Sunday, February 20, 2011

You Must Listen To This!

Trader Dan's weekly interview with Eric King is full of 100% invaluable information.
Please, I implore you, listen to this today.
Once it loads, Dan starts about 40% of the way through.

I am currently working on a new post with thoughts on this upcoming, critical week. Give me a few hours. I promise I'll have something for you by later this afternoon. In the meantime, please keep adding your ideas to the other thread that discusses the new and improved Turd's World. All input is greatly appreciated.



  1. Dont forget your guests Turd! Thanks for the selfless service.


  2. Duke: Please reciprocate by having the Blue Devils cover the 20.5 this evening.

  3. I thought Bill Haynes' interview was just as should definitely encourage folks to listen to the first part.

    Bill has his ear to the ground in a big way and knows what large retail money is doing and he has some really fascinating insight into last week's action.

  4. Myth: Duly noted and changed. Thanks!

  5. Also if you guys aren't regularly checking Dan's blog, you're missing some great commentary. Be sure to read the comments sections as well as his blog posts.

  6. The asian markets open in about 5 hours.

    The US markets will need to stand down for 24 hours as the Chinese and UK exchange gold.

    I reviewed Harvey's blog today. I really like his comments, but a nuance in the situation between the Chinese/Asian BOS and the EE bears further scrutiny. Harvey and others seem to be

    There were reports about two years ago that the Chinese (as in Beijing) were redoing their gold vaults in Hong Kong.


    There seems no way to verify the status of the bullion reserve in either London or Hong Kong. However, Jim Willie's comments over the past nine months really align with the likelihood that the UK gold (sold by Gordon Brown et al) is now sitting in Hong Kong.

    If the physical gold is not in Hong Kong, then the Hong Kong bankers should be attempting to align their paper with their physical. Will backwardation appear in the gold market?

    For the traders on this board, the timing of gold price movement in US dollars seems to show more significant changes during London and NYC trading when compared to Tokyo, Hong Kong or Sydney hours.

    It would be logical that if Jim Willie's comments about the Chinese window are correct, then the Chinese would be liquidating paper positions in HK and then using that liquidity a few hours later to buy gold positions in London. Depending upon the currency pathway chosen, the Euro/Dollar ratio will see movement up in HK trading hours and then reverse direction as London closes and NYC opens. I do not do forex or currency trading and therefore I do not monitor that currency action much.

    In looking at netdania's data for the past week, I do not discern this price action. However, I am only looking at the last two trading days. The last two trading days in the currency markets are not reflective of the prior six months.

  7. hey turd - re: website development - i got 10 years experience programming for UBS. Just launched my own web dev business - i see from the post you already have a local guy but if you need any (pro bono of course!) consulting on heavy tech you can give me a holla.

    My site is live next week (otherwise I would post the url here) - holla back and we can exchange contact info.

    The home page even references FIAT money, which is no small feat considering our sector. You'll love it!

    peace to all,


  8. Sorry, error in the prior posting

    (TF - I'd really like a way to edit postings better. Sometimes the window for editing is so small that you can not "see" the entirity of your message until after posting)

    Harvey and others seem to be noting the "heavy" asian buying.

    The issue is not "heavy" asian buying. The issue is that 2/3rds of the people on Earth are living in Asia. India and China are two of the most populous places on Earth. If the people living in those areas are inclined to view gold and silver as money, then the paper value of a US $100 dollar bill is not recognized. They will only see it as worth something if they can exchange it for real wealth (judged as gold or silver). Most of the 2 billion people in that region have not entered the US PM market and certainly are not trading in options or futures at CME.

    The thread from two nights ago stands. What if JPMC and some of the other GSE paper is only being used to prop up the exchange of FRN's for gold and silver?

    If so, then you would want to prop up the exchange until you know that the vaults are dry and there is no more to be wrung out.

  9. Trader Dan nails it- 30 ry old resistance levels are all we have to go by, but how applicable could THOSE be? The reality is we are sailing in uncharted waters, me hearties. Adventure, danger, and the possibility of treasure or death.

