Gold Daily and Silver Weekly Charts - From the FOMC Smash To the Usual Price Capping

 

Prices of precious metals popped back up sharply at The Bucket Shop as the traditional FOMC related price manipulation was over.

Otherwise the action in the warehouses and 'delivery' was moribund as usual, more like a morgue than a market, where the mourners are in the hallway and parking lot smoking cigarettes and playing liar's poker.

 

It is like a morgue, where values go to die.   Kind of like the Congress. 

 

There is some intraday commentary on NAV and the precious metals here.  I thought it was interesting that the discount to NAV on the Central Gold Trust widened back to the Pre-Sprott Offer levels.

 

Gold is still in a trading range from 1170 to 1230, although it appears to be breaking out in some other currencies. 

 

I am becoming more enthusiastic about the longer term potential for silver.  I have some observations and charts about that from last night here.   I do not know why there is such a lid on the price of silver, but it is certainly there for those who would have eyes to see it.

This gaming of the markets will end, and badly. But the timing is problematic.

 

We are being served badly by our leadership.   I do not see how this can fail to bring about change.  And I doubt that they will bother to initiate that change until they feel the heavy hand of history, clutching the backs of their collars.  Alas, that is often too late.

 

Have a pleasant evening.

 

 

 

 

 

SP 500 and NDX Futures Daily Charts - Up, Up and Away

 

US equities were on a tear today.

 

Purportedly it was because of the 'better than expected' economic news, but really I think this is just more of the hot money, self-referential technical trading that so characterizes this market.

 

It is fluffy; its foundations are made of meringue, not stone.

 

Have a pleasant evening.

 

Why the Greek Parliament Under Zoe Konstantopoulou Declares Troika Debt 'Odious, Illegitimate'

"When the Greek mainland was overrun, the resistance was carried on from the islands. When the islands fell, resistance continued from Africa, from the seas, from anywhere the aggressor could be met.

To those who prefer to compromise, to follow a course of expediency, or to appease, or to count the cost, I say that Greece has set the example which every one of us must follow until the despoilers of freedom everywhere have been brought to their just doom."

Franklin D. Roosevelt

"If the Russian people managed to raise resistance at the doors of Moscow, to halt and reverse the German torrent, they owe it to the Greek People, who delayed the German divisions during the time they could bring us to our knees."

Georgy Constantinovich Zhoukov, Memoirs

"Until now we used to say that the Greeks fight like heroes. Now we shall say: heroes fight like Greeks."

Winston Churchill

"Regardless of what the future historians shall say, what we can say now, is that Greece gave Mussolini an unforgettable lesson, that she was the motive for the revolution in Yugoslavia, that she held the Germans in the mainland and in Crete for six weeks, that she upset the chronological order of all German High Command's plans and thus brought a general reversal of the entire course of the war."

Robert Anthony Eden

A better part of the US media have painted the findings of the Greek Parliament's inquiry into the debt as just another stage in the 'war of words' and having 'nothing to do with reality.'

Nothing could be further from the truth.

As noted by the BBC:

"The concept of odious debt is established in international law where dictatorships or illegitimate governments have borrowed money and later been succeeded by democratic regimes."

Here is one excerpt from the Greek Parliament's preliminary report:

"All the evidence we present in this report shows that Greece not only does not have the ability to pay this debt, but also should not pay this debt first and foremost because the debt emerging from the Troika's arrangements is a direct infringement on the fundamental human rights of the residents of Greece. Hence, we came to the conclusion that Greece should not pay this debt because it is illegal, illegitimate, and odious.

It has also come to the understanding of the Committee that the unsustainability of the Greek public debt was evident from the outset to the international creditors, the Greek authorities, and the corporate media. Yet, the Greek authorities, together with some other governments in the EU, conspired against the restructuring of public debt in 2010 in order to protect financial institutions. The corporate media hid the truth from the public by depicting a situation in which the bailout was argued to benefit Greece, whilst spinning a narrative intended to portray the population as deservers of their own wrongdoings."

