A Broader Perspective

525
Tue, May 14, 2013 - 11:37am

Time is short but I do have something interesting for you to consider today.

Look, there's a lot going on that will make tomorrow's gold (and silver) "market" different from yesterday's. Regardless, I still believe it's useful to look at yesterday's market in order to forecast where we might be going based upon where we have been.

Today, we're going to look at the Continuous Commodity Index. https://en.wikipedia.org/wiki/Continuous_Commodity_Index. Here's a little background info from the Wiki page:

"The 17 components of the CCI are continuously rebalanced to maintain the equal weight of 5.88%. Since CCI components are equally weighted, they therefore distribute evenly into the major sectors: Energy 17.65%, Metals 23.53%, Softs 29.41% and Agriculture 29.41%. While other commodity indices may overweight in certain sectors (e.g. Energy), the CCI provides exposure to all four commodity subgroups."

So, first, let's look at a 25-year chart. Some of you may not even have been alive at the start of this chart. Personally, I was just graduating from college and chasing my then-sweetheart to San Francisco. (That's an interesting story but we'll save it for another day.) The point is: This chart covers a lot of ground and time. Therefore, it is to be respected.

Notice that for the first half of the chart, the action is sideways. From 1988 to 2002, the index fluctuated in roughly a 50-point range. Though there was some action in individual commodities from time to time, overall the sector was a real yawner. The sideways action actually goes back even further, to the early 1980s, when interest rates were raised to choke the money supply and curb inflation. So, for roughly 20 years, commodities in general sucked.

Then what happened? The debt-induced easy growth of the 90's finally popped in 2001 and it has been off to the races for commodities ever since. Sure there have been pauses and corrections along the way but there also been periods of blowoff, parabolic rallies, too. In the end, though, the trend has remained. Here, see for yourself:

So now let's look a little closer. On the five-year, weekly chart below, you can see where we currently stand. Of course, I've tried to draw the trendline as accurately as possible but it's impossible to show exactly where it currently lays. Needless to say though, we're pretty much right on top of it. So there are three things to consider:

  1. First and foremost, is this 11 year bull market in commodities over? Did commodities go sideways for 20 years only to have a bull market end after just 10 years? Look at it another way...Have the fundamental conditions which prompted this bull market changed? Are the Fed and other central banks about to embark on a Volcker-esque tightening spree?
  2. Could commodities in general (and, by extension, gold and silver) bounce and rally right here and right now, just like they did the on the last two occasions they encountered the main trendline in late 2008 and mid 2012?
  3. Are commodities about to over-shoot again, similar to the circled area on the monthly chart above? If so, could a final drop toward 500 or even 475 be in the cards? IF that were to happen, what would be the short-term impact on the price of gold? Of silver? Would you finally capitulate/panic and sell or will you rely on your answers to the questions posed in point #1 above?

OK, gotta stop there but that should give you plenty to think about and discuss for a while. Have a great day and let's hope that CIGA BoPolny/BoPelini/BoDiddley/BoJackson is proven correct.

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  525 Comments

Bobbejaan California Lawyer
May 14, 2013 - 2:36pm

@CalLaw ...

Quote:
It's going to be a long, hot summer, for sure.
Tom Robinson Band - Long Hot Summer (1978)

.

Tom Robinson Band - Winter Of '79

.

Video unavailable

.

Billy Joel - We Didn't Start the Fire (Official Video)

.


May 14, 2013 - 2:36pm

@silver66

You have to click the little 'Image' icon (next to smiley) in the header bar of the message window:

EDIT: Yeah, you got it.

Aye, it's the setting free part that's hard.

AlexCojones
May 14, 2013 - 2:38pm
SRSrocco
May 14, 2013 - 2:39pm

THE COLLAPSE OF THE US DOLLAR

The Collapse Of Fiat Money by a Falling Energy Supply

Each passing day, the world gets closer to a total collapse of the global fiat monetary system. After the United States unilaterally terminated the convertibility of the U.S. Dollar to gold in 1971, the world has been settling trade on borrowed time. It was full faith in the dollar and U.S. Treasury market that allowed global trade to continue for 4 decades.

