http://www.youtube.com/watch?v=YJ9WuX4oQU8
OK. Those of us that follow, store, collect and/or trade precious metals are all very much aware of the presence of The Evil Empire. At the behest of their evil Sith masters at The Federal Reserve, the EE actively, and almost daily, intervenes in the gold and silver markets in blatant attempts to control the rise of price. As you know by now, the most likely time for the EE to intervene is between 7:00 and 9:00 am, New York time. Why then? A myriad of reasons but Asain traders are done for the day, London traders are slowing down, perhaps even at lunch, and its prior to the PM fix on the LBMA. If you haven't already noticed this obvious trend, then you either have not been watching very closely or you're new. Either way, now that you know, prepare to be pissed off nearly every morning at 8:00 EST.
The seminal study of this phenomenon was done by Adrian Douglas and it was posted to ZeroHedge back in August. If this concept is new to you or if, by chance, you have any doubts, I strongly encourage you to take time to read this:
http://www.zerohedge.com/article/guest-post-gold-market-not-“fixed”-it’s-rigged
To see this play out in real time and to illustrate how dramatically just one week of criminal EE intervention affects the price of gold (and by extension, silver), behold the chart below. Wait, wait, wait.
First take a deep, cleansing breath. Maybe get up and walk around for a minute. This is really going to piss you off:
Told ya. Did I just ruin your morning? Remember, don't shoot the messenger. Its just my job to inform.
And you wonder: "How in the world can the bond market collapse, the eurozone be disintegrating and HellyBenny proclaims 'QE to infinity' but yet gold is going down? Who, in their right mind, is selling?" WELL HERE'S YOUR ANSWER! Is it logical to assume that without direct, regular EE price intervention over the past week that gold would be hovering around $1500 instead of $1400? Damn straight! Is it logical to assume that without direct, regular EE price intervention over the past three years that gold would be approaching $2500? $3500? And if gold were at $3500 instead of $1400, would the Fed have even the slightest chance of convincing anyone that inflation is only 2%, thereby making bonds yielding 4% seem attractive?
Look, I show you all this because I believe in my heart that it is completely true and you, my dear reader, need to have this information in order to form your own opinion regarding the true nature of our capital markets. Regardless of EE intervention, the PMs will continue to grind higher, just as they have for almost 10 years now. Additionally, the EE will always be there, trying to keep things from getting out of hand too quickly. Know this and understand it. Don't get too excited when things are going your way and don't get too despondent when they are not. Our Buyer(s) of Size are determined to accumulate PMs in spite of the EE/Fed complex. In fact, the BoS probably enjoy their presence as the dips created by panic or algo-based selling only provide lower entry points for them. Even today, we've already rebounded $7 off of the EE low in gold and $0.30 off of the low in silver.
We will win and the PMs are going much, much higher. Of that you can be certain. Do not, under any circumstances, allow the pathetically blatant, daily manipulations of the Evil Empire to ever prompt you to sell your gold or silver. Period.
Good stuff TD. Totally agree. Wonder when people are gonna wake up. Treasuries looking ugly. Bruce's piece paints the picture:
ReplyDeletehttp://www.zerohedge.com/article/many-questions-no-answers
crybaby......hehehe...look at this as a BoS does......DISCOUNT!!!!....I know it kills the option players ....but adjust. I know I liked my dicount on PHYS
ReplyDeleteAgree Turd - as long as you are talking about the physical.
ReplyDeletePaper is another story though. Several charts (30 min or 1h) are close to crossroads / finishing a bigger triangle.
So either we will break north - or break south. Pretty soon - either today or within next 1-2 days. But break we will.
So I prefer a neutral stance here. Buying or selling the BO. Period.
"Don't get too excited when things are going your way and don't get too despondent when they are not".
ReplyDeleteA quote worthy of Livermore himself. Thanks for feeding us, Turd.
I know I enjoy the dips. Thanks, evil empire! Mwah! You're beautiful!
ReplyDeleteIf I remember correct - the last two times crude broke out north - 1-2 days later we got a sell off.
