The End Is Near (2012)

Sat, Oct 20, 2012 - 11:37am

Time to bust out this sorry-looking SOB again.

I wasn't planning on writing anything today but then it dawned on me:

  1. After yesterday, everyone needs a subtle reminder that all is not lost.
  2. Many folks come and go all week and may have missed the general theme.

Once again, my time is short so I'll keep it simple and to the point. This current pullback/correction is nearly identical in circumstance to the pullback of January 2011. Back then, QE2 had been announced seven weeks earlier and, once the initial, euphoric push into the metals had subsided, priced were raided in order to give The Cartels time to cover some shorts. Both metals saw all of their post-QE gains clawed back over a three-week period. Desperation was in the air. The MOPE was thick with misleading economic statistics and pundits everywhere were proclaiming the death of the metal bull market.

I lived through it and wrote about it on the old "Watchtower" site . Here's a sample of the mood and tone from that period:

Finally, after three weeks of nonsense, I was fed up by the discongruent action and issued this guarantee. Old-timers will recall it as "Turd's Bottom":

This week, we reached the same place. If you haven't yet reviewed this post from Wednesday, I urge you to take the time to do it now:

Look, I really don't care what anyone else says. The chartreaders and the subscription guys can all kiss my skinny, Cornhusker rear end. As Hans and Franz would say, "Listen to me now and hear me later!"


As you can see below, both metals have nearly completed a perfect, 50% retracement of the rally from mid-August to early October. Note, too, that Relative Strength Indicies have subsequently fallen to levels from which rallies typically begin.

What happens next is easily predictable. I mean, I could be wrong but I doubt it.

With silver below its 50-day MA and gold sitting directly upon its, expect more weakness Sunday night into Monday. As gold slips below $1720, more momo-chasers will enter on the short side and gold will likely fall even further. I'd expect a low somewhere around $1700 + 10. Silver will fall toward $31.50, maybe even $31 if it really gets ugly.

At this point, all of the remaining spec short sheep will have been drawn into the trade and the metals will reverse, probably by late Monday or overnight Tuesday. The metals then may hang around in a choppy trade for a few days as they build a base and a bottom. Here's another sample from 2011, this one written on 2/1/11, seven trading days after the guarantee of "Turd's Bottom": Note that the base-building process off of this type of correction can be strenuous as the shorts try every trick in the book to regain their momentum.

Finally, based upon extraordinary fundamentals and overwhelming physical demand, the metals will charge higher once again, eclipsing $36 and $1800 on the way back to the levels last seen in the spring and summer of 2011. This will happen. Just be patient and keep the faith. Relax and continue stacking.

Have a great weekend!


About the Author

turd [at] tfmetalsreport [dot] com ()


Oct 20, 2012 - 2:41pm

My gut says something big happens this week

Drake gives Militia Alert! Bix confirms, prepare today
Oct 20, 2012 - 2:46pm

The two postings

Compare the tone and the content of my posting with that of Turd--enough said

Oct 20, 2012 - 2:49pm

Fundamentally Speaking...

@ Chibster; You are correct.

@ Markus; Election impact? NONE! Its meaningless. The results will be the same, no matter who gets "in"!

The can has been kicked to infinity. There is no longer a wall that is faced, but the fast approaching abyss. Looking over this cliff edge, there is no bottom. This is a complete and utter system failure that is staring us in the face.

As Turd said so prophetically, when he started this site, "the end of the great Keynesian experiment" is upon us.

It remains to be seen what sort of new paradigm awaits us, on the other side of this fog shrouded opaque window, out of which we are attempting to divine what that paradigm will be.

Rest assured, that gold and silver will come through with their value much enhanced.

In the meantime, keep looking at those fundamentals. They don't lie. Things are getting worse. Globally.

Oct 20, 2012 - 2:55pm

I keep telling myself - don't feed the trolls

But I can't help myself.

retireyoung - don't go away mad, just go away.

Oct 20, 2012 - 3:07pm

Dope with a Macbook

I was hoping it was at least a Macbook PRO.

We'll still love ya anyway.

Lots of respect for all the crap you put up with.

The Watchman
Oct 20, 2012 - 3:07pm
El Gordo
Oct 20, 2012 - 3:13pm


Thanks for the advice. I do not live in fear, and I'll always follow a guy named Turd before I'll follow a guy named Obama. As to what I should do with my time, I'll take your suggestions under consideration and let you know what I decide to do.

Bongo Jim
Oct 20, 2012 - 3:22pm

She wouldn't take the shiney?


Gotta give you credit for seeing if she'd take the 10 oz bar as form of payment. Not sure about the chewy candy though.

aomegaa salmonfisherman
Oct 20, 2012 - 3:38pm

Same Experience!

All my silver miners were up a fraction or flat for the day. Even GDX and the HUI were positive. I know that is not RETAIL buying. NO WAY! They won't come in until we reach new highs. I'm adding to my Juniors and stack on Monday no matter what.[Even though I will probably lose it in the lake again.] Hope they drop it to Turd's levels.

