13 March 2015

Gold Daily and Silver Weekly Chart - Tender Mercies

March is a tough month historically for the metals. I would that it were not, but it is.

And don't the wiseguys know it, and they and their shills help it along.
And it seems to be a month that attracts quite few supercilious comments about values and valuations.
However, it is what it is.  Gold and silver have failed to break out of the downtrend.  That has been obvious for some time, since gold broke down hard through 1200.
Let's see what happens next week, with an eye towards Asia and the physical markets there.
This Eurodollar Riot by Cumberland Advisors is very much reading about the US dollar rally and the Eurodollar 'short squeeze' that I discussed a few times in the past.  I used to track these Eurodollar moves through the BIS reports. 
I have not done so lately.  They are usually about two quarters in arrears.  I think this example by Cumberland is good, but it ignores the primary impacts in the currency markets, and instead concentrates on the central bank impacts which are less volatile.  They also do not mention the large number of loans and transaction overseas that are denominated in dollars. 
There was a little action in the delivery department by the bucket shop boys, and nothing moves out of the gold bullion warehouses these days.  The Comex silver warehouses are being used as a delivery point interestingly enough, and there is a great deal of movement in and out.
FOMC meeting next week.  I think the big tickle will be centered on wording, specifically the word 'patient.'   The Fed is a failed institution.  But it is supported by a large and powerful infrastructure of vested interests.
The Fed's actions these days are somewhat disconnected from the real economy.  The idea of raising rates while the rest of the world is cutting, with a soaring dollar, is almost ludicrous.  
The Fed has the itch to raise because they ought to have done so before this latest stock asset bubble took off about two years ago, and changed their method of stimulus which does few outside the financial system any real good. 
They are raising rates, not to fight inflation of which there isn't any, even on the horizon except that which is monopoly-driven like healthcare and pharmaceuticals, and of course, paper financial assets.
Rather, they wish to raise rates for their own future policy reasons, so that they can cut them again when their latest asset bubble bursts. 
This is the credibility trap in action.  Past errors and complicity prevent them from addressing the real problems, or even stating what they are honestly and frankly. 
How can a co-conspirator gracefully introduce necessary reform without harming their credibility, or their cash flow?
Do you envy the rich and powerful?  Don't. 

"It would be far better for that man if he had never been born."
Remember the poor, and the creatures of the air as well, as Spring slowly arrives.  The harsh coldness gives way slowly to the warmer breezes and life giving sun.  And we can help nature to heal and bring forth its bounty anew. 
Remember the things that, in the end, are the only things that really matter, the only that are really worth remembering.  Life may be hard, but love endures.
Behold, He makes all things new.
Have a pleasant weekend.