Fri, May 10, 2013 - 11:50am

I know what you're thinking. How can I guy who is dead wrong all the time have his own website? Good question! Maybe it has something to do with this:

But, seriously, it's a good question. How can I be so freaking wrong all of the time? I mean, it's not like I just fell off the turnip truck and began drawing lines on charts. I'd been pretty good at this stuff for quite a while. So what has happened, aside from the obvious Jack Daniels, methamphetamine, valium and glue-sniffing addictions?

I think the answer lies with three things:

  1. Fed/PD involvement in manipulating nearly all markets
  2. The predominance of High Frequency Trading in nearly all markets
  3. And the coordination of numbers 1 and 2 above

For example, many wonder at how the U.S. stock market can keep going up. That's easy! The Fed's Primary Dealers receive, on average, about $2,000,000,000 each business day, direct from The Fed. Now most of this gets reinvested into treasuries in order to prop up the bond market but a considerable amount is left over each day and the majority of that money gets plowed into S&P futures where the attendant leverage multiplies the buying effect as much as 20 to 30 times. As Ruprecht would say: "That's a lot."

So, of course, the stock market isn't going up because your neighbor just put $10,000 into The Growth Fund of America or some old lady just bought 200 shares of ConEd. It's going up because The Fed is giving free money to the banks in order to prop it up. From there, the HFTs which represent about 80% of the daily volume, take over and bada-bing, bada-boom, you're at Dow 15,000.

And with all this free money sloshing around and being driven by mindless computers, technicals and fundamentals get thrown out the window. Technical analysis only works if a group of relatively risk-averse human beings actually see the same formations and lines and then choose to act in those certain spots. When you're dealing with computers and risk-free cash, you can do anything you want!

Sure, two days ago the POSX looked like it was headed lower. It doesn't matter. The euro looked stable to higher then, too. So what? Crude, the grains, copper...all the same. All driven by momo-chasing HFT computer algos which haphazardly buy one day and sell the next.

So what does this mean? Well, I'm still going to tell you what I think and what I expect but I must warn you again: Attempting to profit by trading in this environment is suicidal. You will think you are doing the right thing and then, for example, a baseless rumor gets floated after the Comex close and gold is whacked for $40 before it can re-open. How's that stop order treating ya? Brutal, just brutal.

(Of course, none of this is new. For those die-hards that want to keep trading, I set up the service with Andrew Maguire over a year ago. You might think it's too expensive but in return I'll ask you how much money you've lost over the past 30 days alone? Considering Andy's performance, I'd say his fee is pretty cheap. If you want to learn more, just click the ad on the right side of this page.)

So here we are. The machines have pounded us all the way to $1425 and $23.30. Ugh. Never mind that The Bernank made no mention of "tapering" today. Never mind that Andy reported that today was the largest physical allocation month-to-date in London. Never mind the CoT reports. Never mind the 300 tonnes taken out of the GLD YTD. Never mind the 100 tonnes taken out of Comex vaults YTD. Just...never mind. The machines are in charge and they will continue to be in charge...until they're not.

And when might that happen? Lots of talk out there about imminent collapses and paper disconnects. Chatter galore on force majeure and cash settlement. Oh sure, this is going to happen one day. No doubt about it. But just don't go getting your hopes up that that day is going to be next Tuesday. If we've learned anything these past three years or so it's this: The main power possessed by The Powers That Be is the power to put off the inevitable. The music will keep playing and the party will continue until the day comes when it simply doesn't. That day is coming and it will likely be at a moment not of TPTB's choosing. Clinging to power and the Old Order, the bullion banks will likely create paper metal until there simply isn't an ounce left that they can steal hypothecate and leverage.

Your only winning move remains the acquisition and storage of physical precious metal. And I don't mean the CEF or the PHYS or a certificate from an LBMA vault. I mean metal that you hold in your own two hands. The real stuff. Period. I know there are production and delivery delays. Who cares. Acquire it and deliver it, while you still can. In order to make this easier, I've assembled a list of "affiliates" for you. They can be found here: and here: If you want to hasten the decline of TPTB, go to these businesses today and order some metal.

