November Begins

149
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. https://www.theburningplatform.com/?p=43305

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: https://www.atsdr.cdc.gov/emergency_response/common_misconceptions.pdf. 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: https://www.nydailynews.com/news/national/gas-pains-pumps-dry-lines-long-new-york-article-1.1195237 & https://news.yahoo.com/tempers-flare-nj-city-where-thousands-stranded-171518266.html & https://www.nydailynews.com/new-york/brooklyn/looters-target-coney-island-sandy-article-1.1195080

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:

DO NOT BE FOOLED BY THE OBVIOUS PLANTING OF MISINFORMATION IN THE MEDIA. ADDITIONALLY, SOME WOULD HAVE YOU BELIEVE THE QUANTITATIVE EASING IS SIMPLY AN ECONOMIC STIMULUS PLAN/EXPERIMENT, HATCHED BY THE EVIL BERNANK. AGAIN, PLEASE NEVER FORGET THAT QE IS ABOUT FUNDING THE ONGOING FEDERAL DEFICIT AT EXTRAORDINARILY LOW RATES IN A DESPERATE ATTEMPT TO PERPETUATE THE GREAT PONZI. ROMNEY AND RYAN CAN TALK A GOOD GAME BUT THEY WILL NOT BE ABLE TO IMPOSE "AUSTERITY" AND THEY WILL NOT BE ABLE TO STOP QE. PERIOD. END OF STORY.

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". https://www.bloomberg.com/news/2012-07-23/cftc-s-chilton-sees-silver-probe-concluding-this-year.html

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.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  149 Comments

dropout
Nov 1, 2012 - 12:59pm

Going Against the Flow

By using the weekly Friday closing prices of both gold and silver and then averaging those prices, we get;

Since September 1st 2012

Gold average price $1,752.33/oz

Silver average price $33.71/oz

Both metals have been trading below their averages since October 12th. When seasonality is factored in, these prices will in fact remain range bound, with a slightly negative nuance, until the Christmas gift buying season provides a small upside move, which should top out with end year liquidation 'window dressing' by the commercials.

During the honeymoon period with the new administration, first 90 to 120 days of 2013, the price of both metals will weaken further, until the realization dawns that nothing has changed and in fact look to be worse. This will be the true bottom for both metals.

Going out on a limb;

This bottom price will be the time to back up the truck, for that last time at ultra cheap prices, that won't be seen again for a very long time. Looking at $1,667.00 gold and $27.20 silver. Just IMHO Do your own diligence.

Dawg thecoloredsky
Nov 1, 2012 - 1:02pm

Vote Early for $%&#%( 0*!@#

They forgot "Vote Often"

Dawg

Don't forget to Vote during your lunch hour....

Submitted by thecoloredsky on November 1, 2012 - 8:59am. Hat Tip! 2

Groaner
Nov 1, 2012 - 1:03pm

The CFTC???

Who are they working for? The government..

Who manipulates every market to perpetuate the fiat ponzi scheme, thus their power, with the blessing of the government..

And you actually believe they will do anything to stop the status quo?

enough said.

Dimeboy
Nov 1, 2012 - 1:04pm

I Stack...

SACKS of those Mercurys. Undeniably real fractional silver. I can buy a loaf of bread or a house and not need change or check a date for either transaction. Of course, you only "produce" what is required at the time so no one follows you home... Much better than 1,000 ozt bars (or any size bars or generic rounds for that matter) No one is gonna bother trying to "salt" or counterfeit dimes..

Those sacks can also double for sandbags in a flood! (it slices!, it dices!, it makes Julienne fries!)

Ergo, the moniker.

rtabit
Nov 1, 2012 - 1:08pm
Bugzy
Nov 1, 2012 - 1:11pm

Violated!!! and not in a good way

Typing to you from my shower:

Been having some challenges with my international wire transfers. Found the problem; my clearing house has changed from using BMO to.............Swift field 57 - JPM!!!!

Oh my - I am contributing to the profits of Blythe and co.

Been scrubbing my plastic cards and cannot seem to get the stench off.

Wondering when I can stop crouching in the corner, rocking back and forth?

Oh the shame!!!!!

Bugzy.

Sheetrocker Jimmy James
Nov 1, 2012 - 1:16pm

@Jimmy James

Maybe you could try a higher strike price a month or two farther out.

Scottrade shows: Nov 42@0.91 Dec 45@0.89 Jan 47@0.97

That way if your shares get called away, you will at least be somewhat compensated by the higher strike. If you hold quite a few shares, maybe only sell calls against 1/3 or 1/2 at a time. Hopefully this helps.

