Well, its Sunday evening in the US and it's time to get ready for what promises to be another wild week in gold and silver. First up, I thought we'd re-visit last Sunday at about this time. In preparing for last week, I posted this:
"On to the PMs. Everything, and I mean everything, looks great for the PMs as we head into this week. From the charts to the fundos to the chatter, it appears to be "all systems go" for liftoff. Therefore, you should be nervous. It is in times like these when the EE often counter attacks. Just look back four weeks ago for your latest example. The Fed announced QE2 on 11/3 and, by 11/9, the dollar was diving and the PMs were soaring with no conceivable end in sight. Well, we all remember what happened next. Out of the blue, we get margin requirement increases and a sharp correction in price. Silver shed $4.30 in a week and gold lost $95! None of the fundos changed, however, and we've since recovered. If you don't think that the EE has more tricks up their collective sleeves, you're living in FantasyLand. They may hit us again this week or they may not but hit us again they most certainly will. Be cautious and you'll make a lot of money in this market. Get greedy and you'll be wiped out faster than the free booze at the company Christmas party."
Unfortunately, The Turd was right again. No real genius in this call, just experience. From the EE's point of view, when all systems are go for a big rise, they have to attack. What other option do they have? Sit back, do nothing and watch gold rise $100? Not a chance. If you learn anything from Ole Turd I hope its this...and never forget it.
As we prepare for this week, here's some light reading and listening for you. First up, a link from KWN where Eric interviews Jean-Marie Eveillard of First Eagle. (Recall that First Eagle Gold Fund is my favorite open-end gold fund.) Jean-Marie is a very experienced and pragmatic investor but even he, when pressed by Eric, acknowledges that things are dicey and that we may be at the end of the current, global financial system. It's only about 10 minutes long so its worth your time to listen:
Next, this little nugget is about three weeks old. Several folks have posted it here recently in the comments section of my notes. If you haven't listened yet, I encourage you to do so now:
There will certainly be a lot of noise this week about JPM and their massive short silver position, especially as we head into the crucial CFTC hearing on Thursday. For some perspective on the jam that JPM is in, read this:
One more, just for fun. This article provides some historical context to current metals prices but the real laughs will strike you as you review all the various sell-side analyst opinions at the bottom. What a joke! Can you believe these people actually get paid for printing this nonsense? Enjoy:
OK, on to this week. As I've typed, the metals have opened for trading on the Globex and both have opened flat. Not exciting but not down $10, either. If a significant trend develops this evening, I may check back in with more thoughts. In the absence of any fireworks, I'll probably just wait until Monday morning to update.
Have a great evening. TF