Here are your mostly-worthless charts. Again, you and I can see where there should be support and buying pressure against the shorts. But that hardly matters when some goon no one has ever heard of can float a rumor and whack the global price of gold for $40.

And I know this is painful but I'm going to give you a CoT update later today, nonetheless. Cast it aside if you want. Claim that it's just fudged-up and manipulated, too, if you want. But...we are talking about levels of Spec shorting that we haven't seen since 2001 and, in some cases, even longer. This fundamental market structure will sometime soon show itself as a bullish indicator once again. It's just a matter of when. Now "when" might be when the banks are finally net long both gold and silver. We'll see. But for now, we'll just keep monitoring the levels in each category and discussing it every Friday.

Anyway, that's all for today. I hope you are able to have an enjoyable and relaxing weekend, regardless of all this nonsense. Keep calm and add to your stack.


About the Author

turd [at] tfmetalsreport [dot] com ()


May 11, 2013 - 3:52pm

Katie .... I will take all the goats !

As a matter of fact .... I had Birria de Chivo a la Plancha .... grilled Goat stew and chile .... this morning .... I never liked goat .... until you came into my life ! See, I can be nice ?

Cry Me A River
May 11, 2013 - 3:58pm

Ten Year Note Yield Update

It's Been 46 Days Since I've Looked At This: This Video Inspired Me To Look At It Again As The Ten Year Surpassed 1.9% Again Yesterday:

Peter Schiff Again Raises The Importance Of Interest Rates--Eventually, We Will See These Rates Take Off. Pay No Attention To The Little Lipstick Girl Or The Other Shills Who Push The "Recovery"

Video unavailable

We Are Again Bumping Up To That 3-year Moving Average Of Yield. The Last Time This Happened, Silver Moved Up.

EDIT: The Left Axis Should Read "SILVER PRICES" Sorry

May 11, 2013 - 4:14pm
May 11, 2013 - 4:17pm

8 years old~!

8 years old~!

Just shoot me now;

Quinn Sullivan - The Thrill is Gone - live
Texas Sandman
May 11, 2013 - 4:20pm

What impresses me about interest rates

is the rate of change here. I mean, the 10 year was just at 1.6% a week or so ago, right?

It went from 1.8 to 1.9 just yesterday.

Texas Sandman
May 11, 2013 - 4:30pm

More Nostradumbass

"There is no housing bubble."

"There is no problem in mortgage lending."

"OK. There's a problem in subprime mortgage lending. But prime mortgage lending is fine."

"OK. There's a problem in mortgage lending but it will never affect the broad economy."

"Gold is NOT money."

"We're going to start tapering QE now."

Ben "Nostradumbass" Bernanke

waxybilldupp That_1_Guy
May 11, 2013 - 4:33pm

Thanks Guy! & @Katie Rose

I gave up checking Cabela's for .223 ammo long ago. 5 boxes (daily limit) of hollowpoints on their way to my doorstep. Herters ammo not the greatest but is fine to check out two new delivery systems I've added to inventory in recent months.

Several folks have advised Katie to include a shotgun to her intruder deterrent system. I agree, but would recommend a Remington 870 20 ga., not a 12 ga. The "home protection" version has a nice short 18-1/2" barrel and a 20 won't kick as much as a 12. Take it with you everywhere, or have it nearby, Katie. A load of 00, #3 or #4 buckshot from a 20 gauge at 30 yds. or less will inspire the most determined piece of scum to assume the fetal position until the medics arrive. It would do quite nicely for coyotes and feral (or unferal) dogs, as well. The rapidly increasing goat herd is sure to become a canine magnet. The trick will be avoiding turning the herd into a goat buffet. Regarding the coyotes or feral dogs ... SHOOT TO KILL! Don't go getting dewey eyed on 'em.

