TFMR Podcast #44 - Jackass on the Barbie


For a holiday treat, Jim Willie stops by for an informative and enlightening podcast.

Jim and I cover three main topics today:

  1. The recent takedown in gold and silver and the incredible physical demand which followed.
  2. News and behind-the-scenes events related to the recent G20 meeting in Turkey.
  3. The Fed's ongoing ZIRP and QE∞ and their total inability to exit the treasury market. Ever.

So there you have it. Nearly 45 minutes of uninterrupted Jackassian wisdom. Enjoy.

Have a great weekend!



May 24, 2013 - 5:41pm

What's wrong with this picture?!?!?!

Check out this chart...

There are times I wish I could just curl my hand up into a tight fist a just plow whomever is responsible for these things square in the face.

I realize however that it's my voluntary action to invest in the markets in the first place so the fault ( it's actually my fault..c'mon) lies with me.

With only $590 wrapped up in my 29 Jan. '14 calls it's a negligible risk and bargain on some level but on the other hand (the one curled up in a fist) it's aggravation I could do without.

May 24, 2013 - 5:56pm

@Lamenting_Laverne: ratio=0.0720?

Could you elaborate on what you mean by that? I am not sure I follow. Or more honestly, sure that I do not...

May 24, 2013 - 6:00pm

@zman re: Petrodollar

Please don't overlook the fact that world's largest energy exporter and the world's largest energy importer are already bypassing the USD.

silver66J Y
May 24, 2013 - 6:06pm

@JY896...LL's ratio

I was going to ask the same question

I can only surmise that it means a REALLY big number

Keep up the great posts LL


Lamenting Laverne
May 24, 2013 - 6:11pm

Yes - coming up

Yes - I will copy the examples in, when I have the close today. It may be totally insignificant. I just thought alignment between the currencies would be an absolute requirement for any reset. Please give me a few more minutes until after the close.

Edit - and I need to finish my air guitar act of the Final countdown first over at the riff raffle thread ;-)

Edit 2 - apparently is has closed at 23:00 CET, and I am late. I thought it closed at midnight.

May 24, 2013 - 6:16pm
May 24, 2013 - 6:51pm

@zman USD Supporting fundamentals

Your supposition of USD support by Military dominance is a fallacy. Based on this all Countries with the ability to "toast the most"(Nuke) should have strong currencies. Pakistan, South Africa, India, Russia, China all fit into the Nuke variability but none have monetary consensus of an alternative reserve currency. Currently the BRICs are are using Osmosis to implement an alternative reserve Currency to the Euro dollar and the USD.

Moving trade settlement away from the USD to another strengthens the Global economy from shock imposed by faulty monetary policy. Currency wars are nothing more than an offsetting of Global trade settlement risk. If the US and EU monetary system cannot balance trade settlement, without a certain amount of risk, a new form of settlement will be required and is currently be absorbed through the Chinese Yuan. If there were no need it would not be happening.

As far as the USD retaining its dominance in the World as a trade settlement vehicle it all depends on whether the US financial markets can purge the systemic corruption in time. Fair and balanced trade is needed in the world, functionally the US is for neither. As such the 3rd tier of the reserve currencies is being implemented one country at a time with Chinese acting as the goto BRICs directorate of monetary reserve. If one looks at the BRICs the idea of having China as the currency reserve seems odd from a Global perspective (Brazil, Russia, India and China) being so separated by regions to make the idea almost incomprehensible. Though, it is in fact occurring. India really seems like an odd man out in the BRICs group. The lack of support for its currency by its population stems from recent currency collapses in India, they don't trust it. This may be why they are part of the BRICs, to find support for their currency for trade settlement, more settlement means a stronger currency.

