Turd Confused

Sat, Jun 18, 2011 - 3:16pm

When I first read this last evening, I was confused by its meaning. After thinking about it all day while working outside, I still have no idea. It would seem to be a possible first step toward a crackdown on PM trading and speculation. Banning OTC PM trading would also serve to drive more business toward the crooked Comex. I don't know maybe I'm reading too much into this. Since one of the original purposes of Dodd-Frank was to regulate OTC derivatives, perhaps this is nothing sinister at all. Again, I don't know. I do know, however, that no action taken by the Fed/TBTF/Govt Complex is ever coincidental.

Help a Turd. Please provide your thoughts below.


About the Author

turd [at] tfmetalsreport [dot] com ()


Jun 18, 2011 - 3:24pm


This is a "can kick" and bullish for physical PMs.

Jun 18, 2011 - 3:26pm


hard to tell. however, the OTC is more of a dark market with lack of disclosure. the prices are set on the CRIMEX and not the OTC, so...perhaps it is better that those trading on the OTC are forced to be subject to some kind of disclosure and true price discovery...hopefully it becomes less relevant as the HKMex starts to offer a silver contract.

Jun 18, 2011 - 3:27pm


"As a result of the Dodd-Frank Act enacted by US Congress, a new regulation prohibiting US residents from trading over the counter precious metals, including gold and silver, will go into effect on Friday, July 15, 2011"

Where does this come from in the bill? No options? Come on... Sounds like BS. I hope is BS

Jun 18, 2011 - 3:28pm

When an expert like the Turd

When an expert like the Turd is confused, you know that things are reaching a chaotic stage. The time is here (and has been for a while) to move to all physical, and ignore all this overly complex crap.

Systems add complexity in order to confuse users. Generally, the reason for this is either to create a class of bureaucrat to "handle" this type of business (think "tax code"), or to restrict the entry of laymen into the field in order to artificially prop up wages for those already in the field (think legal and medical professions). Another reason is to obfuscate some fundamental truth. That is the case here.

The truth they are trying to hide is that the COMEX is about to go bankrupt.

Get that physical while you still can!

Captain Silver
Jun 18, 2011 - 3:29pm


Been watching the boards and haven't seen any convincing analysis yet, some keen insights, but even if it's not sinister it has certainly led to a lot of uncertainty amongst posters today. So I ask:

Is this likely to raise/lower small investor physical demand going forward due to uncertainty?

Will it raise/lower industrial user demand due to potential price/supply uncertainty? I've wondered for a while why there hasn't been silver hedging by large users as there has been in the energy sector with all of the volatility.

Does it open the door for easier manipulation as they lose leverage with margin hikes?

I'm less concerned about the actual impact of the OTC ban as I am about the precedent set moving forward.

I don't trust em! They're not doing this for our health.

Jun 18, 2011 - 3:32pm


I'm confused, too.

Here is an article from seeking alpha from August of 2010


and here's a thread on this from kitco:


Jun 18, 2011 - 3:34pm

Hey TF, reposting my recent

Hey TF, reposting my recent relevant post from the last thread:

Hey guys, I know alot of us are quizzical/puzzled/concerned by the Forex announcement of July 15th actions regarding OTC trading of precious metals. This morning I ran across this piece from Jesse, and it helped put my mind at ease a bit. Hope it helps you too!


Jun 18, 2011 - 3:34pm

Completely sinister?

If you read the text of the law in that seeking alpha article, it actually bans all margined trading of commodities (extension of farm bill) w/out intent to take delivery of underlying goods. Ergo, AGQ, ZSL, DAG, UCO, etc. should all be banned. But they won't be. This is just an attempt to get us to buy into wall street products that we don't have control over 24/7 and have serious slippage issues.

This is perhaps complete selective enforcement of dodd frank provisions?

Or it could be that only forex, saxobank etc. have decided to follow the law, and proshares is taking the wait and see approach, or not announcing until july 15 that their products have been discontinued.

Notice that silver and gold didn't get flushed in this recent takedown? Bankers want your money.

This may be a good thing in that it will help the mining shares in the long run.

I have posted my predictions for the week in pailin and silvernomics corner. I'm short term bullish, intermediate term bearish, long term bullish on metals.

Jun 18, 2011 - 3:34pm

Don't think too much...

