Thursday, January 27, 2011

This Must Be Read

I have no idea of whether or not I can do this or if its legal. If its not, I apologize in advance.
This Mike Krieger is like my long-lost brother. Every time he posts something on ZeroHedge, I feel like I had written it myself (only if I had, it would be a lot less eloquent).
I've chosen to copy and paste it whole because I wanted to add my personal emphasis for you, my dear reader. Its my site and I can do that kind of thing. :)
So without further ado, I give you Mike Krieger...

Submitted by Mike Krieger of KAM LP
Terrorism is the best political weapon for nothing drives people harder than a fear of sudden death.- Adolf Hitler
Sometime around the year 2005, perhaps a few years before or after, America will enter the Fourth Turning. A spark will ignite a new mood. It will catalyze a Crisis. In retrospect, the spark might seem as ominous as a financial crash, as ordinary as a national election, or as trivial as a Tea Party. It could be a rapid succession of small events in which the ominous, the ordinary, and the trivial are commingled.
Remnants of the old social order will disintegrate. Political and economic trust will implode. Real hardship will beset the land, with severe distress that could involve questions of class, race, nation and empire. The very survival of the nation will feel at stake. Sometime before the year 2025, America will pass through a great gate in history, commensurate with the American Revolution, Civil War, and twin emergencies of the Great Depression
-  Strauss & Howe in “The Fourth Turning” written in 1997
All people who try to get elected to government are in love with government, it’s just that the Democrats are in love with one kind of government and the Republicans are in love with another kind of government, and government is going to continue to grow until there is revulsion for government.
-  Jared Dillian (he puts out a great daily piece I would look into it at
The Global Revolution:  Welcome to Phase Two
When first I mentioned the food riots in Tunisia and Algeria in my note two weeks ago the former authoritarian leader Zine al-Abidine Ben Ali had yet to flee to Saudi Arabia with much of his nation’s gold.  What I find so amazing about this whole situation is why someone in their right mind would take the time to take some shiny little element that is in a bubble and that you can’t eat in the chaos surrounding one’s escape to another nation.  Surely he has hidden foreign bank accounts and since gold is just another “fiat” currency according to a Wall Street strategist, why bother?  He must be some right-wing radical that likes the Constitution and is therefore anti-American.  Isn’t that right Mr. Potok?

So back to the food situation.  When I say that we are in Phase Two I am actually not referring to the simple fact that a leader with a 23 year rule under his belt was deposed in weeks seemingly out of nowhere, I am referring to the actions that are being taken and will be taken all over the world in response.  As I have said time and time again, government’s today throughout the world could care less about their citizens.  When they show signs of caring it is merely to satiate the people back to sleep so that they can stay in control.  The leaders of governments throughout the world today consist of the worst humanity has to offer.  The most egomaniacal, narcissistic specimens on the planet (with some exceptions of course, Ron Paul for one).  They care about power and maintaining it.  So what does this have to do with food?  A lot.  I have stated in the past that we are in revolutionary times.  The system that has existed for most of our lives (all of my life) is crumbling under its own weight of insanity, immorality and fraud.  The last ditch effort by the global elites has been to flood the world with money and make sure nothing they are invested in ever fails or defaults.  This bought them a little time and their hope was that rising asset prices would boost confidence and lead to a recovery that could maybe keep this scam monetary system running for another decade or two.  The problem with this strategy is that we are in the Fourth Turning.  My generation is coming into its own and we don’t buy the bull shit of our parents’ generation.  We don’t believe in Democrat or Republican.  We don’t believe in the system itself.  We will be the ones making the decisions going forward.  We will default on the astronomic promises our parents made to themselves.  We will create an entirely new monetary and financial system.  Real free-market capitalism will flourish, not this socialism for the rich garbage Obama loves so much.   We will focus on doing good while doing well.  Not because the government forces us to, rather because we are witness to and victims of this sick, twisted creation of our parents generation that celebrates total greed without the slightest concern of the consequences to others.

With this as a backdrop, the leaders of all nations are scrambling to somehow survive in their positions through this time period.  What is happening across the emerging world now is countries that had increased prices for food and energy are reversing policy.  Countries such as Saudi Arabia are bidding for world grain supplies.  Think about this for a minute.  What this means is that what is being employed around the world at a time of global crop failures is essentially price controls.  What happens when you have price controls?  No elasticity of demand.  What does that lead to?  Even worse supply/demand imbalances and ultimately food shortages and everything goes to the black market and farmers stop planting as much.  So what we now have is the very beginning of a food price spiral that will lead to prices in dollars at unimaginable heights.  I would start to be very careful of the quality of food you buy and where it comes from.  I assume companies will start mixing in all sort of fillers and garbage into their foods.  Especially in emerging markets looks for increases in tainted or corrupt food supplies.

