Weekend Review

481
Sat, Sep 22, 2012 - 12:16pm

What an interesting week. Instead of volatility, we got containment and flatlines. Something tells me next week won't be the same.

Ponder this for a moment, QE∞ is announced as official Fed policy last Thursday. That day gold, the only alternative currency to steadily-debasing fiat, responds with a $38 move. Frankly, I would have expected more but, given the Cartel propensity for containing daily moves at either the +1% or +2% levels, $38 seemed about right. However, over the next five days, would you have expected this?

  • Friday, 9/14: net change +$0.60
  • Monday, 9/17: -$2.10
  • Tuesday, 9/18: +$0.60
  • Wednesday 9/19: +$0.50
  • Thursday 9/20: -$1.50

So, cumulatively over the next five days trading in gold, immediately following the long-awaited announcement of QE∞, the total change was down $1.90. Huh?? And, again, it's not like we saw the +$20, -$22, +$31 kind of volatility you would have expected. Very strange and, once again, subtle evidence of the outright blatant and ongoing manipulation and "managed ascent" of the paper price by The Gold Bullion Banking Cartel.

To no one's surprise, this week's CoT continued the trend of Cartel naked short issuance to contain price. Again, I'm not really sure who wrote the mandate that JPM, DB et al have to act as market makers in the metals but, for some reason, that is the role they allege to play. Spec money comes into the pit and the banks issue the highly-leveraged paper. Not content to see price bid up as the spec bids search for willing sellers of existing contracts, The Cartel, instead, simply issues brand new contracts to satisfy demand.

In doing so, The Gold Cartel added another 18,196 short contracts this week and brought their net short ratio back up to an astonishingly dangerous (to them) 2.68:1. Why is this so dangerous, you ask? Because they are continuing to play this game as if none of the fundamentals have changed. This is no longer 2002 or 2008. It's not even 2011. We are near The End Game for fiat currency and the "creditor nations" around the globe recognize this. The are readily exchanging their rapidly-devaluing fiat for hard assets, gold in particular. This insatiable physical demand underpins the paper market and makes precipitous, short-covering drops, like we've seen The Cartel execute in the past, all but impossible. Oh sure, there will still be selloffs and beatdowns...Heck, we saw one yesterday...but incessant physical demand forces The Cartel to quickly turn tail and buy in order to cover and secure the metal required to meet the allocations sought at every London fix.

So, again, look to buy the dips. Not every $5 dip, mind you, but any substantial dip the pushes price back to obvious support points. Right now, the obvious area is around $1755-1760. IF a dip develops early next week, I'll be all over it. Gold looks certain to soon blast through $1780 and then $1800. From there, I expect a rapid move toward the old all-time highs of $1920. At that point, gold could, once again, get disorderly to the upside, similar to what we saw in August of 2011. It will likely break out and UP through the long-term channel again and head toward and through $2000.

And here is a long-term chart of gold priced in euros. Recall that we've been discussing for weeks how euro/gold was getting well ahead of dollar/gold and that dollar gold would eventually catch up. A month ago, euro/gold was showing that $1800 gold was coming. Now, euro gold makes it look like $1920 gold is only about a month away. (Chart courtesy Trader Dan: https://www.traderdannorcini.blogspot.com/2012/09/euro-gold-on-track-for-all-time-high.html)

And JPM and their pals continue to play games with silver, blissfully unaware that their dynasty has ended. Just last week, they added another 2,880 short contracts in a vain attempt to pin price below $35 and protect the vulnerable buy-stops near $35.50 that, if tripped, would send silver quickly toward $37.50. Oh well, screw 'em. So they "won" this week. Whatever. They're just going to lose eventually so what's another week of waiting. Now at a total gross short position of 82,358 contracts and a net short ratio of 2.58:1, The Silver Cartel is sitting on a powderkeg of their making. Boy is it ever going to be fun to watch it explode right under them.

As The Doc pointed out yesterday, The Forces of Darkness expended a lot of ammunition yesterday in a desperate attempt to start a cascade and keep price under $35. ( https://www.silverdoctors.com/cartel-dumped-2x-annual-us-silver-production-on-market-in-15-min-to-smash-silver-under-35/) They now find themselves in a bit of a jam as we head into Tuesday. They'll need to cover quite a few contracts before the 1:25 EDT close that day or they risk showing their footprints on next week's CoT. What will they do? Cover, of course! Now the question is, will they gamble by raiding first and hoping for a steep enough selloff that they can cover the raid "material" and more on the way back up? Maybe but I doubt it. Physical demand will easily blunt the dip again just as it did yesterday. Their only logical choice, after being thwarted yesterday, is to begin to cover yesterday's new shorts as early as Monday, otherwise they risk a significantly "Happy Tuesday" that blows out those $35.50-area buy stops and send price toward $37+. What to do, what to do. A whole lot of choices, all of them bad. HAHAHAHAHA! You did this to yourselves, you arrogant bastards, and now you're stuck. You'll get no sympathy around here.

