Getting Real, Real Fast

Fri, Jun 1, 2012 - 10:29am

Your blissfully unaware family and friends notwithstanding, the global financial "situation" appears to be deteriorating rapidly. I hope you have prepared accordingly.

First this morning, I suppose we should address this month's BLSBS. As you know, the period between 8:25 EDT and 8:35 EDT on the first Friday of the month is the only time all month when I actually watch CNBS. Today, the usual crowd of misfits populated my screen. There was The Shill happily expecting glorious growth. The Coug was prowling and LIESman was stuttering, as usual. Then, the party ended when we went "Live to Hampton Pearson at the Labor Department". No real reason for me to rehash the dismal numbers with you as I'm sure you've had enough of that already. I don't wish to add some color, however.

  • The media will tell you today that gold is rallying on fresh "hopes" on more QE. Bunk. This is not true. Gold is rallying on fear. If gold was rallying on QE, why are stocks down? Why is crude down? Additionally, gold is rallying and extending gains because of a squeeze in the massive spec short position that has been built up over the past month or so.
  • The last commercial I saw before the numbers were released was a promo for a CNBS program that promises to "show you how you can profit from the declining euro". Looks like the bottom is close there.
  • The printed NFP was +69,000 but the "birth/death adjustment" was +204,000. This means that, without the BLS statistical make-believe, the actual number might be -135,000. I wonder how shiny LIESman's head will get as he attempts to spin that? Chances are he won't even try.
  • The 10-year note is now at 1.47%. This is incredible! Even using the nonsensical and worthless CPI, the 10-yr now has a -1.0% real (inflation-adjusted) annual return.
  • The 30-year Long Bond is at 2.55%. Never in my life did I think I would see the day when the Long Bond yield fell below the stated rate of inflation. Well, OK, maybe I thought it was possible that the Long Bond might yield 10% when the CPI was 12% but parity? At 2.5% Amazing!
  • And crude is now down over 20% in the past month alone. This in spite of the ongoing, geo-political risk in The Middle East.

Speaking of crude, anyone thinking of buying some had better take a long, hard look at the chart below.

(I just snuck a peek at gold here at 10:10 EDT. UP to $1610. Wow! Continuing to rally post the PM fix. Very surprising.)

As stated above, the metals soared on the BLSBS and are continuing to rally. Fear, short-squeezing and QE anticipation are driving things higher. For gold, a move through and close above $1610 would be very exciting. Your short-term target to watch in silver is $29.

I mentioned negative, real interest rates above. Remember, negative real rates are a hugely positive indicator for the precious metals. If you need a refresher on this, go here:

Today's CoT is going to be very, very interesting when it is released at 3:30 EDT. I'll be sure to post some comments and analysis once I see the numbers.

Lastly, please take a few minutes to page through this scribd doc. It was written by Raoul Pal, one of the most successful hedge funds managers of all time. Doom? Gloom? Yes. Heed his warnings.

The End Game

I cannot imagine that I won't have more for you later on this crazy, crazy day so please keep checking back. Gold is now 1617! WOW!


About the Author

turd [at] tfmetalsreport [dot] com ()


Fritz TF
Jun 1, 2012 - 2:27pm

Just Precious

"If everyone finally discovers that "Andy" is actually Blythe and I am actually Ruprecht, the game is over."

Just Precious.

Dr G
Jun 1, 2012 - 2:29pm

@Sturdy Fergusov, what trolls

@Sturdy Fergusov, what trolls and shills? Trolls and shills because they aren't perma-bulls? Please. If you are pointing at me, I'm right here.

I'll take this opportunity to note that silver is still down 25% on the year.

Jun 1, 2012 - 2:30pm

In  my 3rd day of reading on

In my 3rd day of reading on TA and getting into candlestick patterns I have found a friend who helped me to come up with this interesting observation:

3 weekly hammers (actually Hanging Man, but we will get over it) in a row on a 144 moving average..which has touched silver chart earlier to its benefit.

Jun 1, 2012 - 2:31pm


if nervous about NUGT-sell some covered calls-premiums are fantasic-bird in hand is worth 2...

thurd aye
Jun 1, 2012 - 2:31pm

Not sure if you usa and

Not sure if you usa and others know this war phrase from the brits,(spect you do)but if you are winning today remember... "Be like dad.....keep mum."Or shtum you may say .

I believe the little gold and silver tiger DID get out of the cage today after all.He he. Stackle not cackle.Love it!!

Fritz SRSrocco
Jun 1, 2012 - 2:34pm



In keeping with our host's alliteration of dates, 7 times.

Jun 1, 2012 - 2:36pm


BOP for sure. Not to mention the stuff that Shill, Backseatdriver and EWC58 used to put out. Miss them dudes and their posts.


Dr G
Jun 1, 2012 - 2:36pm


Silver is NOT down 25% on the year. YTD it is actually UP just a bit. The 12/30/11 close was $27.99

Regarding silver, everyone needs to be patient. It is going to have a hot and explosive summer. For now, total silver open interest rose by nearly 4000 contracts on Wednesday and Thursday, almost entirely in the Sept12 contract. To me this is quite bullish.