This will also affect oil prices and they should move substantially higher.  While people still quote WTI as the oil price and claim it is down, this is total and complete nonsense.  Nobody pays WTI prices.  Brent is $98/b and Asia Tapis is $101.50/b.  Anyone that is telling you oil prices are moving lower are either lying or don’t know what they are talking about.  For example while WTI is down 7% from recent highs, gasoline is down only 4% and heating oil is at the highs.  Do you pay WTI or do you buy gasoline?  There is also this idea that OPEC is going to come out and save the world by boosting production.  Good luck with that.  First of all, OPEC’s true spare capacity number is highly debatable and I am in the camp of those that thinks  they do not have control over the market at this point.  Banana Ben Bernanke does.  Secondly and most importantly these Arab nations are short food and we are in a food crisis.  They are also amongst the most vulnerable governments to overthrow.  You think for a second that they will crash oil as food prices are soaring?  Oil is their currency.  For what it is worth I think many of these regimes will be history within a year.  Then the Western governments will fall one by one.  This is the Fourth Turning.  There is no point trying to stop it, the only thing you can do is prepare.  There is precious little time left for that. 

U.S. Treasury Bond Holders Will Never Be Paid
Remember the old saying, “if you don’t know who the sucker is in the market, you are the sucker.”  Well ladies and gentlemen if you own U.S. treasury bond you are the sucker.  There is one way these things will be paid back.  With completely worthless pieces of paper, OR not paid back at all.  The one thing linearly thinking investors are not appreciating right now is that there is a gigantic awakening occurring in the United States that will develop into a successful and peaceful revolution.  The new leaders that will emerge will consider this debt illegitimate as I do personally.  It will not be paid.  Think it can’t happen?  Watch.

Meanwhile, looking at the chart of long term treasury yields what we see is a coiled pattern where rates have been in a tight range ever since breaking to the upside in early December.  I think these rates are about to break hard in one direction and I think that direction is higher.  When I looked at the commentary from the Fed yesterday and I saw this line “expectations have remained stable, and measures of underlying inflation have been trending downward,” all I could think was if I was a bond investor I would just say “alright I have had ENOUGH.”  I think that some of the biggest moves ever in the history of financial markets could be coming within the next 1-2 months.  I would focus on treasuries and precious metals.

Silver Disobedience
While the 20th century was a brutal and violent one, some amazing things happened.  Two prophets, Martin Luther King Jr. and Mohandas Gandhi we able to usher in a period of tremendous social justice for their respective causes through non-violent means.  We are now entering a time where the people (completely and totally sold out by their leaders and masters at the banks) must exercise civil disobedience and non compliance with an evil system.  Fortunately for us, the most effective and powerful means of this I can think of is completely legal and consists of buying physical silver and taking possession.  Although the comex paper silver price is showing a drop, this is not reflected in the physical market which is tight as a drum.  Many major dealers are sold out of product all over the world and the U.S. Mint recently stated that they sold 4.7 million silver eagles in January alone, a new record and the month isn’t even over.  If you do not like the way the banks and politicians are robbing you blind in broad daylight buy physical silver and take delivery I think it is abundantly clear that the raid on the comex silver market is a desperate attempt to shake out some supplies since the actually physical market is being depleted rapidly.

One of the irrational “fears” out there is that the Fed will somehow tighten rates.  Get out of the emotional brain for a second and into the logical one.  The Fed funds rate is 0-25 basis points.  The two year treasury yields 0.60%.  If the Fed raised rates even to 0.50% with the two year note at 0.60% total and complete chaos would ensue and the government wouldn’t be able to deal with the rising costs of debt service.  It is just not going to happen.  They will print and print until the whole corrupt house of cards crumbles to dust.  

V for Victory
We are in revolutionary times.  The new generation will not accept the Federal Reserve.  We will not accept feudalism by an oligarchy of banking criminals.  We will not forget the Constitution.   We will not accept SDRs or any global fiat currency.  We will not accept global government or “governance” (sounds so much better doesn’t it).

As I went to grab dinner last night, I noticed V for victory posters plastered all around downtown (  Go Boulder we are winning the infowar!

Turn off the tv and think for yourself,


  1. "Rise up and take the power back
    its time the fat cats had a heart attack.
    Their time's coming to an end
    we got to unify and watch the flag ascend."

  2. CPM silver numbers released in prior post of today are bothering me. How can Investment demand for each of the years 2006 thru 2009 exactly equal the ETFs line in the Inventories section. Shouldn't the inventories be cumulative from the yearly investment demand. So fine, 2006 has 155.1 in inventory. But 2007 should have 155.1 PLUS 230.39 or 385.5 in the ETFs inventory, instead it just shows the 230.4. So to me this table is completely bogus, doesn't appear to add up..

