17 July 2013

Gold Chart Intraday - The Bernanke Dipsy-Doodle and Germany's Gold

As you know Ben Bernanke is giving what is likely to be his last testimony to Congress today as the Chairman of the Fed.

So we see gold doing the old 'wax on, wax off.'

The wiseguys need bullion going into a key delivery month of August at the COMEX. Their registered for delivery inventories are at record lows for this leg of the bull market. Overall inventories are getting thin as well.

Every time this has happened, there has been a marked change in the direction of price, higher.

I found this transcript of Lars Schall's interview with William Kaye to be informative.

The decline in the price of gold coincided with the Bundesbank's request for repatriation as I have shown in the past. I would not be surprised if this gold market operation, which is facilitating the removal of large amounts of gold from the ETFs which I have also documented, is serving the purpose of replenishing the missing gold stocks.

Stand and Deliver: How Germany Disrupted the World Gold Market

It may also take the form of a 'stealth confiscation' which will allow the TBTF bullion banks to get long the metals, and ride them higher.

As some commentators have pointed out, there are big drains of physical metal in the gold ETFs, and comparatively little from the silver.  That is not a mark of 'silver strength,'  but more a sign that the physical gold is in very short supply, whereas silver has a more systemic and longer term supply problem.  This is what I think if one looks at the total picture.  Silver supply on the COMEX is not under immediate pressure.

It will be interesting to watch the hedge funds, who are quite short, try and wriggle out of this one.  They deploy their dependents in the media quite well, but that does not help them provide what they have already sold.  It will be bought back at higher prices.

The wiseguys and their water carriers in the media will try to blame China, which indeed is a recipient of much of this gold, because they are a willing buyer, seeking to trade paper for metal as part of their reserve's plan. But I think they are just a contrarian player in a market managed by the Anglo-American banking establishment. 

As I have noted many times before, there is a 'currency war' underway as the international monetary regime evolves and changes.  And it appears that the wealth of the German people in the form of gold may be serving as cannon fodder as it has been conscripted and deployed.

Change in the monetary system status quo is being resisted by the elite that it has enriched, as it always has been and does still.

So for today, time to shake the ETF tree. Tough times ahead so better sell that gold.

Tut tut, looks like rain.