Sunday, January 30, 2011

Buckle Up!

Well, well, well. What an interesting time to be alive.

Someone had mentioned earlier how this weekend kind of felt like fall of 2008...checking the headlines, wondering how the markets would open on Sunday night and Monday. As it is, gold traded only about $5 higher before succumbing to what has become rather significant selling pressure above the $1345 level. As we head through this week, that level has become the one to watch. Geo-political events, rising crude prices and strength in silver and copper should help provide a push but, clearly, the Forces of Evil have decided to make their resistance there. See for yourself:
As has been the case for the past several days, silver is stronger and is leading the way. Actually, the trend of silver leading gold has been in place since August of last year but I digress. Take a look at this 8-hour chart. I chose that time frame only because it illustrates as concisely as possible the significance of the $28 level I mentioned so frequently last week.
Moving back through $28 tonight is step one. Closing above there tomorrow or Tuesday is step two. Extending through $29 toward $29.50 is our next goal.

Here's a dollar chart to ponder overnight, as well. Once again, just when all seemed lost for the greenback and it appeared ready to plunge, world "events" step in to save the day. Hmmmm.
At any rate, it is struggling with the old 78.47 level as you can see here.
Onto other matters, I received several emails with a link to this FOFOA piece. I must say that its pretty well written and it makes some terrific points. In case you haven't seen it yet, here it is:

I also came across this brief interview of Peter Schiff. The dude that interviews him is such a tool that it's almost unwatchable...but...if you can bear with it, Mr. Schiff makes many of the same points you've heard me make ad nauseam here over the past few months:

Many have conflicting opinions of "debka" as a news source. I've read on several occasions that it uses the Mossad as source material for its stories. Whether or not that's true I have no idea but I've followed the site long enough to realize that their information is no more inaccurate than CNN or Fox.
At any rate, here is debka's latest take on the situation in Egypt:

Lastly, Ambrose Evans-Pritchard gets it. Anytime you see a link to one of his articles, click it and read it.
In this one, AEP discusses what you and I discussed back on Saturday, namely how soaring global food prices are affecting global political stability.

That's it for now. Get some rest. Its going to be a wild week. Turd out.


  1. Is it a sexy dungeon?
    ... Probably not.

    Fun after hours action though! As always, a privilege to be sitting in a warm chair watching shit go nuts like some video game, instead of worrying about food for tomorrow.


    This is the best coverage of events so far...

  3. Turd,
    The only 100oz silver bars that APMEX has left are selling QUICK these last few days. They have some on backorder for mid Feb, but the only thing they have left right now are the JM's. Just today, they sold at least 45 of them! At that run rate, they'll be out in two weeks.

    Unfortunately I don't think this run rate will stay flat, from what I've observed the last month, its accelerating. I think its safe to say that APMEX will be depleted of 100oz JMs within 7 days as the market starts seeing shortages at other online dealers and then people listen to the recent weekly metals wrap on KWN...

    Physical is about to diverge BIG TIME.

  4. B: How do you know how many bars APMEX is selling? Do you have a "mole" on the inside or is that info public knowledge somewhere?

  5. Looking forward to tomorrow and seeing how this plays out.

    On a side note, I stumbled across this page over the weekend and have read a few of the essays. Anyone know anything about this guy? Seems to know his stuff and would fit in great here or at ZH.

  6. kiyotei, No mole. APMEX is kind enough to unofficially publish what they have in stock and are able to sale. Pretty much all major HONEST silver dealers are willing to tell you how much they have for sale (Of course, the mega bullion banks won't!).
    Anyways, APMEX has only been getting JM bars as of late, since the other suppliers are so backlogged with orders.

  7. Justin:
    Seems like we had a discussion in these comments about Armstrong maybe a couple weeks ago. Not sure when.

    If memory serves, opinion was quite sharply divided as to whether he was very worthwhile, or very fishy business. Not many folks were on the fence.