However, faith in the dollar is waning as debts, derivatives and dishonesty plague the financial system. Most analysts (including many in the precious metal camp) are wasting time debating over the mere symptoms and not the disease itself.

REST OF THE POST AT THE LINK: https://srsroccoreport.com/the-collapse-of-fiat-money-by-a-falling-energy-supply/the-collapse-of-fiat-money-by-a-falling-energy-supply/

SilverSurfers
May 14, 2013 - 2:40pm

Extactly

what was posted here in turdville, in that, over the last few days, we have seen two double blown downs, the first put turd on the bender having to wearing shades in shame, and today noticed at turdville. Compare

"So Hilsenrath comes out with his piece, and at a time when the manipulation (of gold and silver) is getting extremely intense"

https://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/5/13_D...

Yes, it is most difficult to predict day to day price movements with the manipulator omipresent, without eyes inside. Sure COT helps, but its not the end all, and they see the COT reports as well, and probably dont give a damn.

Unless a higher high or higher low comes in, over next 48 hours, bullish mode falls, and back to square one. +2 0 +2 -2, the negative is a bull killer, three in a row, and the bull dies.

alan2102 John Galt
May 14, 2013 - 2:46pm

John Galt

John Galt: "[Rockefeller is] heavily involved with banking and business interests in China. So my point is that if the Rockefeller family is part of the NWO interests in America why are they integrating themselves so deeply with one of the biggest BRICS players at the same time unless, of course, they're gaming both sides?"

1. Why do you think that Rockefeller is (necessarily) part of the NWO interests in America? What exactly ARE the "NWO interests"?

2. Even if Rockefeller were part of the American side of the NWO, why could he not switch sides and/or hedge bets (I guess you could call that "gaming both sides") in some ways? Capital goes where it wants to.

3. Regarding elsewhere in your post: who is the entity that controls all the central banks? Any ideas? Why do you think that the East/West competition is an "illusion"?

These are sincere questions. I'm not setting a trap. I'm thinking about these things myself. Whatever you have to say will be read with interest.

Regarding the "illusion": if this is so, it is a pretty convincing one. It has had me fooled. It seems pretty clear cut: the U.S./U.K./Israel/Japan/OECD axis has been running roughshod over the rest of the world for a real long time, and the natives are more than restless -- they're mad as hell, and who can blame them? They are, at long last, getting organized and powerful. The BRICS, or BRIICS, or BRIICSS (or various other acronyms) represents the rest of the world, and it is on the rise, and it is highly competitive with the West. I don't see it as "BRICS v. NWO", I see it as TWO WOs, if you will: the two axes, as mentioned. The U.S./U.K/etc. one has been hegemonic for near two centuries, but its time is passing. The other one is now rising. If anything should be called a NEW World Order, it should be the BRICS, or what that represents. The U.S./U.K./etc. represents the OLD world order.

Ned Braden alan2102
May 14, 2013 - 2:52pm

@DPH

If your timeline is correct; then some of us who are "all in" need to get "some out" as the price for trying to outguess these criminals......

NB

Magpie
May 14, 2013 - 2:55pm
Dagney Taggart
May 14, 2013 - 2:56pm

Just Wanted to Pass a Mid-Day Word.......

Watch your materials indices. Large move feels imminent.

We have been working on some engineer's estimates for work this fall and 2014 and sending out requests for quotes for many basic materials for turnkey work. Lately though, we are getting a lot of highly-conditioned proposals for the materials, even conditions I have not seen in years. Some are even no-bid (too much uncertainty).

Can't say any more than that. Again watch those materials indices.

Dagney Taggart
May 14, 2013 - 3:06pm

Hey SRS

What happens if new or "suppressed" energy resources were released? Please explain if you have time.

I'll come back and read later. Have to run....


May 14, 2013 - 3:10pm

Thanks, TF, Appreciate That

Just settled a case, actually. Going to stack some shiny. I want gold, but seems there is an irresistible impulse drawing me to secure a monster box locally . . .

I promise you TF, that I am here, at your service. Just ask. I'll do my best.

[p.s., as for the monster box, send PM and let's arrange details; you know who you are . . .]

usk
May 14, 2013 - 3:27pm

Banksters needs to act asap

Kranzler reports that the current June futures contracts are 12.5 times the amount of deliverable gold. If more than 8 percent of these trades were to demand delivery, COMEX would default.

