The Disquieting Quiet

Sat, Mar 23, 2013 - 11:47am

With the ongoing Cyprus situation and gold option expiry, next week promises to be a doozy.

I mean, seriously. Who knows what this next week will bring? Cyprus isn't getting easily "fixed" and that ship has sailed anyway. Going forward, why on earth would any sensible person keep funds in a bank in Greece? Or Spain? Or Portugal? Or Italy? Or anywhere, for that matter? With strict capital controls coming over the horizon, the already-robust demand for physical precious metal is only going to get stronger and, as you know, physical demand and delivery is what will finally break the collective backs of The Cartels.

But that most certainly does not mean that The Forces of Darkness won't be in charge this upcoming week. Option expiration for the April13 gold contract is Monday so you can expect some volatility as we get the week started. Probably more significant is First Notice Day on Thursday. Recall that nearly 14,000 contracts stood for delivery back in February and this was a threefold increase over the delivery notices for either the Dec12, the Oct12 or the Aug12. In fact, if you add up the deliveries for those previous three months, they just about equal the total demand in February alone. This is astonishing and, at this critical time, you can rightly imagine that this is the last thing that The Gold Cartel wants to see happen again this week. Therefore, be on the lookout for some serious volatility and downside pressure through Thursday as The Cartel attempts to dissuade as many as possible from standing for delivery in April.

Finally today, just a few words about yesterday's CoT. Recall that we knew it was going to be interesting because of the dichotomy. For the reporting week, gold was UP $19 but its OI fell 5,000. At the same time, silver was down 33¢ and its OI rose by 3,300. I was looking forward to seeing the report and it didn't least in silver. WOW!

First let's look at gold. The reporting week was all about rotation in preparation for this week. The LargeSpecs bought 7,300 new longs and covered almost 14,000 of their shorts. All of this buying was, of course, absorbed by The Gold Cartel as they sold nearly 13,000 longs and added about 7,400 new shorts. <Yawn> Same old, same old. What else is new? The net effect was to raise The Cartel net short ratio back above 2, all the way to 2.19:1. Still bullish but clearly not as bullish as it was last week.

Contrast the action in gold with the movement in silver and you'll be astonished. For the week, the LargeSpecs added another 3,100 shorts! This brings their gross total to 23,656 and their net long ratio down to 1.64:1. Just six, short weeks ago, the LargeSpecs were only short 6,588 contracts and the ratio was 6.44:1. Incredible! 

The other amazing part of the report was once again in the "commercial" category. Recall that I have been pounding the table regarding the historically high commercial gross long position. For what seems like forever, the commercial long position has fluctuated around the 35,000 level but, for the last 4 months it's been growing. It moved through 40,000. And then 45,000. And then 50,000 contracts. And now this week, the commercials...the nearly everybody but JPM crowd...added another 3,100 longs, bringing their gross total to 55,014! Let me state that again, with emphasis: 55,014!! 

And now, dig this: Even though The Silver Cartel short position is still high at over 81,000 contracts, the extraordinarily high gross long position has brought the net short ratio down to just 1.48:1. 

So, there are two important things that you have to understand:

  1. Any Silver Cartel net short ratio of less than 1.5:1 has consistently been followed by a significant rally. On 8/14/12, with price about to move from $27 to $35, the ratio was 1.49:1 and on 12/27/11, with price about to move from $26 to $37, the ratio was 1.34:1.
  2. Knowing that the silver market is the single most controlled, manipulated and managed on the face of the earth, with whom would you like to side? The brainless hedge funds, algos and HFTs who have nearly quadrupled their short position over the past 6 weeks OR the silver commercials who have built a gross long position that is now nearly double its historical norm?

Look, this week is going to be crazy and even I'm not foolish enough to try to predict how it will play out. What I do know is this: Silver is not poised for s steep selloff here...not from this CoT structure. And if it does drop back toward $28 or even $27, the CoT structure will get even more extreme. Hold your nose, close your eyes and add to your stack. You won't be disappointed.

Oh, and one last thing. The latest Hat Contest draws to a close on Friday, too. Perfect timing, huh?? I know there's a spreadsheet out there somewhere with everyone's guesses. Perhaps a link will be posted so that you can be reminded of what numbers you should be pulling for this week.

That's all for now. I hope you have a safe and relaxing weekend. Get some rest and get ready.


About the Author

turd [at] tfmetalsreport [dot] com ()


Mar 23, 2013 - 11:53am

Am I first?...

Close!!!... Bag Of Gold

Fr. Bill
Mar 23, 2013 - 11:54am

So Foisted I am!

Happy Saturday to secund, thurd, furth, and so forth.

