Another Parallel

242
Tue, Oct 23, 2012 - 10:40am

Continuing with the current theme, here's another reprint for you. Party like it's 2011!!

Just six, short days after calling "Turd's Bottom" and issuing a guarantee, (https://tfmetalsreport.blogspot.com/2011/01/1600-gold-by-june-10-2011.html) all looked lost. It was January 27, 2011. Prices had peaked three weeks earlier in the post-QE2 euphoria and now nearly every "maven" was dumbfounded by the continuing weakness. Sound familiar?

So, for today, I invite everyone to go back to "The Watchtower" and review this post:

https://tfmetalsreport.blogspot.com/2011/01/sour-grapes.html

You'll find all sorts of parallels to today...even references to the sudden appearance of a shadowy "insider" who had begun posting cryptic messages on the Yahoo Finance boards.

Anyway, keep the faith and hang in there. This, too, shall pass.

TF

About the Author

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

  242 Comments

Roark
Oct 23, 2012 - 11:38am

@Groaner

Ok. 100 hat tips to you. :) It had been a while since I sprayed Diet Coke all over my iPad...

Groaner Roark
Oct 23, 2012 - 11:39am

I wondered if anyone got

I wondered if anyone got it...

Mickey
Oct 23, 2012 - 11:41am

in any event

I sense today is a good day to be buying the metals or miners-might be better tomorrow but who knows? Its a game to keep the bulk of the folks out of this sector-and my sense also is that folks like us have limited capital to put any stress on cartel.

So if the sovereigns are buying whats that saying and why is the US CB buying treasuries while other CB's buy PM?

Groaner
Oct 23, 2012 - 11:41am

So just 4000 more points to the downside and the dow will be

at fair value.. or still too high?? let's face it, up on helium

The Watchman
Oct 23, 2012 - 11:43am
Gont
Oct 23, 2012 - 11:45am

UCO

Trrr....rryyyyyiinnggggg........ttttt.ttt........ttttoooooooooo

sssssss..........sssssshhhhhhhhhhhove

myyyyyyyyyyyy..........UCO

Uppppppppppppppp.......mmmmmmyyyyyyyyyyyyy aaaaaaaaaasssssssssssssssssssssssssssssssssssssssss

alphamorph
Oct 23, 2012 - 11:50am

Feeling squeezed

Holy crap have I taken a beating on oil but some drillers are holding

their ground today despite continuing plunge in WTC.

A certain aspect of my physicality is seriously puckered over
this PM plunge. I prepared my miners for this on Friday but
second guessed myself yesterday and went back in.

Worthy of note, Trader Dan said over the weekend that we've
essentially touched bottom in PMs so long as the HUI holds $480
area. It rose to over $500 yesterday and currently stands
around $490.

Still hopeful and all in.

Ten_of_Swords
Oct 23, 2012 - 11:51am

Will this be allowed?

It seems to me that an unbiased/independent ratings agency would not be in the interest of the Banks of the world. I think that Egan Jones may be targeted for termination to prevent this from happening. It was EJ that led the downgrading charge.

Reuters / Kacper Pempel

China’s Dagong Global Credit Rating agency is to set up the joint venture with US-based Egan-Jones Ratings Co (EJR) and Russia's RusRating JSC to challenge the three major US ratings agencies.

"The current international credit rating system has proven inadequate to the task of producing responsible and reliable ratings," Dagong said in a statement, adding that a new agency is needed to "mitigate economic risk in the development of human civilization".

The new institution, called Universal Credit Rating Group, will handle global ratings "as an entirely independent rating service provider", which "do not represent the interest of any particular country or group”. Earlier this year the head of Dagong, Guan Jianzhong called for the creation of a global credit rating system with uniform standards.

The rest of the article here:

Groaner
Oct 23, 2012 - 11:52am

The United States of Apple will save the market

New Ipad coming out.. the whole GDP rides on apple..

SilverFocker
Oct 23, 2012 - 12:06pm
Sisyphus
Oct 23, 2012 - 12:08pm

TA to infinity?

Not going to get involved with the recent spat over this, but I always wondered why TAs always contradicted other TAs. Aren't they looking at the same charts?

Yet at any point you can always find a TA to say:

1) It's going up.

2) It's going down.

3) It will break soon, but I dunno whether it will break up or down.

4) Erm...

Obviously a fine art, this TA business!

Groaner
Oct 23, 2012 - 12:08pm

the miners stink today. is that a good sign?

so much for going against the markets

rtabit
Oct 23, 2012 - 12:14pm

Oct 23, 2012 - 12:17pm

Another great presentation

From Santiago Capital. Click the link, enter a name and watch.

https://play.goldmail.com/xml4hydrm4yq

Money By Trading
Oct 23, 2012 - 12:17pm
ratioarbitrage
Oct 23, 2012 - 12:18pm

How manipulation fails

Fact 1:

A very rapid and powerful move, which implies a very steep gradient, is very likely to occur at some time during the next few months due to seasonal and fundamental factors.