  8. The rumors of shortages seem to be being proved true. Aside from the 100oz bars, smaller weights seem to be dwindling in numbers also, though nowhere near the level of the 100oz's. Still, an observation that is hard to ignore. If this uprising overseas isn't settled by Wednesday, which I doubt it will be, I think we are going to see a very good end to the week for metals.

  9. Glad to see TF talking about the importance of $28 silver. Personally, I was so sure 28 was going to hold. After busting it last week, I think it will be important if silver can regain and hold that ground. Don't know if technical analysis really works that way, but I know I'll be back to watching 28 just as I have been for months.

  10. I normally can't stand FOFOA, usually its just a long drawn out post (or so it seems to me). I don't read from the blog because of it, but this link was actually useful. Its a great perspective on GLD and physical relationships and it may be the truth we've been looking for these past few weeks.

  11. Eric, it doesn't matter if we bounce lower off this $28 barrier, we set a bottom last week in Hong Kong trading. We'll be well above $28 next month, it must go higher in order to attempt to force longs to exit their paper positions and prevent delivery. We aren't going lower than that bottom last week. Its concrete.

  12. Been a diehard U2 fan since '84 and a silverbug only since aught8. This old favorite just took on a new meaning to me in light of new insight.

    Silver and Gold

    In the shit house a shotgun
    Praying hands hold me down
    Only the hunter was hunted
    In this tin can town
    Tin can town
    No stars in the black night
    Looks like the sky fell down
    No sun in the daylight
    Looks like it's chained to the ground
    Chained to the ground
    The warden said:
    "The exit is sold.
    If you want a way out,
    Silver and gold."

    Broken back to the ceiling
    Broken nose to the floor
    I scream at the silence, it's crawling
    It crawls under the door
    There's a rope around my neck
    And there's a trigger in your gun
    Jesus say something
    I am someone, I am someone
    I am someone

    Captain and kings
    In the ships hold
    They came to collect
    Silver and gold
    Silver and gold

    Seen the coming and the going
    Seen them captains and the kings
    See them navy blue uniforms
    See them bright and shiny things
    Bright shiny things

    The temperature is rising
    The fever white hot
    Mister, I ain't got nothing
    But it's more than you got

    Chains no longer bind me
    Not the shackles at my feet
    Outside are the prisoners
    Inside the free
    Set them free
    Set them free

    A prize fighter in a corner is told
    Hit where it hurts
    Silver and gold

    "Am I buggin' you?! Don't mean to....bug ya.
    Ok Edge, play the blues!"


  13. Eric,

    I'm still fairly new to Turds blog, but it makes sense that I would bring something up after it's already been debated. Such is life in my world!

  14. Apmex is out of their kilo bars. No huge deal but their buy price is $907.27 / 32.15oz = $28.21 which is .10 over spot as I type. I don't know if that's normal but it is telling.

  15. oil & grains look good too.

    But if you are watching metals, stocks, currencies, then the official word seems to be "Move Along. Nothing To See Here."

  16. This is from an Israeli paper. If true, it could hold serious consequences:

  17. Something tells me that our leaders aren't going to be cool with the M.B. taking over. This could get ugly if we start sticking our noses in their affairs any more than we already do.

  18. Cris: Thanks for the video. I never heard that tune before. Should be the Turdle anthem :-)
    I linked it to my FB page!

    I had to chill today and Reggae was the cure.
    Check out my tunes on Grooveshark if you likes de Ragga mon!

  19. Chris,

    Wow! Throw back Sunday, baby! Time to pull out some doob and remember when this baby was released. Nice! Thanks for the memory jog! Where are these douche bags right now with all that is going on? Have a good week, all. ...and let the silver choo-choo train roll on!

  20. What do you guys want to bet that Western governments soon enact position limits and other restrictions to curb speculation in food commodities and oil going forward? And that the CFTC miraculously does their f'n jobs to enforce it in a matter of days?

    Realization that hunger is just about the only thing that will incent the masses to get off their asses and revolt against the status quo isn't being lost on the elite this weekend.

