21 October 2014

Gold Daily and Silver Weekly Charts - Slowly Higher, More Gold Withdrawals


The precious metals managed to drift higher, with some capping action in the late afternoon.

There was a rumour this morning that the ECB would start buying corporate debt at the end of this year, and visions of QE European Style had stocks zooming, and the precious metals were in rally mode, even that poor old mule silver.

But capping came into play, as stocks continued on their short squeeze, helping to ease the pain that the hedge funds were dealt just a week ago.

There seems to be quite a few tonnes of gold bullion taking off for Easterly destinations.   I doubt that gold will be returning anytime soon at prices anywhere near where we are now.

But that is tomorrow.  Let's keep our priorities, and see if bullion can finally break this price downtrend, and breathe some like back into the charred mining sector.

Have a pleasant evening.








SP 500 and NDX Futures Daily Charts - Draghi Racing To Da Moon


Another central bank rumour managed to light a fire under stocks, and the hedge funds ran with it.

The rumour this morning, following on Bullard's statement on possibly continuing QE, was that Mario Draghi's European Central Bank might start buying corporate debt as soon as December of this year.

And there they go!

Existing home sales came in a little better than expected, but pointing to that as some sort of fundamental trigger for this is nonsensical. The underlying fundamentals of US housing are overall weak.

But the hedge funds are anxious to make up for this years losses, and they are piling on to this market that had become deeply oversold, triggering a short squeeze V bottom.

The question is how long can they take it up, and what will they do when they reach that point, look around and see no other buyers, and say to each other, 'What do we do next?'

It is a job badly done when the capital allocations of an economy are done by a casino, said J. Maynard Keynes. And he was absolutely right.  

Remember, there is no 'we' in fiat.   Power is for the powerful.

Wall Street these days is where money goes to die. But while it lasts, the party is rocking the house.

Take a look at the mildly technical chart of the SP 500 just below.  Volume is dropping off from the big plunge, but has fallen back to 'normal.'  This big rally of the last four days has relieved the deeply oversold condition, but may now find it a little bit of a chore to pop up through the 50 DMA which is around 1966.

What rumour can they float to shake stocks out of their likely consolidation, which appears to be on deck, and get them moving higher again?

Have a pleasant evening.








First Poll In Swiss Gold Referendum Shows Tight Race


It looks pretty even with all those undecided and probably votes.

The Banks have not yet begun to fight.

Let the games and fear-mongering begin.

Cry havoc and let slip the dogs of fiat.




20 October 2014

Gold Daily and Silver Weekly Charts - Post Stock Option Expiration Rally


Gold and even the somewhat hapless silver managed to pull together a modest rally today, after the stock market option expiration we saw last Friday.

The miners and associated precious metals plays had been beaten with an ugly stick.

So what next?

We have a Comex option expiration for the precious netals next Tuesday for the November contracts. I have included a little data from the deliveries in gold, which were a bit more than one would expect for an inactive month. And there continue to be some steady withdrawals from the gold and silver warehouses. In particular silver is flying out of Scotia it seems.

There was intraday commentary about the purchasing of gold bullion in Russia and China.

Have a pleasant evening.








SP 500 and NDX Futures Daily Charts - Shooting Shorts in a Barrel


The wiseguys decided to try and 'take it up' to squeeze the lazy shorts who were overstaying their positions.  As one trader said, 'it is like shooting fish in a barrel.'

There was steady buying on relaxed volume for much of the day in the futures.

Not much in the way of economic data this week.

Have a pleasant evening.





The American Dream By Joe the Angry Hawaiian


This is from the Big Island.  The natives seem restless.

"Democracy in a free market capitalistic society today only exists in the imaginations of sleep-walkers in the American Dream. The idea of honest, hard work being suitably rewarded has become a mind-numbing slogan that is now just beginning to wear off in the minds of some Americans.

While Americans were working and playing hard, our representational democracy has evolved into a political system that has been completely and utterly bought by the moneyed interests, and is now a protection racket for their accumulation of wealth and advantageous positions of power and influence. We live in a land where untaxed off-shored wealth is ignored, and the whole tax system has been customized to suit their personal needs.

We live in a fictitious land where multi-national corporations are legally given Frankenstein-like status as a red-blooded American, and their money has become their vocal chords. Politicians, while posturing that they are working for the people, are nothing but lobbyists for the rich, which most of them are, or assured to be upon leaving office to be rewarded with speaking fees, or think tank positions by their powerful benefactors.

This unreal, and unjust dream-land is kept alive by obscuring smoke and brightly lit mirrors of the mass media that is completely controlled by a relatively few corporate interests. Combined with idealized statistics provided by the government we have been lulled into an illusion that is both numbing and dumbing. To realize there is even a problem, attention spans must be able to last for longer than a 60 second advertisement.

The hard rock reality of the great American experiment is being felt by most everyone with a wallet or purse. The financial system is run by the un-Federal Reserve Banks. The privately owned US Central Bank gives money which they make out of thin air to the boys who run the biggest Banks for less than .25%. As the statistics reveal, this money rarely goes far from the hands of the rich. Their fingers grasp this money so tightly that the so called trickle is now a mere tiny dribble that seeps slowly to those below.

The US dollar is a fiat money con-game sustained by the illusion of American exceptionalism. This confidence in America as a moral force for good has been destroyed by its self-serving hypocrisy, its torture, the poor performance of its political drama queens, and endless wars without end. But things are changing. No longer can the US declare an economic embargo that brings countries to their knees, especially since the US itself is up to it's myopic third eye in debt.

I believe the problem that we will be facing soon enough is not the economic imbalance of the rich and poor in this country. This unequal lopsidedness can be maintained for many years, especially with a militarized police force.

The real problem is those beyond the reach of the system like Russia and China and the rest of the BRICS. When they decide that they have had enough of our self-serving antics, and renounce the US dollar as the world currency, then folks, that's when we have a problem.

Until then nothing changes, since most members of our society can't even remember there is problem or what caused it.

Lower Gold Prices Prompt Large BRIC Purchases


Apparently those lower gold prices proved attractive to the BRICS.

Not all the economic theorems are utopian myths.  Supply and Demand still works now and then.

There was a sea change in the international gold markets around 2005, as central banks became net buyers for the first time in over twenty years, and few even know about it.

Russia saw it's largest monthly purchase of gold in 15 years with 1.2 million ounces
 
Yes, these things are happening. 
 
And yes, most media people are not speaking about them, or pull a cloak of obfuscation and misdirection over them.    The media does not help the people, it handles the people.
 


China's had its third largest flows of gold bullion from Shanghai at 68.4 tonnes after it's week long holiday. And there is a similar story for India, except there the people are buying and the government sahibs would like to resist with import fees.    Or maybe they just simply cannot.

Gold at these prices is steadily flowing from West to East. What is not sustainable will not be sustained. There will be a reckoning, and a revaluation.

It would be better for the world if the would be financial engineers and central planners allow it to be gradual, rather than precipitous. Otherwise the gold leasing window will some day be slammed shut, and gold will go into a highly disruptive backwardation.

Then they will be carrying traders and even whole firms out on stretchers, along with the credibility and reputations of quite a few economists, analysts, regulators, and politicians.


These charts are from the data wrangler Nick Laird at Sharelynx.com.