22 February 2013

Gold Daily and Silver Weekly Charts - Life During Wartime - Moody's Downgrades UK

After the bell Moody's tarnished sterling by downgrading UK debt from its treasured AAA rating. I suspect that this is in advance of fresh downgrades for Europe, and perhaps the US if the sequester rocks the corporatist boat. Spending cuts are for the little people.

The currency wars continue. I have intra-day commentary on Financial Dreadnoughts in Times of Currency Wars, among other things.

The idea of 'financial dreadnoughts' comes from an idea I had in about 2002, when I considered how I might wish to arrange things if I wanted to give the Fed and Treasury the latitude to act economically in the aftermath of a financial crisis while engaging in a currency war to support the Anglo-American petro-dollar.

I should add the significant caveat that incompetence, careerism, and corruption explain all the same things, much more simply, and with a certain experiential credibility. I hate to attribute to Machiavellian intent what can be attributed to unprincipled self-serving stupidity. And by the way in which these graspingly inept jokers have been blowing things up, in perfectly avoidable crisis after crisis, that might be a very good bet indeed.

Comex Option Expiration next week. I will be watching the action after expiration to try and get a better sense of where we are in this cycle of market monkey business.

The COT shows that as of Tuesday the hedge funds had deepened their short position in gold quite a bit in the combined futures/options categary, in preparation for a takedown. Next week's report should give us some idea of how things went into the expiration.

Have a pleasant weekend.