  3. As a soon to be 61 year old, I'm kind of scared by Krieger's thinking. "We will default on the astronomic promises our parents made to themselves". Well I have been a wage earner all my life, and I am counting on the social security I have been promised. I didn't make the decision (a poor one) to not actually purchase treasuries each year and set aside our social security funds. The power elite did that, not our working class. I need my social security check and I'll be drawing in 5 years. Hopefully.

  4. Feel me spirit rising, along with the price of silver. Amen, brothers.

  5. Great pick!
    Saw it earlier today and thought would make a great election speech!

  6. This comment has been removed by the author.

  7. Hate to say it...but the old and weak (poor) have to go. It's HOW the reset happens. It's the way it's always been done...and how it will always end.

    I hope it's not coming this time...I love my cushy life...

  8. sassballs--

    It's not that I want us to default on social security, I just am beginning to feel it is totally inevitable. I'm 50 and desperately trying to come up with Plan B, Plan C, and Plan D. I hope you are doing the same, as you are closer to the cliff than I am. Good Luck.

  9. Yeah I read that on ZH. It was so good I printed it out and took it to my car to have a thorough read.

    I too feel like it could have been me that wrote it because that is just how I think about things.

  10. It does seem hopeless. In very round numbers, military and wars are costing us 900b, divided by 300m population is about $3,000 for every man, woman and child in the US. So a family of four has to write a check every year for $12,000 just for the privilege of not being overrun by Al Qaeda. How much are they spending per capita in Canada, Mexico, China? Quite a bit less, I'm sure. Then repeat this disaster for social security, medicare, medicaid, interest on the debt, 99 week unemployment checks, welfare, education spending, natural disasters, infrastructure and on and on. We are crumbling under our own weight!

  11. Silver over 50 and gold over 1600 this year.
    Lets not forget that.

  12. Pretty awesome piece, though I question whether people in the younger generations truly "get" what's going on. Many understand that we have a fiscal crisis, a few understand the "gov't" is debasing our currency, and a tiny fraction comprehend what it all means and where we're headed. There are still shockingly large numbers who believe we need and can afford a national health care system. There are even more who think that this storm will pass "like it always does" and things will get better soon.

    I'd love to believe that younger people get it, but all evidence points to the contrary. They will be forced to eventually.

  13. I don't think they will actually cut benefits, or even the initial benefit calculations all that much. It's just that we'll all be paid in monopoly money. Company scrip, so to speak. It won't buy much.

  14. @sassballsgrandpa

    You reap what you sow...(on a collective level).

  15. I'm just thankful I have some young folks around me. My kids, nieces and nephews. I worry about them all the time, but I'm also inspired by them. The simple acts of going to college, getting married, buying a house, having kids, face it these are basically the most optimistic things a person can do. Tremendous long term implications, but they just plunge ahead anyway. No Fear. It helps me to keep from just sticking my head in an oven or something.

  16. sass - Re the CPM numbers, why should the ETF line item be cumulative YOY? My reading is that it's showing total net inflows into silver funds for each year. If one year had a net outflow it would be a negative number subtracting from total demand for the year.

    Hope that makes sense.

  17. By the way, silver looks amazing today relative to gold.

    I have no idea what it all means, but there it is.

  18. Now off the pick up my daughter from school. She doesn't know the world is falling apart, and my job is to make sure she never needs to know.

  19. Now they say one must buy when blood is in the streets.. I'm kinda proud to have bought exactly at the last bottom (well, missed by 2 cents). There was blood, and metalheads seemed to start doubting the value of their believes. As I now have invested 30% of my paper money there's still 70% left to invest. Silver is looking strong, however I still have a feeling the apparently strong resistance at $26.50 will be retested in the days ahead.
    Gold is making me nervous, which, if I remember correct, is a sign that you should buy NOW! It's the fear-factor.. It's weird since you try to rationalize the fundamentals while the way markets work nowadays is totally beyond me.
    I will never buy when the lights are green but gold is (especially in EUR) looking totally interesting now. It's near 200DMA and only went below it in 2008 crash. So what's going on...

  20. One of the youngins here, 28yo, and I get it. I try and warn people as often as I can and most just think I'm crazy at this point. The sheeple with bleat till they bleed.

  21. My only comment on Kreiger's piece, is that those who think that Rand Paul is somehow fundamentally different than other politicians are likely to be disappointed eventually.

  22. Eric: Right there with you man.

  23. @flaunt - We can't afford the health care system we have now. A properly managed health care system would save billions.