  21. I am always amazed at the incredible power of the
    Rothschild banking dynasty. The silver price suppression is always the first indicator of just how powerful they are. The the fundamentals are so bullish for the precious metal that at this hour it should be soaring, yet at this very moment, once again the pm's are being crushed. Gold down 10 dollars from its high and silver over -46 cents. Every chance they get in the weakest hours of the 24/hour Globex they are smashing the price.

    The fundamentals as I see it are as follows.

    1. An historic 15 to 1 ratio with gold.

    2. An artificially suppressed price that has cause a vast reduction in the worlds supply from over consumption. Some now estimate that the above ground supply of silver is actually lower than gold.

    3. Prolonged and unprecedented low interest rates.

    4. "Quantitative Easing" 1 and 2.

    5. A global race to the bottom by all the currencies of the world.

    6. No currency in the world is back by any precious metal.

    7. Physical demand is soaring as never before.

    8. Civil unrest in Egypt and spreading throughout the Middle East.

    The last fact alone should at this very moment be driving the pm's through the roof. Technicals be damned. Can any of you provide more reasons than those I have provided here. Thank you very much !

  22. P.S. another just occurred to me.

    9. The average Chinese citizen just recently has been allowed to buy and own precious metals.

    A takedown at this time leads me to beleive they are getting the price down for when the London and New York markets open. Like the Turd says,, fasten your seat-belts. This should be one hell of a ride !!

  23. @ bobsmith5-
    Here's another edge to the Globex manipulation.
    When globex trading occurs, it's closer to the end of the business day in the USA. The only part of the USA that could buy into the 8 hours of price suppression on the Globex is Hawaii or Guam. But, the Chinese and Australians are in a good position to buy into the daily dip.
    By the time the clock starts in NYC, the dip is over. So, the bank is really screwing US citizens when they suppress that price. Why?
    Because the US citizens can not buy silver or gold physical bullion (coins) based upon the temporarily suppressed price. But, citizens of New Zealand, Australia (Sydney in particular) and Tokyo can catch the temporary price suppression on the 24 hour clock.

  24. @TurdFerguson-
    The issue of the identity of the Muslim Brotherhood being involved in the Egyptian revolutionary movement is not entirely correct.

    I've seen several similar reports today regarding the Muslim Brotherhood's participation in the Egyptian revolution.

    Each of these stories interviewed people on the street which refute the broadly accepted view that the Muslim Brotherhood could turn this revolution towards a conservative Islamic state.

    In fact, each source/quote (specifically broadcasts on CNN, ABC (This Week), and Al Jazeera. Each report, which included interviews with people on the street in Egypt, VIP's like El Baradei, and other analysts.

    One in particular was on ABC This Week. Amanpour was interviewing El Baradei. El Baradei's point was that the majority of the Egyptian people had no interest in the Muslim Brotherhood. Specifically, El Baradei argued on ABC's This Week that both the Israeli propaganda and Mubarek's own propaganda benefitted from this spin. But, the reality was that the Egyptian people were being oppressed by the Mubarak regime and family while the "Muslim Brotherhood" threat was used as a false flag op to continue the suppression.

    When Amanpour began to dig deeper into this and began interviewing former NSC director Zbigniew Brezynski (sp?), the satellite feed was dropped by ABC and a fairly mundane and idiotic table talk ensued. None of the round table participants appeared to follow-up on the claim of El Baradei.

    Shortly thereafter, CNN International was broadcasting an interview with an Egyptian-American man who was in a suburb of Cairo with his family. The man on the street interview was interesting because it supported El Baradei's view.

    The reason I raise this interesting set of observations today is that they all fit with the unusual and circumspect possibility that global interests could be using this opportunity to pump the $USD at this time.

  25. This silver take-down is retarded. "Oh boy, I guess the world's problems are solved... better sell my gold and silver contracts.". Ridiculous.

