Gold Daily and Silver Weekly Charts - Standing on the Deck of the Titanic

"Legitimate if you can, coerce if you have to, accommodate if you must."

Jürgen Habermas, as paraphrased by Robert Johnson

There was some interesting back and forth in the media about Germany's gold being held by the Federal Reserve today. You may read about it here.

The  objections to the article by Peter Boehringer seem to be a bit thin in parts.  While he stresses the 'independence' of the Bundesbank from the political process, he fails to note that the Buba never wanted to pursue the repatriation of the gold in the first place. 

It bowed to public political pressure after the embarrassment of their visit to New York in which they were not permitted to view the gold for 'security reasons.'  It seems fairly clear to me that the gold has been committed to the markets by the bullion banks.

Oh yes, it 'looks bad' for the Fed and the Bundesbank, but the real question is 'do they care?'  Perhaps it is time for a pressure check.

 

The US Congress has an approval rating of 7%.   Do they seem to care?  No, and the reasons why they do not care are not that hard to understand, even though we may not like them.  Nothing will change unless the existing equilibrium of the status quo and ruling elite changes, along with their sources of power and money.  And the same applies to Germany and the UK.

Nothing of note occurred in the Comex warehouses or deliveries on Friday.   But the Comex is becoming a Punch and Judy show.

The activity in the precious metals for this week's Comex July option expiration may be driven by silver which is in an active futures contract month.   Gold is not.

"The active contract months for silver will be March, May, July, September and December."

"The active contract months for gold will be February, April, June, August and December."

 

 

SP 500 and NDX Futures Daily Charts - All Is Well

There's no inflation, says the Fed.

No worry 'bout the price of bread.

Don't drive or eat or buy your med,

And you can live just like they said!

Andrew Stanton

Germany's Gold: Auf Wiedersehen

"Finally he makes a decision, it is time to go, and he uses a gambling metaphor: he says 'Roll the dice', 'Alea jacta esto'. Once the dice start rolling they cannot be controlled, even though we do not know what it is as the dice roll and tumble.

Julius [Caesar] and his men swiftly cross the river [Rubicon] and they march double time toward Rome, where they almost beat the messengers sent to inform the Senate of their arrival.

Frances Titchener, To Rule Mankind and Make the World Obey

"Germany has decided its gold is safe in American hands."

That is one response, when you ask for the return of your gold, and your request is refused.

Just when you thought the spin could not become any more blatant or ridiculous.

Do you have any doubts?  It is not patriotic to have doubts.  You must do your duty, and believe.

This saga of Germany's national gold reserves being held by the Fed in New York is one of the most incredible stories in some time.   I believe it is related to what will become the scandal of the century.

Those reserves are largely gone, or encumbered with multiple claims, having been given to the Banks for their profit. 

How are a people fallen, and their spirit extinguished.

 

Addendum:  This appeared in the comments to this story as it ran in BusinessWeek:

From Peter_Boehringer

Just to set the record straight re this article in which my name is mentioned and in which I am quoted out of context:

a) BusinessWeek/Bloomberg uncritically cites statements of politicians and BuBa-bankers who have or give no proof whatsoever re the untouched whereabouts of the german Gold.

b) Re our campaign "Repatriate our Gold" www.gold-action.de/campaign.ht... : "On hold" does of course NOT mean that we are in any way satisfied with the current status of BuBa´s ongoing repatriation (far too slow and too little - only 5 tons came from NY in 2013! Not exactly a proof for the untouched existence of 1500 tons in a NY vault unaudited since 1950...). Our public campaign will therefore have to continue.

c) Almost no info in the article can be considered in any way "news". Simply because there has not been any material news in this context since early 2013.

d) Especially the headline is plainly false, because there has not been any change in BuBa´s (too slow) repatriation plans: at least 300+ tonnes will come from NY by end 2020. It is not much - but contrary to the headline, BuBa has NOT stopped the ongoing partial repatriation - enforced solely by public pressure!  (I would check your pressure readings mein herr.  Buba seems to be a bit less concerned than one might imagine.  Never underestimate the official indifference of a German bureaucrat to popular opinion.)

e) The political party "Alternative for Germany" has never been part of our campaign - they can therefore not have been "rebuffed" as the article suggests.

f) The political party "FDP" has (with the exception of one (1) MP ) never demanded a repatriation - yet another false info in the article.

g) Some politicians cited in the article can not in any way claim to be "in charge" of the german gold hoard (abroad or not). This holds true for both Mr Barthle and for Mr Hardt: BuBa alone is in charge - and officially, BuBa is independent from political influence... (But apparently not to 'public pressure' whatever that may be.)