    After what we saw Thurs and Fri, I've reached the point where nothing would surprise me next week- a sideways tug-o-war fight, a major raid, longs bailing, longs standing for delivery, nothing. Its all on the table. But if I am honest with myself, I must say that deep down, I sense a whiff of something truly extraordinary in the air. Something that smells, oh I don't know, vaguely parabolic...

    You know the thought has occurred to you. For God's sake, don't count on it and don't let down your guard- stay nimble. But just for a moment, savor the idea. Whisper the word ~parabolic~, envision the CNBS anchors looking constipated trying to explain it while not calling into question on-air the entire fetid ponzi; imagine the closed-door shouting at JPM, HSBC, and the COMEX; well-coiffed heads rolling...

    It may not be next week. But it may, someday, be.

  10. "It may not be next week. But it may, someday, be."...

    and it may be this week...we'll see.

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  12. What would you do with your physical when it indeed goes parabolic and reaches $60 in no time..? Would you sell? When would you sell?
    Personally I prefer steady rises/corrections above parabolic supernova moves/spikes.. If such a move would happen and it probably will at some point, I'm pretty confident in the end only a few would truly benefit..

  13. Gniuz: Very interesting observation and a good question for a thread- I hope people chime in. My own 2-cents would be that my physical isn't going anywhere. For me, its role is to serve as a bridge from our current (failing) currency regime to whatever comes afterwards. If things are still trading in current UD dollars (backed by the full faith and credit of the United States Goverment... snicker) then I am not selling anything. With luck and timely trading, however, such a move would provide me with the opportunity to make some paper profits I could then move into physical or other things. Timing? To quote the redoubtable afrum, "I don't know but Turd does!!!". I'd listen to my main man, plus what Harvey, Trader Dan, and others say. Frankly, I would also consider carefully what the really sharp posters on this site (Eric, Flaunt, kliguy38, CO Dan, Cris, Kiwi, TurdleGG, Tyler, and many MANY others) have to say, and make the call at the time.

  14. Parabolic silver to hundreds of dollars an ounce (banks need the metal to make deliveries and survive derivative losses)...probably means a fast system collapse....there will be no real correction as everyone will suddenly realize they need silver when the banks all close.

  15. First of all, kudos to the Turd for this blog. Mucho appreciated. Second, to quote the Wolf in Pulp Fiction, "...Well, let's not start sucking each other's dicks quite yet..." Ag will have to fight it's way out of the manipulation box one step at a time. When SLW does a NFLX move then we can all slap each other's backs. Of course, Ag is no NFLX so for SLW to make that move all hell will be breaking loose, so be careful what we're wishing for.
    Back to the Wolf quote, I started trading in earnest back in GW1 and almost got burned in WTI. I got suckered into a losing spread bet with my broker but did sell my oil positions the afternoon before the invasion in '91 for a quarter gain - how quaint it is to remember having a transistor radio between my legs tuned to the business station at work, not - sitting on pins and needles waiting for the 30 minute radio updates. I then played the .dot com stocks in the late 90's to par. Greed had me up 6 figures on a 1 figure initial outlay but reality brought back those 5 figures. Turd's right when he says TA is BS in manipulated markets; you're better off trading on rumor and innuenduo, unless of course, you're an insider.
    My point? This market in PM feels like nothing I've experienced to date. The ride is going to be bumpy, but astronomic. Catastrophe is not to strong a word imho. To Turd, the person doing the silver bears, is someone I'm following. So, perhaps, if you're serious about a web presense, you might want to join forces. My 2 cents.

  16. No not at $60. But at $100. I will trade my silver for a farm. Then I will grow a ton of vegetables and trade the the vegetables back into silver. What do you people thing? Good plan or what?

  17. This comment has been removed by the author.

  18. At a gsr of < 25-20/1 trade for gold,no higher and maybe lower. I'll never sell it for FRNs.

  19. Thanks for all the quality content Turd.

  20. Jack,
    If silver does just ignite to say 150.00 an ounce by the middle of march, I don't think this will bring about a collapse of the system yet. Palladium saw a huge spike a few years back from 60.00 to over 1200.00. The system stayed in tact. Ofcourse the differences between palladium and silver are like night and day but I don't think we would see a dollar collapse from this. It will be intersting to see what happens and ofcourse I am probably wrong.

