"On Sunday afternoon, facing a revolt by his own party’s senators, Obama dumped Larry as likely replacement for Ben Bernanke as Chairman of the Federal Reserve Board...
But the fact that Obama even tried to shove Summers down the planet’s throat tells us more about Obama than Summers—and whom Obama works for. Hint: You aren’t one of them."
Greg Palast, Larry Summers: Goldman Sacked
JPM has agreed to admit wrongdoing and will pay about $800 Million in fines for concealing the huge trading losses in the case of the London Whale.
The precious metals rallied with stocks overnight as Larry Summers released Obama from having to cut him loose as a candidate for Fed Chairman.
The reason that Larry and Obama did this is quite simple. There was broad bipartisan opposition to Summers in the Senate which precluded a confirmation. Sometimes it really is that simple. Obama's own Senators refused to go along with it on principle and practicality. That is how bad it was. And that is pretty bad.
There was little other support to be gained as footing, except from Wall St insiders, with over 400 economists signing a petition that said Summers was a poor choice, giving their endorsement to Yellen. It was a policy battle that could not be won, and for which no strong allies were to be found. One has to wonder what motivated Obama into such an awkward display in pursuit of a hopeless and apparently cynical policy decision.
Just like Syria.
So what next. The metals were capped all day in a concerted manner. I suspect that this will continue until the FOMC announcement on Wednesday.
Let's see if any additional physical offtake is prompted by this, or if just a steady flow in background will still continues. Keep in the mind that COMEX is not a primary delivery exchange of any real importance. But the low inventories of gold bullion are more of a indicator of trends than a hard stop on anything. The COMEX will probably not be the locus of a failure to deliver. That honor is more likely to be held by the LBMA, perhaps even in response to some market dislocation in Shanghai or Hong Kong.
Have a pleasant evening.