And in case the action in crude this week left you feeling that global peace and harmony were right around the corner, I give you this to ponder: https://www.zerohedge.com/news/2012-09-22/head-irans-revolutionary-guards-war-israel-will-occur

In that same vein, I was contacted this week by a nice guy who asked me to link a few of his prepping articles. I certainly hope you are using this time to full consider these topics: https://destinysurvival.com/2012/09/03/food-storage-how-to-calculate-for-your-needs/ & https://www.emergencyfoodstorage101.com/2012/08/07/being-prepared-for-power-outages/. Of course (shameless plug coming), you can find many of these items by visiting the Turdmart, a link to which is conveniently placed at the top of each page but copied below for your convenience.

https://www.tfmetalsreport.com/preparation-store

I hope that everyone has a safe, fun and relaxing weekend. Come back on Monday and be prepared for a week that is considerably more volatile and interesting than this past one was.

TF

11:00 pm (23:00) EDT Sunday UPDATE:

So, what the hell happened at 20:58? Anyone have a guess? I do but, first, let's look at the charts:

At exactly the same time, the POSX began an uptrend that carried it 20 ticks higher over the next hour.

So, what we likely have here is another HFT algo (WOPR) run amok. True Cartel hit jobs rarely impact so many markets across the board. On a light volume Sunday night, a brainless computer "saw" the uptick in The Pig and began program selling.

Regardless of instigator or intention, it is going to be very difficult to break down paper price much further. Difficult but not impossible. That said, I will be very surprised to see the metals considerably lower in the morning as there is no reason to expect a buyers strike in London on Monday. As mentioned Friday, gold should have considerable support near $1750. Silver will continue to find bids, just as it did two hours ago, near $33.50.

Hang in there and try not to panic. If protracted selling does come in, consider it a blessing. Please consider any and all bouts of price weakness as opportunities to add to your stack.

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  481 Comments

tmosley johnnydow
Sep 22, 2012 - 7:24pm

Dearest Johnnydow, Eat shit

Dearest Johnnydow,

Eat shit and die.

Signed,

Everyone

PS, ignored.

Urban Roman
Sep 22, 2012 - 7:29pm

Turd Hat

@TexAsh, damn you're right!

BTFTH!

Sep 22, 2012 - 7:30pm

Spain: "much as it did before the Civil War in the 1930s"

Spain risks break-up as Mariano Rajoy stirs Catalan fury:

The ruling parties of Catalonia have sought guidance from Brussels on the legality of secession from Spain, requesting a “route map” for membership of the European Union and the euro as an independent state.

It is the latest move in a fast-escalating clash between Catalan nationalists and Spanish nationalists, the latter backed by King Juan Carlos and the Spanish military. Jose-Manuel Garcia-Margallo, the foreign minister, threw down the gauntlet, calling Catalan secession “illegal and lethal”. He warned that Spain would use its veto to stop the region of Catalonia becoming an EU member “indefinitely”.

The constitutional crisis has eclipsed the parallel drama of a Spanish bail-out request from the European Stability Mechanism. It is no longer clear whether premier Mariano Rajoy can deliver on any austerity deal with Brussels.

Catalan leader Artur Mas held high-stakes talks with Mr Rajoy in Madrid on Thursday, armed with a mandate from the Catalan parliament and with charged emotions left from an unprecedented protest by 1.5m people in Barcelona 10 days ago.

He demanded an independent treasury for the rich Catalan region, with control over its own tax base akin to the model already enjoyed by Basques. The 9m Catalans have an economy the size of Austria’s.

Spain’s economic slump has frayed nerves across the country, much as it did before the Civil War in the 1930s. Unemployment has risen to 25.1pc and may go higher as the delayed effects of austerity bite deeper....

https://www.telegraph.co.uk/finance/financialcrisis/9556803/Spain-risks-...

...

Mr. Fix
Sep 22, 2012 - 7:35pm

Fred,

Yep,

the folks who run the Comex are complete fvcking liars.

Roark
Sep 22, 2012 - 7:48pm

@Turd: Re Nice Guy Prepper links. WTF?

Did anyone else hit the Nice Guy Prepper links Turd posted? 99% of the time I am thinking riht along the Turdian Groove, but when I hit those links I just had to laugh. This guy is an EXPERT and this stuff is offered as GUIDANCE? Seriously? His solution to how much food to store is "you need 2200 calories now go go and hit one of the on-line calcs"? Not a word about what stores well, how to store it, or protein/carb/fat distribution. Nothing about aminos, micronutrients, etc. The bit about surviving a power outage is basically "call the power company and read the FEMA guidelines"? No offense, Turd. Just sayin'. A nice guy he may be, but from what I saw that website could be penned by any 12 year old.

