Thursday, February 17, 2011

Tomorrow Is Another Day

No, not really. Not so much.

Tomorrow, Friday, the 18th of February, 2011, is not just another day. Its equity option expiration day. Its a $7B POMO day. Its Vanna White's 53rd birthday (and let me just say...for 53? Uh-huh. She is.).
Tomorrow might also be the single most important trading day for the precious metals that I can recall.

So many of us have waited. We have been bludgeoned by the EE. We have been referred to as insects. We have been accused of being tin foil hat-wearing conspiracy theorists. We have tried to convince anyone who would listen that the Comex is nothing but a fractional reserve bullion banking system which could be brought down if enough people were simply willing to stand for delivery. By this time tomorrow, we may be on the edge of vindication.

The Evil Empire seems to have lost control of their dominion. With only six trading days left until first notice, the March11 silver open interest still stood at 55,811 last night. Tomorrow, we will receive the numbers that will be basis today. IF they hold firm...

The Evil Empire did not intercede in the rally today. Why? Why?? Do they fear that by selling new March11 paper shorts they will only be compounding their OI problem because they will be issuing new contracts to hungry longs who will add their number to those seeking delivery? Tomorrow, we will be on the lookout for Blythe and The Monkeys. IF they fail to raid...

Our Buyer(s) of Size have been aggressively buying in size. March silver began the week at 29.80. It reached a high today of 31.79. With no EE interference, will silver tack on another dollar tomorrow? Will it add 1.50? Maybe $2.00? Tomorrow we will know the answer. IF it continues to rally...

On the other hand, the Evil Empire may be setting a cruel trap. They may let price run initially, only to release information, make an announcement or otherwise change the rules mid-game. Silver may put in a dreaded ORD and we close back near $30. IF they don't act tomorrow, with all that's on the table, we will be able to draw some rather dramatic conclusions.

So, rest well. Be happy. Today was a great day. A fun day.
Tomorrow, however, is HUGE.
Turd out.

135 comments:

  1. what's the worst that could happen... comex goes bust and all paper silver is worthless? oh wait...

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  2. CO_Dan,

    this poster at ZH (under the article about BackwardAsians) seems to have a better handle on things than me:

    by BallsDeepGold
    on Thu, 02/17/2011 - 20:11
    #972606

    Backwardation now exists along the whole trading timeline. This means there are no large holders of physical silver left who want to trade their physical today for a paper promise of silver tomorrow. The chart shows they can get $31.60 today in cash, not have to pay storage on thier hoard, invest the proceeds anyway they like and then replace their hoard later at a roughly two percent discount. When backwardation exists, then the return on the physical longs money is both guaranteed and ABOVE current market interest rates. The fact that their are no large holders of physical willing to make that trade is very telling. It says there are no physical longs who want a return on their money above prevaling rates. The guaranteed above market return on their position is the carrot being offered by the evil empire to entice holders of physical out of their positions. Still that is not enough. Now that the market is in backwardation there are NO large holders of physical left who wish to take the evil empire's offer of free money. This could only be if the longs are convinced they won't get their silver back. Remember the EE's scam has two parts. Depress the price by selling lots of paper silver, all the while buying up all the physical they can get their hands on at a discount to true market price. When there is no more physical to be had (last contango?) there will be a default. This will send the physical price skyward and the public clamoring to get in any way they can. The morgue could (if they had scruples) use their physical to cover their shorts - but they won't. Better to default, send the price sky high & then begin distribution of their physical hoard when the price is high enough. Behaving in this unscrupulous manner actually leverages the runup in price while sticking paper longs with the bill. Genius really. GET YA SOME!!

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  3. Thanks for the great work, Turd.

    I put together a little piece for my "brothera and sisters in arms." I think you'll like it.

    http://thecivillibertarian.blogspot.com/2011/02/my-optimism-is-finally-starting-to-pay.html

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  4. Turd -

    Thanks, Sensei. So glad I'm here!

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  5. Turd, your "Wow" post was a classic, and no doubt gave thousands of PM investers (world wide) a huge boost of confidence. From one of today's ZH PM threads, here's a link to a video stressing balance when preparing for a currency collapse... bless this guy's heart (sounds Russian, and he refers to early 90s Soviet Union when Normalcy Bias prevented people from seeing what was coming)
    http://www.youtube.com/watch?v=hF79UUNaJHM

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  7. Turd the Anointed

    http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_J/threadview?m=te&bn=10073&tid=387167&mid=387167&tof=1&frt=1#387167

    Has anyone ever seen the TUrd and WB in the same room together???

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  8. so in this scenario Comex runs out and the 'true' price of physical skyrockets... but then what happens to a piece of paper that says Comex owes them physical silver ? or did I just answer my own question...?

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  11. Yeeehah! This has already been a wild ride, and the rocket ship's just getting warmed up. Very much looking forward to tomorrow. Thanks for the heads up, Turd!

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  14. Thanks you guys...

    Eric, that was hilarious...how did you know!!!???

    But you are correct...I'd be knocking on/down their door w/ that chunk-o-Bernankies right quick if I cashed that thing in.

    It sounded like a good idear at the time when I did it...mainly becuase I just F'ing knew gold was still going to keep on going up. But I feel like a douche for not "getting it" about silver at the same time or I woulda bought as much as I could have then.

    I appreciate the replies on my question, thanks to all. Strategically, I'm torn between cashing out now to buy silver or letting it ride a while longer to see if it hits 1600 and then cashing it in.

    How about I set a time for sometime in May and stick to it? I'll give it 3 more months and then either cash it in or buy it for delivery.

    And speaking of GVille Coins...is it odd that in 1 weeks time then went from 2.75 to 2.90, and now DOWN to 2.80 over spot on silver eagles?

    I think it's wierd they dropped it down 10 cents while price was rising and supplies dwindling. Maybe they caught some flack for it???

    I'm thinking after today they're gonna jump it up to 3 Bernankies over spot...just a guess.

