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 10, 2013 - 3:03pm

@ grublux

Yep, I'm putting in the 4% my employer matches to reduce my taxable income. F those criminals I'm not paying a dime more than I have to :)

Plus I don't need the money that bad since the wife started a business last year and is making a killing!

May 10, 2013 - 3:06pm

One Year in Hell-Stack the Drugs

Antibiotics. I am the guy. Get Rx from your friendly doc (TX Sandman) for large quantities. Forget about getting it payed for through your insurance plan. Many are very affordable in bulk. Not limited to just antibiotics. All maintenance meds eg blood pressure, diabetes etc. Stack the drugs too. Also good for barter if need to.


Lamenting Laverne
May 10, 2013 - 3:08pm

Oh I forgot...

I think that the reason for the big size of the 200$ smack in Gold, was because the YenGold was at the verge of breaching All Time Highs. If it had broken through decisively, there was a risk of Gold taking off to the upside and burying the short USD/Yen positions and the Japanese Bond positions forever.

May 10, 2013 - 3:08pm

Enjoy smelling the roses

I will miss your cheerful soul. x 10

May 10, 2013 - 3:13pm

The Players

I'm liking Zach Johnson this weekend.

القراع عصفور
May 10, 2013 - 3:15pm
May 10, 2013 - 3:20pm

CEF shares

Evidently you do not have to keep your CEF shares in your broker's name. CENTRAL FUND ANNOUNCES A CHANGE OF ITS U.S. CO-TRANSFER AGENT AND PARTICIPATION IN THE DIRECT REGISTRATION SYSTEM (DRS) For Immediate Release to Marketwire and U. S. Disclosure Circuit TSX SYMBOLS: CEF.A (Cdn. $) and CEF.U (U.S. $) NYSE AMEX SYMBOL: CEF TORONTO, Ontario (November 6, 2012) - Central Fund of Canada Limited (“Central Fund”) is pleased to announce that it has completed a change of its U.S. Co-Transfer Agent from Computershare to American Stock Transfer & Trust Company LLC (AST). Central Fund’s Transfer Agent in Canada remains CIBC Mellon Trust Company, acting through its administrative agent Canadian Stock Transfer Company Inc. (CST), which is the Canadian affiliate of AST. Central Fund is also pleased to announce that it has initiated its participation in the DIRECT REGISTRATION SYSTEM (DRS) enabling shareholders an additional method for holding their Class A shares of Central Fund. Central Fund continues to provide share certificates upon a holder’s request through their broker or directly to the Transfer Agent for those wishing physical possession of their title of ownership. Questions for AST or CST may be directed to CST at 1-800-387-0825 or via e-mail to inquiries[at]canstockta[dot]com . Central Fund of Canada Limited (est. 1961) is an exchange tradeable, refined gold and silver bullion holding company. Class A Shares are qualified for inclusion in many North American regulated accounts. Central Fund’s bullion holdings are stored unencumbered in allocated and segregated safekeeping in Canada, in the treasury vaults of a Canadian Chartered Bank. The gold and silver bullion is physically inspected by Directors and Officers of Central Fund in the presence of Ernst & Young LLP as well as Bank officials. Class A Shares are quoted on the NYSE Amex LLC, symbol CEF and on the TSX, symbols CEF.A (Cdn. $) and CEF.U (U.S. $). For further information, please contact J.C. Stefan Spicer, President and CEO at 905-648-7878 Website: Email: info[at]centralfund[dot]com. Also, CEF selling yesterday London close basis at a 3.6% discount (yes a negative premium).

Ktesibios Doctor J
May 10, 2013 - 3:30pm

Re: any rumors out there?

I just phoned to Ms. Merkel. No crash possible, she confirmed. So leave your cash at the bank.


May 10, 2013 - 3:31pm

@ Juggernaut Nihilism

You know what I meant by that. And I wouldn't be selling my phyzz to anyone anyway. I'm a stacker. The LCS gets his gear from a wholesaler who is selling at 25+1 to him. He's selling for 28.50 flat. Like I said, that's fine with me...he needs to make a little money and stay in business too. What's he supposed to do, go out of business???

And I'm still getting phyzz for under 30/oz. I don't see that as being gouged. You want the phyzz, you're going to pay, right? Well he's being quite fair in my opinion and I'm thankful to be able to get bars and Buffaloes from him at that price.

Actually, my last 10 ounce bar last week I offered him 300 straight up, all 20's...he threw one of the 20's back to me and said don't worry about it. So that bar was actually 28/oz. He's a cool guy...probably a closet Turdite, I know he reads ZH and Silver Doctors every day and I've told him about TFMetals many times.

Anyways...that's just the way it is....keep stackin'!!!