ReplyDeleteJust reading and commenting on the signs
Though maybe the coming 12-16 bln POMOs will help to establish a BO north.
The EE doesn't seem at all worried about Thursday's CFTC meeting considering position limits. Can't tell if this is bearish because it means they know nothing curtailing their manipulation is coming, or bullish because it shows how desperate they are. To be hitting the PMs this hard in the days before the meeting is pretty brazen, even for the EE.
ReplyDeleteWith the long bond finally starting to deteriorate, I thought we'd be moving toward $1500 by now.
Turd, do you think the CFTC meeting and the long bond deterioration are already priced in? Or is the EE just getting more and more desperate?
There is no way the Long bond, devalued dollar, total POMO, EU bailouts, etc. etc. are priced in. We should easily be at $2500 Gold and at least $60 Silver right now. If QE3 doesn't set this off then there is nothing that will. I'm starting to believe that Pitchforks and Torches are going to be the way for this to finally move.
ReplyDeleteX: Personally, it appears that things are unraveling at an increasing pace and the EE is getting more and more desperate, this the afterhours Globex raids of late.
ReplyDeleteI think of the end of Keynesianism as a circular coin drop in an arcade. You drop a quarter and it begins circling the funnel. The Keynesian quarter was dropped in 1971. As the quarter drops farther into the funnel, it begins to circle faster and faster. Finally, at the end, the bottom simply drops out. We are approaching the end right now.
TF: The other day I saw someone's question about PSLV and they wanted to know why it doesn't always move at the same rate as the spot silver market or even in the same direction. This morning when the market opened, PSLV was down just like SIVR so I bought a bunch. As I write, SIVR and SLV are down for the day about .21% and pslv is down .92%. That is 4 times the rate in the other ETF's. There isn't any information on E-Trade about PSLV. Is it a leveraged ETF or something? What gives?
ReplyDeleteNow the stock markets are experiencing technical difficulties :)
ReplyDeletehttp://www.zerohedge.com/article/nyse-experiencing-quote-dissemination-slowness-frontrunning-hft-robots-everywhere-switch-pan
No worries here Turd, I'm selling anytime soon.
It seems to me that after such a long, protracted period of price suppression, the pressure of market forces building up would at some point snap this thing dramatically- in other words, the dam will give way. Given this, I would be interested in comments from the learned readership on the following.
ReplyDeleteI have done very well by using some of my investment $ to 'short-term trade' gold and silver through leveraged instruments like AGQ and UGL, and use the profits to purchase physical. Silver goes up 10% (gracias for the 26.50 bottom call, Turd) I earn 30% in two weeks and turn this profit into real silver. But the danger, and my question, is this- when the price truly breaks, will paper PM trading instruments vaporize? If not, this strategy will make a bundle and can continue to generate profits for physical. But if the paper market goes boom, my principle is gone. Thoughts?
Turd --
ReplyDeleteWe all expect that we are approaching a major phase-change in PM markets. I have two questions for you --
(1) what do you think is the event that will trigger the phase change?
(2) what do you think the phase change will look like?
for example, do you think the change will occur when the COMEX just flat-out doesn't have any silver left?
Do you think there will be a sudden outbreak of honesty at that point?
Or will they simply stonewall, declare a liquidation-only market, and keep pretending that they are relevant, while we all switch over to ... some other market that has yet to emerge?
why not use this to your advantage. i bought 2 silver march contacts @ 29.22 a little after 8 am. I just sold them @ 26.42. 2k ca-ching! EE intervention just before a POMO day. No brainer. I've been doing this for a while. Great trade. You can trade SLV premarket if you want. works just as well. its a day trade. get out and use the profits to buy physical siver or some out of the money call options. All profits should be transferred to physical silver ASAP.
ReplyDeleteThis is a comin to a Federal Reserve bank near you: http://www.youtube.com/watch?v=c1XZL5CSWyA
ReplyDeletethemarkmonster, when you said you bought two silver march contracts at 29.22 and sold them at 26.42, are you saying instead you took a short position at 29.22 and covered at 26.42. or did you buy a put/sell a call or something? i'm confused otherwise how you made money.
