November Begins

Thu, Nov 1, 2012 - 11:41am

As anticipated, the shorts are putting up a fight, desperately attempting to resist the next thrust higher. However, fear not. They are on the wrong side of the trade. As Drago says: "You will lose".

Drago: You Will Lose

Please keep in mind what I have been preaching for almost two weeks:

  • This pullback is almost identical to the pullback of January 2011.
  • Once a bottom a found, a volatile consolidation takes place.
  • The paper spec shorts, just recently drawn into the trade, will initially fight the rally by "throwing good money after bad" in a desperate attempt to protect buy-stops and re-ignite downside momentum.
  • The initial resistance is $1720 in gold and $32.25 in silver.
  • The next resistance is $1730-36 in gold and $32.50-60 in silver.
  • Once that level is cleared, even Helen Keller can see and hear the bottom. Gold will move toward $1755 and silver will advance upon $33.35.

The main thing you want to avoid is frustration and lack of patience. Give this process some time. Tomorrow's BLSBS may provide the impetus for the short-covering to begin in earnest. It also might not. Whatever. Just be long and strong. The metals are headed much, much higher from here.

Let's continue to lead with silver as it is clear that silver is currently leading gold, at least from a chart-advancement perspective. This is mainly due to the strong hands that are accumulating silver, not just in physical form in London but paper form in NY. This accumulation is increasing the pressure upon the shorts with each passing hour.

And, again, let not your heart be troubled by gold. The harder the shorts work to build a line of defense, the more violent the eventual short-covering spike will be.

OK, what else is there to discuss today? Well, there's this new gem from Jim Quinn on the Keynesian fallacy that storm damage is good for GDP growth.

Speaking of Sandy, we are now wrapping up the "First 72 Hours". The reason that I have "" marks around that term is that that is the title of a seminal study done by a renowned psychologist/sociologist a few years ago. If so inclined, you can read the entire paper here: In summary, it goes something like this:

  • The first 24 hours are shock and disbelief.
  • The next 24 hours are realization marked with determination and hope.
  • After the next 24 hours, panic and mayhem can set in as those affected by the disaster begin to clamor for food, shelter, fuel, warmth etc.

To that end, here we go: & &

My point is this: Watch this deterioration very closely over the next few days. If things begin to get out of hand, the negative publicity for the federal government could have a rather dramatic impact on late-deciding voters. In this case, it's pretty tough to hang it all on Romney. Obama will get the blame, deservedly or not.

To that end, I'm still getting questions about the impact of a Romney victory on metals prices. Let me state this a different way from yesterday:


Moving on, The Doc recorded and posted this interview with our pal, Ned, yesterday. Nothing earth-shattering but be sure to listen to the entire thing as plenty of relevant topics are discussed. Ponder, too, the topics mentioned toward the end of the podcast. When will we reach a point of "critical mass" where countries around the world suddenly rush to reclaim their gold before the imposition of a new, gold-based international trade settlement system? Next week? Next month? Next year? Hard to say but that point is definitely coming. Soon.

Ned Naylor-Leyland: Gold Reserves at the BOE or NY Fed? No Chance of Getting Out With Any Metal!

Lastly, today is the first day of November and this is significant, mainly because of this: Back in July and again in August, ole Thunderlips promised us resolution to the four-year silver investigation. He publicly stated that he expected this in "September or October".

Well, it's November now and...still...nothing. If you have a few moments, perhaps you should politely nudge Commissioner Chilton and ask him what the holdup is. The CFTC itself issues all of the information that is so obviously indicative of concentration and manipulation, yet they dawdle. Has anything new come to light recently? Some 11th-hour-type proof of guilt or innocence that is delaying the verdict? I'd be interested to know. Anyone wanting to contact The Mullet can do so by emailing him at bchilton[at]cftc[dot]gov. If you hear anything back from him, please feel free to post his reply in the comments section of this thread. (And again, I ask you to be polite. I know for a fact that he receives plenty of emails but that he only takes seriously those who pose serious questions.)