Last time Comex was ready to default they corzined gold futures holders.

They have something in their bag for this time, we can smell it. What exactly? They need to act in the coming days for sure.

hai
May 14, 2013 - 3:30pm

Pullback In Stocks & Gold ETF Outflows Would Recharge Gold Bull

Pullback In Stocks & Gold ETF Outflows Would Recharge Gold Bull

Of course, we’ve been harping on the downside potential for some time now, but we would be remiss if we didn’t touch on the flip side—the upside risks to our outlook. What could potentially send gold prices marching back higher sooner than expected?

https://www.hardassetsinvestor.com/weekly-commodity-reports/precious-met...

The Watchman
May 14, 2013 - 3:33pm

Shanghai Gold Exchange- 0.3 tons in May Delivery Problem?

Shanghai Gold Exchange (SGE) Gold -- Au(T+D):

  • 14 May 2013 Close:

    • Trade Volume: 20.5 tons of gold, a change of -19.6% from previous close.

    • Open Interest: change of 4.4% from previous close.

    • Physical Delivery: 0 tons of gold.

    • Gold Price: $1454, a change of 0.4% from previous close.

  • Peak One Day Trade: 115.1 tons of gold, 16 April 2013.

  • Peak One Day Delivery: 35.7 tons of gold, 22 March 2013.

  • Current Month Delivery: 0.3 tons of gold as of 14 May 2013.

  • Peak One Month Delivery: 328 tons of gold, March 2013.

  • Gold Delivery Since 1 January 2013: Gold delivery (year to date): 1030.3 tons.

  • Shanghai Gold Exchange physical deliveries, past years:

    • 2012: 2,379.6 tons.

    • 2011: 1,897.8 tons.

  • Week of 26 April -- strange drop off in physical delivery? As of 25 April, physical deliveries on the SGE have been 1 ton (0 tons 22 April, 24 April and 25 April). The last time the SGE has a week of just limited deliveries as base in January 2011, a month that saw 21 days with less than 1 ton of gold delivered per day. Is this due to lack of inventory for delivery?

  • Just 0.3 Tons delivered in May -SOMETHING IS VERY ODD

The Watchman
May 14, 2013 - 4:05pm

EXTREMELY odd

And I'm trying to get to the bottom of it.


May 14, 2013 - 4:08pm

Not a big fan of Jon Stewart.

Not a big fan of Jon Stewart. The oversimplification of issues through sarcasm and a progressive lens isn't really my cup of tea. That said, this is somewhat funny and likely indicative of how most D-republocrats are feeling right now.

Texas Sandman
May 14, 2013 - 4:09pm

Nice perspective

Bull & bear TA case for commodities. Not one-sided.

Very nice.

Thanks, Turd.

¤
May 14, 2013 - 4:10pm

Significant Milestone....Easier to Reach Out and Touch Someone

Aerospace & Defense

Carrier drone launch makes aviation history

By David Alexander

ABOARD THE USS GEORGE H.W. BUSH - The U.S. Navy made aviation history on Tuesday by launching an unmanned jet off an aircraft carrier for the first time, taking an important step toward expanded use of drones by the American military with an eye on possible rivals like China and Iran.

The bat-winged X-47B stealth drone roared off the USS George H.W. Bush near the coast of Virginia and flew a series of pre-programmed maneuvers around the ship before veering away toward a Naval air station in Maryland where it was scheduled to land.

"This is really a red-letter day. May 14 we all saw history happen" said Rear Admiral Ted Branch, the Atlantic naval air commander. "It's a marker ... between naval aviation as we've known it and the future of naval aviation with the launch of the X-47B."

Because of its stealth potential and a range nearly twice that of the F-35 Joint Strike Fighter, the X-47B and its successors are seen as a potential answer to the threat posed by medium-range anti-ship missiles developed by China and Iran, defense analysts said.

The missiles and other so-called anti-access, area-denial weapons would force U.S. aircraft carriers to operate far enough from shore that piloted aircraft would have to undergo refueling to carry out their missions, leaving them vulnerable to attack.