The Watchman
Oct 20, 2012 - 3:41pm
Oct 20, 2012 - 3:42pm

Beinki i laughed out loud

Beinki i laughed out loud when I saw you pay with silver. Thanks for that

Oct 20, 2012 - 3:44pm


  • Repost if you missed it. Check out Quinn's article. Btw, you and 99% of all the folks here are terrific, keep it up.
  • @ Retire- keep to your namesake and Retireyoung
  • Reply to: Hangin' Tough Apropos of yesterdays discourse by murphy 4 hours 44 min ago

    From Quinn

    Well, sometimes people see The Burning Platform as their own personal outlet and often express “I don’t like this material” or “This poster is bad for the site” or “I want to leave because of so-and-so’s comments” or “boo hoo waaaaah waaaaah I’m a blubbering baby and that offends me”…

    By now I hope you all get my point. The Burning Platform is a favorite of many people because of what The Burning Platform is. It is an uncommon recipe that many find to be their favorite supper. If you don’t like something about it, you can tell the Great Granny Of TBP the Admin to hold that specific ingredient to tailor the site to your tastes…. But for your own sake, you had secretly hope he doesn’t change a thing.

Oct 20, 2012 - 4:15pm

According to the charts

inside this article from ZH, the end we seek may still be a ways down the road:

I figure a month, or maybe two, would suit me just fine. Keep the FAITH, keep stacking and keep prepping!

Oct 20, 2012 - 4:20pm

Won't take my silver

There was one gal not in the video at the store who was into silver and she was cute too, probably a turdite. You would not believe all the people I talk to about silver, the bankers etc trying to wake them up and the looks I get. Probably the best is when I go through the drive through bank to cash my paycheck and the teller asks "How would you like that back sir?" and I reply "In silver." They are not expecting that and give me the biggest blank zombie stare....soon that will change.

The Watchman
Oct 20, 2012 - 4:45pm
Oct 20, 2012 - 4:46pm

Lots of room...

...for tax rates to go much higher.

I just left this post in The Speak with this chart and I thought I'd drag the chart out here and share it. It left a sick and uneasy feeling in my gut also.

(Click picture to enlarge)

Oct 20, 2012 - 4:51pm

marginal tax rates

yes, the 50's and 60's that our politicians want to re-create, that sucked so bad that nobody wants to remember their standard of living back then, had some pretty high rates, didn't they?

That's because our economy produced goods instead of financial fraud, which has been the case since 1980.

Oct 20, 2012 - 4:53pm


You crack me up. I am stockpiling chocholate....

Oct 20, 2012 - 4:53pm

Beinki (not to be confused with Benque)

Not sure if you had this when dealing with your local system, but don't give up! (on flouride or paying in silver, lol).

This is something that every one of us can do. No organizing, no "communes", just be a teacher. And don't go in there screaming "the Illuminati trying to kill us" of course. Be calm and professional about it. No fear.

Oct 20, 2012 - 5:12pm


In anticipation of Turd's prognosis being correct I'm going to load up on AGQ early next week and hopefully I'll see a nice increase in fiat before too long.

Oct 20, 2012 - 5:38pm


I just started looking at the AGQ options chains myself yesterday during that sell off.

I sense opportunity especially with the U.S. elections being over within 3 weeks. I think I would go out into next year in March '13 with some calls. I'd feel better with that cushion of time and I think I'll wait until after the election for sure at this point.

These prices look like they have room to fall a bit more imho.

AGQ $60 March 16,2013 Call $3.41

AGQ $65 March 16, 2012 Call $2.50

AGQ $70...........................Call $1.90

Here's the link to the options chain I took these prices from.

Oct 20, 2012 - 5:48pm

Citigroup: “They have to open up the kimono”

Investors Hope for Clarity, Quickly

As Michael L. Corbat takes up the reins at Citigroup, analysts and investors have a message for him: Shrink your bank fast, and be a lot more transparent as you do so....

Dissatisfaction with Citigroup’s progress motivated shareholders to vote against a $15 million pay package for Mr. Pandit in April. That vote came soon after the Federal Reserve turned down Citigroup’s plans to pay out capital to shareholders, a stinging indication that regulators still weren’t comfortable with the bank.

Since those expressions of discontent, Citigroup’s shares are sharply higher, though they are still down 89 percent since Mr. Pandit took over in December 2007. The stock trades at a pitiful valuation, reflecting two dominant views in the markets: Citigroup’s transformation has a long way to go, and its financial statements can be opaque....

Citigroup’s investment bank is the other obvious target for shrinkage. Right now, it is enormous. The “securities and banking” division at Citigroup has $903 billion of assets. That’s only slightly less than Goldman Sachs’s assets. And Citi’s investment bank’s revenue has been uneven since the financial crisis.

The unit is also seen as a black box, something Mr. Corbat will have to tackle if he wants to regain investors’ confidence, analysts say. Citigroup’s disclosures aren’t as detailed as those of some other banks. For instance, each quarter, Goldman Sachs releases a critical number that shows how much profit it makes on its capital.

But Citigroup doesn’t do that for its investment bank; it simply doesn’t tell outsiders how much capital it has deployed in that unit. As a result, it could be making unproductive investments in Wall Street operations without shareholders knowing. This could be true in other business lines, as well.