Have a fun day. Don't get too stressed about today's Comex action. The "positive economic news" and resultant rally in The Pig is simply being gamed by the HFTs and algos. The real fun will come tomorrow with the reaction to the BLSBS.


About the Author

turd [at] tfmetalsreport [dot] com ()


Nov 5, 2012 - 8:21pm
Nov 2, 2012 - 11:16am


May liquidate 5000 Mapes and move them into the miners.

Set ups like this dont happen all that much. Look for 2400Au/67Ag by May.

33% increase by May in Gold 30% <---- Reduce to 25%

100% increase by May in Silver 60%

200% increase by May in HUI majors 8% <---- Bring up to 10%

500% increase by May in Near-Producing Juniors 2% <----Bring up to 5%

Nov 2, 2012 - 10:45am

Barrack back in the news?

back when Major Miner hedging was all the rage.

Standard Oil or Barrick Gold, What is the Difference?

Posted by Derrick Michael Reid on Saturday, March 14, 2009 1:20:09 PM The difference is that the US Government supports Barrick Gold hedging because its suppresses Bullion prices and thereby supports the Fiat Dollar, under the STRONG DOLLAR POLICY. (That is corruption and fraud to support inherent worthlessness.) ===== Feeling Out Gunned,

The battle rages on in the COMEX pits day after day.
Battle lines have been drawn, its out all war!

The CARTEL has many weapons of choice.

1) Index Rebalancing
2) Derivative Pounding
3) CB sales, leases and swaps
4) Jaw Boning a Strong Dollar, talking down gold
5) Media Black Balling of Gold Bugs
6) Major Miner Hedging <=========================== Topic of this Post
7) Certificates of NO bullion mint pooled deposits
8) Miner share shorting and naked shorting
9) Controlled CB Interest Rates on Fiat
10) The 24/7 fiat printing machines
11) Media Releases dumbing down market awareness
12) General Equity Plunge Protection
13) IRS tax payments required in Fiat
14) Government Secrecy
15) Ability to raise margin requirements
16) Confiscation/Outlaw of ownership

All Midas has is a 5000 year history of value and a cafe of whistle blowers.

Hey Midas, you feeling out gunned?


President Obama, CFTC, SEC

I say, the SEC, CFTC, (complicit bullion suppressors to support Fiat money), JPM et al banks (bullion suppressors using naked short selling), and Barrick Gold (predatory major miner) are RICO-CLOWNS, in a planned conspiracy to defraud the American People as to Bullion and THE STRONG DOLLAR POLICY, (while, of course, president Obama pretends change and transparency, WHAT A CROCK!!)

I would like to know just how fraudulent you people really are.
So, 3rd investigation into the concentrated silver short futures on the NY CRIMEX goes on and on, with no results, yet the percent of market concetration and control, and manipulative short selling of gold and silver, IS OBVIOUS. But I understand that the manipulated down gold prices are good for THE STRONG DOLLAR policy, and hence, the government either DIRECTS OR ENCOURAGES futures manipulation, as part of the our new BHO totalitarian democracy. OK, I GOT THAT.

But Does the fraudulent participation by the government with the bullion banks, through the blind-eyed CFTC and SEC enforcement, also extend to the MAJOR MINORS?

Barrack represented to the public they were UN-HEDGED.

That is a FACT.

In order to be a member of the HUI (miner index) Barrack had to be UN-HEDGED. Meaning, they did not forward sale mine production, (as a hedge against falling prices). So, Barrack Gold represented that they were unhedged, NO, forward sales.


Now, we learn that Barrack has been hedged along.

Miners cut their hedging positions by 9 percent quarter-on-quarter to 15.52 million ounces between October and December last year, it said. AngloGold Ashanti and Barrick Gold were the biggest de-hedgers.

So, THE GFMS confirms that Barrick Gold is still a MONSTER HEDGER.