  21. On a quick spike to $60? Hmmm.

    I'd be watching the gold-silver ratio, and if that plummets, as I think likely, then maybe some of my Ag will get swapped for Au.

    Some of my Ag might just get sold outright, in an effort to batten down the hatches on the home front. Debt reduction. Maybe that new efficient wood burner I've been thinking about.

    Some of it for sure will go nowhere at all.

    I would assume all my miners would spike as well. I'd need to go back over the list and decide about any profit taking there.

    Also, a quick spike in metals could easily be either coincident with, or followed by, a serious dump in the stock and bond markets and the economy as a whole. That would make me reassess everything from the ground up. Again back to the "batten down the hatches" idea.

  22. When Norcini, Turd, SGS, Conrad, Fleckenstein, etc. say sell, then it is time to sell. However, I think all of these folks agree that the moment will be generally obvious...when there is something else worth holding. Further, I would venture that the volatility we see now will disappear. We regularly see >$1 moves in silver during the day. This will stop. Finally, remember, although Ag/Au may go parabolic, you will not need to sell them at or even near the top (unless you're levered). When the price returns to earth, they will stabilize at "prices" much higher than today.

    As an aside...the OI that actually stands for delivery will be the first sign and an important gauge of the level of defacto monetization of silver. If folks actually stand and don't go for premium, then these are strong hands that simply don't trust the paper and wish to hold physical silver. It is this trust of paper that is being tested. They will sell it back when they "trust" the paper again. For some, this may take more than a generation. It's incredible how important the next week or so may turn out to be.

  23. Joe Jost,
    Your post is exactly what is on my mind. I have been thinking about this all weekend. I bought my physical silver in 2003. Right now I have purchased options to make some FRN's that I can turn back into physical metals and purchase farm land next to my farm. I saw what WB wrote. My options are May 38's. Reading Butler and all the others I read I get a feeling that this thing could take off for a while. I would not be surprised to see 100.00 silver in the next 60.00 days. Just wait till the hedge funds start to pile in. Then the the Industrial users panic. Lots of stuff to think about. Excellent post!

  24. The discussion today is timely, so to speak.
    However, I do not sense that the blood-letting from the giant has even started yet. The giant still believes he can crush the boy and his pea.

    Unfortunately for the giant, he does not realize what 2 billions boys with peas and shooters will do once several million bean stalks and several thousands gooses are laying the giant's golden eggs.

    There will be no parachute for the giant, only a long ride which for us will be visual and brief. For him, it will seem like slow motion and an eternity.

    Sell at $60.


    You couldn't make me reconvert to FRN's or USD's or any other paper ANY physical.

    It's a one way trip amigo.

  25. Turd writes: I emplore you

    Turd are you channeling Lindsey Williams? :)

    I mentioned back in the beginning of January that silver gained ~82% over 2010. There's nothing different going into 2011 and I might even hazard that it's worse now. Another 82% is my benchmark for this year based on strict macro fundamentals which would put silver around 55-60. This doesn't take into account comex or any other supply issues. I think we'll have a good year :)

  26. Just Fed the Turd for the first time! (yes, I've been lazy)

    Ka-Ching baby! Use it wisely, TF!

  27. emplore, implore... bad spelling :(

  28. As an amateur PM trader, I'll sell physical when it is near 15 to 1 with gold, or when all y'all advise me to get out. The whole point of holding physical for me is to NOT be wiped out by a financial collapse, to have bars and coins for rebuilding our lives in a post-dollar world. As for parabolic rises and the temptation to sell, I am buying cheap out-of-the money calls on miners & SLV that will profit 20 to 1 if they get in the money. I don't want to miss a ride into the $40s in March, but I can afford a loss if I'm wrong. Physical for the long haul. Stock & paper trading for the fast money.

  29. > It's a one way trip amigo.

    Physical yes, paper NO

  30. Here's a new one from John Mauldin. I don't always agree with John, but it's always food for thought, and usually good charts and data.

