Getting Real, Real Fast

Fri, Jun 1, 2012 - 10:29am

Your blissfully unaware family and friends notwithstanding, the global financial "situation" appears to be deteriorating rapidly. I hope you have prepared accordingly.

First this morning, I suppose we should address this month's BLSBS. As you know, the period between 8:25 EDT and 8:35 EDT on the first Friday of the month is the only time all month when I actually watch CNBS. Today, the usual crowd of misfits populated my screen. There was The Shill happily expecting glorious growth. The Coug was prowling and LIESman was stuttering, as usual. Then, the party ended when we went "Live to Hampton Pearson at the Labor Department". No real reason for me to rehash the dismal numbers with you as I'm sure you've had enough of that already. I don't wish to add some color, however.

  • The media will tell you today that gold is rallying on fresh "hopes" on more QE. Bunk. This is not true. Gold is rallying on fear. If gold was rallying on QE, why are stocks down? Why is crude down? Additionally, gold is rallying and extending gains because of a squeeze in the massive spec short position that has been built up over the past month or so.
  • The last commercial I saw before the numbers were released was a promo for a CNBS program that promises to "show you how you can profit from the declining euro". Looks like the bottom is close there.
  • The printed NFP was +69,000 but the "birth/death adjustment" was +204,000. This means that, without the BLS statistical make-believe, the actual number might be -135,000. I wonder how shiny LIESman's head will get as he attempts to spin that? Chances are he won't even try.
  • The 10-year note is now at 1.47%. This is incredible! Even using the nonsensical and worthless CPI, the 10-yr now has a -1.0% real (inflation-adjusted) annual return.
  • The 30-year Long Bond is at 2.55%. Never in my life did I think I would see the day when the Long Bond yield fell below the stated rate of inflation. Well, OK, maybe I thought it was possible that the Long Bond might yield 10% when the CPI was 12% but parity? At 2.5% Amazing!
  • And crude is now down over 20% in the past month alone. This in spite of the ongoing, geo-political risk in The Middle East.

Speaking of crude, anyone thinking of buying some had better take a long, hard look at the chart below.

(I just snuck a peek at gold here at 10:10 EDT. UP to $1610. Wow! Continuing to rally post the PM fix. Very surprising.)

As stated above, the metals soared on the BLSBS and are continuing to rally. Fear, short-squeezing and QE anticipation are driving things higher. For gold, a move through and close above $1610 would be very exciting. Your short-term target to watch in silver is $29.

I mentioned negative, real interest rates above. Remember, negative real rates are a hugely positive indicator for the precious metals. If you need a refresher on this, go here:

Today's CoT is going to be very, very interesting when it is released at 3:30 EDT. I'll be sure to post some comments and analysis once I see the numbers.

Lastly, please take a few minutes to page through this scribd doc. It was written by Raoul Pal, one of the most successful hedge funds managers of all time. Doom? Gloom? Yes. Heed his warnings.

The End Game

I cannot imagine that I won't have more for you later on this crazy, crazy day so please keep checking back. Gold is now 1617! WOW!


About the Author

turd [at] tfmetalsreport [dot] com ()


Jun 1, 2012 - 12:39pm


POS looks capped in the 28's. I guess there is no reason to get excited until overt QE3 is implemented. Until then, we should have fun watching paint dry:)

rocoach tpbeta
Jun 1, 2012 - 12:40pm

@ tpbeta

Actually, it's her Diamond Jubilee (60 years).

R man J
Jun 1, 2012 - 12:41pm

Maybe "tongues as of fire"

Maybe "tongues as of fire" will descend upon the Comex??

Jun 1, 2012 - 12:41pm

Just took the opportunity to

Just took the opportunity to needle a bit.

Jun 1, 2012 - 12:41pm


I just want silver to go along with to get the GSR down compared with yesterday... But looks that You are right. Until smaller buyers flood the market, big ones go for gold.

Jun 1, 2012 - 12:42pm

Intentional Short Squeeze?