Fact 2:

The gradient of the current upward move, as measured by a line drawn from its beginning to the end of wave 2, is now significantly weaker than the gradient of the move seen in 2010/2011.

Assumption 1:

The gradient of the next major upward move in XAG will be defined by a line drawn from its beginning to the end of wave 2. This is at least approximately true of all coherent moves.

Assumption 2:

Market players, perceiving the gradient of the current move to be too shallow but aware of the fundamental necessity for a sharp upward correction, will simply reject the July/August bottom as the starting point for the major upward move.

Consequences:

1) The major upward move is yet to begin.

When it does begin, it may / should have a gradient which is much steeper than the apparent gradient of the current upward move. Perhaps this is the fundamental-related "HEH" move as opposed to the MSM-driven QE bounce. In any case, once that move is established, the low points in July 2012 and October/November 2012 will together form a composite bottom. The poor sentiment seen at present - despite the fact that we are in the process of forming a significantly higher low - is also typical of such a bottom.

2) Since the gradient of this move is - due to their action - as yet undefined, it may be much higher than any of us anticipate.

This is the essential process that takes place in many failures of downward price manipulation. It will be the gradient from THIS bottom to the next one (who knows where) that will ultimately determine the nature of the move.

3) We are essentially still at the bottom, with all the attendant risks and opportunities.

tobydaniel
Oct 23, 2012 - 12:18pm

Deflation here we come

Stocks are cheaper, metals are cheaper, oil is cheaper. The more fiat we print, the less expensive things get! Lets just print up 100 trillion bucks. Everything will be free:)


Oct 23, 2012 - 12:19pm

re Bernanke quote @ SilverFocker

Oct 23 (Reuters) - U.S. Federal Reserve Chairman Ben Bernanke has told close friends he probably will not stand for a third term at the central bank even if President Barack Obama wins the Nov. 6 election, the New York Times reported.

As my cruel kids would say, "He has friends?"

ClinkinKY Groaner
Oct 23, 2012 - 12:20pm

@ Groaner

Wish I'd been sharp enough to buy AAPL a couple years ago. I could then buy a lot more PMs. Just sayin'

---------------------------------------------------------------------------------------------------

bigal60
Oct 23, 2012 - 12:21pm

Turd link not working on above

The requested GoldMail does not exist.

Groaner George Clooney
Oct 23, 2012 - 12:22pm

what a joke

why does the Private for Profit bank, FED, need to have their Chairman elected? To keep the illusion going I guess.

Beastly Stack
Oct 23, 2012 - 12:23pm

Please Make A Case?

OK,I do NOT want to be a Debbie Downer here however please tell me what will halt the Equity slide other than the Fed?

US economy stinks!

Europe,Austerity is crippling growth!

If you don't think the 2 above is slowing down Asia-I think it is safe to say you have lost a few marbles.

I have always favored Gold more than silver for the most part because of JIm Sinclair and the fact that silver is industrial.Yes I believe Silver will follow GOLD to the upside but I do believe it will have a tougher go with crashing equities.I am only pointing this out to help those looking for a bottom today.BE CAREFUL!

GOLD will stop going down where the BIG MONEY see ULTIMATE VALUE.You will see this when the market gets there.I would not be surprised to see 1650,as far as Silver,I simply don't want to guess.I am only thinking this way because of the elections and I would not be surprised to see oil trade below 80 in the coming weeks as well.

It has been a full week since I have exited all my positions and I am glad I have not jumped in yet.I am looking to buy Gold @1670 and I don't care if I have to wait another 2 weeks to do it.

I am not trying to be a douche or rain on anyones parade.I am just observing from the sidelines for a change,and my experience with these markets is the reason I am on the sideline waiting to see how everything pans out.

I really am very cautious of the whole world right now and ultimately feel that GOLD iis the place to be and am grateful for the prices given to us by the Cartel!

Be STRONG-Be MORE PATIENT!

Colonel Angus
Oct 23, 2012 - 12:23pm

Nostradumbass

Thanks for the memory, Turd. I needed a chuckle on the day, and I haven't even cared about the markets all day....when I think about markets, maybe I'll need another smile. You are so good with the writing that maybe you ought to start your own blog or website or something. I bet lots of people would follow it.

agNau
Oct 23, 2012 - 12:23pm

The problem with the FED's recent.......