  31. A lot of great comments about when to sell / trade etc. My thoughts of looking to exit some trades, not my physical, will be when you hear normal folks bragging about getting into the PM market and an over abundance of supply sources for JSP.
    Fortunately, I don't hear of anyone talking about this at normal gathering spots.

    I believe this week will be volatile just from a market perspecive let alone what all the impacts of world events may hold.

  32. Anxiously awaiting the opening bell...

  33. I meant to have a new post up by 6:00.
    Sorry for the delay.
    Give me about an hour or so

  34. Haven't seen the Euro issue on our front pages lately, but it hasn't gone away, not by a long shot. Could throw some kind of curve ball at any time.

  35. sierra_hpbt said...

    Joe Jost,
    Your post is exactly what is on my mind. I have been thinking about this all weekend. I bought my physical silver in 2003. Right now I have purchased options to make some FRN's that I can turn back into physical metals and purchase farm land next to my farm. I saw what WB wrote. My options are May 38's. Reading Butler and all the others I read I get a feeling that this thing could take off for a while. I would not be surprised to see 100.00 silver in the next 60.00 days. Just wait till the hedge funds start to pile in. Then the the Industrial users panic. Lots of stuff to think about. Excellent post!


    I guess my excellent post does not fit within the guidelines of Turd's blog. Turd, I apologize if I offended you. I am direct, but I did not mean to offend. Did you delete my post?

  36. Okay - guys I'm a newbie here - active equity trader for about 18 months on my own account and I am scrambling to learn more about the historical move you think may unfold next week.

    I have some basics down, but what is the trade Tuesday morning? I am not in a position to purchase physical PM's. Is SLW the way to go or is it SLV, miners etc.?

    I have a fair number of PM miners in my portfolio (I'm in Canada so if you want to trade in local paper....), but weighted more to Ag than Au.

    I guess I should dump my JPM too.

  37. Libya's ambassador to China, Hussein Sadiq al Musrati, has just resigned on air with Al Jazeera Arabic. He called on the army to intervene, and has called all diplomatic staff to resign.

    He made claims about a gunfight between Gaddafi's sons and also claimed that Gaddafi may have left Libya. Al Jazeera has no confirmation of these claims.

  38. Can anyone give me a gist of what Trader Dan has to say in the interview? I am deaf, and I hate it when I get GATA dispatches pointing to videos or audios, as they usually don't have text of the audio. I sure would appreciate it, considering what could happen in the next 10 days.

    Thank you,

  39. Ran into the finance/investor guy at a wedding last night. He manages the money for the local religious community here.

    He said two things I found interesting:

    1) hadn't heard about the potential silver short squeeze
    2) had heard about silver over the last few years, and warned that everyone feels smart until it crashes...

    2 tells me he doesn't understand the gravity of the situation with world finance. The bubble is fiat currencies and money printing.
    1 tells me that many people, even professionals aren't involved yet. This can run for a lot longer.

  40. @e736e346-32cb-11e0-89fe-000bcdcb5194
    I think your link got mangled

  41. This from the FT
    "Moody’s expects defaults and distress in the $3,000bn US municipal bond markets but does not anticipate a broad “crisis of confidence”, says the credit rating agency’s chief executive.

    “There may be additional defaults in the municipal sector. There certainly is going to be distress in the municipal sector,” said Raymond McDaniel, chairman and chief executive of Moody’s, in an interview. “But we differentiate that from a broad-based systemic problem.” "

  42. Thanks for fixing phage

  43. 6a1dbcdc...

    You can always get the gist of Dan's saturday morning thing just by keeping up with his blog posts and his commentaries at JSMineset.

    I listened to the broadcast yesterday, and what I really remember, as Pining noted above, is that now that silver is in 30 year new ground, technical analysis needs to adapt. Looking for support or resistance from 30 years ago is pretty useless and TA will need to shift gears more toward trying to project the next price points, up from more recent action.

    Anyone who listened today, please update 6a1 with more stuff that escapes me right now.

  44. Avoid's a paper scam.

    Nothing beats physical silver, it's a win win.