Fred Hayek
Sep 22, 2012 - 8:05pm

Please quit misrepresenting aspects of the Citizens United case

I'm sick to death of people referring to aspects of the Citizens United case that went before the supreme court and misrepresenting it. Because unless you're an idiot who recoils from the very notion of a corporation like a vampire from sunlight, then you will probably agree that, in some ways, a legally constituted association of people should still have the rights that people would otherwise have.

The story begins in 2002 with asshole John McCain and moonbat Russ Feingold. McCain, a scummy bribe taking bully, unencumbered by principles or thought, wanted to rid himself of the taint of being one of the infamous "Keating 5" congressman and senators known to have taken bribes from the S&L crook Keating. Feingold, a left wing senator believed that every atom of american life should be regulated by centralized power. It was a match made in hell. Its spawn was a law, the McCain-Feingold campaign finance act, which had some rather ridiculous provisions. One of these was that within a certain time before an election, 30 days before a primary or 60 days before a general election, it was ILLEGAL for a corporation or union to run ads and you couldn't run "single issue" ads. Interestingly, the McCain-Feingold asshole/moonbat protection law put no such restrictions on incumbents.

George W. Bush, being neither particularly conservative nor particularly sentient, signed the bill.

It did none of what it was supposed to do with respect to -gasp- taking money out of politics. It just wrote new rules about how you complied with the law . . . except for the ridiculously unconstitutional restrictions on when a citizen or group of citizens could run an ad about a candidate.

Try to imagine, Jefferson, Madison et al. sitting around a table in the late 1780's debating the constitution and especially the first amendment. Does anyone really imagine them adding in a clause that says the government shall not restrict freedom of speech . . . except close to an election?!

Well, in 2008, a group of conservatives saw the looming Hillary Clinton presidential run and didn't like what they saw. They decided to put together a documentary to point out to the public the many warts and unsavory aspects of piano legs Clinton. Because none of them were individually wealthy enough to finance it, they created a corporation to which they all contributed and which would bear any liability if somehow something went wrong in filming etc. . They put out their documentary and ran afoul of the McCain-Feingold asshole/moonbat protection law. The documentary was deemed a political ad. And it was running too close to some of the primaries. They challenged the constitutionality of stopping free speech by anyone.

Now, as it turned out, like track star Jim Ryun in the 1968 olympics, Hillary Clinton was upset by a skinny Kenyan. But the case went to the supreme court and the court issued a ruling that covered more ground than just the issue of whether the people who made the Citizens United documentary attacking Hillary Clinton should be allowed to do such a thing.

But, along with taking away monetary restrictions on corporations, the decision said that you couldn't muzzle groups of citizens just because they had joined together in a corporation to finance a particular expression of free speech. In that particular respect, even the people reflexively sneering out the line "corporations are people" with little Gap Girl laughs and snorts will probably have to admit that a corporation probably should be treated as though it was an individual.

As to the money aspect of it, I think we would be better served by sunlight than cell walls. We need the press to do its job. Unfortunately they do not. But I'd be more comfortable without restrictions on politicians taking money but with huge new requirements to report it. Make candidates run ads in prime time in which they have to read off who they got money from and how much. Imagine how much less of a . . hope! and . . . change! . . candidate Obama would have seemed in 2008 if he'd had to run a tv ad in which he read off that he got XXX,000 thousand dollars from JP Morgan and ZZZ,000 thousand dollars from Goldman Sachs. Trying to restrict money will never be effective until you get grossly unconstitutional about it. Making candidates tell you the truth about where they got their money, before the election, would be better, IMO.

Sorry for the longwinded post but I'm sick to death of people casually denigrating everything about the Citizens United case without naming it or admitting that there was much to it with which they probably agree.

El Gordo Mr. Fix
Sep 22, 2012 - 8:14pm

Mr. Fix...

I can see that you and I are in agreement on just about everything that has happened and where we stand right now. I guess as long and NASCAR and the NFL come on TV and the food stamp cards keep being recharged every month the great unwashed will never notice a thing. My real question is after the collapse and NWO or whatever, what are they going to do with all those slugs once they don't need them to vote anymore?

LongGoldLongSilver
Sep 22, 2012 - 8:15pm

Silver COT

The COT chart for silver is very extreme. The commercials have been piling on shorts. I usually would call a short-term top when it looks like that, but with QEUnlimited in the works...I simply don't know. Nevertheless interesting...


https://MiningStockValuator.com - Free portfolio tracker & analysis of gold and silver stocks

Dyna mo hum
Sep 22, 2012 - 8:37pm

Ahmaddinejad

It seems the little prick is staying at the Hilton in NYC. I wish I could send the little bastard a platter of my world famous exlax brownies. Or better perhaps the head chef is with the Mossad. https://www.globalpost.com/dispatch/news/regions/middle-east/iran/120922...