  26. I do believe there was an ancient Chinese curse to live in interesting times. Well I think we got that covered. It'll be interesting to see how the markets handle Monday. Glad I bought the dip though I'll pay a price for it. Yep I'm small but me and my Mom buy physical silver every month. Not big buyers, just 5-10 oz every month steady. We'd lie to buy more but just small players. But we have silver in hand. Keep up the good work Turd and I hope you had a good birthday.

  27. China and India are the two countries to pay attention to. China offering silver to it's citizens is what got me interested in silver, I knew there was a reason. Thanks to blogs like this I know even more about what's going on, maybe not every aspect of it, but enough to know that this is going to be a fun ride. Plus, it's nice to invest in something you can hold.

    On the middle east situation, this all is playing out exactly as it did in '79. Things are a lot different than back then and this economic climate can't handle something like that now, especially if we're at peak oil as some are claiming. Aside from that, these riots themselves are probably going to keep us safe for a while. I found this online map that is being updated with new events. Not sure if it's been posted or not.

  28. I think this takedown is for the benefit of the Chinese, and I'm beginning not to like them because I think lately they are in on the suppression. It seems to always go down or drift sideways when Hong Kong opens then gets smashed harder when London opens.
    But after all, they have 1.5 trillion worthless U.S. dollars to dump so they have every reason to help keep the price suppressed.

  29. I am Hmong. My ancestry goes back to the Yellow River Valley in China. The Hmong (Sometime knowing as Meo in China) were the first inhabitants of what is today known as China. My people settled the area ahead of the Chinese. My DNA sample shows that we were the first group of people to leave Africa and travelled east to China before crossing to over to Australia. In essence our civilization is one of the oldest on record. Our word for money is “silver” pronounced “Nyia”. With this much history behind it, the Bankster cannot crush it. So everyone hang tough.

  30. El Baradei is a wannabee anti-American ass clown. He'll make trouble, lots of noise and accomplish nothing. Ignore ruler he would be a disaster, and I think the people of Egypt know that. They want Democracy, an Islamic repressive Government would cause a Civil war. That's my take anyway.

  31. If you remember back in the first half of 2008, shortly after the Fed began cutting the fed funds rate, the price of oil began its climb toward $150. This was supposedly because the Fed was "printing money," and so the prices of commodities (including gold) were bid up by the speculators and trading firms to astronomical heights. Since there was no fundamental basis for this, no source of new demand for said commodities, these prices came crashing down to reality when demand fell off a cliff.

    It was just a game; create a hysteria and ramp up the prices for a massive gain, get all the suckers in, and then play the other side once the cracks appear. Of course this is the point at which the dumb money (average investors) had been herded into the commodity space. ETFs played and continue to play a role in the engineering of these price ramps. HFT seems to be play a role in driving prices into long, one way moves. This time too prices will come crashing back to Earth.

    No money was "printed" in 2007, and none is being printed in QE2. It is just another pump and dump by Wall Street on the expectation of "money printing."

    I will try, patiently, to point out why the Fed does not print money. The Fed expands its balance sheet by crediting member banks with reserves in exchange for assets, namely treasuries. The banks then proceed to do nothing with the reserves, because banks do not lend out reserves, are not reserve constrained, will never even come up short on reserves, etc. Reserve requirements by the Fed are a formality and holdover from a time when money had intrinsic value and a central banks was some kind of risk-pooling cartel. Today, many central banks, e.g., Canada's, have no reserve requirements. Banks are capital constrained, based on regulatory capital requirements and constrained in the availability of credit worthy borrowers. We are now on the downside of a secular credit expansion, and the definition of "creditworthy borrower" has drastically changed. The excess reserves do nothing, and are not the purpose of the transaction. The purpose of the QE isn't to add reserves, it is to influence longer term interest rates. This is not inflationary. The Fed does nothing other than alter the composition of the assets member banks hold to change the term structure of the yield curve. The reserves have no effect whatsoever on lending or money supply.