I know pointing out the obvious may seem dense... but sometimes it helps. Let's start with what we know.

> FOREX.com must discontinue metals trading for US residents on Friday, July 15, 2011


  • No USA citizen can trade gold/silver in FOREX after the 15th.

  • I expect... no USA brokerages can trade gold/silver in FOREX; overseas investors must stick with overseas brokers.

  • Visibility into the price of gold/silver will not go down because USA citizens can watch the price as traded by those outside the USA.

  • The ability for USA citizens to quickly move their money into PM will be hampered. COMEX futures are not the same as FOREX (I'm guessing, since I trade neither). SLV/GLD are not the same as FOREX.
  • (a possible aside... BitCoin was slandered by claiming it is used to buy drugs... which is a small step from claiming it funds terrorism)
  • The pressure on FOREX entities offering gold accounts will go down; money will drain from the fractional-reserve FOREX gold market.
  • Physical demand will go up
  • COMEX demand will go up
  • GLD/SLV demand may go up
  • Gold stock demand may go up.
Jun 18, 2011 - 3:35pm

Doesn't this really just take

Doesn't this really just take more paper gold and silver off the market? And how many people actually trade gold and silver on forex? Not a rhetorical question - I seriously don't know.

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 9/16

9/17 9:15 ET Cap Ute & Ind Prod
9/18 8:30 ET Housing Starts & Bldg Perm.
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.

Key Economic Events Week of 9/3

9/3 9:45 ET Markit Manu PMI
9/3 10:00 ET ISM Manu PMI
9/3 10:00 ET Construction Spending
9/4 8:30 ET Foreign Trade Deficit
9/5 9:45 ET Markit Svc PMI
9/5 10:00 ET ISM Svc PMI
9/5 10:00 ET Factory Orders
9/6 8:30 ET BLSBS

Key Economic Events Week of 8/26

8/26 8:30 ET Durable Goods
8/27 9:00 ET Case-Shiller Home Price Idx
8/27 10:00 ET Consumer Confidence
8/29 8:30 ET Q2 GDP 2nd guess
8/29 8:30 ET Advance Trade in Goods
8/30 8:30 ET Pers. Inc. and Cons. Spend.
8/30 8:30 ET Core Inflation
8/30 9:45 ET Chicago PMI

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

Key Economic Events Week of 8/5

8/5 9:45 ET Markit services PMI
8/5 10:00 ET ISM services PMI
8/6 10:00 ET Job Openings
8/8 10:00 ET Wholesale Inventories
8/9 8:30 ET Producer Price Index

Key Economic Events Week of 7/29

7/30 8:30 ET Personal Inc/Spending & Core Inflation
7/30 10:00 ET Consumer Confidence
7/31 8:15 ET ADP employment
7/31 2:00 pm ET FOMC Fedlines
7/31 2:30 pm ET CGP presser
8/1 9:45 ET Markit Manu PMI
8/1 10:00 ET ISM Manu PMI
8/2 8:30 ET BLSBS
8/2 10:00 ET Factory Orders

Key Economic Events Week of 7/22

7/23 10:00 ET Existing home sales
7/23 10:00 ET Richmond Fed Manu Idx
7/24 9:45 ET flash Markit PMIs
7/25 8:00 ET Count Draghi/ECB policy meeting
7/25 8:30 ET Durable Goods
7/25 8:30 ET Wholesale Inventories
7/26 8:30 ET Q2 GDP first guess

Key Economic Events Week of 7/15

7/15 8:30 ET Empire State Fed Index
7/16 8:30 ET Retail Sales and Import Price Index
7/16 9:15 ET Cap Ute and Ind Prod
7/16 10:00 ET Business Inventories
7/17 8:30 ET Housing Starts and Building Permits
7/18 8:30 ET Philly Fed
7/19 10:00 ET Consumer Sentiment

Recent Comments

by MoonShiv, 31 min 10 sec ago
by H8Fiat, 31 min 16 sec ago
by NUGTCALL, 33 min 49 sec ago
by NW VIEW, 51 min 42 sec ago
by RickshawETF, 1 hour 3 min ago

Forum Discussion

by HappyNow, 5 hours 29 min ago
by HappyNow, 7 hours 55 min ago
by ancientmoney, 9 hours 49 min ago
by argentus maximus, 10 hours 14 min ago
by atarangi, 13 hours 23 min ago