Eyes open; no fear ... wax off

May 11, 2013 - 4:33pm

Jump, Jamie, jump!

"(Reuters) - JPMorgan Chase & Co Chairman and CEO Jamie Dimon said he may consider leaving the bank where he has held the top post since 2005, if shareholders vote to split his duties, the Wall Street Journal reported on Saturday."

May 11, 2013 - 4:48pm

Nobody expects The Spanish Confiscation?

"Europe said that Greece was the first and last such restructuring, but then there was Cyprus. Spain is holding off further recapitalisation of its banks in anticipation of the arrival of Europe's banking union, which it hopes will do the job instead. But if the Cypriot precedent is anything to go by, a heavy price will be demanded by way of recompense. Bank creditors will be widely bailed in. Confiscation of deposits looks all too possible.

I don't advise getting your money out lightly. Indeed, such advise is generally thought grossly irresponsible, for it risks inducing a self reinforcing panic. Yet looking at the IMF projections, it's the only rational thing to do.

PS. I don't include creditors of the British arm of Santander in this warning, who are ring fenced from the mothership back bome in Spain, theoretically at least."

John Galt
May 11, 2013 - 5:03pm

@ Katie Rose re: Intruders

Of the many comments you have already received I would concur with most of what SouthernCross has said.

Bongo Jim's shotgun suggestion (echoed by many others) is also good. Waxy recommends the Remington 870, as do I (although my preference is 12 gauge ammo, despite the added kick). The R870 also has many available options, including laser pinpointer and spotlight. I cannot recommend handguns mostly because being in Canada the gun laws here make them so difficult to obtain. At least with a shotgun you don't have to be accurate...just point in the general direction and pull trigger.

As for the intruder (assuming there really was a guy with 2 Rottweilers) bear in mind that those dogs are traditionally herding dogs, and it could be the guy was staking out your property taking inventory for future reference. To my knowledge livestock theft is one of the biggest problems in rural areas.

I would not hold your breath reporting this incident to the police. If no crime was yet committed you'll be lucky if they even bother to file a report.

Finally, you mention prayer and quoted Ps 34:7 in your post.

That is admirable, but I'll provide a quote of my own from Frank Loesser:

"Praise the Lord and pass the ammunition."

Motley Fool
May 11, 2013 - 5:19pm

Texas Sandman

"If you don't understand history (e.g., numismatics) you are susceptible to such idiotic statements as claims "gold is money, but silver is not!"."

If this is in reference to me, I am pretty sure I explicitly stated that I didn't think either is money, or will be money (though I grant both were money in the past - there, that covers all the tenses).

So, presumably I am a complete idiot?

Paraphrasing Santayana : Those who do not learn from history's mistakes are doomed to repeat them.

May 11, 2013 - 5:23pm

re Quinn Sullivan

I am such a pale loser. You can shoot me second.

Cry Me A River
May 11, 2013 - 5:29pm

Interest Rates

Tex---Yes---The Rate Of Change Is Accelerating

More money is being spent than normal. This is due to low interest rates and increased borrowing. The cost of doing business starts to go up independent of demand because negotiated labor union contracts are always for higher wages, the cost of exporting foreign goods goes up, and thus, taxes are go higher. Real inflation rises because the price of real goods and services (food and energy) are up.

For right now, lower interest rates are increasing borrowing power for consumers. If consumers spend more, the fake economy grows, but consumer debt increases because people are using credit cards more often to buy things creating inflation.

The fed can raise interest rates, but the cost of servicing our debt is so high that even a tiny increase will cause a slump in growth. They can not slow the amount of cash entering the economy, as this is the only engine keeping the fake "recovery" going .