    The policy of pegging to the dollar in various export-economy countries can be a source of inflation in said countries, since cutting interest rates in an economy with ample room to increase lending can lead to growth in money supply. But this is simply a failure to conduct responsible monetary policy in the country in question. It is not the responsibility of anyone in the US to determine policy actions in other countries.

    So part of the reason various traded commodities are having violent price rises has to do with elements of US policy, but only in combination with the misguided policies of other countries, and even more so, the permitting of Wall Street trading houses to play price ramp games with the dumb money and run essential commodity prices up to ridiculous levels.

    The longer term trajectory of natural resource prices is more a question of supply, which is not a factor monetary policy can influence.

  32. I would say putting 600 billion of new, created money into the stock market by buying back bonds is printing money.

    Yes, we are printing money.

  33. Sometimes you gotta call it for what it is instead of lawyering it up to make it sound attractive.

  34. At this risk of getting "political..."

    Israel is backing Mubarak:,8599,2044929,00.html

    And is encouraging its embassies to lobby for Mubarak. Which means the U.S. will not be opposing Mubarak.

    Seems to me this is far from over.

  35. @Blakely, (we) the common folk no longer care about fine semantics (e.g. tell your argument to those Egyptians). Good luck defending the dollar-denominated-citadel (by yourself). Call me ignorant but your post has all appearances of ... a fed-sponsored meme injection?

  36. @Blakely

    I think Bernanke in his 2009 interview on QE I already admitted he's essentially printing money so I think we could put a stop to such wording game. Fed financing huge government debt is equivalent to money printing no matter how you cut it.

  37. !!!!!!!!!!!!! READ THIS : !!!!!!!!!!!!!!!!!!!!

  38. Egypt protests organized by the US?

  39. That would seem to be an instruction for full on corruption of the market. Whoever instructed the banks is guilty of an offence, and any bank acting to this purpose would also acting illegally.

    Then again we know the US financial system including regulators are from top to bottom as corrupt as it is possible to be.

    So I guess the leak is believable.

    But that wont stop the inevitable. The just delay the day.

  40. OT: Dub and downbeat music, great for getting you in the cool-headed mood to BTFD:

    Dub Sessions (DJ Chill Will)

    Passport Radio on live365:

  41. have to warm up for buying again this week I think, or maybe next

  42. at least - our chart-man awaitds 1260 as a possible turnpoint

  43. Ooh, spank me Blythe. Do it baby, in the after-hours.

  44. Didn't take too long for our Wild Week to start, did it?
    This is going to be volatile and the swings are going to make you nauseous.
    Keep the faith, however. Let the machines sell gold while you buy yours.
    Note that the overnight selling stopped in silver at 27.60. That's good. Its right where we projected support back on Friday.
    The monkeys will start in on it soon. There would seem to be lots of buyers between 27.40-60 so lets watch that battle play out today.

  45. Lower highs and lower lows in the last hours in silver 10 minutes chart..... getting me nervous :-(

  46. "Keep the faith, however. Let the machines sell gold while you buy yours."

    Exactly. Words To Live By.

  47. The dollar is heading toward 77.60 - what then? Ugly.

  48. Looks like we may need a rice chart soon, TF.

  49. "normally" that would be good for PMs - notice silver is just about hanging on whereas gold is getting a beat down

  50. Silver is shinning more than gold why??

  51. Someone covered 10 mins before the Chicago number.

    What BS.

    Can you smell the stagflation coming?

  52. Here's my two cents worth. If you recall back in the fall of 2008, everything was sold off including our precious metals and PM Shares. They quickly recovered! To me, it's not a question of "if" this will happen again but "when" will this happen. If we do have a major market correction like in 2008 I believe our PM's will respond differently this time. The margin isn't in the market like it was in 2008, especially in the PM sector.

    I firmly believe we are on the launch pad. Our seat belts are on and we are talking to mission control. We're merely waiting for the countdown to began. Will it be 10 - 9 - 8 - 7 - 6 - 5 - 4 - 3 -2 -1 Liftoff or will we get a big ABORT?

    The sooner this thing blows up the sooner we can start to rebuild.