  24. Turd,

    you have a great site here, and I enjoy reading all your analytical work, especially with me being a very pragmatic and conservative investor/trader. I tend to look at worst case scenarios to establish my "exit" points and read several other sources beside you. I do wonder though, why you still try to "understand" the market movements (despite knowing the manipulation and complete and utter decoupling from reality) and yet optimistically try to call bottoms. You of all people should know better.

    I know especially in times like these it's easy to "slip" and try believe some "Nostradamus stories"; but I sure hope you'll recover quickly and return to your no-nonsense quality analysis that I value so dearly. I hope this didn't come across as overly critical (it wasn't intended to). As always plan for the worst, hope for the best.

    Some last words...Gold has had corrections of 20%+ over 40 times since the bull started in 2001. Why is everyone so emotional about this one I really don't understand. Keep up the good work.

  25. Nothing will change until a great number of people quit sucking their thumb and admit that we have an oligarchy posing as a viable two party system.

    Once that happens we can talk about what's next, because there is no "next" until that's done.

  26. I'm one of the youngens in here (26).

    I got about 250 oz of silver stocked away along with about 3-5 months of food and virtually no debt except for my house. I'm hoping things get better and the dollar bubble don't pop, but I cant fathom anyway it won't.

    Anyone have any suggestions for the younger readers such as my self who have tight budgets and shallow pockets how to prepare?

  27. Deleted my earlier comment after realizing I had my Muse and Rise Against all out of whack in regard to your reference. If you like Muse, check out Rise Against's album "Appeal to Reason". You want to talk about a band that gets the lyrics right in smack talking the EE, yowser! Best part is they are intelligent and informed.

  28. I understand this guy's frustration....and admire his essay...I disagree with several points and his some of his conclusions...but the real point is there are truly wonderful people that know the best path for us but the oligarchy, the "hidden hand", THE banking family, are not going away. Until this entire mess collapses no significant change will occur.

  29. lord koos--
    Yeah, I'm with you. I totally buy 99% of Krieger's piece, but Ron Paul is the 1%.

  30. Turd- TRE amazingly resilient all week in the face of the gold shenanigans; sumpins brewin, sumpins berry berry gud

  31. lord koos--
    OK, 98%. Ron Paul and health care are 2%.

  32. Meh. Voters under 30 broke almost 70% for Obama, the most transparently fascist candidate in American history. The notion that this same generation is going to loose the shackles of financial slavery is farcical.

    Krieger may be a voice in the wilderness, but collectively his generation is far too stupid to grasp what is happening to them and far too lazy to do anything about it.

    Buy physical. Pay in cash. Do not give ID. Store in safe location protected by appropriate firepower. Ten years from now selling PMs on the black market will be a criminal act, but it is better to be a rich criminal than a broke schmuck. He's got this much right.

  33. To my American friends:

    Turd's followers obviously understand what's wrong with the system. But you (and ZH'ers, etc) are a very small minority of your population. Nothing will change until you get out and spread your message to the majority.

    I wish you all well. The world is watching.

  34. According ZH M2 up again +$46B at $8.8T which is an all-time record. Don't worry though, there is no inflation. The money you lose on your "ancient relics" you'll more than make up in the coming economic boom that will result from the money printing.

  35. Greetings, new follower here and complete newbie to PM purchasing. There is alot of good information and insight here, even though I don't know what half the acronyms are...

    I am looking to make my first silver purchase and have been following spot on Kitco and Gainsville coins but I don't understand why Gville appearst to be $.10 over spot all the time. Can anyone enlighten a newbie?

  36. TF...I like the read and although I am 50, I have never lived beyond my means. I paid cash for every used car that I have owned. I haven't had a credit card bill in ten years.

    There is a piece of me that just wants to tell the young guys to fuck off. I managed my life quite well without debt and there is something that really frosts my ass about getting lumped in with the rest of my self absorbed and greedy generation. In as much I practiced fiscal discipline I remained hostage to a gov and a generation that didn't care about anything other than satisfying their own selfish interests. In that sense, I will accept getting tossed out with the bathwater. If the younger generations actually have the "balls" to tackle gov head on and not just talk about it- then you will win my admiration. I will take my dirt nap happily. Until that time, it is just so much bullshit.

    The thugocracy ain't gonna just go away because you want it to. They got the juice and we don't.

  37. More color from ZH about the M2 increase, worth paying attention to:

    "Desperation kitchen sink anyone? The M2, which up until now was merely diagonal, is about to go parabolic. In the week ending 1/17/2011, Seasonally Adjusted M2 surged by $46.6 billion, the biggest weekly increase in the broadest tracked monetary aggregate (ever since the cost-cutting associated with discontinuing the M3) since 2008. One look at the chart below indicates precisely what is fueling the endless market ramp. Furthermore, for those who realize there is a 93% correlation between M2 and gold, we would certainly recommend putting on the M2/Gold convergence trade on."

