Cutting Vacation Short

Wed, Feb 20, 2013 - 10:04am

This is relentless and unforgiving...and I'm not talking about MrsF.

So bad that I'm cutting my mini-vacation short. I still don't have time for a full post so here are two items for you to read this morning.

ZH has been doing an excellent job chronicling the consistent, daily destruction. Here's the latest:

And here's someone who has noticed some of the same "anomolies" that I have:

The charts, of course, look terrible. Having failed at hoped-for support, silver looks like $28 and gold, if $1580 fails, looks headed all the way back to the bottom of the 18-month range, near $1550.

This is all highly unusual and indicative of extreme manipulation and panic-level positioning. At the risk of sounding trite and reading like another KWN pumper, I must say it: THIS WILL PASS. THESE EXTREMES WILL BE RESOLVED SOON AND NEW UPLEGS WILL BEGIN. PLEASE BE PATIENT. THE FUNDAMENTALS ARE STRONGER THAN EVER AND PHYSICAL REALITIES WILL SOON REPLACE PAPER SHENANIGANS AS THE DRIVING FORCE BEHIND PRICE.

More later if possible.


About the Author

turd [at] tfmetalsreport [dot] com ()


Feb 20, 2013 - 1:45pm

Last Time....@NonOverlap

You "conveniently" roll in here on a down day, and.....out of a sudden emotional need to save start spewing that "Maybe...just are all wrong? have you Turdites ever thought about that? hmmmm?" Am i close enough so far?.......Ok......let's move on... Then (i'll para-phrase) when challenged you go on..and give the ole "Hey, i don't have an opinion either way".....otherwise known as the "I'm just sayin....."

And that, my friend, is what i mean by transparent.

Not only do you have the un-mitigated nerve to roll in here and try to turn strong hands into weak ones..........but then, THEN! you don't even have the balls to take a position??? !!!

I would put you on IGNORE............but you're just dangerous enough where your bullshit needs to be countered....

So have a captive audience.......... "Just sayin....."

Feb 20, 2013 - 1:47pm


Thank you for that excellent advice. I am calm now. Enraged by a newbie and calmed down by a newbie. I wonder what the difference was?

Feb 20, 2013 - 1:48pm

FOMC minutes coming up at 2:00

Will that drive any action?

Feb 20, 2013 - 1:53pm


Thanks for that

Soundgarden - Superunknown
Nigel Black
Feb 20, 2013 - 1:53pm

McAlvany's video

David McAlvany just posted a new video. It is excellent. It covers everything we have been discussing plus he also shares that they are having a hard time obtaining physical gold for their European and US clients.

Worth 38 minutes of your time (IMHO):

Navigating well in times of Distraction | McAlvany Commentary
Feb 20, 2013 - 1:54pm

Not for the weak stomached

The following is an excerpt from an article, by Jeff Clark, discussing the volatility of gold and silver:

Most precious-metals investors know that silver is more volatile than gold. But do they know just how big that difference really is?

We thought it would be interesting to measure how much greater silver's daily moves are – both in gains and declines – than gold.

We documented the daily price movements for both metals, and then calculated the difference using absolute values. To interpret the charts below, you need to know that:

  • Values above zero represent days when silver had a greater percentage move than gold, as depicted in gray.
  • Values below zero are days when gold moved more than silver, as depicted in orange.
  • The values don't tell us the direction of price movements, only how much they differed between each other on any given day.
  • The darker horizontal lines represent the moving average of the price differences for each metal.

With that in mind, here are the differences in daily price movements between silver and gold, measured in percentage points.

The article goes on to show the daily price movements during the late 70's- early 80's. In the summary, the author compares the two and states this:

The historical record tells us that when we enter the mania, silver's volatility will increase. If we have a similar period as in 1979-'80, we can reasonably expect volatility to double over current levels. This will be the result of more investors joining the precious-metals industry. The moves will, on some days, be breathtaking. So again, one must be prepared emotionally to handle the volatility, as well as be more nimble when it comes to buying and selling.

Bottom line. It is going to get rougher. If you haven't got your sea legs yet, stand towards the rail but remember: One hand for you, one hand for the ship.

The article is a great read. Not too much new information, but seeing it in charts drives the point home to me.

Feb 20, 2013 - 2:02pm

Look out below.

Look out below.

Feb 20, 2013 - 2:02pm


Not only do you have the un-mitigated nerve to roll in here and try to turn strong hands into weak ones..........but then, THEN! you don't even have the balls to take a position??? !!!

That is correct - I do not have the balls to hold a belief without sufficient evidence. Overall, your post is a pretty accurate (though mean-spirited) characterization.

Feb 20, 2013 - 2:04pm

From David's Desk  David

From David's Desk

David Schectman

JP Morgan's Silver Position

JP Morgan inherited Bear Stearns huge "short" position in silver (and gold) when the Fed arranged for them to takeover (the bankrupt) Bear Stearns. They have been trying to extricate themselves from that position since 2008. They are trapped. Even now, when they desperately try and reduce their shorts but pulling their bids and allowing the market to fall, with the hope of buying all of the sales at a lower price (to help cover their shorts), the "Raptors," (large hedge funds) step in and buy many of the contracts, making it impossible for JPM to cover.

