Stocks and Precious Metals Charts - A Flight to Sound Money - Fed Attempts Rescue, Leadership Shameless

"Good and bad coin cannot circulate together... and because of this unexampled state of badness all the fine gold was conveyed out of your realm."

Thomas Gresham, Letter to Queen Elizabeth, 1558


“Now, as he [Thomas Gresham] was the first [he wasn't] to perceive that a bad and debased currency is the cause of the disappearance of the good money, we are only doing what is just in calling this great fundamental law of the currency by his name.  We may call it Gresham's law of the currency.   Bad coin invariably and necessarily drives out good coin from circulation.”

Henry Dunning Macleod, The Elements of Political Economy, 1858


"Behind the concrete, the visible events, behind all objective, logical considerations, we find the irrational element: The struggle against the demon, against the servants of the Antichrist.

Everywhere and always demonic powers lurk in the dark, waiting for the moment when man is weak; when of his own volition he leaves his place in Creation, as founded for him by God in freedom; when he yields to the force of evil, he separates himself from the powers of a higher order; and after voluntarily taking the first step, he is driven on to the next and the next at a furiously accelerating rate."

The White Rose, Fourth Leaflet, Munich 1942

No elected body with a fiduciary responsibility, and any remnant of a conscience, should ever hand over a sum like $500 billion for disbursement to corporations to any presidential administration without clear conditions, transparency, and oversight. Especially after the abuses uncovered from the bailouts of the last financial crisis.  But needs must for those with no shame.

The Modern Moloch

Stock futures went limit down shortly after they opened on Sunday night. The Fed threw the kitchen sink at the markets this morning, and managed to hold stocks from falling out of bed completely.

Gold and silver caught a definite bid, as the whiff of monetary mischief permeated the markets.

I read an opinion piece from one of the usual suspects which blames our current state of affairs on the working public for their dissolution and extravagance in wanting to have such things as phones.

These are the same jokers who are still saying that this pandemic is all media hype, and that losing a few hundred thousand people dead would be well worth it, if we could only maintain the financial status quo of plunder capitalism.  They should do some field research in northern Italy.

It always seems unreal until it hits closer to home, as it did in our little town today.

This reaction to the collapsing bubble is like a replay of 2008. Or 2002. Well, you get the idea.  Just another round of shenanigans from our sociopathic elite.

There will be a Comex precious metals option expiration on Thursday the 26^th.

This is not over yet, not by a long shot.

The world does not love you, as God loves you, and the madness serves none but itself.

Have a pleasant evening.

Shanghai Gold Exchange Has 49 Tonnes of Gold Withdrawn the Week Ending 27 November

There were 48.86 tonnes of gold withdrawn from the Shanghai Gold Exchange for the week ending 27 November.

Year to date, there have been a record 2,362 tonnes of gold withdrawn, far in excess of any other year at this time.

What is the reason for this?  Why is there such a strong movement in the 'Silk Road' countries to continue to buy gold in large volumes?  What can the central banks of the West do about this?

Gresham's Law informs us of the why's and the what's of this phenomenon.

"When an official market or cartel overvalues one type of money or asset and undervalues another with respect to its fair market value and risks, the undervalued money or asset will leave the country as best it can, or will disappear from circulation into hoards, while the overvalued money or assets will flood into circulation."

And so it is that gold is flowing from West to East.

More of the same sort of pricing games with 'synthetic' paper gold will only increase the flood of bullion into Asia.  The price must be allowed to float according to the market.

Shanghai Gold Deliveries and Deliveries on the Comex - The 'Rest of the World' According To Bloomberg

Gresham's law is an economic principle that states 'when a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.'

Notice the 'sea change' that occurred with Shanghai gold flows starting in 2013.

And notice how the Western financial media views this phenomenon.

China Savers Buying Gold As 'Rest of the World' Exits

The 'Rest of the World' apparently does not include India, Russia, Turkey, much of the Mideast, and the European central banks who have been busy trying to repatriate their gold from New York and London.

I have included a chart showing 'Silk Road' gold consumption below.

In addition to all the wealthy individuals in the US and UK who are buying it for their own private vaults.

Who are the idiots who own most of the gold in the central bank crowd anyway?  The numbers are a bit hard to come by because for some reason the bankers are notoriously secretive in response to questions.

