Cutting Vacation Short

Wed, Feb 20, 2013 - 10:04am

This is relentless and unforgiving...and I'm not talking about MrsF.

So bad that I'm cutting my mini-vacation short. I still don't have time for a full post so here are two items for you to read this morning.

ZH has been doing an excellent job chronicling the consistent, daily destruction. Here's the latest:

And here's someone who has noticed some of the same "anomolies" that I have:

The charts, of course, look terrible. Having failed at hoped-for support, silver looks like $28 and gold, if $1580 fails, looks headed all the way back to the bottom of the 18-month range, near $1550.

This is all highly unusual and indicative of extreme manipulation and panic-level positioning. At the risk of sounding trite and reading like another KWN pumper, I must say it: THIS WILL PASS. THESE EXTREMES WILL BE RESOLVED SOON AND NEW UPLEGS WILL BEGIN. PLEASE BE PATIENT. THE FUNDAMENTALS ARE STRONGER THAN EVER AND PHYSICAL REALITIES WILL SOON REPLACE PAPER SHENANIGANS AS THE DRIVING FORCE BEHIND PRICE.

More later if possible.


About the Author

turd [at] tfmetalsreport [dot] com ()


Feb 20, 2013 - 10:54pm

Bzzzt! California's REAL First Gold

James Marshall/Sutter gets all the glory, but he wasn't the first to discover Gold in California...

"But did you know that Marshall wasn't the first to find gold in California? And that the shiny metal had been mined there well before 1848? And that Marshall undoubtedly knew it?

The year was 1842. Both Californias — Alta and Baja — were part of Mexico, and Francisco Lopez was herding cattle on his niece's ranch in Placerita Canyon, 35 miles north of the Pueblo de Los Angeles.

It was around noon on his 40th birthday, March 9. Lopez paused to rest with his two companions, Manuél Cota and Domingo Bermudez. As the story goes, Lopez fell asleep in the shade of an oak tree and dreamed he was floating on a pool of gold. He awoke, crossed the little creek to a grove of sycamore trees, stuck his knife into the ground, unearthed some wild onions — and there, clinging to the roots, were chunks of gold.

"I with my sheath knife," Lopez later recalled, "dug up some wild onions, and in the earth discovered a piece of gold, and, searching further, found some more."

Where's Huell Howser when you need him? (Oh, nevermind)

Feb 20, 2013 - 10:55pm

Couple of SA articles

Interesting take on the mining industry, the true cost of mining silver, and how it could impact COMEX prices. $26.x has been the bottom 4 or so times in the last couple years. Also, many Elliot Wave folk have been calling for this for a couple months as another possible/likely low before the next HUGE leg up. At any rate, good time to start buying in case it doesn't get down there. I'm hoping to go 1x (for me 10-20 oz) at 28.x / 2x at 27.x / 4x at 26.x.

Feb 20, 2013 - 10:58pm

@DPH - Where Gold was found in California

Sutter's Mill in Coloma, California

Just minor correction on the location of where James Marshall found gold. You're partly right, It was on the South Fork of the American River, but about 30-40 miles East of Sacramento in a small town called Coloma, where Marshall worked as a foreman at Sutter's Lumber Mill. The American & Sacramento Rivers meet up in Sacramento.

Sutter tried to convince Marshall to keep quiet about the discovery, because he didn't want miners tramping all over his property. Needless to say, he wasn't too successful. BTW: It's a beautiful little town, on Hwy. 49 that winds it way through the Sierra Foothills for about 150 miles. If you ever get a chance, mid-spring is a great time to drive through this country, with lots of Old West mining towns. People still find gold there all the time. Back (30+ years ago) when I used to live up in that country, some of my old miner friends would occasionally pull out mason jars full of nuggets that they had found over the years.

Feb 20, 2013 - 11:01pm

I suggest reading...

...the link nathan1234 just posted and give it some thought.

The USD's demise might take awhile if the Chinese sentiment in the article is to be believed. It seems reasonable to expect interest rates to gradually creep higher.

That's pretty much what we've seen happen since the 10 yr. UST went sub 1.50 and has gradually rebounded. Rates have already started rising in a steady and controlled manner.

Same with USD strength.

Feb 20, 2013 - 11:26pm

@ ag1969 yes LCS's will need to be armed

@ ag1969, yes! Local Coin Shops will need to be armed during the coming mania phase. It's analogous to "Why is Ft. Knox still surrounded in secrecy by guards, surveillance, machine guns and minefields?" Gold IS money and the Western Banking Fiat Monetary System does NOT want the sheeple to know, yet.