Is the SEC and CFTC, going to prosecute or fine BARRICK GOLD for false and misleading statements regarding their hedge book, (which is estimated at 9 million ounces at 5 billion dollars in the RED, that it hides from its shareholders)?

Derrick Michael Reid
March 12, 2009

Gold hedging falls 9 pct in Q4 08 - GFMS

LONDON, March 12 (Reuters) - The rate at which gold miners cut their hedging positions slowed again in the fourth quarter of 2008 and is expected to decline "markedly" in 2009, metals consultancy GFMS said in a quarterly report.

Miners cut their hedging positions by 9 percent quarter-on-quarter to 15.52 million ounces between October and December last year, it said. AngloGold Ashanti and Barrick Gold were the biggest de-hedgers.

Oh that’s interesting! "AngloGold Ashanti and Barrick Gold were the biggest de-hedgers".

From Barrick May 1, 2007 Quarterly Earnings Press release

Barrick Produces 2 Million Ounces of Gold at $313 Per Ounce; Corporate Gold Sales Contracts Fully Eliminated
As a result of Barrick's decision to eliminate its Corporate Gold Sales Contracts, the Company's net income was reduced by $557 million ($0.63 per share) on an after tax basis. Consequently, the Company reported a net loss of $159 million ($0.18 per share) and operating cash flow of $163 million ($0.19 per share). Excluding the impact of the elimination of the Corporate Gold Sales Contracts, adjusted earnings of $398 million ($0.45 per share) and adjusted operating cash flow of $727 million ($0.83 per share) compare to prior year adjusted results of $263 million ($0.33 per share) and $425 million ($0.54 per share), respectively.

"The Company's portfolio of mines had a strong start in 2007", said Greg Wilkins, President and CEO. "Going forward, our operating mines are completely unhedged, able to sell production at spot prices and thereby enjoy expanded margins in this strong gold price environment."

From their quarterly report the average investor would think that Barrick was unhedged…after all they use phrases like "fully eliminated" and "completely unhedged"! The only thing that was "complete" was that it was completely fraudulent to give the impression they were unhedged.
Was it clear to the average person that they had parked their toxic hedges in the undeveloped Pascua-Lama project? Hell no! Even the mining analysts were fooled….

A Buy recommendation has recently been issued to mining giant Barrick Gold Corporation (ABX) by Zacks senior mining industry analyst Paul Raman, CFA. Here's what his latest update had to say about it:

"Barrick is the largest gold mining company in the world. Profitability is increasing due to rising gold prices, an unhedged book and synergies from the Placer Dome acquisition. The company’s financials are solid. Profitability is increasing for Barrick. The company is fully leveraged to the rise in gold prices.

"The company’s hedge book has rolled off all of its hedges, and currently, none are in place. The company is completing the achievement of synergies from the Placer Dome acquisition. It is estimated that there is $200 million of cost cutting yet to be done.

Barrick has completely fooled many investors AND analysts into thinking that they were unhedged and now they are covering at $800-$900 per oz. GATA warned both Anglo and Barrick that hedging at $300-$400 was pure insanity unless they were part of the Cartel’s activity!

Cartel hedge honcho Goldman Sachs has completely covered their short position on the TOCOM and now Anglo and Barrick are scrambling to de-hedge…do you smell smoke?

Barrick Gold, a modern Racketeer?

We all know who Barrick Gold is, the world's king in gold bullion production, having a monster hedge book of 9.5 million ounces. It is of general belief that hedging is good for developers to provide necessary funds to launch production, but not so good for the majors, having reserves, production, and cash flow, when well managed, offering the potential of increasing growth of the company within the current business cycle. On this basis, the hedge book at Barrack is unwarranted and could lead to billions in down stream losses and shareholder value ruination in the normal course of business. However, it appears that Barrick's gold business is not so normal.

Mr. C. Powell, of GATA fame, has recently indicated that the hedge position of Barrick could be use to acquire some 50 mil oz of Au in deep storage, and hence, improve Barrick's very long term outlook. I have been thinking along these lines as well for over a year now, and am so grateful to Mr. Powell for putting it in writing for all to consider. However, there is a twist, that should not go unrecognized.

