron Paul. Oh, that's right, that 2018 date thrown out with it. Plenty of delay hedging there ay? Elect our boy and you'll get 2013, don't and you'll have to wait until 2018 when sadly all you pesky little folk will be long gone.

Besides, who in the U.S. actually gives a damn about Basel rules on tier 1 capital including gold when the U.S. Treasury dept. still has the official value at $42.40?

Basel Schmasel. When the U.S. Treasury dept. officially values it's gold at (taking Jeff Christian's and the oft referred to 100:1 ratio as an example) $4,240 then it'll be time to pay attention.

Of course, TPTB may just wait for gold to reach that price on it's own before doing anything officially, just to save face and save their annointed boy toy.

Like the late Geo. Carlin pointed out, it's an exclusive club and you ain't in it and never will be in it.

Let the shell games continue...

wake me up at $4,240 and/or when the RICO suits get serious.

May 29, 2012 - 7:09pm

Re: above link to ZH post, I

Re: above link to ZH post, I now only read ZH's posts, and never the commentary, which is becoming progressively pithier, bitchier and (in some cases) simply stupider by the day.

The ZH team do a great job. However, the frog in the pot metaphor definately has a ring of truth. I bet most on ZH think that the commentary is completely normal and that we all go around every day in real life backstabbing, snarling, slavering, drooling, and generally being very unpleasant to our peers. Well....maybe in merchant banks and legislative assemblies they do. Its a bit like playschool at times.

Here at TFM its usually the complete opposite, and I enjoy the stronger community spirit fostered here.

Thank you.

cpnscarlet Mudsharkbytes
May 29, 2012 - 7:15pm

@Mudshark - Differences of

@Mudshark - Differences of opinions are fine, but lies are not. The video of WTC7, taken near the base of the structure showed a clear rotation of the structure toward the south as the building collapsed - indicating a compromised foundation. It did not come straight down. And the only video showing "explosives" being set off in the middle floors was a planted fake which the producer used to bait all the "truthers".

There is politics, opinions, and fanaticism, but there is also physics. Don't tell me there's no rotation occurring when it's clear there is one. To satisfy people like you, I looked into the research, the so-called scientific papers (none of them properly refereed), and looked at all the videos out there. This rocket scientist still says it's all a bunch of BS. Don't we have enough to deal with here in the way of PM conspiracies? Give it a rest. It's done and they're dead.

When someone gets a gov't official to fess up, then we'll talk again. But the proof is just like that for the moon landing "hoaxers". Just think of the number of people who would have had to keep this secret for a decade now. Someone would have spilled the beans by now.

The Body
May 29, 2012 - 7:20pm


There have been lots of talks/hopes/speculation about the announcement of more QE. I have seen a lot of reasons touted on TFM as to why folks think this will happen – everything from a strong dollar to falling stock markets to fighting inflation (which, by the government’s own fraudulent numbers is still low).

The one thing that has been markedly absent is the Fed’s original stated purpose for QE – to lower long term interest rates.

I think the Fed (central banks) is the most despicable organization every conceived by man but I don’t believe formal QE3 is going to happen as long as long term rates keep falling.

I would not put it past the Fed to do more Twisting and such, but formal QE not so much until rates start going up. For everyone who thinks QE3 is imminent & going to be the savior for PM prices might be disappointed.

In my opinion, this offering by Turd will continue to define a lot of macro things going on. Interest rates, Interest rates, Interest rates – the cost of money affects everything.


May 29, 2012 - 7:21pm


It does seem like the dog people have found the cat forum.


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