  45. Oil and silver starting out of the blocks very quickly today. Also, whatever happened to people rushing into USD when the world is on edge?

  46. Hong Kong coming on-line here shortly. I keep expecting big buying pressure from there, but it's been disappointing so far in 2011.

  47. We are all amateurs Dr. J,
    You have the right idea. Never sell physical. Play paper for profits.In the new day I would imagine we would borrow against our ag if one needed. Those who would "sell" ag may not understand where we are headed.I will trade my frns for ag til there are no more of either

  48. StrongSideJedi, YES! You articulated well what I myself was thinking earlier today when I went for a walk.

    You have to look at it from a global perspective. Many Americans may not yet see gold and silver as money/store of value, but the rest of the world does!

    As far as when to sell physical? Hmm, I've thought about it to. I am not certain I will trade any physical for fiat. Here's an analogy for those Matrix fans out there... Neo, "So your saying I can dodge bullets?". Morpheus replies back "No, what I am saying is that when the time comes, YOU WON'T HAVE TO."

    So in short when I can go down to a local bank and hand them a 100 oz. bar of silver and they hand me my mortgage, THAT'S when I will consider trading it.

    My favorite thing that Dan said. The fundamentals have not changed. It's going to be a helluva week next week my fellow Turdites.

  49. Yes, I get just about all of the daily dispatches from different people, and as long as these interviewees share what they've said in their articles and blogs, then I should be good to go. Thanks, Eric.

    Yes, I have to agree that TA is useless, EXCEPT that it MIGHT predict the pattern of manipulative behavior, the cycle of how the manipulators trick the fools time and again. TA cannot really be used as if PM were freely traded markets because they are NOT at this time. And I don't think that TA will be able to adapt any time soon.

    For one thing, I don't know how this whole thing is going to play out. Will we see a jump from $30 to $100 OR more in one day, or will CFTC regulators jump in and either declare Force Majeure or declare, "Since we realize that silver must trade at a much higher price in a now-free market than it is priced at the moment, we cannot allow the market to progress in a disorderly fashion so as to cause immediate and irreparable harm to the affected parties involved. From this moment forward, silver and gold shall limit up at 10% per day for as long as market forces dictate higher prices until it stabilizes. The same shall apply for limit downs." Which is more likely to happen? I have no freaking clue (or I just don't want to believe that I could be resigning from my job and paying off everything very soon).

    Jack, is there any truth to the possibility that money outflows of the gold ETFs is coming from the Chinese buying shares and then tendering them for delivery?


  50. 6a1
    One thought. If I were hearing impaired, I'd be over on Dan's blog asking him if maybe he could routinely post a transcript of his KWN comments each week.

    I went back and listened again. There's a ton of nuggets there, but bottom line he's pretty darn bullish. Both silver and gold.

    Talked about behavior of trapped shorts in silver. Dips will be short lived. Talked about how hedge funds love trending markets, and both metals are now clearly trending and ripe for hedgies to pile in.

    Silver: if thru 33.25-33.50, then 35 pretty quick
    Gold: if thru 1394-1400, then new highs

  51. One other thing. I agree with someone above who noted that Bill Haynes comments on the Weekly Wrap, which always precede Trader Dan's, are great great stuff also and NOT TO BE SKIPPED.

  52. If you are tired of being told just what you want to hear, check out Clive Maund's current updates. Calling for a pullback & retest.

  53. Indeed...

    Sunday evenings at 6 30 PM are always exciting times for me, because it marks the beginning of a new trading week starting with the Hong Kong market. I have noticed over the years that overnight tends to be calm while action starts up anywhere from late Hong Kong to late London.

    I bought more some time ago when we had that small correction down to $27. I have more $ set aside IF it drops down to $18-25. Depending on how far it falls, I may do another small purchase, or I may go all in with the money set aside. Either way, for the last two years, I have been buying and accepting that it might be the last time I can afford to buy at these prices.

    I'm concerned about how much time I would have once silver reaches its free-market price. I would want my supplies lined up as much as I can BEFORE this happens, which looks like any day now, BUT it would be good to cash out some silver afterwards to buy the rest that I cannot get yet, BEFORE the general public realizes what just happened and is about to happen, if it does. I buy silver on the dips, but when it's way up like this compared to a year ago, I try to buy supplies as the prices on those don't change much (yet).

