22 July 2014

Gold Daily and Silver Weekly Charts - Capping The Recovery™ By Distributing Paper Wealth

"It would convert the Treasury of the United States into a manufactory of paper money. It makes the House of Representatives and the Senate, or the caucus of the party which happens to be in the majority, the absolute dictator of the financial and business affairs of this country.

This scheme surpasses all the centralism and all the Caesarism that were ever charged upon the Republican party in the wildest days of the war or in the events growing out of the war."

James A. Garfield,  on a resolution offered by the Greenback Party that the government should issue all money, 1880

The number of ounces of silver that were 'stopped' is well over 15 million now for the month.

Next month the emphasis may shift back to gold. Today silver was the stalwart but most metals were capped.

Other than that, not much of consequence is happening in the Comex metals market these days. Bullion gets pushed around the plate in a daisy chain of short term speculation.

The real metals markets are already moved to EurAsia and the Mideast.

When the real markets reconverge with the paper markets, the resulting adjustment may be quite noticeable.

There was some related intraday commentary:  Green Slime: The Return of Franken-Money 

The lack of a recovery in the real economy, coupled with the background growth in artificial and short term focused money is setting up a particularly nasty set of scenarios for the US.  Stagnant wages will not support aggregate demand and generate organic growth, no matter how much money the Fed can create and shovel into the Wall Street Banks and the one percent.  Most despots would fear those numbers.

The Fed and the government have tried to cobble together a whole economy out of the corrupt and rotting pieces of a failed system and the dead bones of false economic theories, and sought to bring life to it with the lightning bolts of huge money infusions into the Wall Street Banks.  And what they have created is a monster, inimical to real growth and organic life.

How broken and dysfunctional is this system?   The US Congress has a record low approval rating of seven percent, and they simply do not care, and are inclined to change nothing.

The 'trickle down approach' does keep down the growth of wages and 'inflation,' as well as productive economic activity versus financializing activity,  but it sets up an absolutely deadly reckoning that may stretch the moral fabric of the Republic in ways not seen in our lifetimes certainly.

Have a pleasant evening.