Mar 23, 2013 - 11:54am

sooooo close

maybe tomorrow Silver66

Mar 23, 2013 - 11:56am



Dyna mo hum
Mar 23, 2013 - 11:56am



Mar 23, 2013 - 11:57am

Russians Got Wind Of IT

Ok, here it is as I promised. This whole Cyprus thing might be NOT what it seems. The Russians Knew it was coming! And the russians did it as a geopolitical step to wipe out the rothschilds and the western elites. This makes more sense to me than what Santa has been saying and others have been reporting. Ok, here is the evidence. It deserves to be watched moer closely. I'm going to stay away from drawing my own conclusions until more unfolds. Feel free to debate the reports. Not debate with me. COMPLETE Story FURY erupted yesterday as it emerged that rich Russians withdrew £2billion BEFORE a tax raid on bank savings in Cyprus was announced. The revelation came as Eurozone ministers proposed a plan to protect investors with under 100,000 euros (£85,700). But British troops on the Mediterranean island were left fearing they may still lose out as the UK Government watered down a guarantee to safeguard their cash. An earlier scheme to grab 6.75 per cent of smaller savings would see an estimated 60,000 British ex-pats — with £1.7billion in Cypriot banks — potentially losing thousands. The controversial one-off tax was announced on Saturday as part of a 10billion euro bailout. But Russian oligarchs and big investors emptied accounts in the days beforehand, prompting claims they were tipped off by bank insiders. A source told The Sun: “It leaked out. Bankers warned their best clients. Government officials warned their friends and relatives. “Billions disappeared from accounts in days, most from accounts held by Russians.” And again, this angle to the story was broke by the man in the black hat, Joseph Farrell. Here is a blurp, for full commentary go to Enter Cyprus, and our story, for Cyprus quickly became a haven for the money of the late Soviet-era and Yeltsyn-era oligarchs. (See One of the Most Important Events in History and Gold). Thus, lurking behind the story of the European banks’ attempt to steal the savings of Cypriots, is the longer-running story of the attempt of Western banksters to rape Russia, and the long-running conflict between them and the nationalistic interests represented by Vladimir Putin & Co. The problem is, the Russians got wind of it (I mean, c’mon here folks, Mr. Putin is the “KGB president”, and the idea that Russian intelligence doesn’t monitor the activities of Western central and prime banks is…well, absurd). Anyway, the Russians got wind of the planned theft, and withdrew their money prior to the announcement (See Troops Betrayed in Cyprus Bank grab… as Russians seize Two Billion Pounds). Now… this is where the story gets interesting… but that will have to wait for tomorrow. Read more: CYPRUS: CLASH OF OLIGARCHIES AND GEOPOLITICS, PART ONE - Giza Death Star Community HEAVY, HEAVY STUFF

Mar 23, 2013 - 12:05pm

#8 ?

8th child in family. This must be a sign.

Mar 23, 2013 - 12:09pm

Next Week

Cyprus needs to pull an Iceland... ---- Edit ---- 7th Amendment: In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law. ---- And keep your eyes on Japan too....Nikkei 225 was down 297.16 Friday

Mar 23, 2013 - 12:09pm

Thanks Alex

Thanks for a Saturday thread. Pretty sure the Russians make a midnight offer soon. Why wouldn't they? TF....If you cruise last nights thread when the Admin was testing you'll see we had fun with all kinds of 'Sweetness' scenarios. you still have Cheeto's dust all over your face and has Mrs. TF untaped you from your office chair yet? ;-). Apparently so Have a great day everyone.

Lamenting Laverne
Mar 23, 2013 - 12:15pm

ZH comments and stuff - carried from last thread

Thanks DPH. The ZH comment section on that article is much better than normal. Disagreeing perspectives, but a real discussion. It is nice to see. Also Gordon Gekko had a nice write up about what is happening with the monetary system in general. Great piece for introduction to the subject for newcomers. I had more to say, but I need to go shopping. Top up to edible stack before it is too late. I am not taking anything for granted from now on. I went for a drive yesterday to top up my diesel cans. It felt a bit like those guys in Margin Call, driving through town looking at people going about their business without a hint of concern about what might be brewing. When I ask myself, if I am overreacting and falling prey to a self-perpetuating gloomy-doomy spiral, I just have to take a look at all the intelligent commentators on many different sites, who have studied the going-ons of the world for a long time. There are many different opinions about what is going on exactly - but very little opposition to the undercurrent of most posts, that the weeks ahead are massively dangerous and the news are significant in every possible way. I am not naive about the authoritarian nature of the Russian and Chinese systems today, but I had never ever ever ever! thought that I would be reading statements from Putin and Xi thinking - yes, they are right about that, and my elected representatives are a bunch of [censored] lemmings. But I suspect that we will see the wheat separated from the chaff shortly - exactly because the stakes are that high. It may become more difficult to decipher from now on though. Notice how the news stream has slowed down. It is not because nothing is going on. I think it is because the back channels have been opened up - after the meeting between the EU Com/Pres on Thursday. There are not as many leaks, as in the beginning of the week. And there has not been an outcry (yet) that the Cyprus parliament have posponed their vote on the levy until after the FinMin meeting tomorrow. They were supposed to be done with the whole deal before the FinMins would convene in Brussel to approve. Either Cyprus has pulled another trick by postponing, which I would expect some noise about from leaks, or the final deal is of such a nature, that Cyprus needs backup from the entire Eurogroup, who in turn have time to prepare their own juristictions, before it can be put to vote in a leaky parliament. Last bit of news:

