Saturday Stuff

300
Sat, Feb 23, 2013 - 12:28pm

Just a quick wrap up of some assorted stuff as we prepare for what will be an eventful week ahead.

First of all, the big news from late yesterday...Moody's downgraded Her Majesty's debt. Though this is once again a fundamentally gold-positive event, I wouldn't expect an immediate jump in price because of it. Remember that in the fiat world, Pound weakness inversely means Pig strength. https://www.telegraph.co.uk/finance/economics/9889485/Downgrade-to-pile-pressure-on-pound.html

In the absence of a podcast here at TFMR, please take the time to listen through all three segments of Andy's visit with Eric King yesterday (once they're finally posted). When we spoke yesterday, Andy told me not to expect anything too earth-shattering but I'm confident that it's worth your time, nonetheless. He and I plan hope to record something either Monday or Tuesday so look for that early next week. In the meantime, here are the KWN links:

https://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/22_Maguire_-_Stunning_225_Tons_of_Physical_Gold_Bought_By_CBs.html

https://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/22_Whistleblower_-_Gold_%26_Silver_Smash_Orchestrated_By_The_BIS.html

https://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/23_Maguire_-_Stunning_%2424_Premiums_For_Gold_In_Shanghai.html

If you haven't already, you're going to be reading a lot this weekend about yesterday's Commitment of Traders report. As you know, I like to review it right when it comes out and then post a sort of "instant analysis". Here's a c&p of my thoughts from yesterday, in case you missed them:

GOLD: For the week, price fell about $45. While this was taking place, the LargeSpecs added 1900 longs and a jaw-dropping 25,000 shorts! The LS net long ratio falls to an very bullish 2.12:1. The SmallSpecs got in on the act, too. They dumped 400 longs and added nearly 5,000 new shorts. This is an extremely bullish, contrary signal.
But the real action was by The Cartel. They added 4,300 new longs and covered an incredible 24,200 shorts. Again, who was buying while the specs were busy shorting? And who do you think will, ultimately, profit??
The Cartel net short ratio now stands at an extremely bullish 1.83:1.


SILVER: Almost identical to gold. Simply astounding, amazing and incredible.
For the reporting week, the price of silver fell about $1.60. Look what was happening internally:
The LargeSpecs dumped 1,150 longs and added 4,450 shorts. After reaching an unheard of extreme of 6.5:1 just two week ago, the LSpec net long ratio is all the way back to a mildly bullish 3.1:1
The SmallSpecs added 500 longs and 3700 shorts. Again, as in gold, the specs are racing to get short.
The "commercials"...pretty much all big firms except JPM and their con-conspirators...added another 2,026 longs, bringing their total gross long position to a never-before-seen 54,208. Simply incredible! They've continued to add longs all the way down. What do they know? What are they expecting??
The Silver Cartel...namely JPM and their two or three pals...were finally able to cover 6,800 of their disgustingly large short position. It's still disturbingly high at 92,164 but the total commercial net short ratio, which last peaked in September of last year at 2.6:1 has now declined to a quite bullish 1.7:1 Nearly every drop in The Cartel net short ratio to near 1.5:1 has preceded a substantial rally. We are very close!
All in all, both CoTs are extraordinarily bullish and indicative of a bottom very soon. Hang in there, now. Your patience will soon be rewarded!

Now, let me just add a couple of things:

  1. Getting the Gold Cartel net short ratio all the way down to 1.83:1 is a very good sign. For perspective, at the lows of late December 2011 and summer 2012, the Cartel net short ratios were 1.98:1 and 2.01:1, respectively. And this week's data was surveyed on Tuesday, before the big drop on Wednesday. All in all, the gold CoT is very bullish.
  2. Please also consider the net short ratio of The Silver Cartel. After the last four price washouts, here are your net short ratios at the bottom: On 8/14/12 it was 1.49:1. On 12/27/11 it was 1.34:1. On 10/4/11 it was 1.48:1 and on 6/28/11 it was 1.79:1. As of last Tuesday, it had fallen 1.7:1.
  3. And, finally, this theory....note the emphasis on theory. Regular readers know how perplexed I am by the silver OI situation. The primary outlier is the Commercial Long position. It "should be" somewhere near 30,000-35,000 contracts by this point in the price cycle. Instead, it grew again last week to 54,208. Chew on this: What if the 20,000 contract difference is, in fact, JPM trying to square away their naked short position that Uncle Ted estimates to be around 30,000. Now, stick with me on this... They tried to lessen it by covering back in April 2011 and the result was a near-cataclysmic event for them that was only rectified by the Sunday Night Massacre and the collusive CME margin hikes. Since then, they've maintained their position as The Big Short but, beginning late last summer, they began to build an equally-large long position. Again, stay with me here... They've added shorts through the fall to keep a lid on prices until they're ready to let it go, either voluntarily or involuntarily. If this is the case...and that's a very big IF...JPM could be approaching the point where they would be short 25,000-30,000 contracts AND long 25,000-30,000 contracts. At that point, if forced to exit the shorts, they'd be fully hedged and even profiting on the UPside.