The 'official gold reserves' of all central banks in the world is also included below.  And the biggest goldbugs are the US, Germany, Italy, France, the IMF, Russia, China, Switzerland, Japan and the Netherlands.

True, a few central banks have disgorged some of their gold. The UK sold quite a bit of their sovereign reserves at the bottom, the lowest price for gold in dollars. Brown's Bottom it was called, presumably to rescue some 'trading houses' who were caught short.

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it."

Sir Eddie George, Bank of England, September 1999

One might wonder what has some of the NY and London banking crowd so worked up?  What have they gotten themselves into now?  Their spokesmodels have been quite active in the media lately.

I am sure the truth of this will come out some day.  Most likely over some long weekend.

This is how Nixon unilaterally took the US off the international gold standard, and declared a new fiat regime for 'the rest of the world' under the rule of the US dollar reserve, thereby rewriting the Bretton Woods agreement by executive decree.

Is it true that only a few 'goldbugs' really care about this and no one else?

Most of the central banks know the truth of things.  They are just keeping quiet about it for now, for whatever reason.  I suspect that they are receiving pressure related to the antics of one or more of the Banks.

"Gold is unique among assets, in that it is not issued by any government or central bank, which means that its value is not influenced by political decisions or the solvency of one institution or another."

Salvatore Rossi, Central Bank of Italy, 30 Sept 2013

Do these fellows take us for complete fools?  Really?

Gold Daily and Silver Weekly Charts - Gresham's Law, Mispricing of Risk, & the Synthetic Gold Carry Trade

"Gold is unique among assets, in that it is not issued by any government or central bank, which means that its value is not influenced by political decisions or the solvency of one institution or another."

Salvatore Rossi, Central Bank of Italy, 30 Sept 2013


Real gold does not fear examination or the furnace.

Chinese Proverb


"Gold has worked down from Alexander's time. When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory."

Bernard M. Baruch


"You have to choose between trusting to the natural stability of gold and the natural stability and intelligence of the members of the government. And with due respect to these gentlemen, I advise you, as long as the capitalist system lasts, to vote for gold."

George Bernard Shaw


"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."

Antony C. Sutton


Gresham's law is an economic principle that states:  When a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.

And this is why gold is flowing from West to East.

There was a fairly lengthy intraday commentary on gold and silver which you might wish to read here.   It covers quite a few topics related to the precious metals.

Surprisingly enough there was an actual delivery of silver at The Bucket Shop yesterday as Nova Scotia stopped 43 contracts for its 'house account.'

Otherwise it was the same old, same old with price going down or nowhere in the highly leveraged, synthetic markets of New York, and with physical bullion slowly leaking out of the warehouses.

The question is not whether or not the financial markets are going to slide into another crisis.  The only real question is when, since there is little to no interest in reform.

"We hypothesize that, having learned from the misadventures of the 1960s, the policy elites, well-versed in the practice of financial engineering and market manipulation, would have seen no need to dump stocks of government gold reserves onto the market, 1960s style, to keep the price in check.

Instead, synthetic gold, sourced in pyramids of credit extended to bullion bankers by central banks with little or no claim on physical substance, have provided a more efficient, better-camouflaged form of intervention. COMEX synthetic gold and related over-the-counter derivatives are traded in macro strategies implemented by hedge funds, high-frequency trades, and commodity funds in pair trades with interest-rate, currencies, equity futures, or even more exotic offsets. The volumes traded are huge, and bear little resemblance to actual flows of physical metal.

We suspect that shorting gold has come to seem like a riskless proposition as long as there is confidence in the Fed. Synthetic gold is the perfect substance for a carry trade: an easy borrow with very low carrying cost and little upside basis risk. Such a hypothesis, in our opinion, does much to explain the incongruity of a declining gold price while fundamentals for paper currency, and the U.S. dollar in particular, obviously deteriorate; while demand for physical gold has exceeded new mine supply for several years running; and while above-ground 400-ounce .995-gold bars located in London, New York, and other financial capitals (in cohabitation with speculative trading activity in paper markets) have steadily dwindled and disappeared into Asian financial centers reformulated as .9999 kilo bars."

Tocqueville Gold Newsletter 2Q 2015

Have a pleasant evening.