Mar 23, 2013 - 12:17pm

Once the door is open!!!!

After Cyprus now Spain is in with levy talks. How big or small do not matter. Next week will be HUGE in my opinion. Dear PM lovers, hold on to your helmets. Banks are coming down!!!

The Watchman
Mar 23, 2013 - 12:32pm

Great Quote

The best weapon of all, is truth. But we all know no one can enter a government building with weapons.

Mar 23, 2013 - 12:34pm


Maybe my question is dumb which won't be a surprise as I am not among the brightest people around but historic high long positions for the cartel might also be a bad sign , doesn't it ? The normal logic says that hey , the cartel is long and the hedge funds are short so the price must rally because the cartel is always right and the dumb hedge funds are always wrong . But what if the cartel decides to dump big part of their record high long positions ,lets say 20,000 conracts (WoW) wouldn't this create a mayhem in silver and break the all important support ? Wouldnt a move below 26$ make many of the "strong" hands actually dump their longs and the hedge funds increase their short positions even more and allow the cartel to make a huge reversal at this point in the 25$ level ? just a thought

The Watchman
Mar 23, 2013 - 12:41pm


COW ECONOMICS TRADITIONAL ECONOMICS You have two cows. You sell one and buy a bull. Your herd multiplies and the economy grows. You retire on the income. AMERICAN ECONOMICS You have two cows. You sell one and force the other to produce the milk of four cows. You profess surprise when the cow drops dead. FRENCH ECONOMICS You have two cows. You go on a strike because you want three cows. GERMAN ECONOMICS You have two cows. You reengineer them so that they live for 100 years, eat once a month and milk themselves. BRITISH ECONOMICS You have two cows. They are both MAD COWS. ITALIAN ECONOMICS You have two cows. You don't know where they are. You break for lunch. SWISS ECONOMICS you have 5000 cows, none of which belong to you. You charge the others for storing them. JAPANESE ECONOMICS you have two cows. You redesign them so they are one tenth of an ordinary cow and produce twenty times the milk. RUSSIAN ECONOMICS You have two cows. You count them and learn that you have five cows. You count them again and learned that you have 42 cows. You count them again and learn that you have 17 cows. You give up counting and open another bottle of Vodka. CHINESE ECONOMICS You have two cows. You have 300 people milking them. You claim full employment and arrest anyone reporting the actual numbers.

Mar 23, 2013 - 12:50pm

@Turd re: silver COT . . .

While I agree that it is bullishly set up, I think we'll remain rangebound. JPM will supply short firepower as needed to keep the lid on. And will do so, until the last physical ounce they can afford to give up leaves their paws.

Mar 23, 2013 - 1:05pm


I removed your comment. You simply CANNOT infer what you were attempting to infer in your second sentence. Are you trying to get this site shut down?

Mar 23, 2013 - 1:17pm


Russian oligarch Boris Berezovsky has died at his home in Surrey [reported on BBC News 24]

Mar 23, 2013 - 1:23pm

Statistics & Fear

W/E Comments and study of the COT is great. Many thanks. Under the light of the study of the latest COT and the historic prices the whole picture is looking more promising for all of us for the near future. However, I believe this time, when the prices of PM's start to pick up, they have a good chance to get higher and quicker compared to b4. Thanks to Europe and their efforts to break up the trust to the system. Next week will be definitely a week to live and remember. This might be the catalyst we all have been waiting for. For the price prediction for next Friday: $ 34.43

Mar 23, 2013 - 1:24pm

Fight!!! Silver versus bitcoins!

now i'm curious ... what did silver surfer say?? tell me pleeese I know many of you don't like bitcoins however you might be interested in this chart of silver versus bitcoins I've drawn up, tried posting it a few days ago but the site was nearly always down, not sure how to link the image in anymore but you can see it on this link though There is also a poll, which will reach $100 first, 1 ounce of silver or 1 bitcoin ? At the moment there are only 2 votes for silver, need some support from the metals bugs.