  38. "Turn off the tv and think for yourself."

    You got that right!

    And to Turd (Furglar), just kidding, hang in there. Size your positions well, and this will end up being just another big, fat opportunity.

  39. Hi All,

    Been lurking since the beginning and thought it was about time I threw in my Tuppence worth. Like many of you, I only believe in REAL money and am super-bullish on Silver in the long-term (I'm sure Gold will do fantastically well too but defnitely higher % returns in silver, especially if/when we overshoot the 16:1 ratio).

    Thanks to all of you who comment on here, and most of all thank you to The Great Turd. The analysis and commentary on this blog simply can't be found anywhere else on the net.

    I have a nice little stash of 2010 Silver Eagles and have just taken the plunge and bought £4.5k of silver on GoldMoney. Even though physical in your hand is the best protection against fiat, I still like the idea of having a a few hundred Oz in a vault in Zurich. If S really HTF then the geographical diversity might come in useful (although I hope things don't get as bad as that).

    I play the paper game as well and somehow avoided being closed out by literally a few cents yesterday. If we hit $26.50 then I'm getting closed out and will look to get back in somewhere near $25. Paper trading is just for "fun" and I would advise anyone trading on leverage to only play with money they can afford to lose!!

    Physical is the only true protection and I have another £4.5k of B of E monopoly money to swap for silver over the next week or two. No doubt we'll see a lot of upheaval in the markets throughout 2011 but I hope everyone can stay strong and take comfort from the knowledge that regardless of short-term problems, as long as we keep buying and taking delivery, it is simply a matter of 'WHEN' and not 'IF'.

  40. What's up with silver, spot, tic chart? It just spazzed out for about 30 minutes then took off to the upside. Did silver have a seizure?

  41. @cmill:

    I'm also young (just hit 25), I have about 200 ounces of silver Eagles and about 20k in silver miners and 10k in AGQ (short-term) that over time I'll look to convert to physical. I've been blessed with a great salary and save like there's no tomorrow because, well, there pretty much IS no tomorrow, at least as good as we have it now...

    I feel you in your situation, it's not easy to protect yourself as much with fewer resources. I would say you're on the right track and in pretty good shape. For a worst-case scenario, have access to a friend with rural land/water source.

    For other scenarios, I would worry about any debt, including the house. Home values will continue to decline into about 2014 nationally, and in badly hit markets, for decades. I would get out now, sell, and look to rent and save more aggressively with the cheaper costs. Use these increased savings to better position yourself.

    I know for certain we'll have huge inflation through currency debasement, but also think it's probably that will be the final chapter, with a huge deflationary event precipitating it and necessitating debasement as a response by our politicans and the Fed. Hugh Hendry has some good details on this, and in this scenario, if it happened first, debt would be very bad, depending on how long it lasted prior to the inflation.

    But, like I said, we're both already ahead of the game and our peers. By having savings, in a form of real money that holds its value over time, we'll have the liquid assets needed to act responsively as things evolve...

    In the meantime, with the tight budget - just keep paring down to what you truly need. I make 80+/year but cancelled cable to up my savings rate, for instance :)

  42. cmill-

    sounds like you are on the right track. Other battle fronts would be to just make sure you have good family/social support system around you and also work like a dog to make sure your earning power, job security, etc. is all that it can be in whatever your vocation might be. And watch your spending.

  43. GG-
    Yeah, we are small potatoes. But I find it interesting that a group of people who I'm betting could mostly be classified "former republicans" and "former democrats" could be in agreement with most of a blatantly revolutionary piece like Krieger's. It's a start.

  44. Deucedude-

    I'm guessing the price you see at the top of kitco is the bid price, and what you see at the top of a PM selling website is usually the ask price. Always a little bit of a spread there.

  45. NoDeal--

    Well said. Welcome aboard.

  46. Blythe, if you have read The Fourth Turning, the generation that will put an end to it is those born 1961-1981: the current 50-30. Although, TFT claims that it could occur as late as the 202x.

  47. Turd,
    I've been active in trading PMs for less than a year. I try to understand all the information that is out there. But I lack historical context. Ted Butler seems to have been going on about manipulation for 10 years, but nothing's changed. The CFTC is not going to change the rules anytime soon. Reading Harvey Organ, it seems that something big is brewing, but honestly I don't understand the implications of what he's saying. Maybe he's been banging on about this stuff for years and years and nothing has changed.

    So, I ask you, as a PM market veteran, are we truly in unprecedented times? Or is this swindling just going to continue to carry on for another 10 years? Who is going to stop the banksters? Not the CFTC, not the SEC, not you and me.

