Sunday, December 5, 2010

Turd's Glossary

Before I do anything else, I must thank you, my dear reader. In just 23 days, we have accumulated over 103,000 total pageviews. A mind-blowingly large number! We had 10,000 pageview days on both Thursday and Friday of last week. Thank you. Thank you. Thank you. If this rate of growth continues, I plan to use your generous "donations" to build a better, more user-friendly site. A true forum where we can openly share thoughts and ideas. I'll keep you posted. Now, back to the countdown...

Many new readers have requested a glossary of Turdisms that this site uses. For future reference and  entertainment(?), I present below a few definitions.

The EE: Is, of course, The Evil Empire. The EE consists of the evil, colluding consortium of "bullion banks" that, at the behest of the Federal Reserve, actively suppress the prices of gold and silver through methods such as the seemingly endless creation of paper metal and "offer bunching". The primary, co-conspirators are HSBC and JPM.
The Death Star: The Comex. This is where the EE wields their power. The survival of the rebellion may ultimately hinge upon its destruction.
Blythe: Blythe Masters is the Head of Commodity Trading at JPM. Sort of a female Sith Lord but I more frequently picture her as the Wicked Witch of NY. Which leads us to...
The Flying Monkey Brigade: Blythe's chimpanic JPM minions who blindly execute her (sell) orders.

On our side we have:
The BoS: Our buyer(s) of size. They first showed up in late August and have since provided a near-daily bid for both gold and silver. The BoS have been particularly active in the silver pit. See chart further down in this post.
Santa: I first discovered the wisdom of Jim Sinclair a couple of years ago. It didn't take long for my friend, Mr. Hyde, and I to get all excited and start trading on Jim's wisdom. Of course, at about that time, The EE attacked and down went gold and down went our trading accounts. Exasperated near the bottom of the move Mr. Hyde asked, "Why should we listen to this guy on the internet anyway? For all we know, he might as well just be Santa, typing gold updates from the North Pole." From that point forward, Mr. Sinclair has been lovingly referred to as "Santa". Coincidentally, this Christmas at the Ferguson house promises an abundance of good cheer, in part due to Santa's terrific insights.
The Canadiens: There are a lot of good mining companies based in Canada. It would follow, then, that there are a lot of good metals analysts up there, too. From Organ to Nielson to Sprott and Embry, much wisdom is to be gained from listening to The Canadiens.
Trader Dan: Trader Dan is The Man. If you don't already, make it part of your daily routine to visit JSMineset every day at about 2:00 EDT for his daily updates. Dan knows his stuff. Heed what he says.
ZH: is the best financial news and discussion website. Period. If you're not on there several times a day, you simply do not know what's really going on in the world.

Other terms include:
POMO: US Federal Reserve Permanent Open Market Operations. The process by which the Fed is overtly monetizing US debt. The first POMO schedule lasted from late August to early October and was about $27B. The next took us to early November and was about $43B. The current POMO schedule ends this Thursday and will finalize around $105B. And you wonder how the stock market keeps rallying? POMO is your answer. This week should bring the announcement of the next POMO schedule. Probably another $100B or so over the next five weeks. If that's the case, don't you dare think about being short anything for a while except, maybe, long-term treasuries.
HellyBenny and Timmuh: Probably need no explanation.
CNBS: The utterly worthless financial news channel that, for some reason, people actually watch.
A-cups: The often-sanctimonious Erin Burnett.
FOAD: Mark Haines is a Fat Old Arrogant Douchebag.
LIESman: The moronic Keynesian shill of an Economics reporter.
Mandy: Mmmmmmandy. Need I say more?
Headiromo: The remarkably self-important afterhours host.

OK, that's enough. If I've missed any, let me know in the comments below and I'll try to add it later.

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.

Lastly, you no doubt know by now that I believe technical analysis (TA) is worthless in this environment. Gold and silver are trading on fundos only. Short-term charts can be quite helpful, however, as they are uncanny predictors of where the EE will construct barriers and where the BoS will likely step in. For today and for perspective, however, I present the daily charts below. On these charts, you can clearly see the emergence of the BoS in silver and the extent to which silver has dragged gold along in its wake.