Anyway, just chew on the 3rd point over the weekend. The more I think about it, the more it explains the "commercial long anomaly" and it provides JPM an exit strategy should the toothless CFTC ever choose to call them out.

Here are your updated charts. Given the CoT structure, I feel very comfortable declaring that a bottom is near. (And obviously hope that, by doing so, my Google ad revenue will increase.)

And just a couple of other items that have found their way into my inbox. First, this interview from last fall that details the whys and hows of gold manipulation:

Gold Market Manipulation Explained

This fun article discusses the effects of the gold repatriation movement: https://wealthcycles.com/features/15-ton-gold-repatriation-hits-jp-morgan-london-vaults

If you haven't read up on this subject yet, I strongly urge you to do so. Just like the German gold repatriation, we may look back on these events and recall them as clear warning signs of imminent events: https://www.sovereignman.com/important-information/red-alert-worlds-biggest-gold-storage-company-dumps-us-citizens-10958/

And our friends at Gold Bullion International do some excellent analytical work. Their latest was posted to ZH and you should definitely take the time to read it: https://www.zerohedge.com/news/2013-02-22/gold-and-potential-dollar-endgame-part-3-backwardation-and-gold

Speaking of GBI, for now they are still the only bullion and storage affiliation that this site has. Many of you have purchased from them and I am very grateful for their support. If you are buying coins and bullion, please be sure to check them out. You can link to them trough the ad on the right side of the page. I'll soon be adding affiliations with GoldMoney, SilverDoctors, Provident and JMBullion, too, so please be sure to always consider them when looking the BTFD. (Which I would strongly encourage you to consider doing this weekend.)

OK, I think I'll stop there. I hope that you have a safe and relaxing weekend. You certainly deserve some serenity after the madness of the past two weeks. But keep the faith as this, too, shall pass. The metals have simply been forced back to the bottom of their 18-month price ranges and will soon begin to rebound as physical demand and the glaringly obvious fundamentals begin to take over.

TF

p.s. You've got to check this out. The trollololo song is going mainstream!! I sure hope that the dead Russian guy's estate is getting a little skin out of it...(Thanks to my pal, DocD, for passing it along!)

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About the Author

Founder
turd [at] tfmetalsreport [dot] com ()
Does Feb19 Comex gold close above $1250 on Friday?
YES
76%
NO
24%
Total votes: 194

  300 Comments

murphy · Feb 23, 2013 - 4:40pm

Silverbee

Two nipples, I mean nickels for a dime?

R man J · Feb 23, 2013 - 4:40pm

Turdites in months of Consolidation

Ouch, that sounds a little uncomfortable. And you know what? It is!!!

Life in the consolidation has been happening to us now for 17 months. No wonder some of our beloved gold bug oracles are acting a little constipated in their attitudes with one another. We keep thinking of the breakout, ah what a release from pressure it will be. But there is a FAR more important question to ask:

HOW MANY OUNCES HAVE YOU ACQUIRED SINCE THE CONSOLIDATION BEGAN IN OCTOBER 2011?

I thought so, you stepped up the pace even more since then and you have much to show for it. You dollar cost averaged somewhere in the $31 / $1650 neighborhood. Now consider how many ounces you would have obtained if the price had not consolidated? What? Oh, no! You would have had 30% less ounces?

Soooo...if you had it to do over again, and it was September 2011 and you could have kept the price at $44 / $1900, would you have done so? Think about how much lighter your phyzz load would have been if the prices had remained high.

So within the slimy walls of this consolidation, let us be thankful Turdites. And when a brother gets discouraged and stinky, let's hold our noses and embrace them until they come to their senses. 

jolidacrown · Feb 23, 2013 - 4:48pm
¤ · Feb 23, 2013 - 4:48pm

GATA...In a nutshell

This is going back quite a bit to a old GATA article but it succinctly paints the picture and how this might work with the BIS/CB's/Bullion Banks etc. You won't regret reading the entire article as it's loaded with links and there are some things towards the end that have you shaking your head.