May 10, 2013 - 3:32pm


Which makes me curious if you are a longtime holder of physical yourself?

Longtime, yes (since 03), though by the standards of this site I'm sure the quantity is shockingly low (~7% of my assets).

So I'm willing to grant physical holders a little bit of allowance to hope that rising premiums will stay and offset paper declines. I choose not to fault others for eagerly waiting to be rewarded for making right choices. On the flip side the pain is more acute for newcomers, there should not be an expectation of quick and easy gains. Not in PM's. But I suspect that many have been and are. Fundamentals take time to play out and are excruciating to sit through.

As far as granting holders the right to hope, no argument here. People can hope all they want. My issue is with what you express in the rest of your response: certainty. Certainty that anyone going all in on PMs is 'making right choices'. Certainty that prices are artificially suppressed. Certainty that you understand the complexities of the global economy well enough to guarantee that eventually paper and physical will disconnect, and PMs will go to the moon as currencies and equities flounder and perish in a global reset.

As far as the recent hysteria about the disconnect finally being here, I just wanted to point it out because no one else here will. It's OK to be wrong, I myself am wrong all the time, but it's important to learn from it when we can.

May 10, 2013 - 3:33pm

@RationalMind I, personally


I, personally think it is a bad idea. Even though there is no precedent that I know of for Australian PM confiscation, I think things are going to get very desperate at that level, and I don't like having desperate people owe me anything. If they aren't paying you an assload of interest to make up for the risk that seems to increase every day, I wouldn't do it.

Though it might be a good idea if you are a Simon Black type jet-setter. I question the sustainability of that lifestyle, though.

May 10, 2013 - 3:33pm
May 10, 2013 - 3:37pm

miners going green

gdxj, paas, mux, ssri, etc.

happy friday,

happy fubm.

...slw, exk, ag,...... who's next?

Texas Sandman
May 10, 2013 - 3:44pm

The TRUE Nostradumbass

"There is no bubble in the housing market."

"There may be a bubble in subprime mortgage lending, but the prime mortgage market is sound."

"There may be a problem in mortgage lending. But it will never affect main street."

"Gold is NOT money."

Ben Bernanke - Chairman of the Federal Reserve

If the guy said "the sky is blue", I'd immediately run outside to see if it had turned green.

Actually, I ask myself how a guy who is wrong all the time can be chairman of the central bank for the most powerful nation on earth...

May 10, 2013 - 3:44pm

Santa and freegold . . . and affect on paper gold . . .

Jim Sinclair has written several posts wherein he believes that freegold is where we are headed. He made a point to say that he doesn't agree entirely with the FOFOA method, but he didn't say how he disagrees, either.

FOFOA says that the EU will introduce freegold by announcing a gold-buy program, if I understand him correctly. Unlike the U.S., the EU currently uses market price to value their gold reserves. So, as they increase the buy price (not sure if they'll start at FOFOA's $55,000/oz price, or start at current market and ramp up to that level), the value of their reserves automatically increases by the gold values rising, plus the new gold bought.

As the gold values rise, the debt is automatically devalued as is the currency. Because only gold is the recipient of this new buying program, other items will not rise in price like in a general inflation.

Santa doesn't say which nation he thinks will cause freegold to occur, or if it might simply emerge on its own as a last resort in the face of failing monetary systems globally.

Freegold is not a gold standard, and there is no convertibility. Gold will be like another currency and all other currencies will float in value vs. gold. The difference that does not now exist is that there will be no paper gold which now makes up 90% of what people think is the "gold market."

So, when there is physical gold only, that 10% of the current "gold market" will be much higher in value.

That is the reason there will continue to be lower paper gold values, until paper gold no longer exists.

It seems we are heading in that direction, fighting and screaming all the way. The bankers want to milk what's left of the current system for all its worth before acquiescing to freegold, or whatever ends up coming next.

May 10, 2013 - 3:46pm


Posted on last thread but I think the action in miners today is worth highlighting again. GDXJ now green and never really had the fear pumped into it that the poor action in gold futures would normally engender, which tells me that some investors are onto the real story.

Stocks lead. If you've been hanging out waiting for the carnage to cease, we may be there. Some really good projects on sale out there.

May 10, 2013 - 3:51pm


Transcript of the latest closed-door Fed Meeting:

<Chairman Bernanke in front of the room>

"In 1930, the Republican-controlled House of Representatives, in an effort to alleviate the effects of the... Anyone? Anyone?... the Great Depression, passed the... Anyone? Anyone? The tariff bill? The Hawley-Smoot Tariff Act? Which, anyone? Raised or lowered?... raised tariffs, in an effort to collect more revenue for the federal government. Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression. Today we have a similar debate over this. Anyone know what this is? Class? Anyone? Anyone? Anyone seen this before? The Laffer Curve. Anyone know what this says? It says that at this point on the revenue curve, you will get exactly the same amount of revenue as at this point. This is very controversial. Does anyone know what Vice President Bush called this in 1980? Anyone? Something-d-o-o economics. 'Voodoo' economics."