Mammoth
Nov 1, 2012 - 1:16pm

Paranoia Runs Deep

Well, I read on another blog that the .gov wants to postpone the Nov. 6 elections because of the hurricane.

WTF?
Paranoia runs deep.

Monday night, wifey complained that she couldn’t get onto Google. I assumed this was due to the storm, then I turned on the desktop computer only to find it would connect with the wireless router but not to the Internet. This had never happened before. Never.

Thoughts began racing through my Mammoth brain:
- EMP attack – the terrorists took advantage of the USA’s attention being focused on the storm, rather than on national security?
- Hurricane Sandy caused some sort of a cascading effect which took out the whole Internet?
- The .gov pulled the plug on the Internet and is using the storm as an excuse for implementing martial law?

And then another thought occurred to me. I unplugged the wireless router, waited ten seconds, and then plugged it back in again. And then we were able to connect to the Internet again.

Paranoia runs deep.

Dawg
Nov 1, 2012 - 1:17pm

My Appoligies to All The Honest "Working Girls"

but the NYMEX is a bunch of WHORES!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Dawg

benque
Nov 1, 2012 - 1:19pm

rtabit - SLW

Note that each past move through resistance was by one day spike or gap up, followed by further upside. This time of year is explosive for SLW, and I have followed it since Wheaton River days. Of course, this is only if silver cooperates.

One more point; with the EE's perverted miner Barrick Gold (Rhymes with Barack!?) having cost and production difficulties, I believe some of the recent strength in SLW is migration from the miners inherant risk to the relatively safe royalty companies.

SLW gets the silver even if the miner can't produce it (in most cases, though that is evolving), as they must buy it where they can, if they can't mine it.

Disclaimer: I am "all in" with my meagre resources in SLW Nov. call options.

Gramp 145Bluesman
Nov 1, 2012 - 1:21pm

Had long since  drawn my

Had long since drawn my conclusion, and took notice of the Metals prior to ever reading anything from Turd, Or Silver Doc. or any of the other sites like that.

All that one has to do is a bit of research into the history of currency and money here in the U.S. and other Countries. The Debasement of Coin has been going on for hundreds of years here in America, and much longer in many other Cultures.

Now we are at the point where even the term "Debasement of Coin" is inaccurate, as we now hold wealth or purchasing power in the form of Paper Monies or even Digital Accounts! Never mind 'Coin'! lol

They even reduced the size and content of Copper coinage almost 200 years ago, and that was after the population initially resisted the issue of Copper coins of any kind, preferring Gold or Silver over any else. It was a common event for the Metal value to outpace the stamped Coin value, thus Silver Gold and even Copper coins were often hoarded/ possibly melted, throughout early U.S history. The Official response to curtail this activity seemed to be reducing the size of coin, or it's quality of metals composition. All the while maintaining the same, or even enhanced struck coin official value. Thus making it more valuable as currency than for metal content...

Does any of this sound at all familiar?... Here we are today with our currency, Paper, with only the Full Faith and Credit promise backing it up. We have come so far from a PM based currency, that what are they going to do next... Reduce the size of our Paper Dollar? lol!! Nope, they will just push interest rate so low that savers get nada. Engage in QE which appears to have the effect of higher cost for Goods/ Services Food and Fuel. The additional catch being, Businesses are feeling the crunch, so Worker's Pay remains the same or even reduced from what it was prior to the sharp rise in Fuels a few years back! If 10 years ago fuel was 3 times less, But the pay rate about the same as now... Now pay rate the same as 10 years prior, or even reduced, or worse no Job opportunity exists... but fuel is 3 times higher in cost...? ( i. e. All things transported by fuels... the PMs ect) How is that working out for us? lol!

Rant off!

Pax Argentum
Nov 1, 2012 - 1:27pm

CFTC 'Report'

...certainly won't come out before the election. In fact, I suspect they're waiting to release it during a busy news cycle or over a holiday weekend. The 'report' is obviously complete, and probably has been for quite some time.

Does anyone really expect that 1) They'll find ANY example of wrong-doing or malfeasance? or 2) That there will be ANY result of the report other than cheers at JPM and groans here at the Watchtower?

No, regardless of the election, it's clear that the status quo will be maintained...until the paper price of metals just doesn't matter to hungry people anymore.

Pax

SRSrocco
Nov 1, 2012 - 1:27pm

THIS WAS A SURPRISE.....

TOP SILVER MINERS AVERAGE YIELD DECLINES MORE THAN GOLD

I have been researching the declining ore grades and silver yields in the top silver miners. I thought the decline would be equal to the gold miners... but it turned out to be a great deal higher.

