Not So Happy Tuesday

Tue, Jun 4, 2013 - 1:57pm

Lots going on today and I'm off to a late start so let's dive right in.

First, let's talk about the price action today. After the surprising rally yesterday, I asked you to watch the Asia and London trade for clues to the Comex action today. What did we see? After a flat Asian session, the London Monkeys did their usual thing from about 2:00 am EDT on. The London Monkeys have now acted on 14 of the past 17 days. Check this chart from Ranting Andy:

The result was a giveback of more than half of yesterday's gains.

Why did we see this? Hard to say for sure but, with volume light ahead of the BLSBS later this week, I suspect that a lot of this was some Bullion Bank selling that was aimed at lessening some longs ahead of the CoT survey. No doubt the action since last Tuesday is a continuation of the trend of last week's report. Therefore, the banks tried today to lighten a few of the longs they had built up over the course of the week. This also serves the dual purpose of defending the 20-day MA and restoring some confidence to some of the shaky spec shorts. At any rate...we're down a modest $13 as I type. Let's see what tomorrow brings.

Speaking of the CoT, there has been some excellent analysis written in the past few days so I thought I would highlight some here. Again, the positioning of the Commericals vs The Specs has gotten so extreme that it has reached historic levels. Ultimately, how you interpret this depends upon just whom you think is really in charge. Is it The Specs or do The Cartel Banks lead The Specs by the nose into whichever position they would like? Let's start with longtime CoT-watcher Gene Arensberg:

Next, read this link over at KWN:$1,000_Spike.html. While we might disagree that this chart alone shows that "gold is set for a massive $1000 spike", the interview is helpful and in contains this excellent chart. (Click on it to enlarge.)

Reading that article inspired the Turdite "WildStyleChef" to create the chart below. This shows graphically how Commercial positioning is inversely correlated to price. (Again, click to enlarge.)

OK, moving on. I found this to be interesting. Recall that when the Dutch bullion bank, ABN AMRO, announced their plan to settle in cash a few months back, many of us called it a default. This article published Friday follows along with that theme. I don't know anything about the author but that's OK. He probably doesn't know anything about me, either.

Still lots of talk out there about Fed QE "tapering". Again, I think is all silly and it may be a non-topic as soon as Friday at 8:31 am. Regardless, as mentioned last week, even if The Bernank was to announce some type of "taper", it would likely come from the $40B/month MBS-purchase side of the QE∞ equation. The Fed could still monetize $45B/month in treasuries directly while cutting the Primary Dealer kickback life support handout welfare bullshit MBS purchases to $20B/month. This would still be $65B/month in QE and silence all the hawks. Not saying that it will happen, just saying that even if it did, it's no big deal! $65B/month is still nearly $800B/year in fresh greenback, created from whole cloth for the purpose of sustaining The Great Ponzi. Read more at ZH: And here's how it looks graphically:

Finally, I don't know if you've noticed but lately there sure have been a lot of big mines that have been taken off-line.

So, now, what to make of all this? Well, if you believe that everything is hunky-dory and that there are no supply issues in gold, then this is no big deal. After all, even though The Grasberg mine is the largest in the world, it still only produces about 30 metric tonnes per year or a little over 1% of all global mine production.

If, on the other hand, you think that the Bullion Banks are living hand-to-mouth and frantically trying to keep their Fractional Reserve Bullion Banking system alive, then it is a big deal. A very big deal.

That's a lot of gold...a lot of currently anticipated and expected supply that isn't coming. How much of this production was already sold forward into the market? And if it was already sold forward, what happens when it fails to materialize on schedule? Hmmmm. Could that lead to those contracts being covered? Could it lead to some new long purchasing as a hedge against supply delays, not only from the suppliers but from the end-users, as well? And with the current CoT structure in gold being akin to an overgrown and dried out California ravine just waiting for a spark...

Let's just leave it there for today. I hope that the rest of your Tuesday goes well and I look forward to seeing what tomorrow brings. Again, if I'm right about the cause of today's drop being Cartel CoT-positioning, then we should see a bit of a bounceback on the Globex and overnight.


About the Author

tfmetalsreport [at] gmail [dot] com ()


Jun 5, 2013 - 11:16am

Who ya gonna call .... Troll Busters ?

I didn't even know the French Canadians still had a guillotine .... kind of makes ya feel good to know ! Here's some red meat .... the 400 shares of Mines Management I bought Tuesday (?) at $ .62 per share .... is up 25% .... to $ .77 per share .... of course I still have some I paid more for .... my theory is .... being in the permit process .... they can't waste the shareholder's money .... by stupid stuff like MINING .... it's just ore in the ground .... better than that re-hypothecated crap .... turd is too nice a word .... for that stuff .... in the Comex warehouse ! Xty .... I flattered you .... when I said I have nothing against cute Canadian girls .... I'm a clever guy .... please read my posts twice ! The real sin .... is being happy and cocksure .... that really rubs some people the wrong way .... EGADS ! Monedas 1929 Comedy Jihad Hoarders Should Have More Fun World Tour

Jun 5, 2013 - 11:13am

We are all serfs here.