Texas Sandman
May 10, 2013 - 3:52pm

May 10, 2013 - 3:52pm

TRUE Nostradumbass cont'd

"The Fed isn’t printing money."

“100 % confident” that, when necessary, the Fed can control inflation and reverse its accommodative monetary policy.

"The term 'audit the Fed' is deceptive. The public thinks that auditing means checking the books, looking at the financial statements, making sure that you're not doing special deals, and that kind of thing. All of those things are (already) completely open,"

Those were not incorrect/mistaken predictions or statements. They are simply 'factoids' that TPTB require the majority of the populace to believe in order to carry on their business in the current paradigm.

Ben is really just Bob.

May 10, 2013 - 3:58pm

Sweet, sticky 15% Greek wine

is the secret weapon against the enemy.

Turd is a Cretan.

I am Turd.

More is less, less is more, good luck to the strongest liver, but in the long run...

May 10, 2013 - 4:05pm

Nostradumbass is a deep topic

I think we really need to consider these two pictures. The first from July 2011, as he prepares to launch QE3:

and from March 22 of this year, as he explained that monetary policy was beginning to gain traction:

hmnnnn ... I know if I saw that look on a family member that something horrible was about to be revealed. Not that anything horrible has ever been done by anyone in my family. But shame is a fairly universal feeling, and you just have to wonder what in particular he has just lied about and knows is going to be impossible to hide.

Cry Me A River
May 10, 2013 - 4:07pm

IT'S A FLAT COT FOR 5-10-2013

The commercials have still not yet signaled that their trend of covering shorts into falling silver prices is finished. Last week, they had not signaled, and this week, they have not signaled anything that makes me believe they've finished for yet another week. Thus, the original trend of short-covering into lower silver prices has STILL NOT BEEN STOPPED, ALTHOUGH THEY SHOWED A FLAT COT.

This week, their net shorts as measured in oz. of silver have shown ALMOST NO CHANGE IN NET SHORTS AS A PERCENTAGE OF COMEX INVENTORIES where they have now dropped back down near a new all-time low of 43.2%.. This is an almost no change 1% rise from 42.7%, last week, of the total comex silver inventory.

The last all-time low was made on 7-2-2012 at 40.83%---Last week, I believed that this number would be broken.

I was not right, but it's still very close. The banksters are also still close to showing a weekly COT REPORT that might indicate a 1:1 ratio of shorts to longs. It's unbelievable, but true. We are also close to a new territory of ever-lower prices that will, most likely, break that $22 level.

Here's the current chart on the Commercial Short/Long Ratio. It's still at 1.22. This is as low as I've ever seen it.

Commercial Shorts Are Now At 80159 Contracts, Longs 65703 Contracts.

The COT Chart Also Shows An Almost New Low Level Of Net Shorts As A Percentage Of Total Inventory:

The above chart continues to confirm its down trend signaling lower silver prices ahead.We will still need to see the commercials to SIGNIFICANTLY ADD shorts for probably two weeks in a row before I can conclude a bottom might be in. For now, we don't even have 1 in a row yet.

The Registered Category Is Now Risen From The All Time Low of 154% which occurred last week, and is now back up to 164%. which registers a tiny blip on this chart:

Absolutely no signals are showing any kind of bottoming. I'm concluding silver prices will continue to drop for at least, another two weeks.


May 10, 2013 - 4:13pm

These weeks have frayed all nerves...

Sasha is very tense, won't drink, and is lashing out...

May 10, 2013 - 4:19pm

Shake and Take !

I love those fruit picking machines .... they drive them up to the tree .... the arms grab the tree trunk .... jack-a-lacka, jack-a-lacka .... the fruit falls into the butterfly nets .... and is funneled back .... into a hopper .... filled with naked girls (we don't want to bruise the fruit) .... who deftly wrap each piece in red tissue paper .... and place in card board boxes ..... uh, I think I lost my place .... oh, yeah .... this is how a silver shake down happens .... weak hands, gamblers, doubting Thomases and trolls .... cough up their silver .... like organ grinder's monkeys ! Monedas 1929 Comedy Jihad Don't Fall For It World Tour

May 10, 2013 - 4:25pm

Nostradumbass mode

From now on it's probably best to communicate in cryptic rhyming couplets (suitable for the situation in Turdistan / Absurdistan) re the future of the PMs markets. (Santa, eat your heart out.) My guess is that Pining goes first on this.

