Stocks and Precious Metals Charts - And Away We Go - Rate Cuts, Trade Talks, and an Option Expiration

The rest of this week and some of the next should be rather exciting, and volatile in the markets.

Tomorrow we have the much anticipated FOMC decision.

I tend to doubt that they will actually give the markets a rate cut tomorrow.

It is possible but not probable. And an actual cut might spook the markets.

Rather it is more likely we will see some sort of verbage like the ECB's Draghi gave the markets about being willing to feed them the rate cut sugar they crave.

This was enough to ignite the US risk markets today.

In addition there were seom 'encouraging' words about the G20 meeting and China trade talks. That really put a spark under bully.

The actual G20 meeting in Osaka is not until late next week, so there will be little more than speculative leaks until then perhaps.

The scenarios for the resolution of these big macro events is in a nice little chart right below.

Today was a taste of number 2.

As a reminder, there is also a stock option expiration on Friday.

I have been thinking of various ways of playing this, other than having a gold long trading position I have had for some time since the price of gold in dollars turned up and broke out of the descending triangle.

The bond and equity markets, along with several important indicators, are suggesting that there is a significant mismatch in the pricing of risks.

My money is on the bond markets. The equity market has become dominated by carnies, con men, and snake oil peddlers.

I have been watching youtube videos today, by a guy named Andrew Camarata, who is a 'property maintenance manager' in upstate NY near some places where we used to go, for used and antiquarian books in Woodstock, and a garlic festival in Saugerties.

He has an amazing array of equipment which he maintains himself.  He has skills, and I find his whole approach to things very similar to my own.  He would be a great friend and neighbor.

Need little, want less, love more.

Have a pleasant evening.

Stocks and Precious Metals Charts

Just charts tonight.

Dolly and I are taking a vacation day.

The markets are waiting for the FOMC decision on Wednesday.

Have a pleasant evening.

Physical Gold Withdrawals from the Shanghai Gold Exchange and The New Silk Road

"Time is coming when markets search frantically for physical collateral to find that paper far exceeds underlying collateral for several metals and other resources.    I am warning that when markets fall in sustained negative response to bursting bubbles, widespread deleveraging will reveal insufficient hard collateral underlying traded asset-backed securities.  The words rehypothecation and hyper-rehypothecation may be rediscovered or remembered again, forgotten somehow during much of decade since the Great Financial Crisis."

Harald Malmgren


"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

One might wonder why these countries are steadily acquiring such enormous inventories of gold bullion.

And they might even notice that since around 2008 the central banks of the world have become net buyers of gold, after many years of managed selling.

Gold is flowing from West to East, and into strong hands and official vaults as security against a changing monetary landscape.  And except for the occasional use of subtrefuge and force, it will not return to the public markets anywhere near to these current valuations.

Stocks and Precious Metals Charts - The Gathering Storm - King Dollar, La Douleur du Monde

“God whispers to us in our pleasures, speaks in our consciences, but shouts in our pains.  It is his megaphone to rouse a deaf world.”

C.S. Lewis


"The Lord is my light and my salvation; whom shall I fear? the Lord is the strength of my life; of whom shall I be afraid?"

Psalm 27

Stocks moved sideways today.

Gold and silver both rallied strongly overnight and in the morning.

They both fell to a much stronger dollar in the afternoon.

Next week will be the FOMC meeting and the week after that the G20 meeting in Osaka.

Both events, along with the simmering geopolitial climate in the Mideast and South America, will most likely have a strong effect on the markets.

There will be a stock market option expiration next Friday.

Have a pleasant weekend.