But with a range of 2,000 nautical miles, an unmanned jet like the X-47B could give the Navy both a long-range strike and reconnaissance capability.

"That makes it strategically very important," said Anthony Cordesman, a senior defense analyst at the Center for Strategic and International Studies. He described the drone as "essentially a really long-range stealth system."

The X-47B - one of only two demonstrator models made by Northrop Grumman - carries the equivalent of two precision-guided bombs. It was catapulted from the aircraft carrier on Tuesday using the same sling-shot system that sends manned aircraft aloft.

LANDING ON BOARD

It is scheduled to undergo two weeks of testing aboard the carrier leading up to a landing on the ship, in which a plane's tailhook grabs a wire that will slow it and keep it from plunging overboard.

While the carrier takeoff represented a significant milestone, defense analysts are focused on the next step.......cont.

https://www.reuters.com/article/2013/05/14/us-usa-navy-drone-idUSBRE94D0...

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

AlexC......great idea...good luck fishing, I'm headed out this weekend to harass some big smallies hopefully.

Magpie....Wow! That's one big cat. Maybe Alex will find it's twin. Something tells me he's headed towards Alaska.

NedB....As always, a person has to do what a person needs to do no matter what. I have 29 SLW calls out in time (Jan. 14) that are my small lottery ticket just in case. Otherwise my stack is staying put like insurance and riding the incoming and outgoing waves and bobbing up and down.

Fortunately I can afford to just sit back on it and wait for time and inevitability to intersect. I'm anticipating another big buying opportunity that I'm hopefully locked and loaded to jump on. I think that'll be the case.

For the record...I have no qualms or regrets about buying any PM's at whatever price levels I have. Because quite frankly no one truly knows when something might break in the market system or breakout in a sensitive geopolitical manner.

My PM's are insurance and given the current ZIRP environment I like holding them and won't consider parting with them just yet. I'm still long and a buyer whenever I'm able to or it feels comfortable to do so. No regrets here at all.

usk
May 14, 2013 - 4:16pm

That's all well and good but

That's all well and good but FND for the June contract still isn't until two weeks from Friday, the 31st.

As of yesterday, the OI was still at 209,286. Also as of yesterday, the total Comex registered stockpile stood at 57.10 mts. That's 1,835,000 troy ounces, enough to physically settle 18,350 contracts.

That said, both the Fed13 and Apr13 came in at about 13,000 contracts so we need about a 50% increase in June to clean them out. Of course, this is based upon yesterday's inventory data and that is certainly fudgeable well before any "crisis" would hit.

Down Range
May 14, 2013 - 4:20pm

Why We Are Where We Are

It all boils down to ONE thing!

The MSM abdicating their responsibility to keep our government honest.

Think About It......

Gold Dog
May 14, 2013 - 4:20pm

Random thoughts from the den

- I am becoming more uneasy, (If such a thing is possible), over the behavior of the U.S. Government. This IRS business targeting Conservatives and the snooping at the phone records of the A.P. reporters reminds me of KGB or Stasi tactics. It only increases my respect for my friends who are going to D.C. for Independance Day and makes my think a little more about joining them.

- This abortion guy should have his eyes poked out! Killing babies! wtf??

-My Daughter graduated on Friday and we had a great dinner party in the city. If you fall into the clutches of young people, be careful. We were out carousing until 5:30 in the morning. I am just now getting back to normal.

-Those of us in Turd's Army, (TWATS), know that Paul predicted the S+P 500 of 1560, right where it topped out today.

-I haven't counted ticket stubs but believe that I will be attending my 40th Indy 500 this year.

- The G7 meeting this weekend is more ominous that we are crediting it with.

Hugs not drugs....unless your knee really hurts, then both.

Peace out,

Dog

achmachat
May 14, 2013 - 4:24pm

Gold Dog

you might want to add the crown jewel of the STASI way:

SEE SOMETHING, SAY SOMETHING

The Green Manalishi
May 14, 2013 - 4:28pm

Bloke I know....

...works for JP Morgan in Bournemouth, came to my wedding - quite high up in his field by all accounts, announced that he had just cashed in all his shares. Wouldn't say why.

No more than that, just reporting.