I suspect the Greeks are not going to roll over on this, and it is very much in the interests of Italy, Portugal and Spain that they do not.

The parties must engage in more reasonable discussions to find an equitable settlement, that does not subject the Greek people to debt peonage.

 

And if they continue to try and make an example of them, if the Troika and the vulture funds want a pound of flesh from the Greeks, I imagine they will be told to come and take it, if they can.

 Related:  ECB 'Blesses' Greek Bank Run

 

 

NAV Premiums of Certain Precious Metal Trusts and Funds - Shenanigans /off

The premiums in the Sprott Funds remain tight, but certainly not as expansive as we had seen in the prior bull market leg in the precious metals.

It was nice to see gold rebound so sharply after the FOMC antics earlier this week. Silver is lagging a bit.

If and when the bull market returns in metals I would expect silver to outperform gold just on the basis of its greater volatility.

Last night I posted a few charts showing the extreme to which silver seems to have been driven. You may see them here.   Others have written more eloquently and repeated about the expanding open interest in Comex silver on declining prices that suggests a shorting campaign by the bears.

If this is in fact the case, then they might very well get stuffed rather handily should silver turn and break out.  But I suspect the ringleaders will have taken their gains by then and left some patsies holding the bag. 

The spread between price and NAV widened back out on the Central Gold Trust (GTU) after having narrowed with the announcement of the Sprott offer. Not quite sure exactly what to make of it, except that perhaps holds of the unitholders are not favorably viewing the offering which is intended to decrease the discount to NAV. I don't think it is a reversal of the arbitrage which we had seen narrow it down to around 4 percent.

Silver: Short Term, Longer Term, In Relation to Equities and Gold

“If you shut up truth and bury it under the ground, it will but grow, and gather to itself such explosive power that the day it bursts through it will blow up everything in its way.”

Émile Zola

Never buy something just because it has declined from a high.

If a principle is fundamentally sound and remains so, then there will be an inevitable reversion from any extreme high or low, back to a primary trend. 

Silver may present an outstanding opportunity. 

In the short term silver is coiling, and is deeply oversold relative to stocks.   It is even out of balance with gold.

But longer term it still remains in a bear market.

Timing and patience are everything.

Gold Daily And Silver Weekly Charts - Shenanigans, Confidence Games, and Bailouts

"If you dont own gold...there is no sensible reason other than you don't know history or you don't know the economics of it."

Ray Dalio

Gold was under early pressure this morning and was pushed lower to the 1176 level for no particular reason. It is in a trading range after all.

What was notable is that silver barely budged, holding stubbornly on to the 16 handle. Sometimes they do hang a lantern on their antics, and silver has an astonishingly large open interest already at The Bucket Shop.

And so as expected, the Fed really did nothing except to update their verbage and gold shot back up again into the capping range they have been maintaining this week.

I provide some thoughts on the Fed's motivations and probable actions here in today's stock market comments.

You may be surprised to hear that Wall Street is whining through their enablers and cronies about more subsidies and handouts. You can read about that here.

Gold is being capped by a Western gold pool that is seeking to prop up their awful policy errors and vainglorious ambitions in managing the world's reserve currency.   Like all pools that run contrary to the primary trend of the markets it will most likely fail.  Forecasting exactly when and how it will fail is a problem, as long as the cheat is profitable, and any consequences are distant and therefore easily ignored.  The forces of paper money are powerful.  That is why it is attractive to those who seek power.

I was saddened to hear that Jimmy Lee, Vice Chairman at JP Morgan, died unexpectedly today at age 62.   My most sincere condolences to his family in their sadness.   I am sure he was a loving father and husband, and he seems like he was a genial colleague.  I have heard him talk, and he was strong on the notion of working hard but 'putting family first.'

One can only wonder what Jimmy might tell us, if he were able to speak to us now.  But then it probably would not matter, because people full of the world 'will not listen even to Moses and the prophets.' Lk 16:31

Eternal rest grant unto him O Lord, and let perpetual light shine upon him.

Have a pleasant evening.