IS the open ended stipulation. NOW, further stimulation (greater quanities of fiat) is waking even those with free OBAMA phones pressed to their ears....NAH! *Note Japans calls for more QE after only one month passing from prior.(ZH) When begun,Japan could do QE and sustain because they were the only one's in the final PONZI mode at the time....and a variety of other economic plus's for their nation. NOW with the entire world experiencing a massive credit cycle unwinding/deleveraging.......and ALL countries printing.....the effect wears off FAST! I have stated long ago, that when things get bad enough the "Deal" would be broken.....someone would bolt for the door. Several cracks appear now. The most obvious being the Bundsbank recall of their gold. This could rapidly turn to a waterfall like moment as more realize their gold may be in play....they may be at the end of the line holding only crumbs....IOU's. I predict THINGS ARE ABOUT TO SPEED UP. IF you think things have been chaotic, and coming at the speed of light, where you can hardly react to one event when another arrives..........I BELIEVE WE ARE SHIFTING TO A HIGHER GEAR! The ELECTION CYCLE WILL MARK THE END OF THIRD GEAR......WE WILL SEE A SHIFT TO FOURTH....... AND KEEPING WITH THE "LESS BANG FOR THE BUCK" RETURN ON QE INVESTMENT........OVERDRIVE IS NOT FAR BEHIND. The end of this system is drawing exponentially closer/exponentially faster.

SteveW
Oct 23, 2012 - 12:27pm

Spread Management

There have been many comments on the Internet regarding Sinclair’s recent column on spread management. I have no way of knowing whether my interpretation is correct but thought I would set it out here as an example for comment.

The “spread” is the difference between the buying and selling price (much as any small business) and represents the profit before expenses (and before the “management” that is peculiar to banks.)

So today, as a bank, I enter into a contract with an approved refinery to buy good delivery bars in 6 months i.e. April. Since the refinery is selling their product forward they likely need the capital. I’m prepared to pay now in full (at today’s spot price of around $1710 less $10 as I’m accepting all the risk of a decline over 6 months). I’ll even provide the money at a preferred interest rate of 4% since their collateral is good. So I’ve already made $34 per ounce for the Finance division on their thin air money. If the refinery doesn’t like the terms they can go elsewhere, ha, ha or we negotiate the discount and the interest rate.

For each 400 oz bar (4 CME contract equivalents) I now buy 40 April 2013 contracts at $1714 and then sell 80 October 2013 contracts at $1725. I’m already 2:1 short over my market management so I’m simply maintaining my position and since less than 5% of contracts are fulfilled the 400 oz delivered in April will cover my October shorts so there is no risk. Looking at my spread I’m long 40 April balanced by 40 Oct shorts for a spread of $11 multiplied by my 10X leverage for a spread of $110 per purchased oz. I also have additional 40 Oct shorts that I will buy back when I repeat this process for October and which provides a trading stock.

Since I run the market I always make a profit.

TF
Oct 23, 2012 - 12:28pm

And once you've watched Brent's presentation

Ask yourself what might happen to the metals when The Bernank lowers the excess reserves rate. And what if he does this tomorrow??

Fritz SRSrocco
Oct 23, 2012 - 12:29pm

REPLY @SRS

I thought you might want to contact Silver Wheaton because they stand in the same position that you and I do . . . and probably have the most significant vested interest in cutting thorugh the blurring bushes. Several of the Silver Wheaton fellows left and formed Sandstrom . . . Another entity that must get it right (at least in these beginning years) or face oblivion. I think it's worth the conversation. I've had that conversation . . . But my data is second hand . . . I encourage you to contact either of these folks for their first hand perspective.

Sisyphus
Oct 23, 2012 - 12:37pm

Turd - great presentation. It reminded me...

The map of Greece reminded me of a female friend who said that she'd had a wonderful time cruising around Lesbos.

As usual, I completely misunderstood.

achmachat
Oct 23, 2012 - 12:39pm

nice presentation...

to answer Turd's question --> HYPERINFLATION!

rl999
Oct 23, 2012 - 12:39pm

industrial gold/silver

With the recent spate of fake gold bars/coins, and the talk of high value silver coins (pandas/numismatics) being fake as well, does it make sense to consider purchasing industrial gold/silver?

The main drawback I've always heard when talking about stackers holding industrial g/s is that it bears no hallmark and is in tiny pieces. Depending on how you see events unfolding in the future I think having a ready supply of tiny (sub-gram weight) pieces could actually prove useful in a complete reset/bartering type of scenario. A decent scale going to the .1 decimal place costs all of $10, so I don't think it presents a big problem.

The size also seems to eliminate the fear of counterfeiting. I am not fond of the idea of cutting coins into pieces to barter, and melting coins has it's own drawbacks. (besides the fact that if I am cutting or melting I will essentially end up with industrial g/s)

Have any of the stackers here bought industrial g/s? Any reasons why or why not? Are the events of this week sufficient to reconsider?

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