    If anyone wants me to pick them up anything just lemme know...I'm only 5 miles down the road from them! :)

    The Turd Rules!

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  15. keep the trolls off this blog...bye bye Derek...

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  16. Glad we all made out like bandits today. I've been very cautious in this rise. I finally hit the FIRE button and bought some more physical in the early AM before the runup. I sold some recently acquired paper right before close. I'm still ready for a pullback and I hope many of you are as well... Don't put all your eggs in the figurative basket! Have some fiat ready to buy physical on any signs of weakness!

    I really can't reiterate it enough. If you already have some physical, now is the time to save your fiat for any signs of weakness. There is no rush to go out and buy all in one night!

    For those that don't own any physical - Get some in whatever way you can. AVERAGE IN! Don't go spend your life savings all at once... Not that I trust fiat any more than physical.

    Its important to diversify, so have some hedges if you have to hold USD right now. Maybe buy some SPY puts for expiration in a few months... The only way they can take silver down is a full market raid. (Am I the only one still hedging in this market?)

    A full market raid will be the result of a "terrorist" attack. I fear one is imminent.

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  17. My gawd...VANNA is older than me!

    She'll be 54, not 53. Gasp.

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  18. hi all ..Thank you for al your insight. I just wanted to share that I go tmy first order from Monarch(3 oz bars) and was very impressed with everything from order to deliver to the quality. The bars look like pirates booty, kids love to play with them. I think from order to deliver was less than 5 days.. Only negative was mailman just left in my mailbox with no signature.

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  19. Rob: Turd is not wynter benton. I believe wynter benton is Bill Winter, ex-JPM, outed yeserday by some sleuths. That's why they walked today.

    And I know who Turd is, but I ain't saying.

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  20. One is not like the others...
    platinum 1900.00

    gold 1400.00

    palladium 900.00

    silver 30.00

    ReplyDelete
  21. Sorry if this point already made, haven't had a chance to read all the comments this last 12 hrs.

    Silver is now over a dollar a gram, now there is a milestone!

    Also, the 2% rule was broken today. I dunno, when was the last time that has happened?

    regards to all fellow PM bugs :-)

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  22. Turd, can't JPM take both sides of the trade when they short silver down so as not to increase the third party long position while putting pressure on the price? In other words, they'd be both short and long, so their risk remains zero while driving the price lower? Thanks

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  23. Turd - thanks for facilitating this great community. I bet many of us held strong over the past 45 days because of the support from this group. We're not out of the woods yet, but our army is gaining strength. "two riders were approaching, and the wind began to howl"

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  24. @pat

    Had a question for you on TRE.. are you buying more before they report on the 22nd..I have been looking to get in for a while?

    thanks

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  25. Byzantium,
    If you are talking about John Embry's 2% rule, that only applies to gold. I'm quite happy it doesn't apply to silver!

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  26. Turd, I have to take exception to your comments. I rather enjoy being referred to as an insect and accused of being tin foil hat-wearing conspiracy theorists. Those just happen to be some of the nicest things I've ever been called.

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  27. I think TURD is correct. If we go into the long 3 day weekend with silver butting up to 33/oz. then everybody and their brother will jump in next week. Prepare the caskets and heaven help those with a short position in Silver.

    On the other hand, if Blythe raids overnight and tomorrow and pushes the price back under 31, she wins time. Under 30 and it's back to business as usual.

    So tomorrow is key.

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  28. Pat,
    did you see this post on ZH? He's talking about TRE?

    by DeltaFunctionToronto
    on Thu, 02/17/2011 - 20:03
    #972572

    Forget the noise - there is a sizeable interest attempting to cover all or a portion of a major silver equity short position, and there are few shares available for him to do so. He is offering a %70 rate to borrow annually at this point from holders of the share in their cash accounts. Standard rate was closer to %10 in this share over the last 6 months.

    You don't offer this type of rate unless you are about to be gutted.

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  29. Ginger - ERRCF not on my radar. I generally don't invest in non-producers but for great stories/properties like czn. I'll pay a higher price to get closer to production firms/firms in production.

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  30. Ben,

    I am chock full, and they are in the vault for at least 2-3 years. I fully expect this to be a three figure stock and surprisingly soon. I further believe 2011 will be the year of TRE's coming out party.
    Dig deep there is so much available public info; thoroughly research their website.

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  31. caramel,
    Thank you.. ..ERRCF definitely a (bit) of a gamble ..that's for sure.

    I appreciated your comments on CZN. I am excited about that one!

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  32. Turdle,

    No, that post referred specifically to a silver short.

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  33. Can't believe no one posted this yet...
    http://www.youtube.com/watch?v=NEqpvQqvcSo

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  34. Pat,
    is this better?

    platinum 1900.00

    gold 1400.00

    palladium 900.00

    silver 3000.00

    ReplyDelete
  35. Nope, fixed it for you
    platinum 1900.00

    gold 55,000.00

    palladium 900.00

    silver 3000.00

    ReplyDelete
  36. Turd,

    A great day, thanks for all you do.

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  37. @Pat

    thanks for the followup, I am late to the party but still going to buy.

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  38. Another boring flat day of PM trading in Asia.

    It certainly lends credence to the theory that Asian buyers are moving away from the spot market and are getting their physical by way of buying GLD and SLV and redeeming shares for bullion.

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  39. Turdle,

    Blythe is caught in a Chinese finger trap. The harder she tries to escape, the tighter it gets.

    The sooner she realizes that fact and lets silver work toward its natural price, the better of SHE'LL be. Derivatives will blow up and JPM will lose a bundle, but it beats the alternatives, most of which end in her losing any semblance of control over the market.

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  40. Holy Crap! Check out this pic I dug up. Its the witch and wynter in the New York times in the same article. Looks like they were teammates before. The witch probably backstabbed him with Dimon, and wynter is giving the biggest ass screw in her life with going long on silver! It takes one to beat one!

