Head In The Sand

178
Fri, Aug 24, 2012 - 11:29am

In the past 24 hours, there's been lots of talk about a "return the the gold standard". Not surprisingly, the majority opinion comes from those who still have their heads buried deep in the sand or up their...

Hoodoo Gurus "Head In The Sand"

First, there's this from LIESman himself. What a jackass this guy is. The 1:30 minute "presentation" not only dumbs-down the discussion (I mean, seriously, explain the wisdom and economics of sound money in 90 seconds?) but note the carnival/ice-cream-man music the deltabravoes at CNBS chose to put in the background.

And CNBS also chose to run this companion piece in text form. It's made up almost entirely from bullshit and misinformation. I especially like how they quote as a source some clown from Royal Bank of Scotland who, later in the article, clearly (but unintentionally) lays his cards on the table as a died-in-the-wool progressive Keynesian. Here's some advice for you, Moorad: Forget about defending the current system and instead focus upon fixing the insolvency and "glitches" in your system that caused your bank holiday/disaster last month.

https://www.cnbc.com/id/48776347

On the bright side, here is at least a partially-helpful discussion of the reports from yesterday. But I despise this CNBS(E) anchor as he has an annoying habit of putting an "e" on everyone's name. My experience with people that do this is that they are attempting to show their intellectual superiority. What a jerk. I wonder, though, if I was a guest, would he call me "Turdy"?

Anyway, the point of all this is: It matters little what CNBS thinks. The opinion of some douchebag chief economist at RBS is insignificant. Whether or not the Republican platform states a desire to audit the Fed or study the gold standard is irrelevant. One day soon, with little or no warning, either China alone or acting in consortium will offer the world a new, asset-backed medium of foreign exchange. All of this nonsense political grandstanding cannot stop it from happening. The U.S. and the rest of the world will be forced to devalue and return to a gold standard. Period. End of story.

https://www.tfmetalsreport.com/blog/4103/nws

https://www.tfmetalsreport.com/blog/4103/nws

https://www.tfmetalsreport.com/podcast/3835/tfmr-podcast-22-john-butler-... (Please listen to this again over the weekend and BUY THIS BOOK!!)

Are you surprised that the metals are hanging in there today? Are you amazed at silver? You shouldn't be. The game has changed and prices are not looking back. Again, there will, of course, be brief pauses for profit-taking. There will not be, though, another drop toward 26 and new lows. If you're thinking that, purge the thought from your head or head back over to Kitco. I'm sure that you and Nadler could make beautiful music together.

While I'm confident that the root causes of this rally will soon be apparent for all to see, anyone who considers him/herself a "Turdite" should be looking to buy all dips and continue to stack. Next week may bring some volatility in both directions as Sep12 option expiration is on Tuesday. This is not a big month of liquidity, though, so I don't expect it to be too crazy.

Gold is banging around 1665-1675 again. Hmmmm. Does that area ring a bell with you? If it doesn't, then you must be relatively new around here. The area around 1670 has consistently been significant because it is there that gold gapped open back on Sunday 8/7/11, following the late Friday 8/5/11 downgrade of the U.S. by S&P. Recall that this move set off a Great Panic amongst The Gold Cartel and price rose from 1650 to 1920 (16%) in just four weeks. Here's a chart from that fateful evening:

And here are your up-to-date charts.

And here's a chart I "borrowed" from Trader Dan showing gold priced in euro on the verge of a breakout to new all-time highs:

OK, that's all for now. I've got a new podcast for you which I will be posting later today. I'll also be posting my impressions of the latest CoT, once it's out. As mentioned, I expect it to be very interesting so please be sure to check back either later today or over the weekend.

Now go. Get some rest. Relax and be happy. The fun is just starting.

TF

p.s. Here's a little more Hoodoo Gurus for you to start your weekend.

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  178 Comments

Bollocks
Aug 24, 2012 - 11:30am
DaddyO
Aug 24, 2012 - 11:32am

If your heads in the sand...

then other parts of your anatomy are pointing skyward!

This seems to be the mode of operation for the central planners, eh Bernanke?

A great crashing sound can be heard off in the distance and getting closer.

DaddyO

Mr. Fix
Aug 24, 2012 - 11:34am

Thurd Place

Off to Work I go now,

Wishing you all a wonderful and profitable day .

Zoltan
Aug 24, 2012 - 11:41am

Zoltan's Lease Rate Spike Prediction

A week from today the lease rates will (again) spike to negative for the weekend to allow some lucky party (the US government?) to roll their leased gold.

Wanted this prediction on main street. Not sure if anyone cares (maybe S Roche and I) but this is a big part of the crooked game they play.

Z

heyJoe
Aug 24, 2012 - 11:43am

Head in the Sand

Not a complete waste. These folks make great bicycle stands.

Bollocks
Aug 24, 2012 - 11:43am

Well, I hope you're right...