This 'squeeze' could very well be by design. The old wash, rinse, fleece, repeat cycle.

Someone posted yesterday (don't recall off hand) that they seen something "odd" on the TSX where SLW received a 200,000 order just before closing. Today the GDXJ and miners in general are up and becoming very healthy. Now, are those units purchased yesterday, selling today into buying?

If so, then we could be seeing trading on inside information. That can't happen. Can it? Its against the law!

Cheering from the roof tops. Back slapping. Happiness all around. General euphoria.

BE CAREFUL. The EE have done this to the PM's soooo many times now, that I have become skeptical.

I will be a believer when gold breaks out over $1,710/oz and silver at $34.50/oz. Until then I'm cautious. The contrarian in me says everybody is toooo optimistic at the moment. Just sayin.

stained white shirt Eric Original
Jun 1, 2012 - 12:42pm
TerrorTed Xeno
Jun 1, 2012 - 12:45pm

Bank Holidays @Xeno

Xeno, is the confusion perhaps caused by the fact that public holidays in the UK are called 'Bank Holidays', and of course 'Bank Holidays' is also the term used for bank closures to devalue the currency?

Jun 1, 2012 - 12:47pm


oh yeah oops. diamond. golden was last time. means I can't go long before Wednesday, rather worrying

Jun 1, 2012 - 12:48pm


Ah, yes. But I was referring, obviously obliquely, to your nickname, which implies you might also stack these:

Jun 1, 2012 - 12:49pm


Heh heh heh

Was flattered actually

This could be the end of the beginning and the beginning of the end .

We'll see lol

edit: p.s. yes the terms are a source of some confusion. They don't go on "vacation" over there - they call it "holiday".

bam TF
Jun 1, 2012 - 1:00pm

@ Turd

That 1st day of the month thing is phony accounting! Just HAPPENED to be on the 1st of the month.

Just trying to juice profits to lure in a bunch of new subscribers, before the performance puke. I know this game. You've learned well from your dark masters.


Jun 1, 2012 - 1:04pm


Keep it down.

If everyone finally discovers that "Andy" is actually Blythe and I am actually Ruprecht, the game is over.

Stock_Canines George Clooney
Jun 1, 2012 - 1:05pm


Yes, indeed. I have two best friends in the world in addition to my wife and they both have four legs. A Staffordshire Terrier and a rottweiler/chow mix (got to protect that stack). Both great dogs. The mutt I found as a puppy. He was abandoned on a logging road in central Oregon. A day never goes by where he doesn't implicitly thank me for picking him up that day - just a damn good dog. The pure bred is a bitch - loving and sweet - but a bitch non the less. I grew up with a 175 lb Newfoundland - still to this day the greatest animal I have ever known.

Urban Roman
Jun 1, 2012 - 1:08pm

I'd like to announce that Silver is now

... free to drop on down to $15.

The reason being that I have just faded the UUP (long POSX) in one of my accounts and bought a big mess of PSLV.

Jun 1, 2012 - 1:08pm


I'll take one of each. Will you throw in the canoe?

Jun 1, 2012 - 1:09pm

Gold and silver both UP

Gold and silver both UP 3%+.

VERY good sign for next week though you should still expect some "Terrible Tuesday" selling from The Cartels after seeing some follow-through on Monday.

Jun 1, 2012 - 1:11pm


Though this squeeze is most assuredly brought to you by The Cartels, we'll soon find out if they intend to "stand down" on this next rally and NOT add shorts back on.

Jun 1, 2012 - 1:11pm

FacePlant vs Silver contest

wasn't there a contest of what date silver would pass FacePlant??? Is today the winner so far?

FB now down 1.63 on the day to 27.97

Silver up today .84 to 28.60

Jun 1, 2012 - 1:12pm



TheRationalist tpbeta
Jun 1, 2012 - 1:14pm

Diamond Jubilee

It's a Diamond Jubilee, tpbeta.

