Waiting on The Fellen

Wed, Apr 30, 2014 - 12:46pm

As Keith would say...."I'm not waiting on my lady. I'm just waiting on a Fellen."

The world holds its collective breath. Not at the events in Ukraine. No, not even at the changing alliance in the Middle East. Nope. Today, the world awaits an update from the all-powerful Fellen. Friggin ridiculous.

Just as ridiculous as the notion, put forth now for over five years, that The Fed is going to monetize the debt in order to "stimulate economic growth". That this lie continues to be spewed and believed is a scathing indictment of a number of things:

  • The level of economic education in the US and the world
  • The level of apathy in the US and the world
  • The level to which the financial media is complicit and in the back pocket of The Banks

If quantitative easing was about "growth" and "jobs", shouldn't it be clear to all by now that it is a complete, 100% dismal failure? Should not today's paltry 0.10% Q1 GDP growth be evidence that The Fed should immediately halt all debt monetization and reverse course? Of course! The fact that they won't (CAN'T) is just further evidence that I am correct in my analysis. I'll state it again for anyone with a short attention span:

The Fed cannot and will not EVER eliminate quantitative easing. QE is NOT about economic growth. It is about funding the debt and deficit of the United States and keeping interest rates at extraordinarily low and unnatural levels. Without The Fed, and now the ECB, providing $80-100B/month for US Treasury debt and TBTF Bank subsidies, three things would happen:

  1. The Zombie Banks would fail
  2. Liquidity-dependent paper markets around the world would fail
  3. Interest rates would rise dramatically from the current 2.62% on the 10-year and 3.46% on the 30-year

Frankly, The Fed/US Govt can handle and work around both #1 and #2. It's #3 that they cannot allow, at all costs.

Currently, servicing the already-accumulated debt requires a huge annual budget expense. For fiscal year 2013, the total was $415.6B. (https://www.treasurydirect.gov/govt/reports/ir/ir_expense.htm) AND THAT IS AT AN AVERAGE MATURITY OF UNDER FOUR YEARS AND A COUPON OF LESS THAN 3%!! If short term rates were to rise or if maturities were extended, the interest component of the US's budget would begin to grow exponentially. THIS CANNOT BE ALLOWED as the entire Ponzi will quickly unravel and The U.S. Empire will go the way of The Romans, the Ottomans, the French and the Germans...just to name a few. Now, don't get me wrong, THIS WILL HAPPEN EVENTUALLY. IT IS A MATHEMATICAL CERTAINTY. However, The Fed/US Govt will do everything in their power to push back the eventuality. Thus you have:

  • QE to infinity
  • Unlimited manipulation of every paper market, from equities to bonds to currencies to metals
  • SPIN, MOPE and outright falsehoods regarding economic data
  • Endless drumbeat toward war to create a "safe haven" bid for sovereign bonds

I could go on and on with this extraordinarily important subject as this is the basis of this site...The End of The Great Keynesian Experiment. For now, though, it's best to keep moving. The week is only half done and we've got a long way to go until Friday.

First, gold. How many times have we seen this chart now? Black line = bad economic news reaction. Red line = cap and intentionally beat back price. Blue line = Hold price down until The London PM fix. Green line = Let it go

If you think I'm crazy, here are just a couple of other examples for you:

Whatever. Like it even matters. Just watch the chart below and the 200-day MA:

If you're wondering why silver is down so much today, it has everything to do with the May expiration. Why? Recall that we've followed the Comex silver OI down from 165,000+ three weeks ago, 160,000+ one week ago to under 147,000 on Monday. That's a lot of contracts closing, in particular the shorts who do not have silver to deliver. Those spec shorts are being out back on today in the July contract...and...down she goes. These shorts will continue to be added for the next few days or until price breaks out of the triangle below. Taking the other side of these spec shorts are The Commercials, which are gladly buying and fattening their positions. Note how silver once again today failed to drop and stay below .20. This is by design. ONLY IF price falls and then closes substantially BELOW would I get nervous and doubt my conclusions/forecast. Instead, I expect price to continue to hold support here and then ultimately break the triangle to the UPside. This resolution will begin to squeeze all these late-coming. momo-chasing shorts and a new rally will be underway.

Two other updates for you. With the lousy GDP number, The Long Bond is rallying again today. With the worsening Ukraine situation, palladium is rallying today, too. Both have once again opened significant gaps versus gold. On the charts below, you can see the clear correlation that gold has had with these two other items...a clear correlation that ended in both at the beginning of April. Since then, The Bond has continued to rally and palladium is up nearly 4%. Gold? Not so much. And so it is when every single market now shows the fingerprints of central planning.

Speaking of "Central Planning Fingerprints", I must close today by revisiting crude oil. Just yesterday, I printed a chart of crude at 2 and shouted that support had held. WRONG! Why has it reversed and what happens next?

Recall that the last time crude hit 5 before crashing to , The Woody Administration intervened by announcing a five million barrel release from the US Strategic Petroleum Reserve. This was done with the blatant intent of smashing price and "hurting Putin in his pocketbook". A funny thing happened along the way, though. Price fell to but could not drop further. Over a period of five days in mid-March, The Evildoers tried and tried and huffed and puffed but couldn't break . Price then recovered back to 5. And now here we are again with The Central Planners jamming price back down. My hunch is that they will fail again near . Let's just see if I'm right.

LOTS of other stuff going on today...so much so that I hardly know where to start. To save time, I'll just give you these:

OK. Expect a full podcast later today, post-Fedlines. Enjoy the show.


About the Author

turd [at] tfmetalsreport [dot] com ()


Apr 30, 2014 - 1:50pm

New daily high in gold

A little Fedline leakage??