    This is like from a star wars movie. Two people from the same bread yet one is evil and one is good.

    Damn interesting, oh, and your welcome ;)


    http://www.nytimes.com/imagepages/2008/11/09/business/09magicCA03ready.html

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  41. Pat, thanks for the TRE tip a while back. Finally dipped my feet in the water and snatched it up. If you come across any info please post. Thanks.

    Turd, well done the past 3 weeks since the bottom. I just told everyone at work that silver hit a high price in last 30 years... a few eyes and ears perked up. Maybe people are finally realizing not everything revolves around the dollar and iPads. Well, maybe not iPads but you catch my drift. Cheers.

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  42. You think Mr Dimon is screaming at Ms Masters yet?

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  43. @ Vernon: A wimpy statist told me the other day that the problem is not the economy, but "rabble rousers" like myself. It was awesome.

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  44. Ginger,

    Ok,you win. Your ERRCF is even MORE TINY AND OBSCURE than my Bralorne! I didn't think that was possible. Good Luck!

    Seriously though, since a bunch of us exchanged lists on Saturday, I have added a few more. Mostly golds, since my first bunch was heavy toward silver. Also, with a total of 15 names now, I'm bumping up against my own advice, where I said if you get past 10-15 names maybe you should just get the ETF in the first place. But I'd say 3 out of those 15 are flat out lottery tickets.

    This week I've added (these are the US tickers):
    EXK
    ISVLF
    NGD
    GRS
    ANV
    BPMSF
    ARNGF

    Oh yeah, and I dumped my GDXJ, because with all these, what's the point of that?

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  45. A prescient opinion on the dollar, and consequently gold, is offered on this forum:

    http://goldscents.blogspot.com/2011/02/dollar-on-edge-of-abyss.html

    I do not necessarily endorse the remainder of the content, but the commentary as it relates to both gold and silver is particularly relevant.

    For those of you familiar with work done by Armstrong, it was stated by him in 2008 that the year 2011 is in phase with his panic frequency (26 years, wavelength and amplitude modulated). This event, itself in phase with the June 2011 low in public confidence also championed by Armstrong, prompts one to question whether the sustained equity market rally is a sign of impending hyperinflation. This consideration is relevant, given the proportionally smaller decline in metals prices to previous OI reductions.

    A significant net long options and futures reweighting is in its infancy after the golden Christmas tree shake this January. In light of bond market indecision while peering down towards the 115 level, the trend in both silver and gold may very well entertain a higher order function.

    Keep an eye on the bond market, and remember that long term cyclical dates always take precedent over technical considerations. I would assume any aberrant strength forcing a continuation of the S&P rally to be a warning of fireworks to come.

    Turd, your commentary has nailed it once again.

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  46. Strike back, that is good. 'Rabble rouser' I like it. I was recently called a scallywag for my notions about gold and silver. Turns out the gentleman was in banking. Who knew? I prefer to wear my titles proudly.

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  47. Hey Hamster...and all you other idiots who decided today that this was the place to act like a bunch of 14 year olds...I've read all your idiotic comments from today...grow up or go home.

    Turd is one of my best friends and I know him well enough to know that if you continue your egotistical, childish bullshit he will simply shut this blog down in a heartbeat.

    Like so many things in life, it only takes a few to ruin everything for everybody else.

    Now I'm sure, after seeing how you operate for some time now, since no one knows who you are, you will simply respond to my comments in your typical teenage fashion.

    Don't ruin it for everyone else...grow up...or take your ball and go home.

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  48. A banker called you a "scallywag"? pretty soon he'll be calling you "millionaire". Keep the faith.

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  49. Poor guy. Maybe EE is behind this, desperate for physical.

    http://www.theprovince.com/sports/silver+stolen+from+home/4300052/story.html

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  50. I would suggest people stop speculating as to who WB may or may not be. What good does it serve to start naming names and making false accusations? Anyway, I'm pretty sure much of that was disproved in subsequent posts. The nice rally is just as much a result of strong fundamentals as any master-plan from some fictional Kaiser Soze.

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  51. @ Turdle GG and Pat,

    You are talking about TRE and a potential short who is having a hard time finding shares to cover his short position.....well, I know of holders of TRE who have received the letter from a well-known brokerage house asking them to put up their shares for a premium earlier this week of 11%!!...this is real my friends, I am a long-time holder of TRE....the LEGAL short interest in TRE is over 6 million shares in the US, and nearly 700,000 in Canada.......average volume has been 400K daily......do the math..this is a short squeeze about to happen if the short can find no more shares to cover and becomes a "fail to deliver".....the link here is to the story about the short squeeze possibility soon.....

    http://rosenthalcapital.com/blog/2011/02/precious-metals-outlook-potential-short-squeeze-brewing/

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  52. The speculation about Bill Winters was intriguing.

    I said this in another thread and I'll say it again.

    It appears to me that the Queen and the Rothschild bankers are clarifying for US banks that there are somethings which should not be crossed. It appears to be a fight now between old and new money.

    We are watching a fight between JPMC (new) and Bank of England (old).

    Bill Winters appears to be playing at the behest of the Old Money which appears to now be committed to gold and silver based money.

    Blythe Masters is playing at the behest of the New Money which appears to favor the US Dollar as the currency of choice.

    Rather than allowing ourselves to be emotionally bonded to a specific camp, it would be wise to wargame a few scenarios.

    1. Winters and Rothschild's camp attempt to run on gold and silver. If they corner, the crown is saved and so are they. On the other hand, the US and EU end up continuing to feed them for the next 100 years.

    2. Masters and JPMC camp attempt to rotate into a stronger commodity position by going long copper, ending the silver short exposure, and pushing paper (USD and NYSE).

    That silver short exposure at JPMC may be more serious than we know.

    If the Comex and JPMC are in a precarious position, a bailout of both could be tied to the FRBNY position with respect to the debt ceiling legislation.