ReplyDeleteTurd,
ReplyDeleteAren't you a little worried that Gold/Silver is acting like Oil did into the 2008 peak?
I think you guys are too trusting of China's position in this play as a saviour for PMs. They are definitely part of the EE as far as I'm concerned.
They are just as bad as the Fed in terms of Debt/GDP and printing money, but everyone seems to look to them as the shining light.
My god, if the US came out saying they are tough on inflation and then just magically raised the bar on inflation targets after they lost control and claim victory, ZH and everyone on the planet would be screaming f*cktards and other niceties but when China does it this week, they're brilliant?!
Your London source anecdotes on Asians buying spot. Since China is #1 gold producer and they're buying spot via 3rd party agents, isn't that like being they're own grandpa?(http://www.youtube.com/watch?v=eYlJH81dSiw&feature=related).
China is about to crash. I guess it's a race as to whether we crash first.
What is everyone's take on junior gold and silver miners? Once SHTF, do you think that pretty much anything with word "Gold" and "Silver" in its name will launch?
ReplyDeleteAlso, what are some good books to read on 1970's crisis?
@Phaethon.
ReplyDeletesorry that post should read that I sold them @ 29.42 not 26.42. I can see how that would be confusing!
This is mostly for Igiveup2 regarding PSLV. A week or so ago, I sold all my SLV and bought PSLV instead. I was worried about the EE (and still am) as JP Morgue is the custodian of the SLV silver bars. However, the premium of PSLV to its net asset value kept growing (and is now like 12 percent). So I sold all my PSLV and bought back into SLV. 12 percent over NAV is just too much risk. I'm willing to pay 3 to 5 percent over NAV to hold PSLV instead of SLV, but not 12 percent.
ReplyDeleteMeanwhile you can see that the SLV discount to the March futures price is a rock steady 70 cents an ounce (see my spreadsheet) here: CLICK HERE"
ReplyDeleteWhy is such a positive NAV a "risk"?? Harvey Organ continaully points to this as a sign of silver's strength. Isn't it a premium paid to be "sure", or at least as sure as you can be, that there is actual physical behind the ETF?
ReplyDelete@publiusnot We're dealing with a whole different set of circumstances than we were in 2008. This time everything around us is crumbling. since 2008 a LOT has been uncovered that had been illegal and critical to the economic well being of the global economy. There was a ton of speculation in 2008, but that speculation is now fact in 2010..and the facts show our dollar is taking the biggest dump ever.
ReplyDeleteWell that's the question. I choose to be OK with SLV right now, because it is a 10 billion dollar ETF and JP Morgan is never going to say "oops we have no bars" since the ETF is audited and the bars are listed every day. If they do, whatever is left of their 150 billion market cap would be paid to the SLV holders (hopefully) due to the outright fraud. SLV is NOT losing ground to physical, it is currently tracking at March futures minus 70 cents an ounce. Why 70 cents? Because of the multiyear accumulation of the 1/2 percent fund expense ratio..
ReplyDeletePining: Just be sure to keep taking delivery on your physical. Hold it in your own hands.
ReplyDeleteMick: I do not anticipate a "sudden outbreak of honesty". The phase change may be gradual enough that is is only clearly seen in hindsight.
Mark: Nice trade. Keep it up. My frustration is that the same BS is allowed to happen every day in our "free markets".
Pub: No, I am not concerned and the BoS is not simply China. They are one of the major players but they are not the only player.
Selfish: Juniors are the best way to leverage gold price increases to individual equity gains. Lots of great names to consider. Take a look at GDXJ, too.
Sass: SLV ok to day-trade. PSLV ok if holding long-term
@ selfishman - we own jr. miners and my take on this is that if/when SHTF, anything can happen. They are a great train to ride right now, but I keep a close eye on the market when it's open as anything can happen. In 2008 they all crashed with the rest of the market. Will that happen this time? If forced to answer, I'd bet on no it won't because I believe gold and silver will be on the rise versus 2008 when they were held down.