The quandary for Mr. Corbat may be that, if he increases disclosure, investors may balk at any alarming numbers and dump the stock. Even so, he may have to risk that outcome.

“They have to open up the kimono,” Mr. Cassidy said....


This is something I am watching. Boss skedaddles, almost as big as Goldman Sachs, and their books are a 'black box' ...

The Watchman
Oct 20, 2012 - 6:02pm
Oct 20, 2012 - 6:06pm
Oct 20, 2012 - 6:23pm

Pentagon, World's Biggest Fossil Fuel User, Shops for Biofuels

Some of the names mentioned in this article will probably be a leader in the bio-fuel industry in the future. Given the Pentagon's huge budget and appetite for fuel (and every other advantage they can think of) it would appear that one of these companies will be the recipient of literally untold BILLIONS of USD into the future when (not if) biofuel is developed large-scale.

I can't imagine that someone doesn't already know how to efficiently extract some type of green fuel from ocean algae and then eventually (and mostly from) land based plant chlorophyll in a viable manner. Our entire planet is mostly covered filled with green plant matter or ocean algae potentially.

The company who perfects our planets green energy potential is the next future energy company giant. It might be one of these names below.


Gevo, Syntroleum Vying for Military Biofuel Supply Deals

By Andrew Herndon - Oct 19, 2012 4:34 PM ET

Gevo Inc. (GEVO), Syntroleum Corp. andSolazyme Inc. (SZYM) may be among a “small set” of biofuel producers vying for supply contracts from the U.S. Defense Department, the world’s largest consumer of fossil fuels, analysts said.

The agency is preparing to announce about five initial grants to companies making fuels from renewable materials to power jet fighters, battleships and other vehicles. The decision, which according to application documents is due “on or about” today, may come Oct. 22, Laura Ortiz, the program’s agreements negotiator, said in an Oct. 17 interview.

The military bought about 130 million barrels of jet fuel, diesel and other petroleum products in fiscal 2011, and is seeking to replace as much as half with renewable biofuels. Winning one of the small initial grants will land recipients on the short list for large, long-term fuel-supply contracts, according to Pavel Molchanov, an analyst with Raymond James & Associates Inc. in Houston.

“The addressable market for the Navy and Air Force each will be in the hundreds of millions of gallons,” Molchanov said in an interview.

Gevo, Syntroleum (SYNM) and Solazyme may be on the inside track because they’re already conducting research with the military or have delivered biofuels for testing, he said. Cobalt Technologies Inc. and Sustainable Oils Inc. also meet that criteria and there may be other potential recipients “that perhaps we’re not currently anticipating.”

First Grants

Recipients of the first grants under the Advanced Drop-In Biofuel Production Project will receive about $6 million in March. In the program’s second phase nine months later, as many as three companies will share as much as $180 million to help fund commercial production facilities.

The goal is to identify and support companies “capable of producing drop-in replacement biofuels,” which can be used without requiring changes to existing engines or infrastructure and are “suitable for military use,” according to the official request for proposals. The military plans to “establish one or more complete domestic value chains” to ensure a steady supply of fuel.

Gevo, which produces isobutanol from corn, won an 11,000-gallon (42,000-liter) Air Force supply contract last year and has submitted a proposal for the biofuel grant program, Lew Phelps, a spokesman for the Englewood, Colorado-based company, said in an e-mail.

The Navy used in a July demonstration 450,000 gallons of renewable jet and marine diesel fuel that Syntroleum produced from recycled cooking oil and algae oil made by Solazyme. Syntroleum Senior Vice President of Business Development Jeffrey Bigger wouldn’t say whether the Tulsa, Oklahoma-based company applied to the biofuel grant program

Supply Contracts

The company is already in commercial production and is more interested in a long-term military supply contract than in the smaller grants to build...

(just found this pic)

Oct 20, 2012 - 6:36pm

By The Way

I bought gas today for $3.19 a gallon but just saw that a loaf of bread in Zimbabwe was 0.1 grams of gold.

What is wrong with this picture.

Oct 20, 2012 - 7:04pm

Take two minutes...

...and forget about the markets etc. and consider something wonderful.

Relax, smile and when given a happy :-)

What A Wonderful World With David Attenborough -- BBC One [FULL HD]

B. Bernanke: "QE is necessary....the benefits outweigh the costs." Jackson Hole ~ 8/31/12

Oct 20, 2012 - 7:09pm

Jim Rickards Latest!

Jim Rickards: Currency Wars Simulation
Oct 20, 2012 - 7:21pm

nuff said

My income tax rate hence forth is freakin zero.

Join me and the 1.4T$ shadow economy, my kind of dark pool.

Wife can pay, I wont. I dont file any more. Been there, done that.

I have had it with the IRS thugs

Morlocks (1960)

8 days off cigs, but still get these urges to blow up a revenue building.

Video unavailable
Admiral Ag Bar
Oct 20, 2012 - 7:24pm

Might as well drag this one back out...

from my very first post here in Turdville. Great song, cool video.

"The End's Not Near" by Band of Horses
Inspired Bicycles - Danny MacAskill April 2009


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