    My guess is that Geithner et al will attempt to "phase out" Fannie and Freddie. That attempt will include language to use JPMC and GS to backstop the GSE paper. Meanwhile, it would be secured by Comex position.

    This would trade the crap paper for the Comex crap paper. In the end, the crap paper all goes away and the NYFed, JPMC, and the US Treasury Department end up deflating to match the "inflation".

    So, you end up with 1 trillion in printing and in dissolving.

    Any comments?

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  53. @lordkoos- Dimon has kept Masters around for some reason. I'm thinking its as a potential fall person for him. Since Winters has left the stage, Dimon may not have alot of people left to talk to the Board of Directors. If Masters is out of the picture, he loses the person that the world knows "created the derivatives" in the first place.

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  54. @deltafunctiontoronto-

    I learned alot from reading Armstrong's analysis.

    His pi analysis/logic is a bit too circular for my interest.

    On the other hand, climate change and the impact of the solar cycle may play a role in macro economic cycles.

    There is not much "science" to "economics".

    But, Armstrong comes close to figuring some of the macro-trends and tying them to a centuries old scale.

    I found Armstrong's paper on Roman currency the most intriguing and convincing. That paper became even more tangible when I walked into a local coin store. The store had some ancient Roman coins. Those same coins were in Armstrong's paper. I could literally see the coins in the case that Armstrong was talking about as a marker of the decline and fall of the Holy Roman Empire.

    Then, I went to my elderly relative's house. In a 50 year old coin purse were 120 year old silver half dollars and full dollars.

    I stacked the old by year. As I dropped the stacks against each other, you could hear the pitch difference in the coinage "clanking" or "clunking" in the stack.

    Then, I stacked current $1.00 coins. What a joke!

    There was even a stack of old Canadian dollars, old yen, old pesos, and old pounds. Nothing compared to the sound of the US $1.00 Silver Morgans.

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  55. ---
    The speculation about Bill Winters was intriguing.

    I said this in another thread and I'll say it again.

    It appears to me that the Queen and the Rothschild bankers are clarifying for US banks that there are somethings which should not be crossed. It appears to be a fight now between old and new money.

    We are watching a fight between JPMC (new) and Bank of England (old).

    Bill Winters appears to be playing at the behest of the Old Money which appears to now be committed to gold and silver based money.

    Blythe Masters is playing at the behest of the New Money which appears to favor the US Dollar as the currency of choice.

    Rather than allowing ourselves to be emotionally bonded to a specific camp, it would be wise to wargame a few scenarios.

    1. Winters and Rothschild's camp attempt to run on gold and silver. If they corner, the crown is saved and so are they. On the other hand, the US and EU end up continuing to feed them for the next 100 years.

    2. Masters and JPMC camp attempt to rotate into a stronger commodity position by going long copper, ending the silver short exposure, and pushing paper (USD and NYSE).

    That silver short exposure at JPMC may be more serious than we know.

    If the Comex and JPMC are in a precarious position, a bailout of both could be tied to the FRBNY position with respect to the debt ceiling legislation.

    My guess is that Geithner et al will attempt to "phase out" Fannie and Freddie. That attempt will include language to use JPMC and GS to backstop the GSE paper. Meanwhile, it would be secured by Comex position.

    This would trade the crap paper for the Comex crap paper. In the end, the crap paper all goes away and the NYFed, JPMC, and the US Treasury Department end up deflating to match the "inflation".

    So, you end up with 1 trillion in printing and in dissolving.

    Any comments?
    ---

    This opinion is both timely and well-informed.

    The Rothschild have no interest in seeing an uncontrolled hyperinflationary collapse. They do, however, maintain a large interest in ensuring a transition to a monetary unit that both strengthens and consolidates the Western world where the majority of their interests are based.

    JP Morgan has become a Leviathan of sorts, and its ranks are now thoroughly populated with those who assume they may continue to act with impunity. This assumption will in time prove to be incorrect, and those not playing by the rules will bear the burden of public scrutiny.

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  56. @StrongSide... the NY Times photo caption reads, "In 1997, J. P. Morgan bankers like Blythe Masters, left, and William Winters served on a small team that pioneered synthetic C.D.O.’s." So, they BOTH created that toxic shit? Theory: Winters (now in bed with Rothschild) has problems sleeping at night, guilt-ridden, decides to broadcast their silver moves as a redemption play.

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  57. When silver reaches several hundred dollars an ounce, I could care less who Blythe Masters, Bill Winters, and Jamie Dimon are/were.

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  58. StrongSideJedi

    Wow, this is interesting. What does it mean to phase out Fannie and Freddie -- just write off the loans and losses? Who gets stuck with Fannie and Freddie "assets" -- the Fed? Also, bailing out COMEX and JPMC means giving them the money to cover their short position? If so, watch the price of silver hit 100 or more and Winters or WB group walk away with enormous profits.

    I personally doubt whoever owns the short silver positions will cover. It might be impossible. More likely is that the CFTC announces something like only 1000 contracts during March will be settled via delivery to be decided by lottery. Those that do not win the lottery for a contract for physical settlement will be given cash for a set price.

    Furthermore, I think WB is still taking significant risk in that the CFTC could step in and declare force majeure.

    What happens after that? Well TPTB kind of have to allow the price of gold and silver to trade freely and unfettered to realize their fair value in all currencies. That outcome might suite the Federal Reserve fine, or it might be a disaster. I don't know.

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  59. Hey, I wound up buying physical after messing around all day...a relief to have it on the way!

    Thanks to all who held my hand all day today (Thursday)

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  60. @Jack -

    You are clearly in the "US" camp.

    On the other hand, you should care about who those people are. I care. Those people have more to do with my net worth right now and in the future than my Congressman, Governor, or any local judge.

    @insight- the discussion about the silver price fluctuation on a day-to-day basis becomes somewhat meaningless as you watch the ROI climb. I know what Santa is talking about now. The reality is that the denominator of my valuation analysis should not be in USDollars. It should be in gold and silver. The funny thing you instantly realize is that if the denominator of the analysis is ounces of silver or gold, then the only thing being played with is the M2 or M3 monetary supply.