Anyone recall Placer Dome, Homestake Mining, Pangea Goldfields, Pioneer Metals, Arequipa Resources, Sutton Resources, and others that are now gone? Competition in the gold industry has been destroyed in some measure, undeniably so. When a major, already in the driver seat, with reserves, production, cash flow, seeks to hedge further production for purposes of growth through acquisition, then what the major effectively does is MANIPULATE bullion price down on the short side of bullion, depressing competitors share value to their disadvantage, for Barrick's short term loss of value as well, during this hedge "dumping", for purposes of monopolizing the gold production industry by acquiring all competitors and all gold resources, on the cheap, and in doing this, BARRICK could be considered the roaming thugs of the gold mining community, and could possibly be CRIMINAL RACKETEERS, with predatory practices that must have limits, ala the anti-trust actions of the early 1900s. There is no difference between Standard Oil and Barrick, is there?. This might be the basis of the Blanchard anti-trust case against Barrick et al.

On moral grounds and fair-dealing principles only, no one should touch any major with a hedge position, especially the very biggest ones on the hunt for acquisitions. Dehedge your hedge book, then, ok, all is fair, but it aint. Personally, I wont support what I believe to be criminal racketeering. Our great country realized the down-falls of monopolies some 100 years ago, and yet, it seems, we forget these lessons, time and time again, and don’t remain vigilant to the evils of greed in corporate America and in the world. Lets all thank GATA and Mr. Powell, for attempting to keep the gold mining industry fair and competitive, and stop Barrick's apparent desire to become the world's ONLY gold producer and the gold industries' biggest criminal as a modern racketeer.


And then the bottom fell out ... 31.20 hitting hard ..

Eric Clapton - I Shot The Sheriff ( Studio Version )
Nov 2, 2012 - 10:43am


If they can take it down this easy, they are also the ones allowing it go up when it was going up. 100% managed moves.

Nov 2, 2012 - 10:33am

go figure

what a farce

Nov 2, 2012 - 10:28am

Yellowstone Park?

Are we there? I haven't see this many waterfalls since my last visit there.

Nov 2, 2012 - 10:27am

Sniff test

Does anybody else smell a little Goebbels in the air this AM. I'm sure something smells a little nazi-ish. Hope to hell we don't get the rest of the associated smells.

Nov 2, 2012 - 9:59am

Miracle man

Judging by today's market action, I might start believing that a Mittsy win next week would be good for gold.

After all, look what the "Miracle Man", the "Great Job Creator" has done to prices of EVERYTHING today. Well, at least we are all saved, and should now repent for ever doubting our new emperor and his glorious financial "advisors".

All bow to the "Great Obammy"

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Nov 2, 2012 - 9:38am


so #'s released and "beat" of expectations. What has been the effect on the pricing of real money? Truly minimal in my view. View the big picture........QE1, market reaction was fairly significant. QE2, market reaction was less than first. Operation twist & twist squared.........less. QE Infinity.........Net nothing. Each time new printing occurs, less happens with paper money vehicles. Each time new printing occurs, less happens with the massive suppression of real money. Diminishing return. I view it this way.......every new round of paper is essentially done with less "paper money value"(inflation/devaluation) on top of the fact that markets adjust to the lack of effectiveness of prior round. IMO, the most recent QE3, was the last........everything from this point forward will be viewed by any thinking person, as just buying assets.......real assets(ie buildings, floundering business's, produced goods, etc.) SANDY next? Cuomo already has blurted that the FED needs to pay for SANDY, because he "cannot print money"!

