Gold Daily and Silver Weekly Charts - Deja Vu All Over Again

A baby step higher day in the metals, with more shenanigans likely in the the waning days of this year.

Intraday commentary on the 'December manipulation' phenomenon here.

"Plus ça change, plus c'est la même chose."

Jean-Baptiste Alphonse Karr, Les Guêpes, 1849

There will be no sustainable recovery without genuine reform of the financial and political system. At best, there will be a pale imitation of growth fueled by a pernicious of monetary inflation and the continued financialization of the real economy.

SP 500 and NDX Futures Daily Charts - Labor's Share of National Income

A wash and rinse day, with the markets going sharply lower on remarks from Senator Harry Reid that he sees no chance of a financial deal before year end.

And in the last hour the market rallied sharply off the bottom, closing almost unchanged for the day, on the news that the House of Representatives will reconvene on Sunday December 30 at 6:30 PM.

I just do not see what they can do, other than to offer to 'kick the can down the road' and take the nation into another crisis, more to their liking, at the next budget ceiling operation early next year.

I suspect the markets will continue to gyrate, as the monied interests and their servants in Washington hold the country hostage, as they did with TARP.

Hang on for a rough ride.

At the bottom is a chart from the Fed's database that shows the latest information on Labor's Share of National Income, which has declined to new postwar lows. 

A greater share of income has gone to those wielding capital.  This has not been positive for aggregate demand or the median wage.  The extractive efforts of the financial and healthcare cartels are taking their toll, slowly but surely.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Premiums are certainly not exuberant, but rather to the low end of historic norms.

Gold: This Time Last Year

As you can see, gold had a 'tap tap' bottom at the end of last year, with a final intraday low on the 29th, the second last trading day of the year.

It rallied in January back to where it had been at the beginning of December.

We may be seeing a repeat of what I think is an 'end-of-year' phenomenon this year.

If so, we *might* see one more low this week, probably tied in with some sort of selloff related to the 'fiscal cliff.'

This sort of thing could be government related but it seems more probable that it is related to the gaming of large short positions as they are marked to market at year end. That, and of course, the obvious price manipulation that allows big players to pick up assets like miners and bullion on the cheap.

The 'bombing' of gold with large contract sell orders in quiet periods is leaving tracks all over the tape, that most can see, except if they are willfully blind.

It would not be surprising if we don't see exactly that double tap bottom again this year. We had an odd overnight plunge to 1649 on futures open after Christmas, and that may mark the bottom.  

We *could* go back down to visit there again, and maybe even the prior double low of 1636 from just before the holiday. If it were me I would consider throwing a curve ball. And maybe hit the metals the first week in January very hard if the specs start jumping ahead of the rally early. Its hard to beat the house in the short term, especially when the cards are stacked, and they can see your hand.

But as Eliot Spitzer observed, when he was the NY Attorney General, what surprised them when they broke the investigation of manipulation by the banks was not the cleverness of their schemes, but the obviousness, the heavy handed, almost clumsy thuggery.

'No time for that. Give me a diablo sandwich, a Dr. Pepper, and make it quick. 
What we're dealing with here is a complete lack of respect for the law. '

Gold Daily and Silver Weekly Charts

The metals were hit hard on the open last night, but went pretty much nowhere today, finishing about even.

The selling will probably be done this week.

Watch out for the 'fiscal cliff' selling which now looks likely.  I don't know if it will hit bullion so much, but it may set up a buying opportunity in some of the miners.

SP 500 and NDX Futures Daily Charts - A Weak Market in Dull Holiday Trade

"Most of the time, evil doesn't manifest as some cackling cartoon villain, mad-man on a murderous rampage, or even an unjust war waged on false pretenses. It results instead, in a far more banal but far-reaching way, from the highly refined ideas of men like Robert Bork who value abstract concepts such as efficiency over the effects the programs they institute have on the lives of real human beings."

Angry Bear, An Editorial on Robert Bork and His Legacy

It's A Wonderful Life: Bedford Falls or Pottersville?

"These men are springs without water and mists driven by a storm. Blackest darkness is reserved for them. For they mouth empty, boastful words and, by appealing to the desires of sinful nature, they entice people who think they avoid error.

They promise them freedom, while they themselves are slaves, for a man is a slave to whatever has mastered him."

Where Are We Heading — Bedford Falls or Pottersville?
By Robert Reich
December 22, 2012

It’s easy to feel discouraged about the bullying by right-wing Republicans and their patrons over everything from gun control to taxes and social safety nets to trade unions and jobs.

Every year about now I watch “It’s a Wonderful Life” again to remind myself what Frank Capra understood about America — its essential decency and common sense.

In many ways the nation is better than it was in 1946 when the movie first appeared. Women have gained economic power and reproductive rights; we enacted Civil Rights and Voting Rights and, through Medicare and Medicaid, dramatically reduced poverty among the elderly; we began to tackle environmental devastation; we stopped treating gays as criminals and have even started to recognize equal marriage rights. We elected and then re-elected the first black president of the United States. We have enacted the bare beginnings of universal healthcare.

But we are still in danger of the “Pottersville” Capra saw as the consequence of what happens when Americans fail to join together and forget the meaning of the public good.

If Lionel Barrymore’s “Mr. Potter” were alive today he’d call himself a “job creator” and condemn George Bailey as a socialist. He’d be financing a fleet of lobbyists to get lower taxes on multi-millionaires like himself, overturn environmental laws, trample on workers’ rights, and shred social safety nets. He’d fight any form of gun control. He’d want the citizens of Pottersville to be economically insecure – living paycheck to paycheck and worried about losing their jobs – so they’d be dependent on his good graces.

The Mr. Potters are still alive and well in America, threatening our democracy with their money and our common morality with their greed.

Call me naive or sentimental but I still believe the George Baileys will continue to win this contest. They know we’re all in it together, and that if we succumb to the bullying selfishness of the Potters we lose America and relinquish the future.