I truly believe the scope and magnitude of how things actually work on a sovereign BIS/CB level would blow our minds and we might have some trouble processing it initially.

A Summary of GATA's Work

By Andrew Hepburn/GATA

The Gold Anti-Trust Action Committee (GATA) believes that central banks, acting through certain investment banks, have surreptitiously manipulated the price of gold. Such activity appears to have started in the mid-1990s and continues to this day. Prominent entities involved include J.P. Morgan Chase, Goldman Sachs, Deutsche Bank, the Federal Reserve, the Bank of England, and the Bank for International Settlements. GATA specifically alleges that the U.S. Treasury's Exchange Stabilization Fund has been used, contrary to official denials, for gold market interventions. Furthermore, GATA believes that the official sector intervened in the late 1990s to prevent an impending gold derivative crisis, the result of excessive short positions accumulated over many years.

These claims are based on analyses of publicly available government documents and statistics, trading abnormalities, and material presented in a GATA-backed lawsuit. Howe vs. Bank for International Settlements et al. accused the BIS, Federal Reserve, U.S. Treasury, and four bullion banks of gold market manipulation. Though the suit was dismissed in 2002 on two technicalities, the evidence presented in it is recognized by many knowledgeable observers as having sufficiently proven the price-fixing allegations. Nonetheless, important questions remain unanswered about the gold market activities of the investment banks and monetary authorities.

Some answers may be forthcoming via a lawsuit currently in the discovery stage. Blanchard and Co., the nation's largest retail coin dealer, filed suit in U.S. District Court in New Orleans against Barrick Gold and J.P. Morgan Chase, alleging that hedging arrangements between the gold miner and investment bank facilitated the manipulation of the gold price. Motions to dismiss the lawsuit were recently denied by the presiding judge. This legal action is independent of the GATA-sponsored lawsuit but is supported by GATA and touches on the same basic issue. Given gold's current bull market, it is very timely. Some of the reasons for gold's extended bear market may finally come to light. (For a detailed explanation of the Blanchard case, see an interview conducted with its CEO, Donald Doyle:

https://www.lemetropolecafe.com/img2003/DoyleInterview1203.pdf).

There are several possible motives for the Fed and Treasury to depress gold prices surreptitiously:

(1) To prevent rising gold prices from sounding a warning on U.S. inflation. Gold has long been considered a hedge against inflation, and a low gold price generally indicates that inflation is benign.

(2) To prevent rising gold prices from signalling weakness in the international value of the dollar. The Treasury Department has never articulated the mechanisms by which the "strong dollar policy" has been implemented. As mutual fund manager John Hathaway notes: "...there can be little doubt the low [gold] price has been one of the most important sound bytes for mass consumption underpinning the low inflation mythology of the new economy and the strong dollar." Hathaway continues:

Gold retains its financial market role as the "canary in the coal mine." A sharply rising gold dollar price would send a clear message to even the most casual observer that something is awry with the Fed's " fine tuning" of the economy and financial markets.

See https://www.tocqueville.com/brainstorms/brainstorms.php?id=108

(3) To keep interest rates artificially low. In an academic paper published during his tenure at Harvard, future Treasury Secretary Lawrence Summers concluded that in a free gold market unaffected by "government pegging operations," the price of gold would move inversely to real interest rates. This relationship broke down in 1996, indicating that central banks moved at that point to suppress gold prices. (A copy of the essay, "Gibson's Paradox and the Gold Standard," is available at https://www.gata.org/gibson.pdf. For an analysis of Summers' work, see "Gibson's Paradox Revisited: Professor Summers Analyzes Gold Prices": https://www.goldensextant.com/commentary18.html#anchor196905).

(4) To prevent banks and others that have funded themselves by borrowing gold at low interest rates and are thus short physical gold from suffering huge losses as a consequence of rising gold prices. The bullion banks profited greatly from the "gold carry trade." As explained in Howe vs. Bank for International Settlements et al.:

Central banks lease gold either by making gold deposits with, or by making gold loans to, bullion banks, the largest of which are international banks or other financial institutions. In both cases, the gold is placed with a bullion bank usually at a very low rate of interest, often 2% or less. This so-called "leased" gold is then sold into the market and the currency proceeds delivered for investment or other use by the bullion bank and/or its customer. When the gold deposit is called or the gold loan comes due, the physical gold required for repayment must generally be repurchased in the market.