    I do remember the event of one of the other PM going from $60 to many multiples of that, and yet we are still here today.


  54. Anyone interested in Au/Ag mining stocks, Bob Chapman goes into great detail on what to look for when choosing a company. Very imformative video. He gives out some picks too.

  55. Eric, thank you! I left a message at Dan's blog.

    I do get the Weekly Wrap and the honking big one that the Daily Report and the Weekly Wrap (on Fridays) is included in every day, so I know about Clive Maund's work and have glanced at his reports over the years, but he gets a little deeper for me than I want to go into (the TA thing), so I usually look at the first few charts and then scroll down to the summary. Rather than get into TA, I look all around me and see what's going on. That is what tells me right now that Clive needs to be careful about being reliant on TA with COMEX about to go Kompum any day. He SHOULD be aware of the possibility of nearly all 55,000+ contracts for March standing for delivery or at least premium.

    On the other hand, I hope he's right, and a STEEP drop comes. I mean 40%+ drop. If that happens, I'm going to dump the rest of my FRNs planned just for this situation. If it doesn't happen and only makes a half-ass correction down to $28, I consider myself out of the buying market and holding to my position and will instead focus on supplies. I was SUPPOSED to consider myself out at $25, but I wanted to make one last buy. I have to put my money where I can buy what is relatively cheap. My income is chump change compared to what my peers make, so I have to maximize my income utility. Because I earn so little, I have to make sure that I own my peers afterwards, not the other way around. I'm tired of them owning ME.


  56. In regards to the hearing impared not having subtitles, I wonder if you could run one of those speech-to-text programs while playing a video or audio file. In theory, your mic would pick up the audio from your speakers and transfer it into text. Be cool if it worked....

  57. Eric said...

    I'd be watching the gold-silver ratio, and if that plummets, as I think likely, then maybe some of my Ag will get swapped for Au.


    That's my plan as well. It's certainly trending that way, I might do a little swapping if it gets under 30 to 1. I'm not a wealthy person by any means, but I've just freed up some dry powder waiting to BTFD at any opportunity.

  58. I'd also add that with silver, not only are we in new territory price-wise, we are also in a whole new game of manipulation. Blythe is no longer the only force to be reckoned with -- the Wynter Benton group has telegraphed their intent to short occasionally on the run up to $40, things will definitely be volatile. Their moves may take a completely different pattern that JP Morgue. Also if silver continues to break out and some hedge funds jump on board, there will be powerful new forces at play. My strategy is to be ready to BTFD at a moments' notice.

  59. good job so far turd man

    here is a gift to you and your readers

    lets hope the supplies are not that limited lol
    and that they are open on prez day!
    either way, stop by our website on thursday and friday for some gold and silver music (mostly classic rock)

  60. that wasnt part of the ad, i wrote down the $659 myself so i know what to tell them on the phone

  61. yeah, its a great price...thanks for posting.

    Flaunt, great job on the transcript. Nice to read the interview as well.

    LC, thanks for all your WB compiling. These are important times and its good to take note of all things.


    maaaaaan. i'm so not ready to be stackin 35 silver. this is almost scary. can't say we weren't warned.

  62. Be honest, I am not impressed. Trader Dan is always just a trader. He only knows what is happening, doesn't know why and what will happen - which is the only way to make a kill. Turd you are a top smart nut not easy to clone at current technology level.

    Only 2 suggestions for your new web site:
    1. pls make the comments area like yahoo message board, the most useful fashion
    2. get more ad's from solid companys you like to benefit both your web site budget and fan's investment choices.



  63. This comment has been removed by the author.

  64. Turd

    Thanks so much for making posts for the rest of us to read while you are on a three day weekend and have guests at home.

    I have noticed that occasionally a poster will say they have had a previous post deleted and in each case you say you did not delete their post. I have now had that experience, also. I am sure there was nothing I said that you would find unacceptable, but the post I made last night is gone. So it would appear that this is a technical issue. FWIW.