This is the chart for the top 5 gold mining companies average yield per tonne:

From 2005 to 2011, the average gold yield from the Top 5 Gold Producers declined 27% or roughly 3.8% per year.

I don't have a chart for the TOP SILVER MINERS, as it will be included in my next article. But, I will give out the preliminary data.

From 2005-2011... the top 5 SILVER MINERS average yield fell an astonishing 33.5%.... or 5.6% per year. This is nearly a 50% higher annual percentage decline compared to the top gold miners.

This does not include the newer silver miners such as SilverCorp, First Majestic and etc. These figures come from the big boys such as Fresnillo, BHP Billiton's Cannington, Polymetal's Dukat & Lunnoye, Pan American Silver and Hecla. I have two other large silver producers that may be factored in. I have to wait and see.

Anyhow, this shows us that the TOP SILVER MINERS are seeing their annual silver yields per tonne fall 5.6% per year compared to the top gold miners that declined 3.8% per year.

COMING SOON.... NEW BIG SILVER ARTICLE

Bugzy
Nov 1, 2012 - 1:31pm
Dr G
Nov 1, 2012 - 1:33pm

I like Pax's comment's above,

I like Pax's comment's above, but I believe the CFTC report will never be released anyway. The only thing easier than lying and saying JPM is not manipulating silver would be saving time by not writing the report anyway.

Sheetrocker
Nov 1, 2012 - 1:35pm

Blanchard & Co vs ABX

Reposting here as I managed to come in last on the previous thread.

Maybe some will find this interesting. From GATA

Blanchard & Co.'s federal anti-trust lawsuit against Barrick Gold and its bullion bank (yes, JPMorgan Chase & Co.) was based on Barrick's excessive dominance in gold short positions in futures markets. Blanchard argued that Barrick, using JPMorgan Chase & Co. as agent, had gotten access to so much borrowed central bank gold that Barrick was able to use its gold hedging program to run the gold price up or down at will -- that Barrick essentially had become the gold futures market. Indeed, in defending itself against Blanchard's lawsuit, Barrick actually claimed to be the agent of the central banks in the gold market and argued that the company should share their immunity against lawsuit (https://www.gata.org/files/BarrickConfessionMotionToDismiss.pdf).

U.S. District Judge Helen Berrigan rejected Barrick's claim, and soon after that, in November 2005, Barrick settled Blanchard's lawsuit. While the settlement was sealed, Barrick simultaneously announced that it would stop hedging gold, so that appeared to be the settlement. Here is a chart showing what happened with the gold price since Barrick stopped hedging, a steady rise leading to a doubling today:

https://www.kitco.com/charts/popup/au1825nyb.html

Could some miners similarly be helping to suppress gold and silver prices today?

Bugzy
Nov 1, 2012 - 1:40pm

Supressing metals price

Why would Barrick benefit from selling Gold for less than market value?

The Watchman
Nov 1, 2012 - 1:46pm
SRSrocco
Nov 1, 2012 - 1:47pm

WE DON"T NEED THE CFTC...

SILVER IS GOING OVER $100...

I don't even pay attention to the CLOWNS and MISFITS anymore on the Main Stream media. I couldn't even stomach watching more than a few minutes of the Presidential Debates.

We don't need any help from any of the typical sources such as the CFTC, SEC or even class action lawsuits against JP Morgan & MF Global. All we have to do is just wait around a while and watch the fireworks.

This will be the THEME of my new article. The best part about doing these articles is the research. Sometimes I am surprised and other times... quite shocked by the data I uncover. Anyhow, the price of gold and silver will hit levels or values we will find simply amazing.

Silver Investment demand is heading up towards the MOON & STARS. Those like Ned Schmidt and his side-kick JON NADLER, treat silver like it's just an industrial metal. Well, I got news... the price of silver has been based on INVESTMENT DEMAND the past 5-6 years... and not industrial demand.

That being said... its only the beginning.

THE GREAT SILVER INVESTMENT STAMPEDE IS STILL AROUND THE CORNER..

Louie
Nov 1, 2012 - 1:49pm

After the election...

Thumbs up to Istack, Merc dimes are my favorite also. No need to look at the sides, no need to look at the dates, if it is a Mercury (Winged Liberty) dime, it is silver. Low premium, divisible, recognizable, and best of all SILVER!

Does anyone besides me remember when we used to be able to buy 90% junk silver for under spot?