When there is not enough economic growth to keep wages up and unemployment low, stagflation sets in and is IMO, the first sign of possible hyperinflation. The last time this happened in 1979, Volker was able to ignore the debt issues as it was relatively tame, ignore the recovery issue, as we still had a robust manufacturing-driven economy, and raised interest rates until inflation and, as it turned out, the economy was killed. In a few years, under Reagan with the willingness to build up military spending to crush the USSR, recovery was accomplished

Today, we just don't have any "economy strengthening factors" left to perform this interest rate miracle. As a result, the fed is in a box, as we all know, but the bond-buying fuel may run out. thus, watching the ten-year note, is essential.

May 11, 2013 - 5:29pm

Waxybilldupe and John Gaul !

We are talking .... a girl who can't keep a padlock .... on her goat gate .... all these arms recommendations .... are touching .... but, I think she would just prefer CASH .... PayPal .... Bitcoins .... or, as in the past .... SILVER ! Monedas 1929 Comedy Jihad Maybe Turd Could Just Set Up A Donation Account For Katrina Rosen Jewish Goat Herder World Tour

John Galt
May 11, 2013 - 5:30pm

LCS Update from Toronto

In previous posts (especially during/after the price smashes several weeks ago) I reported seeing virtually zero PM inventory at my LCS. Orders were being taken for Gold (for delivery in May and later) and for a while orders for Silver were not even being taken.

Although on the surface it seemed that real physical supply was drying up, I openly wondered on several occasions whether it was really a case of physical shortage or, perhaps, production bottlenecks with getting raw metal processed into finished product.

Based on what I saw today I am inclined to believe the latter is more the case.

When I walked into my LCS the display cases were TEEMING FULL with product, both Gold and Silver. You name it and it was there in abundance: MLs, Eagles, Buffalos, Bisons, Phils, Krugs, Koalas, and small bars.

I was also surprised to see very few buyers because Saturday is normally their busiest day. I had a brief conversation with the owner and he told me that traffic has tailed off a bit lately, although their phone + online business is still brisk. He added that big moves up and down in price usually spikes up buying, and the relative "quiet" of late on the price front has lulled the buying into passivity again.

Based on what I have seen and heard over the past few months my theory is this:

The world as a whole (at least here in Canada) remains largely oblivious to what's unfolding. Probably less than 1/4 of 1% of the population has any clue or inclination to buy PMs (as opposed to the crowd here at TFMR which has an awareness level of around 100%).

When the price smashed lower that .25% of the population ramped up their buying and in the short term overwhelmed the supply chain. What couldn't be bought as cash and carry was ordered instead for delivery later. Taken together this burst of buying probably cleaned most of the .25% out of their dry powder, and now they have to wait before being able to buy more. Or maybe like the 99.75% they're now distracted by American Idol and/or the hockey playoffs and/or MLB/NBA/golf etc.

I still think we're getting ever closer to physical availability being vaporized because despite the abundant supply the pricing on the phyz was radically higher than spot, and the owner simply said that higher premiums over spot were the norm now - everywhere.

Something shiny caught my eye and a modest addition was made to my humble little stack.

While I continue to believe that much higher PM prices are inevitable, those higher prices are not necessarily imminent.

Keep stacking, my friends, and remain patient.

Cry Me A River
May 11, 2013 - 5:34pm


I'm sure someone has asked you this before---refresh me on this statement as I have not crossed paths with you until yesterday:

MF: "Gold and Silver Are Not Money"

If They Are Not, What Is Money?---This Should Be Good---LOL!

John Galt
May 11, 2013 - 5:41pm

@ Monedas

Curiosity got the better of me, Monedas, and I had to check your profile.

I never realized you had a Twitter account, but did LMAO over your Sept. 2012 tweet which said:

Real men don't fucking tweet ! 4:52pm - 2 Sep 12
May 11, 2013 - 5:42pm

According to the USGS, silver is . . .

one of the first metals the earth will not be able to supply to meet needs.

Even if gold becomes the money of kings again, and silver is shunned as money (which I disagree with), the supply/demand characteristics would say silver will continue to rise in value as it is used up. While there may be many areas in which silver is replaced sometime in the future by other technologies, new uses for silver are found nearly daily.

