Gold Daily and Silver Weekly Charts

"When the international monetary system was linked to gold, the latter managed the interdependence of the currency system, established an anchor for fixed exchange rates and stabilized inflation. When the gold standard broke down, these valuable functions were no longer performed and the world moved into a regime of permanent inflation.

What will be the character of the international monetary system in the next century and how will gold intersect with it? This subject may strike modern audiences as a strange topic, but back in the 1960s, when people were deliberating about the future of the international monetary system, gold figured importantly in the discussions.

Even today, the importance of gold in the international monetary system is reflected in the fact that it is today the only commodity held as reserve by the monetary authorities, and it constitutes the largest component after dollars in the total reserves of the international monetary system."

Robert A. Mundell, Nobel Prize in Economics 1999

There is a fairly tight cap on silver.

The equity market seems to be pricing in a Greek settlement that is favorable to the paper markets. It is not yet clear that this is valid.

Let's see if this proves out, and how the precious metals react.

SP 500 and NDX Futures Daily Charts

The stock market seems to be pricing in an outcome in the Greek debt crisis that is favorable to the international banks.

Gold Daily and Silver Weekly Charts - Remembering Django Reinhardt

I am concerned about the Greek situation, and a little guarded about the non-Farm Payrolls report on Friday.

On the bullish side, the Fed is going to start up QE again as soon as they get the proper excuse. Their rationale is going to include the notion that by printing new money to buy debt from the banks, they will not contribute to inflation because they will lock up the money on their balance sheet.

It is just a variation of the 'excess reserves' play they have been making for the last few years.

Zimbabwe Ben is going to print. That is all we need to remember. The pity is that the printing will be used to specifically benefit the wealthiest perpetrators of fraud and will have negative side effects for the real economy.

In the light of such boorish ugliness of these cheats and financiers, let us sit back and enjoy enduring greatness.

SP 500 and NDX Futures Daily Charts - Bounce Day Ahead of Greece and Payrolls

I added back some short positions to balance new longs in the beaten down silver added yesterday.