16 April 2013

Gold Daily and Silver Weekly Charts - Change Is Coming

“First you destroy those who create value. Then you destroy those who know what values are, and who also know that those who have already been destroyed were in fact the creators of value.

But real barbarism begins when no one can judge or know that what they are doing is barbaric."

Ryszard Kapuściński

Intraday commentary about gold here, What Does the Recent Decline in Gold's Price 'Prove?'

Well I think we can stipulate that if you give the Banks enough money and regulatory leeway, they will be able to have a good time with almost any market. But there is a bit more in there than that, and you might wish to give it a read.

I will caution everyone that I obviously do not know what the future will bring, and that, within the context of a currency war and a post credit bubble adjustment which I very much believe is underway, markets are going to remain difficult if not treacherous.  So leverage is best left for professionals.  The lack of transparency and market reform is appalling.

One thing that puzzles me when discussing this subject with American economists and financial pundits who have been expounding on the decline in gold, and those who may choose to buy gold and silver for their portfolios, in some fairly over the top terms complete with name-calling.  And drawing some fairly dodgy but broadly sweeping economic conclusions from it in the process.

Do they realize that quite a few people also buy Swiss francs and other currencies for many of the same reasons like portfolio diversity that people might also buy gold and silver?    And they are often the same people?

And their motivation in making such a purchase is not a hatred of the Democratic Party?  It may be a vote of 'no confidence' in monetary policy of a particular central bank, motivated in part by the negative real interest rates for example.  And it might reflect concern about scandals and corruption too, but that is more of a practical than political matter. 

Unless of course you are a creature of the central bank and its subsidiaries who can admit no error and allow no questions.

Do they realize yet that the world's central bankers are now net buyers of gold?  Are the Chinese and Russians closet Republicans?

Do they have any idea of what is happening outside of the clubby enclaves of the Washington-New York metroplex, the Hamptons, and the City of London?

Do they understand what is happening in the global currency markets and the way in which they are evolving?  I see little evidence of that.  They are stuck on some fairly narrow self-interests and issues.

Do they look for anything beyond their comfortably entrenched place in the status quo or does this bring too much fear and even desperation?  Its a common problem for many, but few see it in themselves.  But they are quick to point to it in others.

I think that quite a few economists and pundits might be in for yet another rude surprise (again) in the not all that distant future, because it looks like a sea-change is coming, slowly but surely.