Nov 2, 2012 - 9:07am

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Key Economic Events Week of 8/10

8/10 10:00 ET Job openings
8/11 8:30 ET Producer Price Idx
8/12 8:30 ET Consumer Price Idx
8/13 8:30 ET Initial jobless claims
8/13 8:30 ET Import Price Idx
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Unit Labor Costs
8/14 8:30 ET Cap Ute and Ind Prod
8/14 10:00 ET Business Inventories

Key Economic Events Week of 8/3

8/3 9:45 ET Markit Manu PMI July
8/3 10:00 ET ISM Manu PMI July
8/3 10:00 ET Construction Spending
8/4 10:00 ET Factory Orders
8/5 8:15 ET ADP employment July
8/5 9:45 ET Markit Service PMI
8/5 10:00 ET ISM Service PMI
8/6 8:30 ET Initial jobless claims
8/7 8:30 ET BLSBS for July
8/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 7/27

7/27 8:30 ET Durable Goods
7/28 9:00 ET Case-Shiller home prices
7/29 8:30 ET Advance trade in goods
7/29 2:00 ET FOMC Fedlines
7/29 2:30 ET CGP presser
7/30 8:30 ET Q2 GDP first guess
7/31 8:30 ET Personal Income and Spending
7/31 8:30 ET Core inflation
7/31 9:45 ET Chicago PMI

Key Economic Events Week of 7/20

7/21 8:30 ET Chicago Fed
7/21 2:00 ET Senate vote on Judy Shelton
7/22 10:00 ET Existing home sales
7/23 8:30 ET Jobless claims
7/23 10:00 ET Leading Economic Indicators
7/24 9:45 ET Markit flash PMIs for July

Key Economic Events Week of 7/13

7/13 11:30 ET Goon Williams speech
7/13 1:00 ET Goon Kaplan speech
7/14 8:30 ET CPI for June
7/14 2:30 ET Goon Bullard speech
7/15 8:30 ET Empire State and Import Price Idx
7/15 9:15 ET Cap Ute and Ind Prod
7/16 8:30 ET Retail Sales and Philly Fed
7/16 11:00 ET Goon Williams again
7/17 8:30 ET Housing Starts and Permits

Key Economic Events Week of 7/6

7/6 9:45 ET Markit Service PMI
7/6 10:00 ET ISM Service PMI
7/7 10:00 ET Job openings
7/9 8:30 ET Initial jobless claims
7/9 10:00 ET Wholesale inventories
7/10 8:30 ET PPI for June

Key Economic Events Week of 6/29

6/30 9:00 ET Case-Shiller home prices
6/30 9:45 ET Chicago PMI
6/30 10:00 ET Consumer Confidence
6/30 12:30 ET CGP and SSHW to Capitol Hill
7/1 8:15 ET ADP Employment
7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 2:00 ET June FOMC minutes
7/2 8:30 ET BLSBS
7/2 10:00 ET Factory Orders

Key Economic Events Week of 6/22

6/22 8:30 ET Chicago Fed
6/22 10:00 ET Existing home sales
6/23 9:45 ET Markit flash PMIs for June
6/23 10:00 ET New home sales
6/25 8:30 ET Q1 GDP final guess
6/25 8:30 ET Durable Goods
6/26 8:30 ET Pers Inc and Spending
6/26 8:30 ET Core inflation

Key Economic Events Week of 6/15

6/16 8:30 ET Retail Sales
6/16 8:30 ET Cap Ute and Ind Prod
6/16 10:00 ET Chief Goon Powell US Senate
6/16 4:00 pm ET Goon Chlamydia speech
6/17 8:30 ET Housing Starts
6/17 12:00 ET Chief Goon Powell US House
6/18 8:30 ET Initial Jobless Claims
6/18 8:30 ET Philly Fed
6/19 8:30 ET Current Account Deficit
6/19 1:00 pm ET CGP and Mester conference

Key Economic Events Week of 6/8

6/9 10:00 ET Job openings
6/9 10:00 ET Wholesale inventories
6/10 8:30 ET CPI for May
6/10 2:00 ET FOMC Fedlines
6/10 2:30 ET CGP presser
6/11 8:30 ET Initial jobless claims
6/11 8:30 ET PPI for May
6/12 8:30 ET Import price index
6/12 10:00 ET Consumer sentiment

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