See https://www.gata.org/howe_complaint.html

The benefit to the bullion banks lay in the difference between gold lease rates and prevailing interest rates. By borrowing gold cheaply, selling it into the spot market, and investing the proceeds in interest-bearing instruments, the gold borrowers realized substantial gains. At some point, however, at least theoretically, the gold might have to be repurchased in the market and returned to the central banks.

This short position caused a huge price spike in the aftermath of the so-called Washington Agreement, where 15 European central banks agreed to limit gold sales and curtail lending activities. The reaction to the short squeeze by the Federal Reserve, BIS and Bank of England was outlined in Howe vs. BIS:

According to reliable reports received by the plaintiff, this effort was later described by Edward A.J. George, governor of the Bank of England and a director of the BIS, to Nicholas J. Morrell, Chief Executive of Lonmin Plc:

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The U.S. Fed was very active in getting the gold price down. So was the U.K."

Former World Bank consultant Frank Veneroso, currently global strategist at Allianz Dresdner, stated the following regarding the gold market activities of the central banks:

"In other words, the official sector intervened to prevent an explosive gold derivative crisis. We conclude from our argument based on the development of an inadvertent corner in the gold markets, from a "prison of the shorts," that, since the Long Term [Capital] Management crisis in late 1998, the official sector has been managing the price of gold."

See https://www.gata.org/Veneroso1202.html

In order to "prevent an explosive gold derivative crisis," the central banks have likely had to let the bullion banks off the hook for the majority of borrowed gold. Other possibilities include allowing the banks to settle outstanding gold loans in cash rather than metal. Whatever the case, it is also probable that an implicit agreement exists whereby the bullion banks will...(cont.)

https://www.gata.org/node/4239

joehappen · Feb 23, 2013 - 5:12pm

Future wedding no registry at APMEX......Any ideas?

I will be getting married right after the first of next year. I do not need people to get me pots and pans or a mop and broom set. I wanted ideas on how to not sound like an ass but ask for silver or gold ect. I really wish Gainesville or Apmex had a registry but they do not. So with this concept out in the open what do any other turdites out there suggest? We could use fiat too I suppose to offset the cost of the honeymoon but I think people placing a few Eagles in an envelope would by my thoughts be beyond awesome. A roll of dimes would be fine too!

Tell me if I am crazy, but if people ask what we might like as the date approaches I can't lie to them that would just be wrong... what do you all think? The girlfriend also thinks this is a fine idea too!

foggyroad · Feb 23, 2013 - 5:21pm

Margin Decrease

TF, most excellent analysis.

TF. wrote... 

  1. "Since then, they've maintained their position as The Big Short but, beginning late last summer, they began to build an equally-large long position. Again, stay with me here... They've added shorts through the fall to keep a lid on prices until they're ready to let it go, either voluntarily or involuntarily. If this is the case...and that's a very big IF...JPM could be approaching the point where they would be short 25,000-30,000 contracts AND long 25,000-30,000 contracts. At that point, if forced to exit the shorts, they'd be fully hedged and even profiting on the UPside."

"Anyway, just chew on the 3rd point over the weekend. The more I think about it, the more it explains the "commercial long anomaly" and it provides JPM an exit strategy should the toothless CFTC ever choose to call them out."

-------------------------------------------------------------------------------------------------------------------------------------------------

Reading this TF, got me to thinking about the 'margin maintenance' decrease a while back, which struck me as odd. 

I have since come to believe it was done to allow a decrease in cost, by the CME, (JPM sits on the board of directors), of the big shorts (JPM et al.), of maintaining their huge Short Position.

Now with the 'Theory' of building an equally large 'Long Position' as an escape route, lowering the maintenance margin a while back makes even more sense.

Keep up the Fine work my Friend.yes

Dimeboy joehappen · Feb 23, 2013 - 5:21pm

RCM for silver gifts

The Canadian Mint has had a nice line-up of personal event commemoratives, such as birthday, baby's first anniversary and yes, wedding coins. The are priced well over spot but usually keep there premium value well. Many are using the same planchet as the Maple so they are still nice to get for a silver bug. They sell direct at their online store mint.ca

foggyroad SIlverbee · Feb 23, 2013 - 5:37pm

@ Silver Bee re.Sexy Silver Vlog

Beauty and Brains, a very nice voice, and a lovely set..er sets. :)

I think I should re watch to clarify that commemorative sets silver content.blush

Lamenting Laverne · Feb 23, 2013 - 5:43pm

@ joehappen - Wedding gifts

Maybe you could say that you really wished for a wedding Indian Style (only maybe a wee bit more modest - since the Indians apparently goes completely bonkers in Gold at their weddings) to start your marriage on a sound savings foundation. I think many people would nod in favor of such an idea, particularly during these times.

