Friday Fun

Fri, Aug 10, 2012 - 10:30am

So much to do and so little time. Let's get started.

Thank you for the day off yesterday. It was very productive and helpful. However, the world doesn't seem to stop just because I want it are a number of things that have piled up while I was away.

First of all, the USDA crop estimate that I was anxiously awaiting finally came out this morning. It was pretty much what most expected. Bad...but not horrific. Yet. By late yesterday, I had come to expect a quick pop at the news and then some profit-taking. That's pretty much what has happened. From late Wednesday through the close yesterday, corn had already risen by 40c and soybeans bounced 80c. This indicated that we were onto a "buy the rumor, sell the news" type of event and that's exactly what has happened. From here, let's see if we can get a little pullback and subsequent erosion of option premium. Nothing can save the corn crop at this point so yields will likely continue to be marked down. Nine dollar plus corn is still likely as we head toward harvest.

Crude ran out of gas today and you can see it on the chart. I'm not too worried, though. The 16-day global festival of peace, love and utopia is about to end in London so next week should bring a renewed focus on all the strife and chaos in the Middle East. The next move, through this week's highs of $94+, should carry crude toward $98.

Lots of talk about Uncle Ted's latest piece. Since it has now been widely distributed, I thought I'd c&p the two paragraphs that I personally found the most interesting:

"More importantly, were the agency to charge JPMorgan with manipulation of the silver price (as it should) that could set off a series of events that could easily grow out of control. One thing that makes the silver manipulation so potentially profound is that the core allegation is of a crime in progress. The CFTC has never busted up a manipulation that was in force; like most government agencies, it only reacts after the fact. Don’t take that solely as a complaint, but more as an observation that governments are more reactive than proactive. Because the silver manipulation is very much in force, were it to be terminated by CFTC actions against JPMorgan and/or others, it would be a “live” event for the first time. History shows that all manipulations end violently. In the case of silver, since it has been depressed in price by a downward manipulation, its termination would necessarily cause prices to explode higher. Any charge brought by the CFTC would send a clear signal to the world that silver had been depressed in price and was undervalued and, therefore, should be purchased. This would cause a flood of buying and discourage new selling, causing the price to truly explode, most likely in disorderly market conditions. Do you find it likely that the CFTC would wish to cause that disorderly pricing that could lead to further unsettled conditions in other markets?

If JPMorgan (and perhaps the CME Group) were found to be the main culprits in the silver manipulation and the CFTC brought charges against them, the repercussions to JPM and the CME could be a threat to them as going concerns. It was never a case that JPMorgan couldn’t financially afford to buy back its concentrated silver short position; it was always a case that should JPM ever move to buy back aggressively to the upside that would prove conclusively that it had been manipulating the price of silver all along. That would set JPMorgan (and the CME) up for a legal holocaust, both civil and criminal. There has been talk of a civil litigation nightmare for those banks deemed guilty in the developing Libor manipulation; but determining damages will be difficult because the Libor rates were allegedly manipulated both up and down, making the damages unclear and hard to prove. Were there to be findings of a downward manipulation in silver, those damaged, from investors to producing companies and countries could easily demonstrate the damage. Back in the Hunt Bros silver manipulation of 1980, one of the successful litigants was Minpeco, the government producer organization from Peru, who I remember collected more than $100 million. That would be chicken feed compared to the consequences of the much longer downward silver manipulation of today by JPMorgan. And this says nothing of potential criminal liability."

High hopes, indeed.

And here are a couple of updated charts for you. I posted similar charts into yesterday's comments section when I saw the clear and determined effort to keep gold under $1620. I suspect that there are an enormous amount of buy-stops above 1620 and 1625 that must be protected. A move that trips those stops would cause a surge in price that would likely break gold through 1635-1640 and present a clear technical buy signal to the momentum-chasing algos. To keep this from happening, 1620 is being defended. That said, The Cartels are fighting a losing battle here. Demand for physical metal continues to be extraordinarily strong in London, particularly in euro. Trader Dan wrote an excellent piece about this yesterday ( Soon, gold will break through 1620 and silver will break through 28.20. It is simply a question of when. Today? Monday? Soon. Very soon.

I've got two other posts that I have to create this morning and a podcast for TTM, too. Again, lots to do and little time to do it in so I'd better wrap this up. Please keep checking back as I will be adding content through the day.

Have a great day and a great weekend!


About the Author

turd [at] tfmetalsreport [dot] com ()


Aug 10, 2012 - 10:51am

Break on through

The Doors - Break On Through (To the Other Side)
Aug 10, 2012 - 10:52am

My impression of the PMs

Video unavailable
Aug 10, 2012 - 10:56am

Great Quotes

"There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt." John Adams

"When a business or an individual spends more than it makes, it goes bankrupt. When government does it, it sends you the bill. And when government does it for 40 years, the bill comes in two ways: higher taxes and inflation. Make no mistake about it, inflation is a tax and not by accident." Ronald Reagan

Keep stackin'

Aug 10, 2012 - 11:02am

Sick and Tired

Metals go up, metals go down, metals go up, metals go down.

And tired always follows sick.

Video unavailable
I Run Bartertown
Aug 10, 2012 - 11:09am

Nana / TF

Nana - Haha.

I remember a family gathering at that time when someone put that Bill Cosby routine on. It's the only thing I can remember that had everyone, from the small kids to the grandparents, laughing the whole time. Something for everybody in that.

Thanks for the update TF! Seems I'm seeing more people jump onboard with the explosive summer idea!

Aug 10, 2012 - 11:10am

FT article, CFTC "nothing to see here"

Of course, the 70's-porn star-mustachioed, weak-chinned leader of the dept of what justice won't do anything to any financial criminal.

This weeks FT headlines was the starting bell. At the ringing of the bell the agreement was struck. You F-tards won't go to jail. But you have got to stop. Even freaks named "Turd" are on to you. I can't stop them. You are called out. Don't embarrass me anymore than I already do.

Aug 10, 2012 - 11:15am

Beautiful cap at 28.20!

Amazing precision at 28.20. I wonder where all of those buy stops went at 28.20? Next stop either 28.35 or 28 even. What an easy trading range to make some fiat!

Short Stack
Aug 10, 2012 - 11:24am

Since someone has broached the subject.

Why is it that people (sheeple) are so willing to accept the notion that our elected officials can borrow money, create a huge debt, and we the people and our descendants are expected to pay it all back with interest ?

Did anyone reading this post borrow the money ? No. Did anyone here order their Senators and Representatives to borrow the money ? No.

Well, if we did not borrow the money and we did not receive the money, then why should we be required to pay back the money we did not borrow and did not receive ?

If your next door neighbor takes out a home loan why should he expect you to pay it back ?

Therefore, if anyone should pay back this nations debts it should be those who created the debt (the politicians). Every member of Congress who put his or her YES vote on additional spending above and beyond what is received by the tax payers, etc. should have said debt taken out of their respective Estates.

And if any debt remains, as we know there will be, make them work at hard labor until it is all paid back, or they are worked to death like a slave. Like the slaves on a slave galley.

Like the slaves they have tried to make us into.

(Oh, stay on subject, right. Metals, metals, metals. Uh, go gold, go silver. Down with manipulation.)

Aug 10, 2012 - 11:25am
Aug 10, 2012 - 11:27am


Since Platinum is a luxury item and has no history of money, it goes up in price during good economic times then plummets during bad times. Everyone may want to consider picking up some platinum after the SHTF for dirt cheap and hold it till we have some recovery, has potential to make a pretty penny

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10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
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Key Economic Events Week of 9/9

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