It is clearly going to be a very, very interesting week. I seriously have no idea where gold will finish on Friday. Without EE intervention, silver may see $32-33 and gold may reach $1500, thereby fulfilling my "$1500 by 12/10/10" prophecy from last summer. If the EE attacks, they'll probably try to paint double-tops in both gold and silver early this week and we end up on Friday near 1380 and 28. We'll see. One thing I do know, however, is that its going to be crazy and fun. Get some rest. See you Monday. TF


  1. Thanks for the summary for us newbies! Keep up the good work ya bastard! (I say that with respect btw, it's ok I'm from Texas)

  2. 8/24/10...a day to remember indeed, but will probably be forgoten in the anals of history. It would be fun to see that daily chart and go over what happened that day.

  3. Yes, indeed, the "anals" of history - just the right place for the EE's fate to be recorded!

  4. Man...did you see that 20 cent jump at opening? Straight vertical line.

  5. Watch that crude oil, too.
    If it continues to rally and blows through $90, it's going to drag the PMs along with it. Crude strength also makes it very difficult for Blythe to have much success in her price-capping efforts.

  6. Looks like the Flying Monkey Brigade is working overtime. There must be some serious steam coming out of that trading room.

  7. Heheh, yea ones thing for sure, anyone that leaves that room is going to come out a lot skinnier than when they went in!

    JPMorgue... Man that was a funny little video.

  8. Turd,

    ZH alumni are arguing and arguing over pullback prices in PM's. What IF to say, the game will be manipulated/changed by the EE yet AGAIN, and physical will be worth 18-19. I want to take possession of another 100oz, but at 30 + premium, JPM short or not will find a way to win at our expense, no?

  9. I don't think it will drop that low, but I am a newb. I think there is to much demand support for prices to get that low right now. I bet we would see a small price dip if the crimex, I mean, comex bumps up margin requirements again. As for me, I am doing the dollar cost averaging thing, buying what I can when I can. I ain't rich, so I do understand where you are coming from Docmac.

    I hope something good comes from Chiltons last public message.

  10. I only wish silver would hit 18-19 again so I could buy some more! I've been buying silver with the idea that is a long term investment. I think that is the best approach, that way if price does go down by a few dollars in the near future (I doubt it), I will be better prepared for it.

  11. If JP Morgue could have held silver at 18-19, they would have.

    I don't think we'll ever see $25 again not to mention $20.

  12. I tend to agree w/ Jack. Perhaps wishful thinking, but it almost looks like they are losing control in silver.

    Is anyone else struck by the divergence between gold and silver?

  13. A fascinating read by Martin Armstrong.

  14. I love seeing the rapidly declining gold/silver ratio more than anything. Approaching 47 now.

  15. Going for the record. At this rate it will breach $30 in two hours :-)

  16. Read the ZH article on the Bernank's 60 Minutes interview. Jeezum! Things are a LOT worse than I thought and I tend to think they're pretty bad. I couldn't help but wonder, the more I read the text of the interview, if someone had made it up as a spoof on the Bernank. Unfortunately, he actually said those things. We're in for a long hard road IMO.

    Bubbles - If silver gets to $50 or $100 or higher, will you really care if you bought at $30 vs $28 or $25? We made the decision at $18.34 that we were going LONG and that it wouldn't matter a bit in the big picture if we held out for $17.50. Glad we made that decision and bought when we did this summer! GLTA and as always thanks to TBT (add to glossary as The Big Turd).

  17. Bubbles: FISD says it best. And if silver were actually to trade back to 20, there would be throngs of "analysts" telling you to wait for 15.
    At the risk of sounding like a CFP market shill, maybe you should dollar-cost average your way into silver? Buy a little bit every week or two, regardless of price?