I have been to two different weddings in very different countries, where the bride was completely showered in small fiat notes, because it was tradition to send the couple off with a little something on the bottom of the savings chest.

Maybe you could call it a Silver Indian Wedding, and put some easily accessible bullion coins on the wish list with info on where they can be bought - just like you would do if it was a vase or a piece of artisan work etc. 

I don't know - just an idea... And congratulations to you too ;-)

foggyroad joehappen · Feb 23, 2013 - 5:55pm

@ joe happen

Register with silversmiths, ie silverware , cutlery, cream dispensers etc.

Just a thought.

Some of our lady turdites might have more experience, with wedding planning ideas.

tpbeta · Feb 23, 2013 - 6:05pm

The technical narrative and the manipulation narrative

We all know the technical narrative suggests short covering will eventually come, but consider this. It seems likely that someone expended a lot of treasure during Xmas and then again during Chinese New Year rewriting the algorithm expectations in relation to PMs, so that those heuristic morons would learn to sell even as QE ramped up. The prime objective was not to cause a short term waterfall, IMHO, so much as to create the narrative that the bull market is over. Hence the repetitive waterfalls at the same time every day. It was Pavlovian tactics at their most crude. That point needs to be fully taken on board.

The cartel want you trained to thing that the bull markets in precious metals is over. The link between money printing and inflation does not exist. The dollar remains strong. Put your money into equities. The good times are back.

I say all this because it doesn't seem likely that this is a narrative they're going to let go easily. It's just too valuable in macro terms - far more so that the value of the PM markets in question. They need gold at $1400 and silver at $24 to make it credible. So the desire exists. Do the means exist? Well maybe they do in the short term. Dropped margins and lowering lease rates all help. Japan printing and maybe buying US bonds is fantastically helpful in strengthening the dollar.

Where the wheels fall off for me though is the strong dollar. It will kill any prospect of US growth. They have to bring it down, at which point inflation creeps in, or maybe rushes in. This narrative is self limiting. But it might nevertheless be good enough for the next three to six months. Enough to put PMs right back in their box.

Remember that the hedge funds are still net long PMs, even though they are now driving this downturn. They aren't really buying the narrative 50% yet and yet their selling has taken us to here. There's therefore quite a bit of downside left to mine, if the powers that be can make the narrative sale last for a bit longer. And if JPM has also been building up a secret long warchest as the CoT might suggest, then their capacity to go short is even greater, should they chose to. 

If this sounds horribly bearish, then be consoled that my analysis is nearly always unnecessarily complicated, evidentially challenged and basically wrong. You can usually call a bottom on it. That's of some comfort anyway. 8-)

Maximillion · Feb 23, 2013 - 6:20pm

Open interest anomaly

IMO Turd is likely right in his theory (and I don't always agree with him).

In the words of Charlie Munger ' If you want to know how a group of people will act, simply look at their incentive for doing so!'.

Sun Tzu, know your enemy = JPM et all are not thicko traders! Add to this the London Whale muck up made recently, combined with Blythes statement on TV that they were not naked shorting PM's on their own behalf = If they're caught out this time they'd have no chance of defending themselves and the fallout would in all likelihood result in a 'Margin Call' like scenario crashing the whole ponzi scheme!

Far better for them to transfer their naked paper liability to the Large and Small Specs over time (ie pension funds etc), and let the specs act as the fall guys, probably in collusion with them IMO (ie a simple stealth tax pay back on the populous for all the free QE $ pumping up the markets). Throw in a dollop of Mope such as Moody's downgrades (conveniently overlooking the fact that a little Canadian rating agency is now barred from even rating the USA for the next few years as a result of questioning US debt), and you've got the perfect get out for the 1%. Net result is PM's can rocket in price with mope justification, Govts get their currency devaluation without damaging the credence of the likes of JPM, joe public loses out through their paper savings/pension fund losses (particularly as most joe's have already cashed in their jewellery to 'we buy gold'). PLUS This would conveniently justify the annual taxing of PM jewellery / bullion / coins AS THIS WEEK PROPOSED BY UK POLITICIANS (check out Gordon Browns 12 year pre plan regarding trust taxation if you think they don't know how to forward legislate to catch future revenues).