Listen to Peter Schiff. He got it right when all the pundits missed.

2/18/13 Peter Schiff - Markets Will React Big When Reality Sets In

Amen my brothers. Hold gold with strong hands. Buy silver, the people's money. Pass the word and educate everyone you know.

Feb 20, 2013 - 11:30pm

@Chibster.....i hat-tipped your comment on previous page...

.....for reminding me that Soros will die soon enough!

Green Lantern
Feb 20, 2013 - 11:31pm

I like Peter Schiff but he

I like Peter Schiff but he certainly hasn't gotten it right. He recommended people go in deep sometime back. Sentiment is the big issue on the table and has been the big issue. Rickards made a comment today or yesterday about why people weren't spending. Psychology. When we can identify when velocity of money will pick up, then you know sentiment has changed. Somebody needs to do a chart gold vs fear index.

Feb 20, 2013 - 11:43pm
Feb 20, 2013 - 11:46pm
nathan1234 ¤
Feb 20, 2013 - 11:46pm

When the Fed can give

When the Fed can give trillions of dollars to foreign banks without approval what is there to stop them from continuing to give the US Govt!

Money is created digitaly today- just a computer entry

The Fed controls the US Govt and through them all Americans

The whole thing is truly the biggest fraud of all time

March 1st will be only used for further trading frauds to keep lining the pockets of the criminals while relieving the citizen of their funds.

El Gordo
Feb 20, 2013 - 11:50pm

Burning dry powder

I pulled the trigger today and burned a little dry powder thinking (like the flea with an erection shouting to raise the drawbridge) that would reverse the down trend or at least lower the average cost of my stack. Having apparently failed at reversing the down trend, I'm now regrouping, reassessing, and reloading with an eye toward establishing a new trigger price. I'm thinking in the range of $27.50 or less. Any comments?

nathan1234 silver66
Feb 20, 2013 - 11:59pm

Reply to Wash Rinse Repeat

Today the US States again have huge debts of their own. Which is not part of the Federal debt.

While the US had people/immigrants from all over adopting a new country at that time , Europe has a history. The Iron Curtain exploded because in the final analysis the human's thought process and requirement for freedom can never be suppressed. No man will wish to undertake the financial burden of another as they need to fend for themselves.

IMHO this can never work in Europe.

Feb 21, 2013 - 12:01am

earlier a post was made abt the Fed stopping QE in march

earlier a post was made abt the Fed stopping QE in march.

It is certainly possible. However, the fallout from that decision would be a disaster across the board with gold and silver action likely being buried on page 47.

Feb 21, 2013 - 12:13am

Puck dump it

then what...hard assets? more gold and silver? just curious.... i generally like his vids but he seemed a little more panicky and didn't really say what to do with the fiat from the sale.

Exogen200 ForWhomTheTollBuilds
Feb 21, 2013 - 12:16am



have one for silver? also his proprietary videos??

Texas Sandman El Gordo
Feb 21, 2013 - 12:17am

$27 by first notice sounds right

Draw the trendlines. Look at the bottom of the channel.

I think this was my specific target I mentioned around the time my longer term model turned bearish (established downward trend in the MACD shown --- vertical red bar).

proton777 Texas Sandman
Feb 21, 2013 - 12:23am


Haven't you read all the posts here?! 27 is not possible. TROLL!

Feb 21, 2013 - 12:26am


I have arrived home and, after getting some rest, will attempt to make some sense of this madness in the morning.

And this was linked above. If you haven't read it yet, you should. Very well written.

Texas Sandman proton777
Feb 21, 2013 - 12:27am


Haven't you read my past posts. I've been absolutely consistent in my opinion regarding silver for the past 2 weeks. I have given you evidence in the form of the chart above showing that $27 is VERY possible.

That you can come out with such an idiotic statement as "price X is not possible" shows you have the market maturity of a 2 year old. And that's all I have to say on the matter.


Feb 21, 2013 - 12:28am

Another 20.7 tons of GLD

disappears today. Where is all this gold going?

On another note I got to thinking tonight that supposedly less than 1% are invested in PM's. Given all the chatter about drying up supply wouldn't it is any surprise that the Fed and government through the bought and paid for MSM has stepped up their almost daily MOPE and spin which then gives the banksters the opportunity to continue to daily crush the non backed naked paper market thereby creating the perception that gold, silver and the miners is not the place to be. One of the most frustrating things right now is the unbelievable amount of downright lies and deception coming out of the mouths of the Fed and other government spinmasters (MSM)

There is no truth. There is only perception.
Gustave Flaubert

That is clearly the case right now.
Feb 21, 2013 - 12:28am

More sliding down in the AM?