Apr 30, 2014 - 1:51pm

@Pining - Ned Ned Ned

There just aren't any words Pining. You are one dangerous guy.

Apr 30, 2014 - 1:54pm

Caught short

Dear Turd,

I am short the June futures contract in gold at 1285 from a few days ago. Any hope for a smash-down, cram down or vicious sell-off by the bullion banks? Please?! I am hurting.

If gold goes over $1500 then God is calling me home!

Apr 30, 2014 - 1:56pm

Turd Please

I seem to think in pictures, and the idea of Fellon having a lil' "leakage" is just too much!

Thank you again for this pic Pining!

Apr 30, 2014 - 1:58pm


stock charts high (so the millions of retired people and gov workers feel secure in their ?wealth?, and are bought in to whatever it takes to preserve the "system"/WFCS)

silver chart low (so real money looks to be a terrible alternative to any WFCS offering)

Together the masses stay herded into the WFCS/equities pen. In reality, and in their perception of reality.


Fed announcement

-according to TPTB objective of killing the USD as the reserve currency, the Fed announcement will be more unwatchable blundering (overall U.S. and USD negative in the global arena, but nothing to spook the masses out of the WFCS markets)

-not likely the trigger for running the metals charts to new highs (to show USD 'failing' and need for new reserve currency) But, having ran the silver chart down to what has been it's functional lower limit, there will probably be an obligatory spike in the silver and gold chart. Enough to show Fed/USD weakness but not enough to make metals appeal to the masseszzzz.

just some pre-theater speculation

Apr 30, 2014 - 1:59pm

Many say "when TSHTF

I say TSHAHTF...the shit has already hit the fan.

Do we need a nose job? Smeller not working.

Apr 30, 2014 - 2:02pm


Gold still pushing 1300, need a break out, waiting on a friend.

The Rolling Stones - Waiting On A Friend - OFFICIAL PROMO
Apr 30, 2014 - 2:02pm

Netdania data going crazy

like a yo yo


Apr 30, 2014 - 2:05pm

Good luck

That 100-day should continue to provide support as it did last week.

Apr 30, 2014 - 2:10pm

They really want to hold usd $.7950

But the water falls have began the annual cleanse.

If you need to sit back and just relax, check out this waterfall sequence. This lasts a long time, it's for meditation and cooling off after the rat race. These waterfalls are found in the Smoky Mountain National Park in Tennessee. Enjoy.


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Key Economic Events Week of 11/11

11/12 Three Fed Goon speeches
11/13 8:30 ET CPI
11/13 11:00 ET CGP on Capitol Hill
11/14 8:30 ET PPI
11/14 Four Fed Goon speeches
11/14 10:00 ET CGP on Capitol Hill
11/15 8:30 ET Retail Sales
11/15 8:30 ET Empire State Manu Index
11/15 9:15 ET Cap Ute and Ind Prod
11/15 10:00 ET Business Inventories

Key Economic Events Week of 11/4

11/4 10:00 ET Factory Orders
11/5 9:45 ET Markit Services PMI
11/5 10:00 ET ISM Services PMI
11/6 8:30 ET Productivity & Labor Costs
11/6 Speeches by Goons Williams, Harker and Evans
11/8 10:00 ET Consumer Sentiment
11/8 10:00 ET Wholesale Inventories

Key Economic Events Week of 10/28

10/30 8:30 ET Q3 GDP first guess
10/30 2:00 ET FOMC fedlines
10/30 2:30 ET CGP presser
10/31 8:30 ET Personal Income & Spending
10/31 8:30 ET Core Inflation
10/31 9:45 ET Chicago PMI
11/1 8:30 ET BLSBS
11/1 9:45 ET Markit Manu PMI
1/1 10:00 ET ISM Manu PMI

Key Economic Events Week of 10/21

10/22 10:00 ET Existing home sales
10/24 8:30 ET Durable Goods
10/24 9:45 ET Markit flash PMIs
10/24 10:00 ET New home sales
10/25 10:00 ET Consumer Sentiment

Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

Key Economic Events Week of 10/7

10/8 8:30 ET Producer Price Index
10/9 10:00 ET Job Openings
10/9 10:00 ET Wholesale Inventories
10/9 2:00 ET September FOMC minutes
10/10 8:30 ET Consumer Price Index
10/11 10:00 ET Consumer Sentiment

Key Economic Events Week of 9/30

9/30 9:45 ET Chicago PMI
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/1 10:00 ET Construction Spending
10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
10/3 9:45 ET Markit Service PMI
10/3 10:00 ET ISM Service PMI
10/3 10:00 ET Factory Orders
10/4 8:30 ET BLSBS
10/4 8:30 ET US Trade Deficit

Key Economic Events Week of 9/23

9/23 9:45 ET Markit flash PMIs
9/24 10:00 ET Consumer Confidence
9/26 8:30 ET Q2 GDP third guess
9/27 8:30 ET Durable Goods
9/27 8:30 ET Pers Inc and Cons Spend
9/27 8:30 ET Core Inflation

Key Economic Events Week of 9/16

9/17 9:15 ET Cap Ute & Ind Prod
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9/18 2:00 ET Fedlines
9/18 2:30 ET CGP presser
9/19 8:30 ET Philly Fed
9/19 10:00 ET Existing Home Sales

Key Economic Events Week of 9/9

9/10 10:00 ET Job openings
9/11 8:30 ET PPI
9/11 10:00 ET Wholesale Inv.
9/12 8:30 ET CPI
9/13 8:30 ET Retail Sales
9/13 10:00 ET Consumer Sentiment
9/13 10:00 ET Business Inv.

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