George Soros ' There are only two kinds of ideas, those that have been falsified, and those that have yet to be falsified!'. So why would he have recently dumped a large portion of his gold? =

1)Price due to drop (which it has, so has he bought it back?) If you do a bit of research you'll quickly realise that Soros / Paulson buy / sell news is wholly misleading, as per Georges stated philosophy, so perhaps,

2) He was holding paper gold shares and he's converted to physical, which would tie in with all of the above, or

3) He's misleading the populous to build up a larger position at the lowest price as per his stated philosophy, or

3) He's being philanthropic and wants to help all the other fund managers! Yeah that's likely, check out how much money he made betting against the £ in the 1990's

Pity I had to sell my last bit of physical to feed my family, so I'm only following it all now for fun. I may well be wrong, and am always open to be proved so, but facts speak louder than mope, so IMO hang on in there guys.

tpbeta · Feb 23, 2013 - 6:28pm

@Maximillion

"JPM et all are not thicko traders! Add to this the London Whale muck up made recently, combined with Blythes statement on TV that they were not naked shorting PM's on their own behalf = If they're caught out this time they'd have no chance of defending themselves and the fallout would in all likelihood result in a 'Margin Call' like scenario crashing the whole ponzi scheme"

Problem is these CoT shifts are recent. Blythe said that stuff months ago and the CTFC investigation has been running for years. Presumably even the CTFC investigators would notice that these compensatory longs are only a month old. Has to be more to it than that. Might it be that JPM were previously holding longs on behalf of other hedge funds, who gave the sell order. I don't really understand how this stuff works tbh. I guess only Blythe does. I strongly suspect it has something to do with arbitraging the different delays in price sensitivity to do with buying and selling of ETF PMs, futures PMs, and physical PMs, as described here...


https://ftalphaville.ft.com/2013/01/18/1343872/slv-and-the-mystery-inventory-build-up/

Ilya Repin · Feb 23, 2013 - 6:30pm

TF sorry but Pound weakness

TF sorry but Pound weakness does not mean USD strength, it means the opposite.

have you even looked at the GBP corss' ??

CHF NZD AUD SEK NOK CNY SGD all are pretty much identical to USD cross'

GBP will bring down the USD. Very basic concept based on historical relationship between Sterling and the USD. Just look at the charts people.

never heard of the "special relationship" geeeez 

I think gold opens up and trades up this week. Miners too.

2 more down days (at any point) for a confirmed numeric bottom and two more down months untill cylce low is complete. it doesnt have to be a new low.

The next major move should climax around Feb/March 2014

If im wrong then im wrong.

· Feb 23, 2013 - 6:43pm

I guess we'll group this post

I guess we'll group this post with the 7 out of 10 you disagree with?

cliff 567 robov · Feb 23, 2013 - 6:56pm

good job robov

Clear concise and accurate is my view robov.

Atta-boy says cliff

dropout · Feb 23, 2013 - 7:00pm

Go For the Jugler

Lee Adler who always does that, does it again with his latest offering.

The Fed between a rock and a rock? This is MUST check out. Adler rides again!

https://www.testosteronepit.com/home/2013/2/21/the-fed-is-blowing-a-dangerous-bank-deposit-bubble.html

tpbeta · Feb 23, 2013 - 7:04pm

@Ilya Repin

The US dollar index has a GBP £ component of 11.9%. If the £ goes down , the $ index goes up. Winston Churchill doesn't really enter into it.

Maximillion · Feb 23, 2013 - 7:04pm

@ tpbeta

The current Open interest anomaly of increasing longs seems to have commenced with QE 3 (I only record Commercials so don't have the historic data on spec positions).

With regards to arbitrage, you may well be onto something. Every open interest represents an equal position (ie a buyer and a seller balancing each other out). Bearing in mind that 99.5% of all trading is now electronic rather than in the pits, and that the algos work in millisecond dealing times, JPM with its high power servers and primary dealer position, would be ideally positioned to siphon off new sell orders, whether they be naked or not, and take them on as new longs, thereby hiding the build up of their true position, as Turd describes. Brilliant tactic if you think about it, as us little guys have no way of knowing for definite before they're ready to move, price stays capped, and the only anomaly is an increase in the open interest. It would be great if Turd's got it right as he's worked hard enough trying to figure out what the hell's been going on for the last 18 months.