Dyna mo hum
Mar 23, 2013 - 1:29pm
Mar 23, 2013 - 1:43pm


Thanks Turd for the update! As I don't care much about the cot and the idiots at jpm or any of the other big banks do I do care about the cyprus situation. It just goes to show people what governments are willing to do to save thier a$$es! And that is why I STACK! as for the bitcoin, I think it should be called the bit con, as it is just digital money and you can't hold it in your hands! everytime someone mentions the "bit con" I think of little bend us over bernake printing his digital money, sorry, that just my opinion! again thanks Turd for all your hard work!

Mar 23, 2013 - 1:54pm

Farage wades in

Nigel Farage, the UK Independence Party leader, has urged British savers with money in Spanish bank accounts to withdraw their cash to avoid being hit with any future attempts by European finance ministers to tax savings. Mr Farage said he wanted to warn the 750,000 British people who live in Spain that their money could also be at risk should similar measures be implemented in other struggling Eurozone economies.

Mar 23, 2013 - 2:17pm

@Turd . . . very apropo that . . .

Disquieting Quiet should immediately follow Drunken Debauchery.

Mar 23, 2013 - 2:19pm

For Cal Law

RE you post on the last thread: You assume that the men behind the curtain are all powerful. I suspect they are not. If folk start withdrawing cash out of southern Europe en mass then I really do think it is game over. Printing press or no. Please read the wizard of Oz Seriously - A movement by the masses is unstoppable.

Mar 23, 2013 - 2:21pm

banks and dominos

with a little push, they all fall down...and Good Friday is already a "bank holiday". Just sayin' (picture not working- use your imagination)

Mar 23, 2013 - 2:26pm


feedback is good. Passing ball to cypriot street people, and let them sing freedoms song. Humanity Enslaved. "The people of Cyprus need to take to the streets and fight against this oppression." What's this?

cris MrGuboci
Mar 23, 2013 - 2:27pm


Fwiw, I think you are exactly right. Monday, I plan to put money where my mouth is. I think the way to play this, at least in terms of making fiat, is with a "straddle", ie out of money options on both sides of $29. Of course, the long range plan is to keep stacking. A little downside risk and huge upside gain. Its a cliche, but this is endgame.

Mar 23, 2013 - 2:28pm

Lead By Example

It's all

Mar 23, 2013 - 2:35pm

Turd and GL

I don't understand the first day notice argument. Why would someone who intends to stand for delivery be "dissuaded" by a cartel paer-price raid ? First of all the person/entity who intends to take delivery of a single contract needs about 160,000 plus or minus. They are a sophisticated buyer and they "want" physical for some reason, why do we think they would be "dissuaded" by a $20/ $30 or $100 raid for that matter? IF you want the physical metal, you want it regardless of minor price fluctuations. The cartel probably uses raids to "dissuade" the sucker fish who have no real intention of delivery - but want to speculate. That is my take anyway - curious to hear yours/others. Lantern, regarding Russian money being tipped off before the event so the very well connected to move some money out - That's a no-brainer, nothing earth shattering there. Who bought the put options on the airline stocks just before 9/11 - somebody always knows something. The question is what Percentage of Russian money was removed and my guess is not much percentage wise. If Cyprus is like Grand Cayman, $2B is small potatoes. The story has no conflict with Sinclair's narrative. RLW

Mar 23, 2013 - 2:42pm

Look what they did in Spain on Friday

23 MAR, 2013, 07.22AM IST, REUTERS Spain's Bankia to face new hurdles on road to recovery MADRID: Spain took the last steps to clean up nationalized lender Bankia on Friday, valuing its shares at a bare minimum of 0.01 euro, while pressing ahead with a partial merger of the bank that could slow its recovery. The new valuation, confirmed by Spain's rescue fund FROB, was imposed by the European Union as Bankia prepares to get a capital injection of 10.7 billion euros (US$13.91 billion) out of European rescue funds. It would wipe out tens of thousands of investors who bought shares in the bank. Last year, Bankia became Spain's biggest-ever bank failure. The state took over and applied to Europe for a 41 billion euro rescue for Bankia and other banks that held hundreds of billions of euros in bad debt from when the country's property market crashed in 2008. In 2011, some 350,000 Spaniards bought shares in Bankia, which was created by a merger of seven savings banks. When Bankia went public, its shares were worth 3.75 euros. On Friday they closed at 0.25 euro. The price has not fallen to 0.01 euro because some shareholders expect the bank to return to health. After the bailout request and meeting strict conditions such as imposing steep losses on small savers who had invested in the bank, the announcement of the valuation on Friday was meant to mark a fresh start for the lender. Why would imposing steep losses on small savers be a strict condition of giving the banks 10.7 billion euros? And they just state it openly. The writing seems to be on the wall.

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