Gold is cheap relative to the idea that you could have a life’s fortune on a statement from a clearing agent and then find out that you don’t have a penny left anywhere. Which should you have had, physical gold or that clearing house statement? Gold is cheap because of the condition of other things.
Jim Sinclair
There was a very obvious drop in gold today. It was coincident with a decline in the SP futures, but was much sharper and more severe. I include the intra-day chart. It has every indication of a major bear raid.
There was a quite a bit of disappointment today when the ECB cut rates 25 bp rather than 50 bp, and Mario Draghi did not pledge his central bank to endless quantitative easing and the buying of European bonds.
There was a report today at Zerohedge from Goldcore that the German business wire MNI reported that "MARKET SOURCES REPORT BIS, BOE & FEDERAL RESERVE WERE SELLING GOLD AFTER IT POPPED TO SESSION HIGH AT GMT 1335 -MNI NEWS via BLOOMBERG."
I get the daily report from Goldcore and I have a non-premium subscription at MNI. I have not been able to find the particulars of this, or any details, so I am unable to further comment. It is not that I doubt this, but I would like to know what causes them to say this with such specificity. How did they know who was selling, and what were their sources?
Tomorrow will be interesting. In the afternoon a report/rumour swept the markets that Germany would not be supporting the new EU Treaty to resolve the debt crisis, and the equity markets went out on the lows.
Jon Corzine was testifying today before the House, but the more enlightening testimony may have been by CFTC Commissioner Jill Sommers who made it quite clear that the customers of MF Global have a claim on its assets that is superior to the creditors including JP Morgan.
As John F. Kennedy once said, "My father always said that all businessmen were sons-of-bitches, but I never really believed it until now."
This affaire d'MF will give us some insight into the character of the American government. It might be advisable to have a bag nearby however, because the experience may be truly nauseating.
At the end of last year I promised you a 'year of revelations.' And it seems that they are well underway. But the greatest revelations are not about what those in charge have been doing, but rather about ourselves and how we react to them.
I am thinking about what next year will bring. But I think the time is already here in which to take steps to protect your assets.