  48. GG: The outcome is inevitable, but the timing is unpredictable.

    "Yet the criterion of truth is that it works even if nobody is prepared to acknowledge it." Ludwig von Mises

  49. Another young one (34) .. the number of us who 'get it' is increasing and we also share this meme around where possible; buying physical where practical. This undercurrent will eventually tip the scales. All hail the Great Turd who helps us describe it all.

  50. sass...,
    Regarding defaulting on Social Security and other entitlement programs: I don't care. If I had an intention to stay in the US of A my whole life, I'd certainly want a default on those programs. I've never expected to recapture a dime that I am legally required to put into them. But how is defaulting on the programs formally any different than leaving the country and letting the tax base shrink? See: my view is this. Screw your generation. Screw my parent's generation. Screw my generation (20-30s). They're all responsible for the problems of today because they've been short sighted and politically divided on just plain stupid issues. (Have you seen what Congress -- mostly your baby boom and older generation -- has been debating?) Its stupid and childish.

    I understand there are good people and well intentioned hard workers in all generations, but the problem is that even with the good the majority has overwhelmed. So I'm saying a good FUCK YOU to your generation. Please, now is the time to do the desperate things you need to do to save your future. Do not hope for SS, expect it not to be there. Expect it to be gone within two years from today.

  51. The silver story is heating up. How long before the lid pops off?

    From KWN Bill Haynes interview:

    "I was able to get 100 ounce silver bars (recently) and then all of the sudden these guys I call them and say ok, we are talking 100 ounce silver bars, they’ll say well, it’s a month out on any order you place today. And then I have people telling me they will not take any orders on 100 ounce silver bars until May.

    There’s a couple of things that are going to happen that is going to shut a lot of people out of this market. All of the 100 ounce bars are going to be gone in a matter of days, not weeks, days."

    Got physical?

  52. Mike's indictment of the older generation rings true. Perhaps no generation was given so much by their parents yet passed on so little to their children. In just one generation, the U.S. went from being perhaps the wealthiest nation the world has ever seen to the greatest debtor the world has seen. What did they trade their wealth for? SUVs and happy meals, I suppose. And having squandered their wealth, they then proceeded to sell their children into debt slavery. Shameful.

    So it falls to the next generation to clean up the mess. Tough break, but it's got to be done.

    "I wish none of this had happened."

    "So do all who live to see such times, but that is not for them to decide. All we have to decide is what to do with the time that is given to us." -- Tolkien

  53. Every Cloud has a Silver Lining.Keep the Faith,Believe for a better Tommorrow. (:

  54. Flaunt-

    Appreciate your posts, and your opinion- so let me ask you a question. As per your previous post, M2 is exploding, they just made it official that QE 2infinity is certain (as if we didn't know), physical supplies are getting scarce, and yet in the face of a falling dollar PM's tank? Add all that up and to me, these last takedowns in gold and silver smell suspiciously like a last-ditch stand for big time shorts to cover before the lid blows off. Maybe it's just me, but I think the recent action reeks of desperation...

  55. citi-doc We boomers didn't squander the wealth of this nation. It was stolen by the elitist banksters. You make it sound like we had a 40yr party.

  56. From Franklin tonight:

    "Silver, too, will fall further, likely heading to 2500c or even to the 200 DMA, now standing at 2209c."

    But then:

    "About now y'all will have to prove your mettle, and whether you are a bunch of geese that panic at every breeze, or whether you understand the primary trend and why you must hold on. More than that, you must grasp that the market is about to offer you -- at the bottom of this move -- a colossal buying opportunity."

  57. are right. In our youth we were partying, but also leading a revolution...many of the gains now are being taken back!

    It's great to blame the folks who helped get this country out of the Middle Ages...unfortunately, we're headed back there, on fast forward now.

    Speaking as a woman...I'm pissed as hell as having my reproduction/privacy used as a football and seeing the complacency about it. I think Ron Paul is on target on many fiscal issues, but why do "Libertarians" draw the line at allowing women to be free and not under the thumb of crappy laws designed to keep them from exercising their (increasingly hollow) rights?

    I'm afraid the Ron Pauls and their followers could easily tranform into the same type of power hungry autocrats that we've been suffering under. Hell, I went to a meeting on the wilderness here and saw all the crew, wanting to drive us backwards...because, in truth, many are even more radically right then the pols who run the place now.

    Having found a graphic showing that about 75% of our financial mess arises from Republicans, I find it really disheartening to see the likes of an Obama (whom I did NOT vote for) just be on the continuum as we lurch further into facism. And the media is completely bought and paid for, so no help there...

    unless you come to blogs like this one!

  58. Pining: Thanks. It definitely reeks of a concerted effort to scare people out of their positions. In a free market, you don't have supply constraints coupled with falling prices. Those things only occur when governments or others who have out-sized control of a market institute price controls. I really think what we're seeing is a form of price control whether government-backed or not. I'm going to listen to the experts in this field who say that the paper price catches up with the supply fundamentals when things get this distorted.