    Btw, the high tonight, so far, on the March11 is 29.85 WOW

  18. FISD, that is exactly what I was thinking just now: it's a slooow moving train wreck. I am glad I bought some PM's, I just wish I've done so a little sooner.

  19. I just re-read this post. I'm happy to say I may have added a new adjective to the English language: chimpanic.

    (chim-pan-ik) adj. - describes a person who, while seemingly intelligent, does not display the capacity for emotion or rational thought

  20. Might I add, there will be a day in the not so distant future when you won't be able to buy at any price. My suggestion, beat the herd before they have fear in their eyes. It's coming.

  21. Well said Turd, it's all about the long run. But in the meanwhile, I bet it's going to be a fun first quarter.

  22. Chimpanic, not to be confused with the prevalent feeling of the flying monkeys at the JP Morgue.

  23. Turd: You don't talk much about platinum. I have a few 1 oz coins and follow the charts on Kitco.

    It is especially interesting this evening with a huge price spike that took it close to a one year year high before collapsing. I wonder who is manipulating this market.

  24. The thing you need to worry about a bull market is losing your positions rather than entering a bit early.

  25. Turd, I'd like to know who you think the BoS for Silver are. Is it the cumulative effect of small fries like us from around the world? Is it a few big boys like Warren Buffet? Or is it the sovereigns (China/India/Russia)?

  26. Turd et al,

    My mentor, (we all have one), just sold his silver.

    He has been wrong, but more often he is right.

    I am not selling. I hope he is right because I want to buy more next year.

    He still has ALL his gold.

  27. Great to catch up on all your posts Turd, after being away for days - feeling this week will be a roller-coaster, and knowing there will be some great commentary, both above & below the line, throughout. . .

    silver hit 29.96! it so wants to be 30, hehehh.

  28. Turd, catch me at "Same As It Ever Was'......and keep up the good work.

  29. Hi all,

    Thank you Turd for sharing your exceptional feel for the silver market in these remarkable days.

    I do have one major question that continues to nag at my psyche.

    Has silver lost its status as a precious metal?

    Does anyone here have a solid argument why silver has irrevocably lost its status as a precious metal and is henceforth an industrial commodity?

    Many thanks in advance.

  30. I found this blog merely by clicking a link cause the username was sweet.

    Thanks, SNL Jeopardy.

    and thanks Turd, for teaching this imbecile how this game works. funny, i spent 10 years at an investment bank and never understood it - now it's all too clear...

    peace guys, good luck and blessings to all non-haters in the coming months.


  31. kiyo: My main interest is gold and silver. I throw in a little crude and grains, too, but that's about it. If you'd like, I'll be happy to peek at the platinum chart and give you my impressions but I don't really know anything about the fundos so it'll just be a guess.

    Jackal: Ah, the $1MM question. Answers abound all over the internet. Let's start with who the BoS is not: small fries like you and me. We provide some nice organic, grassroots demand but the BoS are an entirely different matter. I have my hunches but they are only that, for now.

    NIc: It would appear your mentor has made "enough" money in silver and has exited the market. You should now mentor him on the fundos and advise him to start rebuilding a position.

    Jimi: Thank you very, very much for stopping by. Great to have you!

    Qussl: Silver is truly unique in that it is both. It has not "irrevocably lost its status as a precious metal", nor will it ever. Industry decides what is industrial but people decide what is precious and the people will always value silver and gold as true money and stores of value.

    James: I'm very glad you found us. Stick around. Oh, and tell your friends, too. All are welcome. Well....except those The Turd deems as a douchebag.

  32. I bought more Silver late last week, despite expecting some price weakness over the weekend. To my surprise (as a PM newbie), Gold and Silver are showing lots of strength this morning. Not complaining, just bracing myself for the flying monkey squadrons.

  33. Hi Turd,

    My 1oz: your blog is fine as is - recommend don't be tempted to do your own website, you may find it a bit of a nightmare (re: maintenance+cost).