Ilya Repin · Feb 23, 2013 - 7:17pm

TF

What's with the sensitivity? geeez PM community is getting all sketchy attacking one another. I am not an enemy.

I was just pointing out valid information regarding the correlation between GBP and USD cross' as i feel you had obviously missed this very clear fact and so i disagreed with your comment, not the post in general, your COT analysis is interesting.

i thought this was meant to be a forum where we share information. my information regarding GBP USD correlation is accurate as shown in the charts. that's a fact. I thought it may be use full to others.

i was watching the close... what happened.. EUR moved up.. DXY flat printing a doji and the GBPUSD bombed. USD had time to launch. it didn't. why not?


DXY remained flat as the GBP cross' i mentioned are effecting the USD and bringing it down, not up. I think its important that readers are made aware of this. They can read your view and mine, whats the problem?

And on the 3:10 comment i made, you seem to have interpreted it wrongly. What i said, i do believe, was 3:10 post at TF metals were very informative and made up for the fact that the rest we not so valuable in terms of relevant information. I never stated whether i was in agreement or not.

In fact i thought my previous post was broadly supportive of you and unbiased. 

I am confused by the confrontational nature here in regards to me pointing very relevant fact based analysis that differed from yours. This is not how its supposed to be.

I enjoy reading here and also enjoy the comments, the disagreements and the observations of others.

It would be sad world if all agreed.



(when i get home tomo i will have to post a chart to show you all what the reality is of the GBP USD and no it is nothing to do with Churchill, but very much to do with the term "anglo american establishment"

GEeeeeezz

HiHo_Silver · Feb 23, 2013 - 7:33pm

Can't remember...

Was she talking about coins? Guess I'll need to watch them again and pay closer attention.

Bollocks · Feb 23, 2013 - 7:36pm

You USA and Canada - types

probably wouldn't have heard of him, but he was a great inspiration to Terry Gilliam (Monty Python illustrator / animator) and I personally really liked his characters and unique animation style.

A great quote of his:

"You can always spot the ones with real talent. They don't listen to you."

===========

Bob Godfrey, Roobarb animator, dies aged 91

The animator of much-loved cartoons Roobarb and Henry's Cat has died aged 91, his family has confirmed.

Bob Godfrey won an Oscar for his short film Great, a biography of the engineer Isambard Kingdom Brunel, but remains best known for his TV work.

---

Bob Godfrey

...he was at his happiest when he was pushing the boundaries of conventional animation, working alongside avant-garde stars such as Spike Milligan and Michael Bentine, hob-nobbing with the Beatles and, later, becoming an inspiration for a young Terry Gilliam.


A 30-sec clip is here:

https://www.bbc.co.uk/news/entertainment-arts-21552718

¤ · Feb 23, 2013 - 7:49pm

GBP/DXY Divergence

If you go to the link below and then add DXY as an overlay to the GBP chart and go back 6 months you'll clearly see a divergence with minimal shadowing of each other.

The GBP drops and the DXY strengthens at this point but possibly not as a specific reaction off each other but with other circumstances in play at the same time (Yen and Euro turbulence ).

 Having said that, has anyone given any thought to how the markets might open up tomorrow night after the UK was downgraded on a Friday afternoon after the markets closed?

Could it be that gold started to rise after 12:30 on Friday after the news was leaked early and that the steady rise of gold into the globex had something to do with the UK downgrade? I think it's possible and I wouldn't consider it impossible for the markets to react a bit with that downgrade now in play on Sunday night.

The UK and BOE losing the AAA has meaning I would think. Does it have anything to do with the massive GLD drawdowns lately? Maybe imho, but it would make sense in some part if the news was leaked way ahead of time like I believe happens all the time in these situations.

https://www.marketwatch.com/investing/currency/GBPUSD

¤ · Feb 23, 2013 - 8:05pm

Me and My Flying Monkeys

In honor of all those hard working monkeys everywhere...

Me and My Flying Monkeys/Wizard of Oz

pensacolawindham · Feb 23, 2013 - 8:33pm

AR-15 prices

Colonel Angus your right and wrong on AR-15 prices as it depends on where you live and where you are buying as far as Wal-Mart's that sell guns go they have not raised their price nor some of my local gun/sport store. Of course wouldn't attempt to buy one at a gun show.