From someone's earlier post, who copied it from somewhere's;

"The world will soon wake up to the reality that everyone is broke and can collect nothing from the bankrupt, who are owed unlimited amounts by the insolvent, who are attempting to make late payments on a bank holiday in the wrong country, with an unacceptable currency, against defaulted collateral, of which nobody is sure who holds title."

This brought back an interesting memory;
Couple years ago I was talking with an attorney specializing in Real Estate law.
She explained "Title" to me - and this is my recollection;
It is the right to pay tithe or taxes on a piece of land.
In fact, YOU never own a piece of land. You only own a Title, which is your privilege to occupy land - as long as you pay the state the amount they set as rent - or taxes. Yes, you can make improvements to the property - which you must get permission to do, by applying for permits, which serves to notify the state that you agree to pay more taxes. 99% of the time the state is very happy to see you improve their property while you rent.
Just try not paying yur taxes and see who really owns the property.
No property "title" changes hands without the state granting title transfer by verifying all taxes paid.
The state never wants to hold a title - they only want renters.
The state reserves the right to remove you from the title as they see fit, under the "Rights of Eminent Domain".
This happened to my parents when we had just moved into a new house, (2 months~!) and the state decided to move a new bridge's footings and immediately took possession of the land. My poor dad went to a lawyer and was told - there is NO recourse. As the title rights are always "owned" by the state - you merely rent the occupation - not the ownership.
We are all serfs here.
Think about it...........................................................................

Jun 5, 2013 - 11:05am

Monedas: The Solution

He should change his name to Saad Jihad and publicly confess to being a BHO sock-puppet.

Then almost everyone would be happy.

(Alternatively, he could be stationed outside JPM when Blythe is going for lunch. Think Alex Jones with a megaphone outside the White House. Best deployment of resources and all that.)

Jun 5, 2013 - 11:04am

Free Monedas. If the EE is

Free Monedas. If the EE is to be defeated thick skin and ideas enter from left field tour.

Jun 5, 2013 - 11:03am

Rand via Santa


Whenever destroyers appear among men, they start by destroying money, for money is men’s protection and the base of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs: upon the virtue of the victims. Watch for the day when it bounces, marked, ‘Account overdrawn.’
–Ayn Rand

Jun 5, 2013 - 10:59am

No Fed-head can be another Volcker

This snippet made me think about the differences between then (Volcker) and now (Bernanke):

"The last central banker who had the cojones to take on Wall Street was Paul Volcker. Ben Bernanke, as well as his predecessor Alan Greenspan, have been nothing but nice to the speculating and borrowing classes."


It dawned on me why Bernanke cannot be like Volcker. When Volcker was Fed-head, the bankers could not speculate in the markets due to Glass-Steagall. Volcker punished the little people and business by raising rates. And, the size of government debt was nothing compared to today.

Today, the ones punished would be the banks, who own the Fed. And, the government of the U.S. with the largest debt in the history of the world.

There is no graceful way out of this mess. Gold will, no, MUST come to the rescue of bankers and governments. Will it come peacefully or through chaos? That is the only remaining question (other than when).

Jun 5, 2013 - 10:59am

El Gordo

The bullying that Monedas did to Katie Rose was "truly hateful".

His shit should not be tolerated.

Jun 5, 2013 - 10:57am


on the Jidhad comedian, loose cannons are the hall mark of very high intelligence, and it just gets fired off time to time, from to rapid associations of the brain function, especially where fun is totally involved. Hes a keeper.

Robin Trower - The Fool and Me.

Speaking of the fitful Cat

Robin Trower Lady Love
Jun 5, 2013 - 10:56am
El Gordo
Jun 5, 2013 - 10:56am

Mondeas sees things...

...through a little different lens, but I doubt he's got a mean bone in his body. If we can't stand a little ribbing now and then, coupled with an occasional brush of the truth, then something is missing. I'm an old, ugly, fat, ignorant slob, but I can lie drunk in the gutter and still look down on some others. If someone wants to offend me, they will have to try pretty hard, and I for sure don't need the rest of Turdville trying to come to my defense. That's the kind of stuff liberals do. Just say "no" to censorship unless it's truly hateful or vulgar. Just my $.02.

Subscribe or login to read all comments.


Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 9/21

9/21 8:00 ET Goon Kaplan
9/21 10:00 ET Goon Evans
9/21 Noon ET Goon Brainard
9/21 6:00 pm ET Goon Williams & Goon Bostic
9/22 10:30 ET Chief Goon Powell on Capitol Hill
9/22 Noon ET Goon Barkin
9/22 3:00 pm ET Goon Bostic again
9/23 9:00 ET Goon Mester
9/23 9:45 ET Markit flash PMIs for September
9/23 10:00 ET Chief Goon Powell on Capitol Hill
9/23 11:00 ET Goon Evans again
9/23 Noon ET Goon Rosengren
9/24 1:00 pm ET Goon Bostic #3
9/24 2:00 pm ET Goon Quarles
9/24 10:00 ET Chief Goon Powell on Capitol Hill
9/24 Noon ET Goon Bullard
9/24 1:00 pm ET Goon Barkin again & Goon Evans #3
9/24 2:00 pm ET Goon Bostic #4
9/25 8:30 ET Durable Goods
9/25 11:00 ET Goon Evans #4
9/25 3:00 pm ET Goon Williams again

Key Economic Events Week of 9/14

9/15 8:30 ET Empire State and Import Price Idx
9/15 9:15 ET Cap Ute and Ind Prod
9/16 8:30 ET Retail Sales
9/16 10:00 ET Business Inventories
9/16 2:00 ET FOMC Fedlines
9/16 2:30 ET Powell Presser
9/17 8:30 ET Philly Fed
9/18 8:30 ET Current Acct Deficit

Key Economic Events Week of 9/7

9/9 10:00 ET JOLTS job openings
9/10 8:30 ET Initial jobless claims
9/10 8:30 ET PPI
9/10 10:00 ET Wholesale Inventories
9/11 8:30 ET CPI
9/11 9:45 ET Core CPI

Key Economic Events Week of 8/31

9/1 9:45 ET Markit Manu Index
9/1 10:00 ET ISM Manu Index
9/1 10:00 ET Construction Spending
9/2 8:15 ET ADP employment
9/2 10:00 ET Goon Williams
9/2 10:00 ET Factory Orders
9/3 8:30 ET Initial jobless claims
9/3 8:30 ET Trade Deficit
9/3 12:30 ET Goon Evans
9/4 8:30 ET BLSBS

Key Economic Events Week of 8/24

8/24 8:30 ET Chicago Fed Idx
8/25 10:00 ET Consumer Confidence
8/26 8:30 ET Durable Goods
8/27 8:30 ET Q2 GDP 2nd guess
8/27 9:10 ET Chief Goon Powell Jackson Hole
8/28 8:30 ET Pers Inc and Consumer Spend
8/28 8:30 ET Core Inflation
8/28 9:45 ET Chicago PMI

Key Economic Events Week of 8/17

8/17 8:30 ET Empire State Manu Idx
8/17 Noon ET Goon Bostic
8/18 8:30 ET Housing Starts
8/19 2:00 pm ET July FOMC minutes
8/20 8:30 ET Jobless claims
8/20 8:30 ET Philly Fed
8/20 10:00 ET LEIII
8/21 9:45 ET Markit flash PMIs July

Key Economic Events Week of 8/10

8/10 10:00 ET Job openings
8/11 8:30 ET Producer Price Idx
8/12 8:30 ET Consumer Price Idx
8/13 8:30 ET Initial jobless claims
8/13 8:30 ET Import Price Idx
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Unit Labor Costs
8/14 8:30 ET Cap Ute and Ind Prod
8/14 10:00 ET Business Inventories

Key Economic Events Week of 8/3

8/3 9:45 ET Markit Manu PMI July
8/3 10:00 ET ISM Manu PMI July
8/3 10:00 ET Construction Spending
8/4 10:00 ET Factory Orders
8/5 8:15 ET ADP employment July
8/5 9:45 ET Markit Service PMI
8/5 10:00 ET ISM Service PMI
8/6 8:30 ET Initial jobless claims
8/7 8:30 ET BLSBS for July
8/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 7/27

7/27 8:30 ET Durable Goods
7/28 9:00 ET Case-Shiller home prices
7/29 8:30 ET Advance trade in goods
7/29 2:00 ET FOMC Fedlines
7/29 2:30 ET CGP presser
7/30 8:30 ET Q2 GDP first guess
7/31 8:30 ET Personal Income and Spending
7/31 8:30 ET Core inflation
7/31 9:45 ET Chicago PMI

Key Economic Events Week of 7/20

7/21 8:30 ET Chicago Fed
7/21 2:00 ET Senate vote on Judy Shelton
7/22 10:00 ET Existing home sales
7/23 8:30 ET Jobless claims
7/23 10:00 ET Leading Economic Indicators
7/24 9:45 ET Markit flash PMIs for July