Juggernaut Nihilism
May 10, 2013 - 4:34pm


"My wife's sister just called and warned us to pull all our cash out of the bank--that the banking system was going to crash later today... Hmmm.

Anyone hearing rumors out there?


This post got 9 hat tips. DrkPurpleHaze's well-thought-out page long post is only up to 8. Someone shoot me in the face.

Halfheartedhamster George Clooney
May 10, 2013 - 4:38pm


Oh, I dont know, I think having a pet cheetah is a legitimate news story. They are supposed to get along really well with dogs if they are raised together and would be far better than greyhounds if you were a rabbit hunter. Probably would need a very large customized cat box.

May 10, 2013 - 4:40pm

Past 20 Years Nostradamus Would Have Been Wrong About America

Turd - Buddy - Bro:
If someone told Me 20 years ago that Ron Reagan would have been our last good president, and the rest of the POTUS for the next quarter century would be no better than Nero or Caligula until America finally fell... I WOULD NEVER HAVE BELIEVED YOU.

If someone told me 20 years ago, following the feel-good inauguration of Bill Clinton, with "Don't Stop Thinking About Tomorrow" playing, that Randy Weaver's wife and kid would be shot by the Feds, Waco would be fire bombed by the Feds, the WTC would be bombed with encouragement and help by the Feds, and that the Murrah Building in OK City would be destroyed by a FERTILIZER bomb, with the Feds standing by, I WOULD NOT HAVE BELIEVED YOU.

If someone would have told me even a dozen years ago that some strip club loving Saudis, who failed simple Cessna flight school, would hijack and fly a pair of jumbo jets hundreds of miles, evading NORAD in the process, and crash them into the Twin Towers, and succeed in knocking down THREE of them, I WOULD NOT HAVE BELIEVED YOU IN a New York Minute.

If someone would have predicted 20 years ago, that some unknown, Pot Smoking guy named OBAMA would be our President Today, and that he would win the Nobel-Fucking-Peace-Prize on his first months in office, and then conduct unlimited drone warfare without Media criticism from the Liberals, while wrecking the Entire US Economy, while enriching the Super-Rich, and that he would Outduel a master terrorist named OSAMA, and see his approval ratings spike just before his re-election on the announced assassination of the mysterious terrorist, I NEVER WOULD HAVE BELIEVED THE UTTER ABSURDITY of a single word of this fairy book story.

And lastly, If someone would have said 20 years ago, or even ten years ago in 2003, that GOLD would be NOT $1,000 and ounce, but close to $2,000....and that Every Central Bank and scads of Wealthy elites were Rushing in a Panic to Get Gold. . . and the US Media remained absolutely mum. . . I WOULD HAVE SAID,

"Dude, What are you smoking?!"

Today it takes a damn good Illuminati crystal ball to be a mofoing Nostradamus.

AC not PC

The Watchman
May 10, 2013 - 4:44pm
May 10, 2013 - 4:44pm

Not sure whether to laugh or cry

Reading this headline almost made me ill. I want this to be true. Always did. I'm now more concerned about getting to the other side of this with my sanity intact. First time I have ever had a visceral reaction to an upbeat metals title. What's happening to me?,_Look_For_$12,000_Gold_%26_$600_Silver.html


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Key Economic Events Week of 5/13

TWELVE Goon speeches through the week
5/14 8:30 ET Import Price Index
5/15 8:30 ET Retail Sales and Empire State Manu. Idx.
5/15 9:15 ET Cap. Ute. and Ind. Prod.
5/15 10:00 ET Business Inventories
5/16 10:00 ET Housing Starts and Philly Fed
5/17 10:00 ET Consumer Sentiment

Key Economic Events Week of 5/6

5/9 8:30 ET US Trade Deficit
5/9 8:30 ET Producer Price Index (PPI)
5/9 10:00 ET Wholesale Inventories
5/10 8:30 ET Consumer Price Index (CPI)

Key Economic Events Week of 4/29

4/29 8:30 ET Pers Inc, Cons Spend, Core Infl
4/30 8:30 ET Employment Costs
4/30 9:45 ET Chicago PMI
5/1 8:15 ET ADP jobs report
5/1 9:45 & 10:00 ET Markit and ISM Manu PMIs
5/1 10:00 ET Construction Spending
5/1 2:00 ET FOMC Fedlines
5/1 2:30 ET CGP presser
5/2 8:30 ET Productivity and Unit Labor Costs
5/2 10:00 ET Factory Orders
5/3 8:30 ET BLSBS
5/3 9:45 & 10:00 ET Markit and ISMServices PMIs

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