Slowly the idea of the Petro Dollar is being pulled away from the US as more countries changed their settlement functions in non USD denominated currencies. Soon the "Petro Dollar" will be an incorrect term for settlement of trade. It may continue on as an Petro currency though. On a fundamental basis USD trade settlement will likely continue, albeit in a very much smaller venue, once the Financial markets are reset to a more viable function of trade, rather than a "Yosemite Sam" forced trade style. Trade at gunpoint is not trade, its theft, which is the reason why the BRICs are strategizing.

It is possible that the great reset many of us have talked about will not occur until official consensus of the Yuan being the 3rd reserve currency is bestowed. Just a guess but this will happen AFTER London and China decides to do trade settlement in CNY/GBP.

After that happens its your guess as to where currencies flow and at what speed.


Gold will not be used to back the CNY due to the nature of Gold hoards being so secretive, no Country wants any audit of its Gold holdings not even China, otherwise they would be announcing to the world what they are settling trade for in Gold outside of the purview of Financial markets. It's a shadow world of finance and will always remain outside the norms of conventional Finance. World Bankers realize Gold "ACTS" like a currency, because it is the ultimate currency. By admission of Gold being the ONE CURRENCY brings too much pressure on Governments to disclose the uses of its Gold holdings. Accountability then comes into question, something no Politician/Central Bank wants due to perception of confidence in its own currency.

Hmmm. This is way longer than I had intended, take it for what is worth, its all just an opinion of perceived understanding of the arcane world of finance. Cheers.

May 24, 2013 - 6:59pm
May 24, 2013 - 7:01pm

@DrkPurpleHaze re. SLW

looks to be forming a base, rather constructive one through my glasses... and time is on your side, I think you're likely to reap some rewards yet!

The Watchman
May 24, 2013 - 7:11pm

From ZH-Scary Chart For Shorts

Short positions in gold have risen 25% in the last 3 weeks

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Key Economic Events Week of 1/27

1/28 8:30 ET Durable Goods
1/28 10:00 ET Consumer Confidence
1/29 10:00 ET Pending Home Sales
1/29 2:00 pm ET FOMC Fedlines
1/29 2:30 pm ET Powell presser
1/30 8:30 ET Q4 GDP first guess
1/31 8:30 ET Pers Inc and Spending
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2/2 10:00 pm ET Chiefs win SB LIV

Key Economic Events Week of 1/13

1/14 8:30 ET CPI
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1/15 8:30 ET PPI and Empire Fed
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Key Economic Events Week of 1/6

1/7 8:30 ET US trade deficit
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1/7 10:00 ET Factory Orders
1/8 8:15 ET ADP employment
1/9 8:00 ET Goon Chlamydia speech
1/9 1:20 ET Goon Evans 2:00 ET Goon Bullard
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Key Economic Events Week of 12/16

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12/16 9:45 ET Markit flash PMIs Dec
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12/19 8:30 ET Philly Fed
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Key Economic Events Week of 12/9

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12/11 2:00 pm ET FOMC fedlines
12/11 2:30 pm ET CGP presser
12/12 8:30 ET PPI
12/13 8:30 ET Retail Sales
12/13 10:00 ET Business Inventories
12/13 11:00 ET Goon Williams speech

Key Economic Events Week of 12/2

12/2 9:45 ET Markit Manu PMI
12/2 10:00 ET ISM Manu PMI
12/2 10:00 ET Construction Spending
12/4 9:45 ET Markit Services PMI
12/4 10:00 ET ISM Services PMI
12/5 8:30 ET Trade Deficit
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Key Economic Events Week of 11/25

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11/26 10:00 ET New home sales
11/26 10:00 ET Consumer Confidence
11/27 8:30 ET Q3 GDP 2nd guess
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Key Economic Events Week of 11/18

11/19 8:30 ET Housing Starts & Bldg Perms
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11/12 Three Fed Goon speeches
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11/14 8:30 ET PPI
11/14 Four Fed Goon speeches
11/14 10:00 ET CGP on Capitol Hill
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Key Economic Events Week of 11/4

11/4 10:00 ET Factory Orders
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