So guys, what does your gut say about the upcoming AM.? Do we see the price slide again for the 9th day in a row, stay at current levels or start to bounce a bit?

For me it feels like we're not quite done yet, JPM still needs to close a few more shorts, so I'm expecting a bit more weakness this morning... maybe down to 27.80 or so before we're done. Any other guesses?

Feb 21, 2013 - 12:35am

And mr proton...

I've been trying to keep up on this post all day, checking it whenever I can. You, more than anyone else, have spent the day trying to poke and incite. I've tolerated it today but not much longer. It's possible to disagree without being disagreeable a prick a douchebag rude.

Feb 21, 2013 - 12:40am

Harvey's posted

Gold closed down $26.00 to finish the comex session at $1577.60 Silver finished the day at $28.61 down 69 cents. The bankers continued with their raid today as they had their sights glued on silver which continues to report higher OI despite the lower silver price. The plunge is silver price is occurring at the exact time that we have record levels of open interest on the comex together with record sales of silver eagles in the month of January and February. This is totally incompatible with reality. Somebody here is really wrong. Is there something that we are missing?.... or are the banker shorts knowing something that we do not? When you have no referee it is difficult, because the bankers can short to oblivion without ever being called into question.

Feb 21, 2013 - 12:50am

And one last thing...

I could waste time typing this myself but I'm tired and, since I've already typed this so many times, here's a C&P instead.

From our pal Denver Dave:


Is The Fed Serious?

The Fed minutes for January were released today and it suggests that the Fed will consider changes to the current QE policy of buying $85 billion of Treasury and mortgage bonds per month. But does anyone really think this will happen? Really?

Let's "play the tape" on what would happen. To begin with, the Fed holds 41% of all 30yr Treasury bonds issued since 2009. This month, the Fed purchased 75% of the recently issued 30yr Treasury auction. Assuming the Fed continues buying at least its stated policy of $45 billion in Treasuries every month, and assuming the Treasury will be issuing roughly $100 billion per month (this is actually likely a low-ball estimate based on the annual increase in Federal debt over the past 4 years), the Fed will buying nearly 50% of all new Treasury debt issued.

Imagine what would happen to interest rates if the Fed were to curtail it's Treasury purchases. Imagine what it will do to the Government's interest expense if the Fed stops buying Treasuries and the market adjusts to a much higher "natural" interest rate.

How about mortgage paper? I have written recently about the amount of money being thrown at the housing market by both the Fed and the Government to try and stimulate housing sales. We're already seeing a significant slow-down in housing market activity based on mortgage application data and non-seasonally adjusted housing data. If interest rates spike up, the housing market will be decimated. In fact, the entire economy will fall further into a recessionary abyss.

The minutes also reflected the "view" that the economy was on a moderate growth path. And yet, based on data that has been released since January, it is obvious that retail and housing sales have - at best - stalled. In absence of the possibility that the FOMC members are idiots, the only conclusion we draw from the statements in today's released FOMC minutes is that the Fed is playing a dangerous game of political rhetoric.

Let's not forget that the FOMC co-chairman, Janet Yellen, has openly advocated using a negative nominal short term interest rate policy as a mechanism to stimulate employment. The Fed is painted into a corner. Unless Bernanke wants to go down as the guy who was at the helm of the Fed when the worst depression in U.S. history hit, I can guarantee that not only will QE continue but that the path of least resistance for QE is to increase its size.
Feb 21, 2013 - 12:56am

omg peopel chillout. Don't borrow 4 PM but don't forget gravity!

My kids will Gd willing get married in a decade from now. My many children will still need gold and silver (even if it's silly tradition).

Societies will crumble, people will suffer, and evil will still be around. Through it all gold and silver will still be there. I told my father in law in 2006 that the markets were for gamblers. He argued with me etc etc. 2008 proceeded and he still thinks the same (even though he knows I was right). People will stay in their own paradigm and live there even when the buildings are collapsing around them.

Stay cool, stay calm. The righteous live by their faith. At some point you have to let go and realize you just get reality a little better then others. It doesn't mean the "sheeple" don't have something to offer. Some people are more street smart, and others will be led by the hand. Fascists will be fascists, criminals will be criminals; but all cannot defy gravity for too long. These are Gd's laws and there are repercussions for defying them for too long. I see plenty of people here who "get it" but still cannot comprehend my views on justice. So even if we believe in gravity; you still have your own and sometimes twisted view of reality. Perhaps my views on reality are ""twisted", but such is life.