    As I type silver is plumbing Turd's bottom.

  59. Flaunt-
    "In a free market, you don't have supply constraints coupled with falling prices" Perfectly, succinctly put. That is it. What I fear is "the market can remain irrational longer than you can remain solvent". But this rubber band must snap at some point. We shall see.

  60. CMILL....advice from one of those old "problem" people who created this mess ...not.

    Be frugal. I have always been VERY frugal. This means that for years, I've been out of step with most of my family and most Americans who don't look beyond the couch and eating out.
    Save money anyway you can!! Live cheap!!! Buy good quality in lower amounts, but don't follow the crowd on every fad.

    Be flexible in terms of jobs. I lost 2 jobs because of recession (70's) and in the 80's. Having had a great education (which I helped pay for by working), I switched fields and survived. Then, I had to quit one because the building made me really sick. Then I learned "portable skills"...very important...things you can do, either on the side, or something that won't go to another country...practical job skills.

    You should be able to have several resumes handy to reflect different skills, or career paths.

    Also, don't be snobbish...I worked temps and did everything from packing bottles, unloading trucks, working the forklift....Masters' degree or no!! While I kept looking....

    So, you see, this kid from the 60's didn't mess up the world at all!
    My 60th birthday is Feb. 2. Instead of crawling into a hole and whining, last year I started studying trading. Making progress, read like crazy but am working at it. Basically, even though I'm disabled, I'm still trying to work to keep ahead of the crowd!!!

    Good luck! I try to talk to my 20something nephews to no avail. They don't have a clue and show little respect...can't even say thank you for a gift.

    Happily, you sound like you have your head on straight! You're one of those who will be a survivor!

    It doesn't matter what generation you're from...some people are survivors and work to maintain their integrity, others never break the mold society sets for them.

    Be a mold-breaker!!!!!! Stay strong!!!

  61. Fjords These takedowns have been here for years but I agree the action is so blatantly against the fundamentals now, something is on the horizon....Watch the miners because they may give you a clue....They are cheap and soon may be the only game in town if (when) the metals are unavailable for purchase....That time is getting close and if a person is looking for protection it will be his only choice. I know most of the discussion here is focused on physical, but the miners will outperform......notice how they held up relatively well today with this drop ?

  62. The us and them mentality is common throughout human history. Also common is people rising above it. These are people with character. As the crises which we see unfolding before us intensifies, so will the us and them mentality. You will want to surround yourself with people of character. If you have yet to develop character, now is a good time to start.

  63. UNABASHED promotion of SLW since we are talking PM's and silver predonminantly. Good article and Co info on SLW...

    Like other PM shares taking a hit also...

    p.s.: Turd Ferguson, don't beat yourself up so much about missing targets by a few cents / dollars. Yes looks horrible on charts and temporarily hard on investment accounts "but" fundamentals, unless EVERYTHING IS BOGUS will rule the day. We all appreciate your insight and blog!

  64. When I first got hired in the corporate world, there was this young guy who everyone thought was strange. He joined those pyramid scheme "soda and wellness" flash companies who wanted to sell all kinds of random crap like energy drinks, tooth paste, filtered shower nozzles, whatever.

    Well I thought he was weird too, not because he acted strange, but because he told me that he never goes in debt. He told me that he doesn't "believe" in debt. I remember this distinctly.

    Flash forward 4 years and here I am, starting almost exactly where his frame of mind was sans the energy sodas (no idea what his fascination with pyramid schemes). But as I look back, he was right in so many ways except he couldn't explain himself in logical ways to the sheeple like me. I was right out of college and the only thing I knew was debt. His "strangeness" and contrary belief didn't make any sense to me and surely never helped his argument.

    So here I am, sitting in the same department as him four years later. What I've been graced is likability, in some laid-back way - mind you. I get along with everybody so with that in mind I figure why not pitch the truth? If I can do it in subtle ways over time I might open a few eyes and not only save myself, but also more people that acknowledge the downward spiral. Last thing we need is 100,000 turdites and zero-hedgers fighting off the infinite angry hoardes (as an extreme example).

    So I spoke to this lady in my department whom I work with. She is Panamanian by birth, US citizen second. She tells me about Noriega and all the crazy things that happened in her previous country. I told her that I'm spending my bonus on PMs and she gawks at me. Almost as if she expected me to say that I should've bought 2 iPads and a couple extra MP3 players just to make sure I have my music everywhere I go. I explained that at one point in US history, gold was confiscated. Her eyes widened.

    Point is even people who have been through major life changes in environment QUICKLY forget about those days when things are good. Over time, between her and others I will slowly *hint* on PM purchases and eventually by goal is not only to be a valued co-worker, but also to gain their support.