ReplyDeleteIn short, I love the juniors now as they are creating great profits that we can convert into physical, but I won't hesitate to pull the plug and go all physical if circumstances dictate that kind of a move.
TF I know where you are coming from that PSLV is for long term and SLV is for daytrading. 12 percent premium is just too much in my opinion. That would be like paying $32.03 for the SLV I can buy for $28.60 right now. It just is too much premium for me. If PSLV comes back to 5 percent premium or less, believe me, I will be first in line to convert my SLV back to PSLV. All of this action is in an IRA account so I don't have many choices for pure silver investments. Just my two cents of course.
ReplyDeleteTF
ReplyDeleteWhat about a "pool account" at Kitco? Or anywhere else you'd suggest? WOULD they actually send it to me if things are getting "iffy"? I'd think it more liquid if things DO actually improve and PM's start down.
Turd: What do you see coming out of tomorrow's CFTC meeting? First Maguire speaks out, then Chilton, then the RICO suits. Now what? JPM puts out some pr (FT article) about consolidating its short position, and the CFTC considers the matter addressed? This despite the EE hitting the PMs hard every day the past 5 in the run up to the meeting?
ReplyDeleteWill the CFTC continue to be deaf, blind and dumb, or will they do something to curtail JPM? That is to say, is Chilton's admission just noise w/r/t regulatory action?
Congrats on the blog, Turd. It's both entertaining and informative. Please keep up the great work.
BTW, more congrats are in order: you've recently surpassed Mr. Hankey the Xmas Pooh as my favorite excrement-themed persona. Well done!
All, I know this is completely off subject, apologies, but would anyone know of a good blog or blogs primarliy devoted to domestic equity investing? thanks.
ReplyDelete15% of net worth in PSLV
The darn dollar index is what's causing a negative day for precious metals, it appears. DX futures at 80.21 up 0.52 right now. Apparently with the bonds crashing, the dollar is strengthening because the bonds yields are so juicy. Long term, because we have no will to do anything about our 1 trillion a year budget deficits, and our huge trade deficits, the dollar should erode faster than any other major currency? That's a tough call, because the Euro and the Yen have severe problems of their own..
ReplyDeleteFor Drew Bill: as far as "domestic equity investing", may I suggest that you take the Chris Martenson video course. In it you will find data on the limits to growth, which is what we have hit. No growth implies a completely defensive posture to investing, which is why I am into gold and silver. The government is trying, in vain, to grow the economy, to get us back to the good old days. In the era of peak oil and peak housing and peak debt, this is probably impossible. Real growth cannot occur in this environment. JMHO of course..
ReplyDeleteTurd,
ReplyDeleteI like your blog and I'm a PM bull.
Just a heads up. Traders watched $1395 support fail in the Asian market last night.
I've switched from bullish to neutral/ sell.
I will add that a correction is necessary for this bull run to continue, and it will. But the correction must come first.
Thanks for your hard work.
Normality will be resumed ASAP as soon as the EE realise the physical game is up,ie forcing the price down leaves them even less physical to manipulate or the nemesis of not being able to satisfy the paper physical,sooner or later the big BOS are going to sit tight for physical,at this point the game is up,unless of course they take Copper instead.When the dam bursts its off to infinity.
ReplyDeleteBuy Silver,take down a bank,its your Patriotic duty.
flower,
ReplyDeleteYou look at that chart? That tells you everything. It is clear MANIPULATION. Has nothing to do with a "correction that is necessary". Gold and silver should both be way beyond $1420 and $30 right now. TA is rendered almost useless in this environment, IMO. Buy physical on the dips. I wouldn't touch options and futures.
THEY WILL NOT CONTROL US!
ReplyDeleteWE WILL BE VICTORIOUS!!!
ReplyDeleteFlower: I'm obviously Bay on this one. I think I've made my feelings about TA quite clear over the past month. If you insist on trading gold based upon TA when your charts are nothing but EE-painted bullshit, you're going to lose far more often than you win.
ReplyDeleteTA on short term trading is a tool for the EE to hose you....longer term TA trends and channels to be respected though
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