    So, yes, we got a 3% rise in silver price. This does not, in my humble opinion, mean that I am 3% richer in terms of wealth. In fact, it is sadly that the entire value of the US Dollar has lost 3% of its buy power against silver today. This coupled with the USDX tapping the low 78 range again is further evidence of the decay of our monetary regime.

    Only a simple analysis would suggest that this a good thing. The reality is quite the reverse. For those who did not take physical possession of silver when TF and Santa and James Turk and countless others said to, well, they're without a lifeboat as the USS America is sinking.

    The irony is that the band is still playing while the flooding of the lower decks continues.

    I am starting to feel like there are 99.99% of the people around us who are going to financially die.

    The SHTF scenario is arriving. I have already implemented several of the steps. There are more to follow.

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  61. ---
    His pi analysis/logic is a bit too circular for my interest.

    On the other hand, climate change and the impact of the solar cycle may play a role in macro economic cycles.

    There is not much "science" to "economics".
    ---

    Admittedly, Armstrong reveals only the bare outline of his logic and the corresponding laws governing his analysis. In part, the reason is that to describe how he came to his conclusions would require resources beyond those currently available to him, and an assumption of expertise that many of his readers do not possess.

    His analysis may appear circular, but the causal interactions he proposes are both real and significant.

    Cycles govern all fields of science, but are thoroughly misunderstood by the majority of those trained scientifically in modern academic institutions. The notion of cycles is analogous to the scientific description of a wave, or quantified disturbance of any medium -- thus, economics is very much a science -- it is simply poorly understood and misrepresented by the majority of those trained to be its informants.

    In my opinion, the only way to effectively understand the nature of cycles is to view them as a force acting to maintain equilibrium in an evolving system. All of science and mathematics has its roots in the notion of equalization (=), and the notion of equilibrium is simply an extension of this fundamental concept. Thus, economic cycles are in their fundamental form the process by which the economic system reverts to equilibrium over time. Confusion and volatility become interspersed in our experience as a result of failing to understand human interaction often works against this process.

    I hope the above digression was somewhat clear, and apologize in the event I may have misdirected the discussion.

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  62. @Andrew - That is an interesting perspective on Winters. As soon as that story was outed by someone on this board about Bill Winters in London, I knew that Wynter_Benton was done. For that reason, it really irritated me that someone tried to out him. But, what else should we expect.

    On the other hand, Wynter_Benton halting posting was stupid. If that is Bill Winters or someone aligned with that camp, halting posting was the worst thing to do. Instead, they should have continued posting but attempt to deflect the analysis. Now, we can all speculate and the behavior reinforces that WB was BW!

    In fact, it would be logical that someone in London realizes that BW is WB or at least that there is a reasonable chance.

    more to follow...

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  63. @deltafunctiontoronto-
    Thank you for your comment and reply.
    There is little disagreement between you and I on the existance of cycles. There is similarity also in the view regarding "equilibrium" as a paradigm.

    On the other hand, the fundamental laws of thermodynamics argue that the universe does not trend towards "equilibrium" but instead towards "chaos" and "disorder".

    For those that are not familiar with what "cycle" we are discussing, consider the following thought experiment.

    Let us assume that the guys want to buy silver at G'ville coins at $30.

    You can say the coin is worth $30. You'd be correct. But, can you really say anything about the price of the coin in terms of time? You can not because you do not know the price over time.

    When you look back at the price of 1 ounce of silver in US Dollars, you can create a graph of US Dollar price of silver ($USD/oz of silver) per unit time. This would theoretically give you a price vector or (delta price over delta time). Obviously, the pricing vector changes in direction over time.

    Armstrong appears to argue that general macroeconomic conditions prevail over timelines that are millenia long. In fact, he seems to view individual human choices within a context of nearly predestined trends.

    Still, I find his work very stimulating to discuss. I really appreciate the opportunity to discuss it here. There are very few other places where I can hold this discussion.

    In conclusion, I would like to suggest that Armstrong's economic cycle (pi theory) should be analyzed against the known solar cycle. My guess is that some of the political and economic trends noted by Armstrong are also impacted by solar energy input during solar max cycle years.

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  64. @JoeJost
    http://www.fiercefinance.com/press-releases/jp-morgan-covering-silver-short-position-says-nia

    Here's some hi-lites- from this prescient posting from December 14, 2010...

    According to the Financial Times in London, "JPMorgan has quietly reduced a large position in the US silver futures market which had been at the centre of a controversy about its impact on global prices for the precious metal."


    NIA, along with the Gold Anti-Trust Action Committee (GATA), has been at the forefront of helping expose JP Morgan's silver price suppression scheme. Over a year ago on December 11th, 2009, NIA declared silver the best investment for the next decade at $17.40 per ounce. NIA said in its December 11th article, "It's not a coincidence that the day silver reached its multi-decade high of over $21 per ounce in March of 2008, was the same day Bear Stearns failed. Bear Stearns was a holder of a massive short position in silver."

    NIA went on to say, "The reason why we believe the Federal Reserve was so eager to orchestrate a bailout of Bear Stearns, is because Bear Stearns was on the verge of being forced to cover their silver short position." NIA then said, "JP Morgan still holds the silver short position they inherited from Bear Stearns" and "JP Morgan will have to cover this short position or it could jeopardize their existence


    NIA estimates that over the past 30 days, JP Morgan has covered approximately 4,000 silver contracts, which has corresponded with about a $4 per ounce upward move in the price of silver. We estimate JP Morgan to still be short approximately 26,000 silver contracts or 130 million ounces of silver, which equals about 18% of worldwide annual silver production from mining of 709.6 million ounces. If JP Morgan covers their entire silver short position and the price of silver was to continue rising by $1 for every 1,000 silver contracts that JP Morgan covers, silver would rise to $56 per ounce.