Mr. Fix
Sep 22, 2012 - 8:41pm

@ El Gordo.

Genocide.

Subscribe or login to read all comments.

Contribute

Donate Shop

Get Your Subscriber Benefits

Exclusive discount for silver purchases, and a private iTunes feed for TF Metals Report podcasts!

Key Economic Events Week of 7/22

7/23 10:00 ET Existing home sales
7/23 10:00 ET Richmond Fed Manu Idx
7/24 9:45 ET flash Markit PMIs
7/25 8:00 ET Count Draghi/ECB policy meeting
7/25 8:30 ET Durable Goods
7/25 8:30 ET Wholesale Inventories
7/26 8:30 ET Q2 GDP first guess

Key Economic Events Week of 7/15

7/15 8:30 ET Empire State Fed Index
7/16 8:30 ET Retail Sales and Import Price Index
7/16 9:15 ET Cap Ute and Ind Prod
7/16 10:00 ET Business Inventories
7/17 8:30 ET Housing Starts and Building Permits
7/18 8:30 ET Philly Fed
7/19 10:00 ET Consumer Sentiment

Key Economic Events Week of 7/8

7/9 8:45 ET Fed Stress Conference, three Goon speeches
7/10 8:30 ET CGP Hump-Hawk prepared remarks
7/10 10:00 ET CGP Hump-Hawk House
7/10 10:00 ET Wholesale Inventories
7/10 2:00 ET June FOMC minutes
7/11 8:30 ET CPI
7/11 10:00 ET CGP Hump-Hawk Senate
7/11 12:30 ET Goon Williams
7/12 8:30 ET PPI

Key Economic Events Week of 7/1

7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 10:00 ET Construction Spending
7/2 6:35 ET Goon Williams
7/3 8:15 ET ADP June employment
7/3 8:30 ET Trade Deficit
7/3 9:45 ET Markit Services PMI
7/3 10:00 ET ISM Services PMI
7/3 10:00 ET Factory Orders
7/4 US Market Holiday
7/5 8:30 ET BLSBS

Key Economic Events Week of 6/24

6/25 10:00 ET New Home Sales
6/25 1:00 pm ET Chief Goon Powell
6/25 5:30 pm ET Goon Bullard
6/26 8:30 ET Durable Goods
6/27 8:30 ET Q1 GDP final guess
6/28 8:30 ET Personal Income and Consumer Spending
6/28 8:30 ET Core Inflation
6/28 9:45 ET Chicago PMI

Key Economic Events Week of 6/17

6/18 8:30 ET Housing Starts and Building Permits
6/19 2:00 ET FOMC Fedlines
6/19 2:30 ET CGP presser
6/20 8:30 ET Philly Fed
6/21 9:45 ET Markit flash June PMIs

Key Economic Events Week of 6/10

6/11 8:30 ET Producer Price Index
6/12 8:30 ET Consumer Price Index
6/13 8:30 ET Import Price Index
6/14 8:30 ET Retail Sales
6/14 9:15 ET Cap Ute and Ind Prod
6/14 10:00 ET Business Inventories

Key Economic Events Week of 6/3

6/4 All day Fed conference in Chicago
6/4 10:00 ET Factory Order
6/5 9:45 ET Markit Services PMI
6/5 10:00 ET ISM Services PMI
6/6 8:30 ET US Trace Deficit
6/7 8:30 ET BLSBS
6/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 5/28

5/28 10:00 ET Consumer Confidence
5/30 8:30 ET Q1 GDP 2nd guess
5/31 8:30 ET Personal Income and Consumer Spending
5/31 8:30 ET Core Inflation
5/31 9:45 ET Chicago PMI

Key Economic Events Week of 5/20

5/20 7:00 pm ET CGP speech
5/21 10:00 ET Existing Home Sales
5/22 2:00 ET FOMC minutes
5/23 9:45 ET Markit PMIs
5/24 8:30 ET Durable Goods

Recent Comments

by lakedweller2, Jul 23, 2019 - 11:39pm
by AvgAmerican, Jul 23, 2019 - 10:52pm
by Winder, Jul 23, 2019 - 10:52pm
by climbthathill, Jul 23, 2019 - 10:17pm
by DAGEORGE42, Jul 23, 2019 - 9:49pm

Forum Discussion

by HappyNow, Jul 23, 2019 - 10:18pm
by Scarecrow, Jul 23, 2019 - 4:54pm
by zman, Jul 23, 2019 - 2:07pm
by zman, Jul 23, 2019 - 2:00pm
by NW VIEW, Jul 23, 2019 - 11:45am
by silver66, Jul 23, 2019 - 11:38am
randomness