People I talk to also feel that the reason gold is punished is to influence the price of silver, to the downside of course, in aid of JP Morgan's quest to shed their huge short silver position.

Here is what Ted Butler had to say about JP Morgan's short position and the Bear Stearns position they inherited:

The Real Story -

November 10 2008

The price of silver at the time of Bear Stearns implosion was $20 to $21 an ounce. A free market covering of a concentrated short position of this size would have driven silver prices to the $50 or $100 level and would have exposed the long-term manipulation. Rather than let the free market deal with the required short covering of such an uneconomic and unbacked short position, government authorities arranged to have the short position transferred to JP Morgan. This was undertaken by the U.S. Treasury Department, along with taxpayer guarantees against loss to Morgan worth billions of dollars. This was done, no doubt, to save the financial system from imploding. This was also patently illegal, as it aided and abetted the silver manipulation.

I'm sure the motive behind the illegal transfer of the silver short position was the mistaken assumption by Treasury that an explosion in the price of silver (and gold) would threaten overall financial stability. Well guess what - they succeeded in crushing the price of gold and silver, but to no avail, as financial stability has been shattered.

JP Morgan was not just an accommodative good corporate citizen in the illegal transfer of the manipulative silver (and gold) COMEX short position. In addition to undisclosed government guarantees against loss, JP Morgan was given free reign to liquidate the COMEX short position at their discretion, knowing full-well the regulators would look the other way, no matter what dirty tricks were necessary to cause the price to collapse. Nor was JP Morgan a neutral agent in the silver price collapse. Data from the Office of the Comptroller of the Currency (OCC) indicates that JP Morgan held a much larger Over The Counter (OTC) derivatives position in silver and gold than was transferred to them from Bear Stearns.

My analysis shows that Morgan has made many billions of dollars, perhaps tens of billions, from their downward engineering of silver and gold prices from their combined COMEX and OTC short positions. They have used that engineered price decline to buy back as many short positions as possible. If investors are wondering what caused the destruction of billions of dollars in gold and silver values, metal and share price alike, look no further than JP Morgan, and the government officials who enabled them.

There can be no question that the CFTC is complicit in all these illegal activities. Same with the CME Group, owner of the NYMEX/COMEX. It is not possible that they are not privy and an active party to this successful downward manipulation. To think that officials at the CFTC, from the top of the agency, to staffers and even the Inspector General, have taken oaths of office to uphold commodity law and then have allowed that law to be repeatedly violated is beyond repugnant. That they have knowingly participated in an organized cover-up of this manipulation and have taken to lying to a Congressman calls for criminal prosecution.

Continue reading on

Here is a discussion from NIA on this topic, which adds to Butler's position:

...March 14th, 2008, the very day Bear Stearns failed, was the same day silver reached a multi-decade high of about $21 per ounce. Bear Stearns was on the verge of being forced to cover their naked short position in silver, which could have quickly sent silver as high as $50 per ounce. This would have caused a loss of confidence in the U.S. dollar and a possible currency crisis. Instead of allowing this to happen, the Federal Reserve orchestrated a bailout of Bear Stearns and JP Morgan acquired their assets with the backing of the Fed. Shortly after taking over Bear Stearn's silver short position, JP Morgan was able to manipulate the price of silver down to below $9 per ounce. (They made billions!)

Continue reading on

For those of you who want to know more about how this all happened, I have re-printed a detailed explanation that Butler published three months ago, titled A Manipulation Timeline.

Do you agree? A lot of smart people think this is exactly what is going on. One of these days, JPM will have to bite the bullet and move out of their position, regardless of the price, and it will most likely be caused by a rising market, in spite of the manipulation.

My silver position is as large as my gold position. My expectation is simple - silver will outperform gold, and if it doubles gold's gains from now forward, I will not be surprised at all!

Yesterday, Bill Holter discussed the shortages of ammo and guns in Texas. I have experienced the same thing here in Miami and in Minneapolis. A friend, here in Miami, owns a guns store. He turns customers away. He hasn't had a new gun, handgun or assault rifle, to sell in months. I visited a major gun dealer in Minneapolis, after the first of the year, and they were virtually out of everything.

There was some inventory, but a fraction of what they usually have. The store was crowded. Yes, ordinary Joes are stocking up on guns and ammo. They are afraid - not only of the bad guys, but of our own government.


David Schectman

Miles Franklin

Feb 20, 2013 - 2:07pm

John Rubino-The Currency Wars

John Rubino-The Currency Wars will Destroy Wealth but Precious Metals will Benefit

WallStForMainSt, Published on Feb 19, 2013

Mo Dawoud from Wall St for Main St interviewed John Rubino, who is the author of “The Collapse of the Dollar and How to Profit From It”. He is also a former Wall Street analyst. In this interview, we discussed the general stock market and if the so-called government spending cut will have any affect on the market. We also discussed the ongoing currency wars and how Japan will be the first to fall. Plus much more!

Mo Dawoud from Wall St for Main St interviewed John Rubino, who is the author of “The Collapse of the Dollar and How to Profit From It”. He is also a former Wall Street analyst. In this interview, we discussed the general stock market and if the so-called government spending cut will have any affect on the market. We also discussed the ongoing currency wars and how Japan will be the first to fall. Plus much more!

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