    JP Morgan appears to be covering its shorts in a very managed and orderly way. We are not yet seeing anything that resembles a short squeeze, although one could occur at any time. If we see a major silver shortage and a real short squeeze, silver could literally rise to hundreds of dollars per ounce overnight. Silver's all time high of $49.45 per ounce adjusted to the CPI equals $139 per ounce in today's dollars. As all NIA members know, the CPI understates inflation through geometric weighting and hedonics. The real inflation adjusted all time high for silver is over $400 per ounce.

    With almost everybody who has ever purchased silver being up on silver in terms of dollars, it is possible we could see silver prices take a breather in the short-term. NIA is hoping for a short-term pullback, but with so many investors waiting to buy on dips, there is a chance that a large short-term pullback will never occur. NIA is very pleased that for the first time in many years, silver prices appear to be trading based on free market forces and not the manipulation of JP Morgan.

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  65. StrongSideJedi

    I don't really "care about them" and please don't tell me how I should feel or what camp I'm in (I don't know what the camps are and I don't care). thank you.

    ReplyDelete
  66. @JoeJost-
    Assume that a significant fraction of the old Bear Stearns Short-Silver position has been covered by JPMC eating it directly, then a mechanism is required to bail out the BearStrn bad position.

    Tim Geithner has already stated that the debt ceiling needs to move up. Increasing the debt ceiling can only be done by an act of Congress. I do not believe that the US Congress is capable of passing such a bill without being "assisted" or "fronted" by another issue.

    My guess is that the statement from Tim Geithner last week was meant to forecast or foreshadown the request to wind-down Fannie and Freddie. I believe Obama Admin officials used the phrase "private interests" in the context of the wind down. And, who would be the only interests capable of shouldering the Fannie Mae and Freddie Mac debt? JPMC, WF, BoA, and Citi and Goldman Sachs could.

    My guess is that the Congress will entertain legislation which will be labelled as a Fannie or Freddie wind-down package, but is really a debt ceiling extension and a bail out for our favorite merry band / den of thieves.

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  67. @Jack - either contribute something useful or get off the board.

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  68. Wynter Benton = Bill Winters

    Does this makes sense???

    ReplyDelete
  69. StrongSideJedi said...
    @Jack - either contribute something useful or get off the board.

    Funny. I was going to say the same about you. Who are you again? I was here Day 1.

    ReplyDelete
  70. @Himalayas - that's what people were pointing to this morning... but what do you think?

    I think it makes some sense. It also seems to conflict with the whole theory of the Chinese buying hard.

    What if it's not the Chinese buying hard. If the Chinese were buying hard, wouldn't we be seeing the buying during these hours of trading?

    We're seeing trading during NY and London Hours that is leading to a higher price.

    Here's another theory....
    If the Chinese are liquidating UST's by trading in London, the Chinese could be buying those silver and gold positions through BW's hedge.

    This stuff is making real good sense now and I'm beginning to wonder how many chess pieces are left on the board.

    It feels like a check mate could be close.

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  71. @Jack- why do you care who I am?
    You already said that you don't care who WB or BW or Jamie Dimon are!
    LOL

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  72. @StrongSideJedi

    Great discussion by you this late hour.

    > It feels like a check mate could be close.

    I agree and I sense that too. Once the dominos begin to fall, it could get very nasty.

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  73. Here's a link to Sherrie Questioning All, which is the blog that originally posted the "Red Alert" email.

    http://sherriequestioningall.blogspot.com/

    Earlier today, Sherrie interviewed David Morgan about this email.

    Here is the interview, hosted on David Morgan's site...

    http://cache.silver-investor.com/audio/1-17-11-DavidSherrieInterview.mp3

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  74. @StrongSideJedi

    No, that's not what I said. Don't put words in my mouth.

    You're the newcomer here, not me.

    ReplyDelete
  75. Hmmm, the html tag is working on my links above but redirects to here. Guess Turd disabled linking directly or I'm just too much of a WYSIWYG slacker.

    Anyway, the addresses are still correct...

    http://sherriequestioningall.blogspot.com/

    http://cache.silver-investor.com/audio/1-17-11-DavidSherrieInterview.mp3

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  76. @Joe-

    I've been trying to think of a way to identify if the Chinese are liquidating our UST's in London to Euro buyers.

    It seems to me that if the UK or Euro exchanges had Chinese sellers exchanging for Euros, we should see Euro strength and dollar weakness during the Hong Kong and London trading hours.

    Those Euros would then be moving into various international funds to buy gold and silver.

    In the end, US citizens would be aligned with this action if they are buying SAE's and CML's.

    This would mean as an additional benefit to the PRC, that buying in London would be AFTER the HK and Asian markets close. This would mean that the asian retail buyers would be getting in at a lower price.

    It's as if JPMC's hammering on the globex ends up hurting US citizens (doors are closed on the coin shops) and helps Asian buyers exclusively.

    Geez... what if the Chinese are intentionally propping up JPMC precisely for this reason????

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  77. Hong Kong priming the pump for London? Ag up .23 in just the last few minutes. 31.90 last


    Silver Bitchez

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  78. Price of silver matters. Supply of physical matters. Government encroachment on civil liberties matters.

    Taking peoples words out of context and telling them what to think or feel is wrong.

    I've asked Turd to check into the possible troll here. Other than that, no more posts tonight and no more replies.

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  79. Oh noes, the game looks like it's about to start and I wanted to go to sleep. Will I be stuck here refreshing price charts for the next 3 hrs?!

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  80. 12:23 am PST -----> $32.00/oz Y E A H !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

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  81. 12:23 am PST -----> $32.00/oz Y E A H !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

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  82. 12:23 am PST -----> $32.00/oz Y E A H !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

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  83. @syk-
    www.kitcosilver.com
    Showing a high of $32.02, ask $31.96?
    Good morning London!

    ReplyDelete
  84. @Jack - your comments lose power when you juxtapose "civil liberties" and "check into troll". For crying out loud, it's a blog written by some guy named "turd ferguson"!
    LOL lighten up pal!