Jun 1, 2012 - 2:36pm

Of course, it feels a little better.

It is nice to see a day like this, but we need many more to get back to something called "normal" for this bull market.

But, friends and enemies, it is the print of the UST that still has me in a funk thinking about the whole shootin' match. Things, if they are coming to head, are going to be nasty. And I just hope I can get some friends to do a little more to protect themselves.

UST 1.46% =

Fritz ivars
Jun 1, 2012 - 2:37pm

In my 3rd day of reading on

144 is a Fibonacci (naturally occurring) number.

Dr G
Jun 1, 2012 - 2:39pm

Turd, you are absolutely

Turd, you are absolutely correct. It is up 2% this year. I meant to say year/year (6/1/11-today).

Jun 1, 2012 - 2:39pm


in that when I was moving my stash via a canoe, to my "secret spot", well, the thing got tippy and is laying in many feet of water and mud. I have no idea what to do, and I am sick about it,

but, at least is was not alot, can always start again, just got to pay a higher price

colihondro Hoping to learn
Jun 1, 2012 - 2:39pm

the markets

have been being sold for a few months now

Reply to: Am I thinking correctly ?

Jun 1, 2012 - 2:40pm

When Santa Posts This....

Santa had this clip on his site today. He's usually more reserved than this to say the least.

I'm even more nervous now.

Rollover 1981... world economic collapse

Jun 1, 2012 - 2:42pm

July12 silver closed

at 28.51

FB last 28.10. Contest still has a chance to extend into next week...

Jun 1, 2012 - 2:42pm

Greece out this weekend?

Would it make scene for the EU to kick Greece out this weekend?

Using the Diamond Jubilee to keep everyone from running to Pounds or emptying the London Bullion markets.

All the Bilderbergs could have a grand party together Saturday night.

Jun 1, 2012 - 2:44pm

Speaking of "Rollover"

John Butler mentions this movie in his book. I haven't watched it yet. Perhaps we should all watch it over the weekend.

Video unavailable
Jun 1, 2012 - 2:45pm

Dr G

I am glad you are here! I was not pointing specifically at you but at the general sense of negativity in the comments section here on Tuesday. You don't need to be a perma-bull, but you also don't need to be a downer who always sees glass half empty. As Turd pointed out Silver is not 25% down for year, but outperforming many other assets including stocks. Cheer up yourself and help cheer up others! That's what we all here for!

thurd aye
Jun 1, 2012 - 2:48pm


Looks beautiful and inviting, but poisonous as hell. WHO is it? Blythe?

And these are not poisonous.The Laplanders drink the pee of their reindeer which eat these,to get high.Rather them than me.Fly Agaric I believe.The Ag is in there!And it will fly,soon!

Jun 1, 2012 - 2:49pm


has anyone discovered the secret information alluded to earlier in the week? i may have missed it in all the action

Jun 1, 2012 - 2:51pm

just pulled the trigger

More ounces of AG off the market. $2 premium.

Provident's stock of ASEs is getting thin.

Jun 1, 2012 - 2:53pm

I bought that Krugerrand on

I bought that Krugerrand on Wednesday...Have to look again in my pocket very carefully, drink less Cola- may be another one tomorrow (I miss American Golden Eagle in my small collection)? Then two weeks of austerity. Prices are up, naturally, but..

Jun 1, 2012 - 2:55pm

It's always nice

It's always nice when we have an up day just when my package from Provident Machine Bearings arrives. I love saying to the wife "See, these 10 oz Bearings are worth more now than the day I ordered them". Now if they would just start trading shoes on Comex. She'd be a millionaire.

Jun 1, 2012 - 2:56pm

Whoops,, the giant awakens ..

silver getting smacked more.. gee, Blythe must be pissed now..

Jun 1, 2012 - 3:02pm


Anyone else here thinking very seriously about refinancing their mortgages?

I can get a 30 yr at 3.625 with only 600 bucks out of pocket.

Your thoughts?

Jun 1, 2012 - 3:03pm

I can't look; tell me what it says

Usually start the day checking PM prices.

For the first time, I was so bummed, I couldn't look, so I decided to check TFmetals for comments. Wouldn't you know the comments were suddenly quite positive! Fortunately, haven't sold a silver dime, yet!

(That's how you know a bottom is in.) ~Right?

csquared13 opticsguy
Jun 1, 2012 - 3:05pm

no disrespect, but you do

no disrespect, but you do realize NUGT is 3x ETF, right? this is a trading vehicle and one should have an exit-point in mind prior to entering a trade.

Jun 1, 2012 - 3:10pm

@thurd eye - pee not poisonous

Its the pee that is not poisonous! And not beautiful, either.

Jun 1, 2012 - 3:11pm


over weekend I'll sell itm or otm calls--gives me a hedge and stil keep upside.

a 2 month atm call roughly 100% per year--but more important would cover a chunk of downside.

opticsguy csquared13
Jun 1, 2012 - 3:14pm


well aware of the 3x aspect. In fact, a slow steady climb is better than a few big up days. I'm eyeing either 48 or 50 for GDX to get out.


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