So we must ask ourselves: If Gd made every snow flake different (if you even believe in Gd); then so Gd made people the same way. We were not meant to be cookie cut. We can call them "sheeple", or other demeaning names; but in reality we all came from one source.

Somewhere down the line a person realized he was stronger then another if he forged a weapon. He lived by the sword to make it easier for themselves. However, gravity is still gravity. One who lives by the sword will die by the sword.

Not long ago everyone was fixated on Bill Clinton and a white Bronco speeding down on the freeway. 9/11 hit and some people woke up to a new reality.

2008 hit and markets crashed. It was saved artificially.

The SHTF all the time. People who see it coming are just more street smart then others. The fundamentals are just GRAVITY. Violate the fundamentals; and reality will stretch like a rubber band until it SNAPS BACK HARD.

I wake up every morning and say "I offer thanks before you, living and eternal King, for You have mercifully restored my soul within me; Your faithfulness is great".

I have no control over anything.. but when I wake up I have to play within the rules of the reality created before me. I know gravity exists and maybe someday I will try to defy it. It doesn't change the fact that it's still there. I can create my own artificial bubble and live there.... until the air runs out.

We are here so that we can learn to breath as opposed to believing the bubble is reality.

So relax. TPTB are really not in control; they are just trying to defy gravity.. but in then end; they have no control over why the wake up in the morning.

Texas Sandman
Feb 21, 2013 - 12:57am

Long term.

I think this posturing about stopping QE is just that.

Perhaps they'll stop qe for 60 or 90 days (max). During that time, $27 silver will look like "the good old days". But everything else will come unglued as well (think 2008 revisited). Then they restart QE in emergency-panic mode. Hell, they'll be out buying S&P Emini futures in the Chicago pits with freshly printed $100 bills at that point.

There are always a few people on the fed who have the right idea about what SHOULD be done. But it's far too late for that.

It was too late when they committed to the tarp. That was my signal to start stacking. There's no way they can go back, find religion and suddenly do the right thing. Ain't going to happen.

Feb 21, 2013 - 1:03am

medium large gold miners

Aussie Large and medium gold producers broke through some major support today , the small guys have been in the toilet all year. blood in the streets.

Feb 21, 2013 - 1:17am

QE a big Zero for PM's?

Musing: So much has been made about the positive effects of QE on PM prices, but IMO I just don't see it. The last two rounds of QE have had absolutely no mid-long term effect what-so-ever. Inversely, stopping QE may then not have a negative effect on PM's.

Feb 21, 2013 - 1:28am

Who didn't see this coming?

Oh yeah (sigh...)

The price waterfall over the last few days is what I and others had warned was likely coming earlier this week, despite our host's conviction that the correction was all but over. As I said at the time, last week's price and volume action wasn't how durable bottoms are formed. The extreme negative action of the last few days on the other hand, is how durable bottoms are formed. I don't think the correction is quite over yet, but we're a lot closer now than when Turd made his latest ill fated prediction.

I mentioned a few nights ago that I bought April $26 puts, expecting us to test near that level before this correction was over. Today, silver pierced the bottom of its 10 year price channel (!) and closed below it. Unless it reverses quickly, that should lead to an acceleration in the fall that pushes us below $25. Having said that, today's negative price action also masked impressive underlying strength that silver showed against massive selling volume. If they couldn't break silver today on the back of the FOMC meeting minutes, they're going to have a hard time forcing it down much further.

Given these conflicting signals, I have no idea where we go from here - we might still test $26, we might not go below $27.50, or we might go all the way to $24. Some of you may recall I bought my $26 April put contracts the day before this week's waterfall started. The puts were cheap and my goal was to use them to get into a fully hedged long position as price approached that level. Seeing silver's underlying strength today, I've started scaling into that long position early. I started nibbling a bit today, and will keep adding if and as the correction continues, with the goal of being fully long 10,000 shares by the time we test $26 (assuming we even get there).

Hang in there everyone - we're days away from a durable bottom, and while silver might lay on the mat for a few weeks, this kind of action is a necessary precursor to the next wave up.

Feb 21, 2013 - 2:00am

Anybody ever heard of a Flash Bang holster?

I hadn't either until today and can't think of a more appropriate name. Certainly gives the girls their just advantage in an appropriet way. Near the end of the 3 min vid. Made in a county that borders the one I grew up in.


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