    Maybe back in the day the boomers weren't like this... my Dad is having a hard time understanding some of the things I try to tell him. People are smart despite the "sheeple" references, but they need to hear snippets and facts at random times, not a barrage of "the world will end" type speak.

    I encourage everyone here to subtly throw hints at people at work or wherever, they will figure it out over time. Anyways, back to your regular scheduled program :)

  65. Ah, finally a move in the PMs that make sense...looks like sliver bounced hard, maybe well up by morning? (thinking wishfully)

    Thought about buying more on "the big dip", but I'm so deep into it now that it wouldn't bring down my DCA by enough to matter.

  66. Gold is being seriously manipulated by the U.S. government and the Fed. USD's are backed by faith & faith only. When the loss in that faith hits a tipping point amongst the masses the value of the USD will take a plunge like no other. That's when gold goes up like a rocket and the USD will essentially be dead. All those freshly printed USD's will be funneling into a very finite amount of gold.

    So, the battle the U.S. government has to fight is keeping the sheeples faith in the USD. What better way to do it other than to slam gold & slam it hard. The more things start getting out of control for the Fed, the more you'll see gold nosedive. The government knows that the tipping point can never be reached or all will be lost. There's *nothing* to support the recent fall in the price of gold.

    I fully expect gold to continue to get slammed down without any apparent fundamental reason. Every piece of economic data is showing that our economy is seriously contracting. It's pretty damn easy to suppress the price of gold when you own way more of it than anyone else in the world.

  67. good read. although I am over the pond in the UK, a lot of the same stuff applies. A lot people my age (early-mid 20s) either think things will sort themselves out (despite being completely clueless about the timeline of this 'crisis' so far), are already working in the finance world or think that any 'fringe' stuff is a conspiracy theory. one or two kind of get it to varying degrees.

    and it's hard to spread any type of message when you are in the process of starting to understand a lot of this stuff for yourself. from my perspective there are a fair few young people still educating themselves before they are ready to get mobile and really talk out. i'm just about there. but propaganda is so powerful and people really aren't aware of the real issues.

    most of the pushing back against the system so far has been about isolated issues and very standard fare, the type of stuff the media can put in a good showing by covering and getting some shills to talk about the supposed issues.

    a lot my hope rests in this thing here and how it unites and provides a good dose of freedom (albeit virtual) for all of us. even the more conservative young people are and will stand up to keep the internet pretty much as it is today. i believe strongly that control of the internet is one of the key issues going forward and something that's been heating up increasingly for the past year.

    anyway enough rambling, keep up the great work turd :)

  68. Yen rising in the face of a debt downgrade.

    Welcome to wacky world.

    This jan has been exceptional, correlations falling apart everywhere you turn.


  69. No bullion gold in any coin shops in Singapore only the bank has any stock.

    Only buyers no sellers at all.

  70. I'm one of the young ones too (29) and have never bought the current system at all---I bought a flat at 19 and made some money on it, even at that age I saw that 120% mortgages at 6x salary at 4% interest was inflating the housing market like crazy and I was able to capitalise. I never signed up to a pension, other than the ponzi the government force me to pay for that I never expected to receive.

    But I think I'm in a very small minority. I actually moved away from northern england a few months ago because I'm so dismayed by what is going on up there---the vast majority of people there my age are moaning that there are no more teaching or public-sector jobs, which is pretty much all anyone has been doing for the last ten years. Their answer? More socialism, see the student riots of the last few months. Moved to London because I earn much more money down here and I can plug it away in PMs and do a bit of speculating on the side. But you know what? It ain't that different down here, and I'm genuinely shocked at how much more heavy-handed the authorities are, it's a fucking police state. In three months I've had six fines or threats of fines for debatable traffic offences (for which you are now almost constantly monitored by CCTV), parking (whilst I was trying to fix heating systems in local authority social housing), riding my pushbike, and even putting the household waste out wrong! Something is desperately, desperately wrong here. The super-rich russians and arabs are buying property with bullet-proof glass and panic rooms pre-installed. Me and some friends did a back-of-napkin calculation and worked out that one family's housing benefit for one year eats up all of our combined tax payments. And we're not a bunch of low-wage earners either, a gas technician on £50k a year, a dentist and a consultant neurologist. We lose pretty much 40% of our earnings to tax, and ONE FAMILY gets it to live in Notting Hill for free, and this doesn't even include their other welfare benefits.

    I thought I was pretty economically-savvy, but I cannot make this stuff add up whatsoever. Unfortunately, neither can I couple it to a positive outlook about my generation wanting something different, or to a productive 'reset' of government systems and a return to markets.

  71. Apologies for rantiness of above post, normally I know how to use paragraphs pretty well...