QE is the only option to extricate Europe temporarily from its acute state of crisis. If this happens as expected we can also expect them to continue further QE's because no one wants to be the man or woman known for implementing policies that will cause the world to spiral into a deep economic depression. So they will kick the can down the road as many times as they can ultimately leading to hyperinflation over the next ten years. This is the main reason why I am so bullish on PM's at their current depressed levels, in addition to which the COTs are strongly bullish too, as they show that Smart Money (Commercials) is thinking there will be QE coming very some perhaps as early as June 20th.

A very important low in the big commercial bank net short position along with the dramatic reversal Friday favors a big move in Silver and Gold am still maintaining stops beneath the September, December and current lows, which coincide and that is no coincidence I might add. so what will it mean if silver does actually break to new lows I am not sure but looking at the ratio chart above a new low would probably be a head fake.  Remember the game is to get the little guy out at the lows, reduce shorts as much as they can and pile in as cheaply as they can.so if I do get stopped out i'd be ready  to jump back in if silver then breaks back above the breakdown point. 

The Buzz Is Growing That World Leaders Will Fire Off A Globally Coordinated Bazooka

As we noted last week, analysts have been tittering over a new potential policy response to risks associated with a global slowdown—most particularly the crisis in Europe.

World leaders are worried, as evidenced by the conference call between G7 finance ministers and central bankers this morning. And with fears about bank runs in Spain escalating, some analysts expect some kind of coordinated central bank action similar to that which we saw announced last November to lower dollar swap rates between banking systems.

Read more: http://www.businessinsider.com/what-are-the-odds-of-a-global-coordinated-intervention-2012-6#ixzz1x4FpPqXo

Obviously the jobs report came in significantly below the forecast. Because these numbers are mostly make-believe anyway I won't go into them in-depth. The number of jobs BLS wants us to believe were created in May was 69,000 vs. the expectation of 150,000. Even more troubling was the big downward revision in April. But what really should be people upsetting people is the treasury bond market. The yield on the 10-yr Treasury is at a record all-time low and the yield on the 30-yr Treasury  is below it's lowest point during the Lehman crisis. That's is a huge sign post I feel people in the media are either not seeing or purposely not talking about.

Essentially what this means is that all liquidity is being sucked out of the global financial engine and it's going into Treasuries and precious metals. I suspect today's big move in both reflects the expectation that we may get a heavy dose of QE3 in some form - likely not an obvious, overt form - at the June FOMC meeting. Uncle Ben will do his best to inject as much money into the system but disguise it in a way that the public will accept as nothing more than some temporary line of credit.

Recent breakdown was on heavy volume if you look at all the major sector ETFs they also sold off on heavy volume, it appears as if we are headed for the 200 week moving average which is the grand daddy of them all if that breaks look out. On the daily chart we can see the double white line that correspond to strong support on or around the 200 wk ma. The VIX broke out and it will probably top out in the 40's by the time Big Ben announces printing presses are ready to roll. 

after horrendous jobs report



interesting read:

Jamie Dimon And The Fall Of Nations

Posted on May 31, 2012 by Simon Johnson | 25 Comments

By Simon Johnson

 http://baselinescenario.com/2012/05/31/jamie-dimon-and-the-fall-of-nations/

 Market indicators mixed MSI bottoming and the MO with room to fall.

dollar is breaking out MACD is at the high point smelling a short term reversal at least 81 and change Euro still has a ways to go my previous target was 120

 Gold and silver both look like they are going to break down still at strong support and the MACD trying to turn positive. I don't see how with out any announcement of QE it will move upwards, even though the money supply.