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  85. @strongside, interesting comments. Not sure where you're getting all this info on the Queen and JPM though. I always thought most of the big financiers cooperated w/ each other rather than fight. Wasn't JPM the American branch of the Rothschild banking family?

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  86. @Himalaya-
    http://www.24hgold.com/english/news-gold-silver-china-plays-europe-card.aspx?article=3319174422G10020&redirect=false&contributor=Jim+Willie+CB

    Jim Willie on the Chinese opening a Euro window for their US Treasury dumps.

    If Willie's hypothesis is correct, it should be reflected in the Jan and Feb Treasury reports. I attempted to find that report, but the Jan 2011 report is not yet posted on the website (the report shows amount of $USD held by other governments).

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  87. @syk - the stuff about the Queen was extrapolation. Yesterday morning 2-17-2011 some guys posted about Bill Winters. When I did some web searches on the guy, some stories from London popped and there was discussion about the guy leaving JPMC. The story is really interesting because Winters clearly knows more about the JPMC ops and the international finance scene than most other players. The stories also told of a link between Lord Rothschild and the fund being created in London.

    Jim Willie's comments from many months ago held a great deal of interest to me, and I began putting the two stories together.

    If the Chinese are needing to sell UST's, there would be good reason for the people in London to buy. It's almost like a swap with the Chinese of the British gold / silver position for US paper that affords the UK a controlling interest over the situation in the USA.

    I recall a story from 2 years ago where the Queen was said to be asking "how could this have happened?" If Lord Rothschild is turning tables to assist the Queen, the Winters fund makes good sense now. Winters is recruited to help stabilize the UK banking system through funds created to hold gold and silver "repatriated" to London. Meanwhile, that position is hedged by the Chinese exchanging the UST's and FRN's for that gold and silver basis.

    It appears to me that the daily fluctuations and volatility may only be starting to manifest.

    If so, we should see London trading bringing spikes in gold and silver price as the houses in London attempt to control the supply for their clients.

    The international intrigue of this thing is great.

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  88. strongsidejedi .. WB is not Winters or the leader, but just a spokesman of the group. The leader posted only a few posts and under 2 different nicks.

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  89. This bill winters talk is clearly premature. Lets see what happens with his fund and then speculate on if he was wynter benton. Meanwhile, i think the focus shifts back to gold as early as next week when we make new all time highs!

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  90. strongsidejedi - conctact me and I'll sent you a link which will connect quite some dots.

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  91. @AGoldhamster

    Why not post the link here????

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  92. Turd,

    What do you mean in your last paragraph about something dramatic could happen ?

    "On the other hand, the Evil Empire may be setting a cruel trap. They may let price run initially, only to release information, make an announcement or otherwise change the rules mid-game. Silver may put in a dreaded ORD and we close back near $30. IF they don't act tomorrow, with all that's on the table, we will be able to draw some rather dramatic conclusions."

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  93. @Parker - yes... it's just interesting speculation at this point.
    ____
    @goldenhamster - I want transparency in analysis and discussion. Discussions like those tonight need to see the light of day, not back rooms exclusively the domain of insiders. If you can not post it, why bring it up?

    ReplyDelete
  94. Silver selling a bit. Better than expected UK retail sales and Greek deficit reduction (if you can believe the Greeks) are the cause I assume

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  95. Also, China just raised required reserve ratio by 50 bps. Effective from next Thursday

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  96. My many thanks to all who shared insights tonight, especially Strongside Jedi for the illuminating discussion of the Old Money vs New Money idea. Very interesting indeed.

    The Shafter Silver mine reopened in SW Texas yesterday. Serendipity at it's best as I see it... HiHo Silver!

    http://www.marfapublicradio.org/

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  97. I'm no moderator, but I am an original poster. Jack and Jedi, I believe Turd will allow pretty much anything from the profound to the inane, it's all good.
    However, please I implore you to not take even mild potshots at each other or anyone. That's when things go south on blogs. Disagree? Sure, even violently as long as its on topic, and not about the messenger. no personal attacks.
    I mean look at all the above- what an incredible discussion, what a shame it would be to get distracted and derailed at this moment in PM history.
    None of us ( I don't think!! ) are behind the curtain, but Jedi, et al conjectures are fascinating.
    The more dots exposed and conjectured upon, we all gain.
    Not to mention insights into miners as a group or individual entities; general comraderie; inflation/deflation chat; commodities chat, etc. I feel like I'm in the best school I've ever attended.
    Let's park our egos at the door; we have the best blog
    on the web ( well, PM focused anyway ) going here.

    ReplyDelete
  98. Could it be that Blythe and her monkeys have gone on to "copper pastures"?

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  99. Canadian CPI just out.

    Up .3% m/m vs. expectations of + .1%

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  100. As of 7:08 EST...Copper down; dollar up; gold flat; silver up 0.5%.
    Are we indeed watching history? The death of paper PM's? Any way it goes, i want a front row seat and high end popcorn. This ain't kabuki anymore!!

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  101. one has to say that silver is holding is gains very well - and is even trying for $32 - Like turd says, todays action will tell us alot about the state of play - as will the OI which is still at ~55K

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  102. Silver can go down just as quickly as it can go up. There is a lot of back-slapping here. Unless you sold today, any gains could be gone by tomorrow. Or silver might add another $1 or more. Or do nothing. I have no idea, but I'm cautious...

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  103. Please look at a long term chart of gold in particular; compare that chart to the value of stocks, bonds, and the dollar.
    If you just accumulate, and don't speculate for short term movements, it really is a no-brainer.

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  104. Quite right to be cautious Saul - the minute you think you've won is the point at which you'll get killed!

    Separately, article on ZH just up about emergency borrowing needs in europe over yesterday and today - coincidence with the rise in silver?? perhaps something big is coming down from above...

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  105. Saul...Silver could go up, go down, or stay the same...that helps.

