NAV Premiums of Certain Precious Metal Trusts and Funds

Silver continues to take it on the chin.

Gold Silver ratio is back up to 70.



 

Divergence In Gold and Silver Open Interest

Someone asked to see the open interest divergence in the gold and silver futures graphically that I mentioned in an earlier post here.

As always, Nick Laird of Sharelynx.com has the goods.

By itself the open interest divergence is not compelling, just odd.

But with everything else, especially the great and ongoing divergence in ETF and Fund physical inventories, and it begins to approach the irregular.

 

That is not to say we can comfortably call a bottom here, as oversold we might be at old support.  The downtrend will not be broken until we see a higher high.  

 

It would not be well to underestimate the thugs and pampered princes and the markets they that they control.  

 

What they cannot manage is the physical market which will eventually break them, as it did the London Gold Pool.  But that will take time.  But when the time comes, it will fall apart rather quickly unless some of these jokers wise up first and stop the spiral of inventory leverage and paper before it becomes a critical, systemic problem. 

Gold Daily and Silver Weekly Charts - Peak Empire, In Time of Plague

Sculpture after Albrecht Dürer's Knight, Death, and the Devil

Beauty is but a flower,

That wrinkles will devour.

Brightness falls from the air;

Queens have died, young and fair.

Dust hath closed Helen's eye.

I am sick, I must die.

Lord have mercy on us.

Thomas Nashe, A Litany in Time of Plague

We had a nice bounce after an overnight smackdown with gold tagging the 1180 support area.

There was intraday commentary about the interesting divergence between gold and silver here.

 

I am focused keenly on what I consider to be one of the greatest macro-economic events my generation will probably see in the Bretton Woods era when Nixon took the world off the dollar/gold standard.

 That set the world out upon some very uncharted seas that were easily overlooked in the sturm und drang of the Cold War.   But that all changed in the 1990's.   Few have yet perceived it, and what it implies for us.

And so here we are.  Peak Empire.

China comes back from holiday on the 8th.

Gold and silver need to break the downtrend of lower highs and lower lows. That is the technical market analysis in a nutshell.   I do not know when it will happen, and what it will lead to next.  One can only forecast, relying on probabilities.

 

Have a pleasant evening.

 

SP 500 and NDX Futures Daily Charts - Skittish

I do not like the idea of holding equities here, although a big selloff is unlikely before the November midterm elections. They seem rather fully valued, and the risks inherent in this unreformed financial system and globally interconnected mélange of mispriced exogenous events do not seem equitable.

So, for example, we saw stocks unable to rally even with a big financialisation announced, with the splitting of Hewlett-Packard into two different companies, although the stock itself could rally.

But the algos have these markets 'in hand,' and the Fed continues to pump money into Wall Street. The problem is that Wall Street is reported using 95% of their profits for stock buybacks and payouts.

 

And so money continues to be scraped out of the real economy and aggregate demand to the one percent.

This will be a fairly light week for the economic calendar.

Have a pleasant evening.