  53. Regarding Pritchard's article about how global food prices are affecting political stability: Just finished an amazing read by Matt Taibbi at Rolling Stone -- Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America.

    I'll preface by saying that I don't agree with Taibbi on everything or even most things. He definitely has a penchant for progressive thought and I skew more towards the Libertarian variety, although I would argue that progressives, Libertarians, Austrians actually agree on more than the MSM will ever give them credit for as it relates to Wall Street, Fed, etc.

    But his treatment of Goldman engineering the oil bubble in '08 makes me seriously consider whether the food/oil commodities run-up (and the current Middle East crisis) is yet another bankster manufactured bubble to enrich the vampire squids and has little to do with any fundamentals of supply.

    Won't get into all of the details here (the book is well worth the read), suffice it to say that Taibbi argues that with a public reluctant to get into anything that felt like paper in '08, the Street moved the casino to the physical commodities (thing you could touch - corn, wheat, energy).

    He argues persuasively that there never was a problem with oil SUPPLY in '08, but rather by Goldman persuading big institutional investors to get into oil -- transforming oil from a physical commodity (subject to supply and demand) into another casino bet, like stocks, oil DEMAND soared... The market was packed to the rafters with retail speculators. From '03 to '08, speculative money in commodities increased 2300 percent.

    Goldman was able to do this in the first place by secretly pushing through hinky rules changes to a 1936 CFTC law that was specifically designed to maintain distinctions between people who were buying and selling real tangible commodities and people who were trading in paper alone. Taibbi recognizes the need for speculators, but the rules changes essentially caused a massive gold rush into commodities with retail investors, pension funds, insurance companies and institutional investors making massive LONG (not short) bets on commodities prices. In other words, without shorts, the casinos engineered it so investors were only betting that prices would be pushed in one direction... Up.

    Fast forward to today... The world's in turmoil, commodities prices are spiking, government's are falling, riots in the streets. Fuck with someone's 401K and they'll be pissed enough... But fuck with food and oil prices (what people need to survive) and you've got 'em by the short hairs.

    Don't know if Taibbi's right or wrong here, but the Goldman engineered commodities bubble scenario (minus PM's of course) sounds perfectly reasonable. Not being a commodities expert, would be interested in others opinions, links, etc.

  54. Say we do break through $29.50 this month, TF...would you then see $31 silver as overhead resistance, or something higher, maybe between $33-36?


  55. Blacky I think that sounds very agreeable. Now if they do want Lidnsey Williams war and new global currency they will leave things be and of course things will spread and escalate, but if this commodity runup is manufactured they will pull the reigns as they don't want to loose control.
    This sorta sounds like they know exactly what they are doing and will do ANYTHING to float the $$$. Most likely hurt metals, crude, food. Unless you have the inside info it's there predetermined plan.

  56. Question: Bullion Bar/Round vs. Coin. I understand that there may be some value in claiming face value of a coin (vs its real worth as bullion), is there anything else? It looks like bars -- even with assay card -- are a bit cheaper than coin in general.

  57. I'll re-post this on a current (today: Tuesday Feb 1) post, but I just have to ask: Did anyone see the "mini-melt-up" on SLV on the 1-minute chart at 10:25 am EST today? The 10:25 to 10:26 minute *now* shows O/H/L/C of
    O: 27.3201
    H: 27.34
    L: 27.30
    C: 27.33

    but when it was happening real-time, there was a tail on the candle that went all the way up to 27.68.

    Odd, I thought. I called my wife over to look and she saw it. I hit the 2-minute chart to see how it looked there (not!), and when I went back to look again on the 1-minute, it was gone, about 2 minutes later. Too bad I didn't grab a screen shot!

    A big market order that exceeded the flood of paper for a millisecond or two?

    Anyway, it was odd, I thought to let y'all know...

    PS: from a previous post, can anyone remember silver in Jan 2002 and why lease rates went nuts? We just had a spike...

  58. Just got back from costco. All prices up.