Edit: Mind you he is as camp as a row of pink tents, so he might be just funding a set of Judy Garland DVDs.

wouldyoubelieve...
May 14, 2013 - 4:29pm

this administration is on a kamakazi mission

you got Jay "Baghdad Bob" Carney

Janet "hollow(point) head" Napolitano

Eric "I never met a Constitution I couldn't shred" Holder

Hillary "what does it matter?" Clinton

and Barry Obama as the Beaver

csquared13 TF
May 14, 2013 - 4:30pm

Reponse to Watchman and Turd

Could it be related to that statement that was made from their trading floor last month? When they stated they were bringing in gold from London and Switzerland?

I'm sure some Turdite has that link handy...maybe it was a floor trader or director at the shanghai exchange that was interviewed? May have been on bloomberg, but sure that it was on ZH too.

wouldyoubelieve...
May 14, 2013 - 4:39pm

ballyale

https://www.skynews.com.au/offbeat/article.aspx?id=872062

don't laugh, they're saying we should eat bugs to help ease food shortages

robov
May 14, 2013 - 4:40pm

Apparently...

Bo don't know either. Didn't he say May 10 - 13 would mark the low? So what happened today? The relentless naked paper selling as REAL PHYSICAL SUPPLY continues to dwindle daily sure does wear on a man.

AlienEyes
May 14, 2013 - 4:43pm

Jon Stewartstein

Until I watched your Jon Stewart clip, I wanted to see him "dipped in shit and set on fire."

Since seeing the aforementioned clip, I might have been a bit harsh with regard to mister Stewart.

I now feel that perhaps the "dipping in shit" is not necessary and that perhaps a "dipping in napalm" might be ok with the new, more liberal, me.

The Watchman
May 14, 2013 - 4:51pm

US Mint UPDATE-658,500 More ASE's Sold

2013 Gold Sales Totals
(in ounces / number of coins)
Month One
( oz. / #coins )
Half
( oz. / #coins )
Quarter
( oz. / #coins )
Tenth
( oz. / #coins )
Total
( oz. / #coins )
January 124,500
124,500
8,500
17,000
6,000
24,000
11,000
110,000
150,000
275,500
February 68,000
68,000
2,500
5,000
3,000
12,000
7,000
70,000
80,500
155,000
March 54,000
54,000
2,000
4,000
2,500
10,000
3,500
35,000
62,000
103,000
April 187,500
187,500
7,000
14,000
6,500
26,000
8,500
85,000
209,500
312,500
May 25,000
25,000
500
1,000
0
0
0
0
25,500
26,000
Total 459,000
459,000
20,500
41,000
18,000
72,000
30,000
300,000
527,500
872,000

[Top]
[American Eagles Bullion]

2013 Silver Sales Totals
(in ounces / number of coins)
Month One
( oz. / #coins )
January 7,498,000
7,498,000
February 3,368,500
3,368,500
March 3,356,500
3,356,500
April 4,087,000
4,087,000
May 1,558,500
1,558,500
Total 19,868,500
19,868,500
Southern Cross
May 14, 2013 - 5:01pm

Proud To Be Called A Terrorist -

Founding Fathers

The Founding Fathers were a group of well-educated men who led America in the early stages of her history. These men risked their lives for the freedom of Americans. This began with achieving independence of the thirteen colonies from England, and continued on with the formation of a government for the new nation once the Revolutionary War had been won.

As for specific people, the Founding generation included: Benjamin Franklin, George Washington, Thomas Jefferson, James Madison, John Adams, Alexander Hamilton, Samuel Adams, Patrick Henry, John Hancock, Thomas Paine, Roger Sherman, John Jay, James Wilson, and Gouvernor Morris. It would be impossible to construct a list which would be accepted by all historians.

If one considers any of the people who participated in the forming of this Republic or of evicting the King to be "Founding Fathers," then naturally the Framers of the Constitution are a subset of the Founders, since they gave us the format and structure for the Republic. Of course, the number who might be deemed Founding Fathers would be larger than the list of Framers, a case in point being Thomas Jefferson and John Adams, who were not present at the writing of the Constitution, but were surely Founding Fathers.

The first US war on Terror. The American Revolution.

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