It is only in a paper-controlled world as we have now that lower supply and higher demand means a lower price for an item.

May 11, 2013 - 5:44pm

New gun

I bought a Beretta 9mm today. Picked up some ammo too. Now I leave the silver out of the safe and keep the ammo in. It is harder to get and is the price is rising faster.

May 11, 2013 - 5:59pm


aren't you so proud of the tar sands and Bombardier? ... how the petroleum industry helps Bombardier employ people making buses in Quebec so we should all (I think) buy our gas from Petro Canada and keep the Quebecois happy?

I think things would work better with less government driven "equality". Yeah, let's put Mikey's grandkids into debt so we can have an Office Of Religious Freedom. Next, perhaps a government agency for Freedom From Religious Freedom.

My kids get cheques from the government every quarter

What am I doing wrong? Why don't mine get cheques from the gov every quarter? Maybe if I declare all those kayak-tipping losses?

Swift Boat Vet John Galt
May 11, 2013 - 6:01pm

Hey Miss Katie Rose

If I were you, after turning in a police report AND asking if there are any other reports of a man with the matched pair, I would go both to the local feed store, market and farm supply stores and chat up the proprietor and any customers around about your intruder and ask if any others had a similar experience. I would also ask there and all over the local area who the hell owns a pair of mutts that fit the description. If he's local, you will probably find out who he is. If not, every other stock owner will be on alert. Local grapevine is a powerful asset ! The 870 is an excellent 'deterrent' . It is said that the scariest thing an intruder can hear is the racking of a shell into the chamber. If the sound doesn't scare him, RIP.

I have a great sign here, 'Trespassers will be shot, survivors will be shot again!'


Cry Me A River
May 11, 2013 - 6:03pm


NOPE!--"medium of exchange"<---that's currency---you got them confused, fool! Money is Not Federal Reserve Notes---Fool!

NOPE AGAIN!--"In the short term (quick transactions) fiat currently serves all three of those roles"<---There is no "store of value" that exists in federal reserve note currency. It can be taken away as fast as the fed can issue a decree. You got money and currency confused, fool!

Even "unit of account" is now a questionable aspect as it's now just digits in a computer. The fed can play around with this all they want---erase zeros, add zeroes, put currency in computer digits "off-balance sheet in the trillions"---Lie to politicians where the Currency is, etc:

Alan Grayson: "Which Foreigners Got the Fed's $500,000,000,000?" Bernanke: "I Don't Know."
Senator Sanders asks Bernanke WHERE IS THE MONEY


NOPE---THREE STRIKES AND YOU'RE OUT!---"So atm I would say fiat is (as close as we have) money."<---FIAT IS CURRENCY FOOL!

May 11, 2013 - 6:03pm

Whaaa....cliff did another wujo?


Video unavailable


Motley Fool
May 11, 2013 - 6:04pm


Money is generally defined as something that serves the three functions store of value, unit of account and medium of exchange.

Gold and silver fail on the latter (and most important) criterion at present.

In the short term (quick transactions) fiat currently serves all three of those roles (reason for the short time frame mentioned of course is that it is not an ideal store of value due to inflation).

So atm I would say fiat is (as close as we have) money.

I know, I am just a complete idiot, but perhaps consider some words of Mises on the topic :

"Money is a medium of exchange. It is the most marketable good which people acquire because they want to offer it in later acts of interpersonal exchange. Money is the thing which serves as the generally accepted and commonly used medium of exchange. This is its only function. All the other functions which people ascribe to money are merely particular aspects of its primary and sole function, that of a medium of exchange."

May 11, 2013 - 6:15pm

On a very positive note

Someone posted Back to Eden here a few weeks back and I thoroughly enjoyed watching it, scripture quotes and all.

I'd removed all grass last year and mulched over the unplanted areas. Preparing the garden for this year, I raked a bunch of mulch out of the way. Underneath is beautiful, rich soil filled with life. Nice lesson here: nature works.