"Are you amazed at silver? You shouldn't be. The game has changed and prices are not looking back. Again, there will, of course, be brief pauses for profit-taking. There will not be, though, another drop toward 26 and new lows."

I kind-of hope it does, for a bit. Just to get more dirt-cheap!

edit: not that it's not dirt cheap in the 30's of course, it's just that ooooh, I do love an ultra-bargain!

50sQuiff
Aug 24, 2012 - 11:49am

tmosely, re: 'free stuff' from previous thread

The US trade deficit (which it's run continuously for what, 40 years?) represents a net inflow of free stuff. Ergo, at the margin the US exports its currency and gets real stuff in return. This would be inflationary if it weren't for the fact that Europe, then China since 2001 have soaked up the dollar overhang by purchasing Treasuries.

So yes, the US has been in a unique position since about 1922, where the rest of the world agreed to hold US Debt as forex reserves. Subsequently, vast amounts of currency and currency obligations were created without any major inflationary feedback. This process seems to have ground to a halt in 2011 when China stopped expanding its dollar reserves. In the meantime Japan has stepped into the breech, but we know this position is untenable from Japan's declining current account surplus.

Once the music stops, gold launches.

Aug 24, 2012 - 11:51am

For anyone interested

I last bought phyzz on 8/16 and I just bought some more this morning.

Tube
Aug 24, 2012 - 11:54am
Pellet
Aug 24, 2012 - 11:55am

What's ahead

Here is my OPINION on what is ahead:

1. Gold will be capped at 1575 or so and rangebound for a little while.

2. Volatility is increasing. Santa said that 100 point price swings are ahead. I don't think we are there yet, but now that gold is on the move, volatility will be a couple notches higher than it has been the past few months.

3. I would expect the Cartel to make a couple/few raids over the next several weeks. Price could get down to 1600 or so, but it would rebound pretty quickly.

4. Regarding Turd's predicted HEH Summer- It has started, and the bulk of it could be summer or it could be fall. It is really hard to predict the timing of these things. But it is definitely coming, it is not that far off, and it will be historic. I am expecting a pretty rapid rise to over 2000.

5. For those trading gold futures (like me) or options or silver, fasten your seat belts.

6. I am a gold person, and I stay away from silver after getting burned. But I would expect silver action to mirror gold action.

I could be proved wrong in the next ten minutes. I know how Turd feels about sticking his neck out. This is my 2 cents, FWIW.

Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

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Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

Key Economic Events Week of 10/7

10/8 8:30 ET Producer Price Index
10/9 10:00 ET Job Openings
10/9 10:00 ET Wholesale Inventories
10/9 2:00 ET September FOMC minutes
10/10 8:30 ET Consumer Price Index
10/11 10:00 ET Consumer Sentiment

Key Economic Events Week of 9/30

9/30 9:45 ET Chicago PMI
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/1 10:00 ET Construction Spending
10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
10/3 9:45 ET Markit Service PMI
10/3 10:00 ET ISM Service PMI
10/3 10:00 ET Factory Orders
10/4 8:30 ET BLSBS
10/4 8:30 ET US Trade Deficit

Key Economic Events Week of 9/23

9/23 9:45 ET Markit flash PMIs
9/24 10:00 ET Consumer Confidence
9/26 8:30 ET Q2 GDP third guess
9/27 8:30 ET Durable Goods
9/27 8:30 ET Pers Inc and Cons Spend
9/27 8:30 ET Core Inflation

Key Economic Events Week of 9/16

9/17 9:15 ET Cap Ute & Ind Prod
9/18 8:30 ET Housing Starts & Bldg Perm.
9/18 2:00 ET Fedlines
9/18 2:30 ET CGP presser
9/19 8:30 ET Philly Fed
9/19 10:00 ET Existing Home Sales

Key Economic Events Week of 9/9

9/10 10:00 ET Job openings
9/11 8:30 ET PPI
9/11 10:00 ET Wholesale Inv.
9/12 8:30 ET CPI
9/13 8:30 ET Retail Sales
9/13 10:00 ET Consumer Sentiment
9/13 10:00 ET Business Inv.

Key Economic Events Week of 9/3

9/3 9:45 ET Markit Manu PMI
9/3 10:00 ET ISM Manu PMI
9/3 10:00 ET Construction Spending
9/4 8:30 ET Foreign Trade Deficit
9/5 9:45 ET Markit Svc PMI
9/5 10:00 ET ISM Svc PMI
9/5 10:00 ET Factory Orders
9/6 8:30 ET BLSBS

Key Economic Events Week of 8/26

8/26 8:30 ET Durable Goods
8/27 9:00 ET Case-Shiller Home Price Idx
8/27 10:00 ET Consumer Confidence
8/29 8:30 ET Q2 GDP 2nd guess
8/29 8:30 ET Advance Trade in Goods
8/30 8:30 ET Pers. Inc. and Cons. Spend.
8/30 8:30 ET Core Inflation
8/30 9:45 ET Chicago PMI

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

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