We've already had to sit through the Silver and the Golden.

Just when things are hotting up we have not one but two days off. It's very frustrating, especially for the hordes of us Brits who are not monarchists, and find the whole business of fawning on the Royals about as edifying and enlightening as watching CNBC.


Jun 1, 2012 - 1:18pm

From Santa: Dear CIGAs, QE

From Santa:

Dear CIGAs,

QE to infinity is more certain than death and taxes. See the video we posted here on today that gives you the worst case economic and social scenario for 2012, unless we go to full QE before the end of June 2012.

Problems are reaching terminal velocity right now, here, today.

QE to infinity might hold things together, in a sense, for 24 more months with gold above $3000. Those popular gold writers calling for much lower gold prices are simply out of their mind sand disconnected from reality.


Jun 1, 2012 - 1:19pm

Mr. Magoo returns to Crap,

Mr. Magoo returns to Crap, Nothing But Crap Greenspan on CNBC: Worry About Rising Rates

csquared13 TF
Jun 1, 2012 - 1:25pm

I hope they don't give up too

I hope they don't give up too easily next week. Just got paid today, need to go pick up some phys!

RaRaRasputin TF
Jun 1, 2012 - 1:28pm

Friday humour

Xeno - Turd is absolutely correct about the incoming 4 day week-end when we are ordered to celebrate the Queen's 60 glorious years on the throne as our monarch. We usually have just one bank holiday on the Monday but have been given an extra day off (unless you're a nurse like me, where it means nada in terms of extra time off) on the Tuesday so yep shut for 2 days. There is Union Jack flag bunting hung from everywhere and anywhere here which makes me proud to be British but Queenie I can do without (sorry to any royalists out there)

I'm afraid when people mention Queenie this is all I think of

Where's My Pressie? - Blackadder - BBC

And in other Friday humour

$4,000 gold-plated vibrator stolen by armed robber in Brazil

Thief ties up sales assistant and steals luxury sex toy from display case – but forgets to take its charger

Store owner Vanessa Baldini told the G1 news website the robber might get no satisfaction from Wednesday's theft – the Swedish-made sex toy has a stainless steel core, making it difficult to remove the gold plating.

And, she noted, the robber forgot to take the vibrator's charger.

"I really don't know what he'll do," she said. "I'll leave it up to his imagination."

Have a good w/end folks


Jun 1, 2012 - 1:29pm

Jim Willie Said 10 YR 1.50 Yield Was Coming

Just a week or two back Willie said the 10 YR had to rise in price to save the Ivy League Sh..heads. Since then we have seen JPM unloading "investments" to cover losses. I believe this drastic move on the 10 YR is a sign somebody or something really big is in profound trouble.

Could it be the Minsky Moment has arrived?

Jun 1, 2012 - 1:29pm

Deck chairs on the Titanic

"Your blissfully unaware family and friends notwithstanding, the global financial "situation" appears to be deteriorating rapidly."

So true. Utterly amazing that so many of my friends, many of whom are highly intelligent professionals, are so completely and totally unaware of the impending disaster. Americans are about to get a lesson in sound money and tangible assets, a lesson already learned by other folks around the world (Turks, Chinese, Indians, etc.).

Fed the Turd today. Thanks for the timely and essential reports.

Jun 1, 2012 - 1:30pm

Not funny

Watching the president make jokes and laugh his way through his speech about this mornings numbers and the economy. Sickening. He gets serious when he goes on the attack. Ha, just fired off another joke. Really. Millions of people out of work. Maybe one will be a comedian in November. This moment in time is as serious as a heart attack. God help us.

Jun 1, 2012 - 1:32pm

Missing Regulars

Hopefully the pop in prices will bring back some of our regulars who seem to be AWOL.

Indy7? Fried_Eggs? CapnScarlet? et al?

Hopefully they are just taking a break from this interwebs thingy. Drop us a note so we know you are all right.


Jun 1, 2012 - 1:33pm

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