No more shipping in dirt and manure. We've converted to hugelkultur and grown most of the plants from heritage seed. I'm pretty sure this is the lowest-cost approach, but more importantly it fosters a sense of peace... of working with nature.

Apparently, it also fosters the best quality garden.

The neighbours think I'm crazy for burying dead trees under my garden. Meh.

Motley Fool
May 11, 2013 - 6:16pm


Fwiw, I dislike the word 'money' as it is such a loaded term. Given your specific question I could not avoid the term. Personally I think of fiat as currency, and gold as wealth.

Perhaps the words of Menger are also of value to you :

"[I]t appears to me to be just as certain that the functions of being a "measure of value" and a "store of value" must not be attributed to money as such, since these functions are of a merely accidental nature and are not an essential part of the concept of money."

If I were forced to define money, I would prefer the freegold definition as per FOA :

"Money in its purest form is a mental association of values in trade; a concept in memory not a real item… the value is in your association abilities. This is the money concept, my friends."

S Roche
May 11, 2013 - 6:18pm

re that big twitter rumor sell-off...(sry, late to the party)

I apologize if these matters have been covered in the comments already:

Here is the tweet from the other day per zero hedge:

Andrew Yorks @andrewyorks

Over/under on a 3pm Hilsenrath article hinting tapering is coming sooner than later

2:12 PM - 9 May 2013

Note the time.

The gold sell off started 12 minutes before that, got some momentum 5 minutes before then consolidated for 15 minutes around the time of the tweet then started again. My view is that most people are wrong about most things most of the time.

Price makes news.

Yesterday was a bear raid. They shit in the woods and they raid gold, but I don't think they're smart enough to do both at the same time. The raids will end.

Along those lines there was this interesting prediction from Jim Sinclair's site the other day: that May 10 would see the retest raid and the follow up from the author, Bo Polny .

Again, apologies if this has all been covered.

Southern Cross
May 11, 2013 - 6:20pm

ALERT ALERT>>>>>First Shot Fired In US Revolutio. .


I believe this is the most important speech you should hear. When people look back this may be the most important speech given at the start of the US Revolution. Most will not recognize it, but this speech is the first shot of the war against tyranty. The person shooting is not just talking, they are firing a vocal shot and asking for support to launch an all out assualt against the criminals powers. This is one dark knight folks. His prior experience under 5 prez says so.

Calling For The Overthrow of Illigitimate Government -

If you don't believe listen......

The guest speaking on InfoWars led the take out of Noriega and Al Damour in Lebanon. This guy is the real deal. He has worked for the last 5 US prez bringing down world leaders. He says he can and will take down the present administration if the US people get supporrt him using a quick "cut off the head" of power style.

We are hearing more and more drums of war the last week. Good news. It's time to restore the Republic.

Prepare while you can.

From Info Wars

Steve Pieczenik Calls For Military Junta – Arrest or Assassinate the Treasonous Criminals in Office

Friday, May 10, 2013 17:32
Cry Me A River
May 11, 2013 - 6:20pm

Fool Says

"Fwiw, I dislike the word 'money' as it is such a loaded term. Given your specific question I could not avoid the term. Personally I think of fiat as currency, and gold as wealth."

What kind of an answer is that?---according to the posts here last night about you---You're the big intellectual---the "big mind"--- here, who can pontificate on these subjects.---Well?

These are basic tenets of this blog---MONEY, CURRENCY, BARTER ,GOLD SILVER. Come On Man!---Give Us Your Theatrical Theory!

I thought you told us you were "REALLY GOOD"---well---prove it!

Answer me this---Describe the action of exchanging money. What happens?

Answer me this---When hyperinflation was in full swing, why were people paid twice per day in Weimar? And what did they do with this currency?---If they were paid MONEY---would this have happened?

Motley Fool
May 11, 2013 - 6:23pm


I have said enough. If you care to disagree with me, Mises, Menger and FOA, so be it.

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