In a way it is like silver and gold prices it depends on where you buy, but as for my experience here in the Pensacola area our coin stores sure are not the place to buy or sell to. Yes we have a bullion store which price wise is quite fair, but does charge a 3%. Due to Florida laws when it comes to purchases of non US minted coins under 500 dollars it is better to purchase them out of state.

To be honest most of the information and all is over my head and being a retired person with somewhat limited spare funds, I normally can only buy a few silver rounds most of the time. I was able to purchase 40 oz of silver rounds Friday at spot price, but many of the BTFD periods I just do not have the funds.

Ilya Repin ¤ · Feb 23, 2013 - 8:34pm

Yes Gold and Silver were @DPH

Yes Gold and Silver were moving higher for this reason, i believe so. Silver 1.15% off its intraday low.

Yes, as i said i think we go up next week.

UK is a big deal, priced in somewhat but still a big deal. The UK and US are joined at the hip finance wise. They have a very strong relationship in politics, militarily and economics. I could actually argue that sophisticated UK (and European to a lesser degree) finance oligarchs actually run the US from abroad. and are currently looting it (the tax payers and assets) like an old colony.. anyway, another matter entirely.

So again.. the facts.

DXY sank into the close it printed a doji candle at resistance.

It did not react to the plunging GBPUSD and actually softened a bit. 

Questions

DXY had time to react positively, why didnt it?

Gold and Silver moved up into the close. Why? 

Stocks ripped into the close. Why?

now, im not saying the USD will get smoked along with the pound, although it may. What i am saying though is it will weigh negatively on the USD via many currency correlations.

I will post a chart tomorrow to show you what the dynamic is. GBP down = USD down. this is not my opinion it is the reality.

i mentioned CHF SEK NOK NZD AUD SGD CNY everyone should go check, don't take my word for it.

Also, the implications for the UK Gilt market could be far reaching and we have already seen continued weakness in UK Gov securities. This may indeed spread to the US.. it may already have happened.

Fun week perhaps



Honest_Money · Feb 23, 2013 - 8:41pm

Chew on this

I think that you might be on to something Turd. A lot of people just look at that big short position (knowing it's JPM) so by increasing the long side of their hedge book, JPM is able to better disguise their positioning. How much of their short position is actual producer hedges? Perhaps after the specs got suckered into taking it down big on Wednesday purely based on negative price momentum, JPM is close to net long. If so, the upward price swing is going to shock the bears who have no idea what's going on. With price free to soar without taking down JPM, I could see higher prices into the sequester and the narrative being: "Look at those higher precious metals prices, investors are worried about the economy so we need to spend more money!"

¤ · Feb 23, 2013 - 8:46pm

Magnetic Personality

Not quite, and as much as you might despise the current JHPM namesake you have to admit one thing....how friggin' rich and powerful were Morgan and a circle of 6-8 others that they were able to bailout and finance and then takeover the banking system of this country? Wow!

Anyway, here's a Morgan classic and a few other Puck cartoons of that era circa 1900.

Many more at this link...

https://www.tfmetalsreport.com/forum/2917/dphaze-graffiti-maze-signs-times

Strawboss · Feb 23, 2013 - 8:54pm

As it relates  to JPM

As it relates to JPM and their short position (assuming it is they with the gargantuan sized short), for me its easier to think of it as a 2 stage strategy to shift from being short to being long.

Stage 1 - massively increase your long position while at the same time continuing to suppress the market using shorts. During this phase your short position may continue to increase but your long position will increase faster and eventually catch up (surpass) the level of your shorts.

Stage 2 - Dump your shorts en masse by buying as others (specs) sell. Concurrently - continue to add to your longs. This combined buying pressure will turn the market positive and you will be well positioned to benefit tremendously from the upmove.

I dont think its any more complicated than that.

Time will tell if that turns out to be the case.

Of larger interest to me is what that signifies (if true). Somewhere deep in the caverns of TPTB - a decision was made that it was time to ramp the price of gold/silver to the moon.

Is it to rebalance the balance sheets of various sovereigns as Sinclair posits? Have they exhausted the amount of physical metal they were willing to part with in their attempts to string the status quo along by suppressing the metal prices? Did China/Russia accelerate their time schedule by their voracious purchases? Are TPTB alarmed by the velocity of the metal flow from West to East?

Big questions. Momentous times. 

¤ · Feb 23, 2013 - 8:58pm

Gold/Silver Mining

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