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 - 3:31am

Sinclair's non-convertibility = a floating gold price

In Santa's model, gold price would float based on the amount of the credits being issued. They would not maintain a steady rate where this fixed amount of fiat could convert into that fixed amount of gold. Santa believes such model should lead to healthy economic growth, which is wishful thinking at best to me.

We have such non-convertibility already in these banana republic nations such as Argentina where people have a currency choice b/t PESOs and foreign sounder currencies. Instead of growth, it got Argentina into round after round of hyperinflation / PESO revaluation as their central bank just cannot stop abusing the PESOs.

The key problem of Santa's (and FG's) model is that they still have a central bank controlling the money supply. Bummer!! That's a central planning Keynesian model bound to fail.

One more thing about Santa and free gold as it appears lots of people here don't know it. The gist of Free Gold was advocated by certain European central bankers long time ago. Santa knew the theory and bought into it way before the FG folks came around. FOFOA arrived later to add his own goofy ideas such as "needing to separate store of value from medium of exchange" on top of it to create a free gold theory.

And that's why I always take a grain of salt when Santa says anything. If those European bankers have managed own continent into a disaster then why would anyone believe their model is sound?

The Vet
May 11, 2013 - 3:41am

Katie - Bright motion activated lights work well...

I have a number of solar powered motion triggered LED floodlights in strategic positions which work well. They are quite cheap to buy and can be mounted on any available pole or wall (high up to avoid being interfered with). Mine are waterproof and use standard AA NiCad batteries which can be easily replaced if necessary, but they are three years old and still going strong on the original set. They cost me about $30 each.

Being solar charged means that there is virtually no installation or running costs, and they can be placed virtually anywhere and they can be mounted on a pole or wall. It only needs a few hours of sunshine a week to keep them charged for average use.

Apart from the deterent effect of being spotlighted, as the lights are triggered you can get a good idea as to where the intruder is and which way he is moving. You will get an occasional animal that trips the lights, but that's probably a good thing as most predators (like cougars) will probably be spooked by the light and leave the area quickly.

May 11, 2013 - 4:08am

Motion Tracking Security Spotlight

There's a house on a corner near me with one of these...


When I walk my dogs past it it is super bright and follows us as we walk by! It's pretty annoying! Kind of expensive $225, has a built in camera too.

Put this near the house (power), and get a couple Solar powered ones for along the driveway?

edit: Hey Vet, we think alike. ;-) I had to go look up a few.

May 11, 2013 - 4:19am


for it, just because, but, all posts are manually stuffed after each new thread, for the record of course, plus with off line storage, immune to sneak and peak through the looking case, you have three versions in storage, always, the temp locally, the permanent at turdvile which no doubt smartly would backup for the 2b copy, and local off line optical so that the data is protected from on line trolling villainy of leviathan, and for the record, lets all please kindly notice that on friday, not only did the bulls come back in a major way, from two blow downs by the leviathan, as the bulls heaves BTFD, with the high close exceeding wednesday low, but those tall tell signs, the peeps with brushes were at it again, painting the tape in after hours, signaling we are still in bull lift off mode, despite the two blow downs within 24 hours, just saying, as one woke up at midnight to start the day, which is perfect and quite and typical, for a grandiose alpha werewolf in light speed.

So, recapping, with all lay indicators a go go, save higher highs and higher lows, the first being only higher lows, for the part score, the second was a nullified downer if not an outside reversal, with the bull heavies and peeps coming back strong, and 7 days of higher highs and higher lows, portends bull lift off, as we are still in the game despite the back field foul called by the ref.

Mel & Tim - Backfield in Motion

two posts down:

Meh, so jealous, if not envious, having the soul mate bro, who thinks alike, its lonely in outer space, circling jupiter with thrusters on in the third order, a loner.

Ground Control to Major Tom
Katie Rose
May 11, 2013 - 4:20am

a few answers

A few answers before I head off to bed.

We have a gate at the beginning of our driveway. We were locking it at night until this last winter when the lock kept freezing, making it impossible to open. It would be very easy for someone to cut the chain that holds the lock or the wire fencing if they really wanted in. I don't see a locked gate as much of a deterrent. Out come the bolt cutters, and in they come.

We have a motion detector light over the shop/ garage door. We can easily see the door from the house. We barred the window following the string of robberies this winter.

All our outbuildings are securely locked.

What upsets me the most is that this man brought dogs with him. Pit bulls are not country dogs. Nobody wants them here. Too many people have free range chickens and livestock. And these dogs were well trained. Otherwise they would have torn our loyal pet apart.

I know there is more that we can do. That is why I asked for help on home security.

I truly believe in prayer.

Ps 34: 7 "For the Angel of the LORD encamps round about those who fear HIM, and delivers them."

I pray this prayer every night. I ask that we be delivered from all evil as we sleep, and I believe that last night we were.....

May 11, 2013 - 4:28am

I have a geopolitical concern

I have a geopolitical concern that I feel is off radar here. Pakistan is having elections and I think this could be a major problem spot if you include the fact they have nukes.

May 11, 2013 - 4:35am


The Europeans had the blatant fiat system forced on them by Nixon. Rui I agree that Fofoa has merely came along and tacked on his stupid theory add-ons. You have a good grasp of the situation.

Free-market gold concept existed before Fofoa Freegold. Suggesting Santa has come to Fofoa's view is ignorant and stupid.

There are many who believe the Free-market gold position, but confusing it with FofoaFreegold is unfortunate.

The gold paper markets ending is Free-market gold.

Fofoafreegold is a whole new world of intellectual dishonesty and stupidity.

May 11, 2013 - 4:38am

Based on this expoential

Based on this expoential trendline on monthly chart, gold is going to be back into 1800 region around October-November 2013:

Pity I spend most of money trying to catch the downtrend, but the minimum is either in or very close.

May 11, 2013 - 4:42am

Erm, Don't want to worry


Don't want to worry anyone but Bankia has finally fulfilled its dismal outlook. Obviously 100K is ok and backed up the whole article is well advised.

Spain is officially insolvent: get your money out while you still can

By Jeremy Warner Economics Last updated: May 10th, 2013

511 Comments Comment on this article

I'd not noticed this until someone drew my attention to it, but the latest IMF Fiscal Monitor, published last month, comes about as close to declaring Spain insolvent as you are ever likely to see in official analysis of this sort. Of course, it doesn't actually say this outright. The IMF is far too diplomatic for such language. But that's the plain meaning of its latest forecasts, which at last have an air of realism about them, rather than being the usual dose of wishful thinking.

Let's take the projected budget deficit first. This is expected to decline quite steeply this year to 6.6 per cent of GDP, but that's mainly because the cost of bailing out the banking sector fell substantially on last year's budget. On a like-for-like basis, there has in fact been very little fall in the underlying deficit. And nor on the present policy mix is there ever likely to be, for that's where the deficit is projected to remain until the end of the IMF's forecasting horizon in 2018.

May 11, 2013 - 4:48am

This is Pakistan's one and

This is Pakistan's one and only shot for a democratic government to be elected. If it fails, there will be trouble. Mind you, if it succeeds, there will be trouble too. Either way, The US gets pulled in further either to support democracy or to act against a emboldend anti-western factor.

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