    We like your writing style (short, easy) and your paper-scanned charts (they are v. cool). Don't change a thing. We're all excited about the current appreciation of our holdings but I think the real value of your info is the skinny on the evil empire and their reactions + movements.

    In short, we'll keep contributing. Like jahbless just said above, it all makes sense now. 'Let's watch this new silver market together, yes?'

  34. Just read a good article over on ZH: 'I Don't Want Speculation, I Want Clear Investment'

    Hellmeyer presents the German perspective on the Federal Reserve’s destructive destabilizing Quantitative Easing (money printing). He says the USA/FED is waging financial war on other productive countries and their currencies.

    He thinks gold, silver & other commodities will continue to be good investments. He sees good earnings/growth for corporations serving the 70% of the world are not bankrupting themselves (like the USA is bankrupting its middle class).

  35. "...At best, GLD and SLV are simply a bank deposit priced in spot prices without the benefit of government deposit insurance. At worst, GLD and SLV are vehicles by which investors provide the banking community with the resources to control and manipulate the precious metals market without adequate compensation. ..."

  36. "At worst, GLD and SLV are vehicles by which investors provide the banking community with the resources to control and manipulate the precious metals market without adequate compensation. ..."

    I'll go along with that.

  37. Sumo,
    I reply only bc you have brought the issue up re; SLV.
    Why is there such skepticism about a fund which is audited to have some 350 million oz? I hate to invoke Ted Butler again, but he IS an expert on this and his arguments seem sound (I posted a few paragraphs from his newsletter in a reply above). There is a difference between the parts of a bank that are custodians and the parts that are actively shorting etc. And the fund is closely monitored re: deposits and withdrawals. Butler actually takes the view that the SLV is the silver investor's best friend in that it takes silver OFF the market.

    I think this is an incredibly important point -- it is valuable to get many perspectives.

  38. Turd,
    As you said before, perhaps we will just have to agree to disagree. I dont wan't to fall into the d---bag category! Just trying to see both sides is all.

  39. Cris: You are definitely NOT a douchebag! You present reasoned and thoughtful information. Ted Butler is a respected and credible source. He is certainly far more experienced and knowledgeable than I.

  40. @Turd

    Thank you for your reply, I have similar sentiments regarding silver's "remonetisation". What many western investors do not notice is how silver has always been money to the Chinese.

    So much so that they only traded their porcelain, silk and tea for silver, until opium.

    Although I have no particular insight, I believe China is making a play to shift the vaulting and pricing of PMs and resources to its venues.

  41. Let me explain a little further why I feel this question of the validity of the SLV is SOOO important. Perhaps it is obvious, but if we can validate the SLV, it does become our chief weapon AGAINST the big banks. I invest in it using pre-tax "retirement" funds -- I haven't found a better way of utilizing those funds to get bullion (I am all ears if someone has a good strategy there!). I would bet MANY people here are in that same situation -- wanting to take advantage of utilizing pre-tax dollars to invest in silver. If we are really taking silver "off the market" as Butler argues, we have a perfect vehicle for the "crashJPM, buy silver" tactic that is now viral on the Net. Perhpas the PSLV is a better vehicle -- I am actually going to move half of my SLV retirement funds into PSLV today I think as a "hedge".

  42. Hehe. I am Asian too, ethnic Chinese but not from China. I have seen many syndicates ramping stocks in my neck of woods. One more question, how do you actually know that the bash downs are the work of Blythe/EE? The reason why I ask is that billionaire syndicates cannot be perpetually buying, they too sell to ease their load and to weed out the weaker holders before the next leg up.

  43. Hey Turd, Love the blog. One question though. Is there any particular reason you misspelled Canadians?

  44. Turd,
    could you elaborate a bit on the committment of traders report? You have stated that when it is Tuesday, that usually Blythe does not tank silver and gold. Is there a cutoff time for the COT data that we can use?(example if it is cutoff at 1:15PM eastern then I would know to be out of my position)
    I trade the miners, and for short term trading, would like to figure out when to worry about the selloffs.