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  106. http://www.zerohedge.com/article/euro-surges-expectations-ecb-rate-hike

    Aahhh, the implications...

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  107. On the little downdraft in gold you see...this from TD:

    "Here is how one offsets the aftereffects of concerns there may be a liquidity crisis in Europe: just make a few completely impossible statements about hiking interest rates and presto: your currency is back to unchanged. The EURUSD has surged by 60 pips in seconds following reports that the ECB's Bini Smaghi was quoted as saying that ECB may raise rates as price pressures mount. While it is great that more central planners are finally acknowledging inflation does exist (cotton is now firmly planted over $2), the probability of this happening is zero to negative, as it would put pressure on the short end, flatten the curve and otherwise pull the rug out from the ponzi "recovery" that has taken foothold in Europe, forcing even more involvement from the Fed to keep the European domino from going down. Elsewhere, Bund futures tumbled as the inflation genie is one step closer to being released from the bottle..."

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  108. Still at new highs in silver ... says a lot!

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  109. silver not really following - dollar just got whacked!

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  110. Rate hikes are an admission of inflationary pressures... Everyone knows they can't hike rates enough to offset inflation because there's so much debt out there they'll bankrupt many of the EU countries. China could theoretically do it without bankrupting their country but they would destroy their economy. Fiat sucks, and people are figuring it out.

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  111. @Rick : my point was more along the lines that it is dangerous to assume we will have as good a day today as yesterday.Trading is inherently risky. If you want my guess, and I'm highly likely to be wrong, I'd say we close today at 31.25. There. Now what's your guess?

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  112. LBMA SIFO rates just went from -0.09 to -0.36.

    http://www.lbma.org.uk/pages/?page_id=56&title=silver_forwards&show=2011

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  113. @Saul, at the risk of sound like Captain Obvious, you sound like Captain Obvious. I don't think anyone with half a brain "assumes" that we'll have as good of a day as yesterday since that was an extraordinary day.

    Most guys who post here advocate the purchase of physical metals, as do I, and it's unlikely that 90%+ of the regular posters here could care less if silver goes down a little today.

    You must have half-expected the response you got I'd imagine. Cheers!

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  114. Thanks Flaunt,

    What are the implications of this move?

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  115. "...But here's the thing... Silver is not correcting like it usually does.
    ...
    I'm telling you, I've watched the silver market for four decades in "real time" and much more than that in research, and I have never seen such strength.
    ...
    If silver can close above its "old" $30.91 of just New Year's Eve, we are likely in for another leg up. My next bullish target is $49. I had expected a bigger correction first. But in this world, you take what you get and work with it as best you can."

    http://www.dailywealth.com/1634/This-Is-the-Critical-Number-to-Watch-for-Silver

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  116. It implies backwardation on the LMBA. Here's a chart that illustrates:

    http://marketcuriosity.wordpress.com/tag/backwardation/

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  117. Saul...Point taken. I would say 31.25 is more likely than 32.25.

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  118. March OI is at 54745, down 1066.

    http://www.cmegroup.com/daily_bulletin/Section62_Metals_Futures_Products_2011033.pdf

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  119. @Mythblasters - No real argument from my on the physical, as they say, I got mine. So I would be more than happy to see another massive up day. There just doesn't seem to be much scope for a negative sentiment around here at the moment, it's unbalanced. Anyway, I take your point, and I'll steer my ship "HMAS Obvious" to clearer waters. Pip, pip, cheerio!

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  120. @Rick - "..more likely.." - that helps!!

    ;-) Just yanking your chain.

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  121. Looks like the Strippers and Monkeys have all decided on a 4 day weekend

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  122. @flaunt
    But these OIs are only the preliminary ones, right?

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  123. Does anyone else find the lack of pre-hours EE raids unsettling? I find myself so conditioned to think in terms of manipulated takedowns and orchestrated strafing runs to shake out weak hands that I find the absence of same disconcerting.

    I'ts quiet out there. Too quiet....

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  124. @Pining for the Fjords I would agree. I day trade the silver spot on FOREX and the volume and price movement is unusual.

    Price is in a 20 cent range 31.72 - 31.92

    Either everyone has a hang over from yesterday's party or the monkeys are hiding over top of the ridge waiting to descend on the PM Fix.

    Time and patience are a trading tools like fundos and TA...

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  125. Looks like Bill Winters (Wynter?)had a real big afternoon yesterday.

    http://www.efinancialnews.com/story/2011-02-17/bill-winters-renshaw

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  126. @Pining

    This market action is identical to the that just before the early Jan selloff.

    Only difference is that now the shorts have to deliver.

    Will be interesting to see what happens next week.

    Also, the shitstorm that has been brewing in euroland seems likely to come to a head soon, we may be in for some major USD strength soon.

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  127. Silver looking strong again this morning.

    Another comment posted link to this article, which I found very encouraging:

    http://www.dailywealth.com/1634/This-Is-the-Critical-Number-to-Watch-for-Silver

    Just catching up on last night's thread.

    One thing struck me:

    StrongSideJedi said...
    @Jack - either contribute something useful or get off the board.
    February 17, 2011 11:22 PM

    I just have to say, admittedly late, that I don't think there is ANY place for this type of thing on this blog, and I really hope Turd says something explicitly about groundrules or makes it very clear behind the scenes.

    And I say this also admitting fully that I have been generally VERY impressed by StrongSide Jedi's comments and contributions, and in no way do I want to be adversarial to him personally.

    This blog has turned into something really special.

    We have to guard that. We have to try to be gentleman, and gentle ladies. We can/should disagree, passionately, but agreeably.

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  128. Pat:

    Words of great wisdom. You're an especially classy resident of Turd Town.

    I followed Turd over here from ZH the day he opened the door. Like others here, I do not want to see what has happened over there happen here.

    Turd and his Town are special parts of a very special moment in time. We should all be mindful of nurturing it and keeping it alive for as long as possible.

    ReplyDelete