While the storm and the election are occupying everyone’s minds, is anyone thinking about the lame duck congressional session coming up, possibly with a lame-duck president, the US hitting the debt ceiling again, and all of the new taxes coming into effect on 1/1/2013? Seems like last time the US raised the debt ceiling, we had short-term bounce in silver of about $5.50 and a $60 bounce in gold. Does anyone besides ol’Louie think we are in for a merry Christmas and a very happy New Year?

The Watchman
Nov 1, 2012 - 1:54pm
Excalibur
Nov 1, 2012 - 2:11pm

Screwtape Tittle Tattle

As I was typing up a document to try to sell an idea to a business school, cos PMs have not gone to moon yet and I need to get my ass back in gear to earn some money, I was listening to Brother John. I find his voice relaxing. Liking a bit of gossip myself, I couldn't help myself from tuning in when he was giving his opinion on our friends Screwdup and Joan of Sark. For those with minds as small as mine here is the link:

Silver Update 10/27/12 Wynter Benton Screwtape

Now back to corporate culture and leadership styles. ugggh. SRS, great, but how much longer!

Montreal Squad
Nov 1, 2012 - 2:21pm

10 box

10 box we're closing above 32,40 ;-)

TreeTop Dweller
Nov 1, 2012 - 2:26pm

"Money for Nothing"

"Money for Nothing"

Looks like an excellent project if they can get enough funds to release. The link below shows a 4 minute trailer that would be of keen interest to Turd's community.

www.kickstarter.com/projects/372518877/money-for-nothing-inside-the-fede...

Donate and they will send you one of the best t-shirts around:

"The Fed bailed out the entire global financial system and all I got was this lousy t-shirt."

alert
Nov 1, 2012 - 2:29pm

Silver Lease Rate

Have anyone seen the silver lease rate today? I see 1 month rate at -.63!!!!

Does this mean another smack down imminent?

SilverLease Rates

SRSrocco
Nov 1, 2012 - 2:30pm

REPLY @ SILVER ARTICLE..

Excalibur... Normally, I like my main articles to hit the Internet on Monday-Tuesday. However, we got the election next week... so I don't want to compete with that CIRCUS. It looks like it will be out the following Monday...

Steve

Kuchek
Nov 1, 2012 - 2:32pm

Obama and Biden Indicted

Video unavailable

Nov 1, 2012 - 2:36pm

New Business - Cash for Silver - Middleman Arbitrager

Mates:

I just got into the silver business.

I am the new buyer for silver jewelry and flatware from a friend's cash for gold store. They buy this stuff at 40% of spot, and sell it to the smelter for between 75-80% spot, depending upon the assay. The buy price is thus $.48/gram, and the sell price to the smelter is north of $.70 per gram. The gross profit is north of 60%, and after expenses of smelting, I figure the net profit will be at least 30%, at today's spot prices. But, I am not selling, I am stacking.

I agreed to take all the meltable silver off their hands at $.48/gram, with the promise that if silver explodes, we will share the upside percentage gains.

I looked into buying a smelter, and they are priced at $300 and up. I have my eye on one for $1,000 or so.

Basically, I am going to be the middle-man, doing the smelting, holding the raw bullion, then in turn selling to the industrial buyer.

Can anyone tell me why this is not a good idea?

BagOfGold
Nov 1, 2012 - 2:42pm

Getting ready for the race...the human race?...

Hmmm..."Swing & Sway"?...

Second Derby--They Shoot Horses, Don't They?

NO!...The manipulation will only work...if you allow it!...Let's end this shit!!!...

Bag Of Gold

Montreal Squad
Nov 1, 2012 - 2:45pm

Epic battle

If you look at the 1 hours chart, the battle for support is epic to close in positive territory. Who ever did that had my respect

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Key Economic Events Week of 4/22

4/22 10:00 ET Existing Home Sales
4/23 10:00 ET New Home Sales
4/25 8:30 ET Durable Goods
4/26 8:30 ET Q1 GDP first guess

Key Economic Events Week of 4/15

4/16 9:15 ET Cap Util and Ind Prod
4/17 8:30 ET Trade Deficit (Feb)
4/17 10:00 ET Wholesale Inventories
4/18 8:30 ET Retail Sales (March)
4/18 8:30 ET Philly Fed
4/18 10:00 ET Business Inventories (Feb)
4/19 8:30 ET Housing Starts and Building Permits

Key Economic Events Week of 4/1

4/1 8:30 ET Retail Sales (Feb)
4/1 9:45 ET Markit & ISM Manu PMIs
4/1 10:00 ET Construction Spending (Feb)
4/1 10:00 ET Business Inventories (Jan)
4/2 8:30 ET Durable Goods (Feb)
4/3 9:45 ET Markit & ISM Services PMIs
4/5 8:30 ET BLSBS

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