Gold Daily and Silver Weekly Charts - Risk On, and Miners Pounded

"We live in deeds, not years; in thoughts, not breaths;
In feelings, not in figures on a dial.
We should count time by heart-throbs. He most lives
Who thinks most, feels the noblest, acts the best.
And he whose heart beats quickest lives the longest:
Lives in one hour more than in years do some
Whose fat blood sleeps as it slips along their veins.
Life's but a means unto an end; that end,
Beginning, mean, and end to all things—God.
The dead have all the glory of the world.
Why will we live and not be glorious?
We never can be deathless till we die."

Philip James Bailey, Festus

Complacency reigns.

The pounding in some of the miners today was pretty impressive.

The relationship between stocks and the metals are fascinating.

I am still refining my list of mining stocks, but I am not buying here as my price targets are much lower than current prices. I could be wrong on them as I am quite pessimistic about stocks in general, and the miners are catching it from both sides, being metals related. But for now I see no reason to buy.

And I may not get those buys. But this ability to be 'picky' is one of the benefits of having a substantial long term position which one does not touch. You do not feel pressured to buy bottoms or sell tops, because your greater concentration is always on the long term prize.

You may trade around it if you will, but never, ever, give up your position entirely in a bull market.

SP 500 and NDX Futures Daily Charts - Complacency Returns

Today was a QE bet, risk on, as the market shook off any fears of Europe.

But this is an obsessive-compulsive rally, and the trends go with the winds, which are highly variable.

 

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Thin with a slight edge to silver.

China's Extreme Real Estate Bubble: Globalization Is a Fraud, a Castle Built On Sand

Quite a few people know about this, but they really do not understand it.  It is a fraud that surpasses by far any in history, including the South Sea and Mississippi bubbles.

China is an extreme bubble fueled by artificially low wages and an autocratic industrial policy that is distorting the economy of the entire world.

The monied interests of the West have been riding the trend of deregulation and globalization to their personal enrichment and benefit.  But it is an empire of illusion, with a foundation of sand, held in place by the corrupting power of money.

There are some ways out of this that the Chinese leadership might take, but I suspect that their powerful oligarchs will be caught in the same credibility trap that has kept Western leaders from taking the appropriate policy actions for the good of their own people.

This is a story of betrayal, powers and principalities, of the rulers of darkness in this world, and evil in high places.   And the Anglo-American establishment has played a key part in it.

Sorry for the commercials, but the video is worth watching because it carries a visual impact that words alone do not quite capture.

China's richest woman says in a related interview not included on the aired program that the 'Chinese people are craving for democracy.'

So are the Arabic people, and the people of Europe and the Americas, who often have the illusion of choice, from amongst a series of choices allowed by technocrats acting for a ruling elite.

Gold Daily and Silver Weekly Charts - Sequester Will Harm Effectiveness of the CFTC

CFTC Chairman Gensler noted on financial television that the sequester will make the enforcement efforts of his agency to police the markets harder, and it will be more difficult to 'stop the bad guys on Wall Street.'

Isn't he the one that just went to court and filed a brief in support of market manipulators to overturn the Federal Energy Commission's successful $30 million fine against an Amaranth natural gas trader because the FERC was doing 'his job?'

Chairman Gensler also noted today that LIBOR is useless for ensuring the integrity of commercial business interest rates.   Can't dispute that testimony.

Not to put too fine a point on the irony, but speaking of concocted numbers without genuine merit, and of little value in setting prices for the real economy, has the Chairman looked at the silver futures markets lately?  

Have a pleasant weekend. 



'Oh lawdy, this is grim.  My Grand Slam breakfast!'

SP 500 and NDX Futures Daily Charts - Sequester Cometh

Let's see how it goes next week.

VIX down and the market floating on a thin film of bravado.

Net Asset Value Premiums of Certain Precious Metal Funds - Thin Premiums, No Bubble

Premiums are rather thin again.

One of the reasons I track this series of prices and relationships, which can all be accessed in a series by clicking on the category title at the bottom, is that I use it to keep track of any 'frothiness' in the market.

And it is well known that a 'bubble' does not exhibit this lack of enthusiasm in what are largely retail instruments.

This is confirmed by the bellwether precious metal mining sector, which is not robustly priced to say the least. It looks more like gloom and depressed sentiment rather than overly enthusiastic buying.

A bubble is marked by wide public participation. And there just isn't any yet in this bull market.

Even at this stage of the bull, the 'wall of worry' is quite steep and troublesome. But this has marked every major consolidation before the next leg higher, as the metal passes from weaker to stronger hands, over and over. The paper onslaught works, until it does not.

And then the metal bears retreat to a higher level and repeat the process. It is a cynical game, and does not perform the functions of capital allocation and demand satisfaction that are the purpose of the markets with regard to the real economy. There is a great moral hazard in this that will be reconciled at some point.

What I do particularly resent is the use of the media and propaganda and obvious price manipulation to help that process along. The hedge funds and bullion banks go too far, and the regulators do far too little to uphold their responsibilities.

But for those who have been involved since the beginning of the great turn in valuations, this is nothing new, and it too will pass.

I could be wrong, but I do not think that I am. And at least I am thinking, and not merely mouthing nonsense, which is what passes for much commentary about the metals from even 'name' economists. Change is hard for the status quo.

And we are in a period of great historic change, and like most great change, it happens slowly at first, and over a long period of time. And then suddenly the greater mass of people become aware, as if that change just happened suddenly, and just fell from the sky. And it is a revelation to many who otherwise would not have given it a thought.

 

Gold Daily and Silver Weekly Charts

Intraday commentary on gold and stocks here.

I like the 'risk on/risk off' chart cited there which comes from Barry Ritholtz.

I think it speaks to action in the gold and stock markets.

As for gold and silver, we seem to be getting the post-expiration test of the market which I had suggested we might see.

I am not sure how they will fare vis à vis the sequester. I do think that stocks and the metals may be inversely correlated once again in a risk off environment.

Today I started setting the criteria by which I might take positions in the badly beaten down precious metals mining sector. The funds have been having too much of their own way there, but it does not seem that we are done with that yet. But I have created a short list, and am refining some 'tough' target prices. Obviously that list is evolving with the market and economic outlook. But for now they are below this market.

Bullion is still my preferred vehicle, but I think once we get past whatever big bump in the road is coming, we may see smoother seas more amenable for a longer term chartist such as myself.

Sequestration Is Coming. Now What?