Summary: a "non-news" article with a wrong headline, strange interviewees, old news, and with a clearly apologetic ideological approach: the main purpose seems to be NOT to give space to the myriad of unanswered and extremely relevant questions BuBa and the Fed have been refusing to answer for decades. Pls read more at "Repatriate our Gold" http://www.gold-action.de/camp...

German Gold Stays in New York in Rebuff to Euro Doubters

By Birgit Jennen

Jun 23, 2014

Germany has decided its gold is safe in American hands.

Surging mistrust of the euro during Europe’s debt crisis fed a campaign to bring Germany’s entire $141 billion gold reserve home from New York and London. Now, after politics shifted in Chancellor Angela Merkel’s coalition, the government has concluded that stashing half its bullion abroad is prudent after all.

“The Americans are taking good care of our gold,” Norbert Barthle, the budget spokesman for Merkel’s Christian Democratic bloc in parliament, said in an interview. “Objectively, there’s absolutely no reason for mistrust.”

Ending talk of repatriating the world’s second-biggest gold reserves removes a potential irritant in U.S.-German relations. It’s also a rebuff to critics including the anti-euro Alternative for Germany party, which says all the gold should return to Frankfurt so it can’t be impounded to blackmail Germany into keeping the currency union together...

“The Bundesbank never doubted the integrity of the foreign gold-storage sites,” Carl-Ludwig Thiele, the bank’s council member for payments and settlements, said in an interview on May 23. “We were able to see everything we wanted to see in New York. As far as we’re concerned, there are no more open issues...”

Read the entire article here.

David Cay Johnston: The Impact of American Inequality

"It is to be regretted that the rich and powerful too often bend the acts of government to their own selfish purposes...

No free government can stand without virtue in the people and a lofty spirit of patriotism, and if the sordid feelings of mere selfishness shall usurp the place which ought to be filled by public spirit, the legislation of Congress will soon be converted into a scramble for personal and sectional advantages...

It is one of the serious evils of our present system of banking that it enables one class of society--and that by no means a numerous one--by its control over the currency, to act injuriously upon the interests of all the others and to exercise more than its just proportion of influence in political affairs."

Andrew Jackson

Moyers: Andrew Bacevich on the Duplicity of Ideologues and Chaos In Iraq

"Looking at the world as a whole, the drift for many decades has been not towards anarchy but towards the reimposition of slavery. We may be heading not for general breakdown but for an epoch as horribly stable as the slave empires of antiquity. James Burnham's theory has been much discussed, but few people have yet considered its ideological implications — that is, the kind of world-view, the kind of beliefs, and the social structure that would probably prevail in a state which was at once unconquerable and in a permanent state of 'cold war' with its neighbors...

It is the same in all wars; the soldiers do the fighting, the journalists do the shouting, and no 'true patriot' ever gets near a front-line trench, except on the briefest of propaganda-tours."

George Orwell

I found it interesting that Kagan's piece was published in The New Republic.

Gold Daily and Silver Weekly Charts - July Metals Futures Option Expiration Next Week

There is an option expiration for the precious metals on the Comex next week. It is for the month of July which is not a particularly lively month.

Gold and silver both paused today, after their big move higher yesterday. I still have not quite figured out the reason for the move, except for the obvious technical boost it had from the short squeeze.

 

I will let you know if I see anything to either confirm or add to the usual suspects, Argentina and rehypothecation unwind.

Have a pleasant weekend.

 

 

 

 

 

SP 500 and NDX Futures Daily Charts - Complacency - Quiet Quad Witch

Today was a quad witch in stock option expiration and the day was very quiet with low volatility.

Next week there is not much in the way of new economic news, with the third iteration of 1Q GDP coming out.

I suspect that macro world events will tend to dominate an otherwise dull market with a bias upwards to sideways in the absence of some exogenous bad news.

Have a pleasant weekend.

Gold Daily and Silver Weekly Charts - Hi Ho Silver!

There was intraday commentary about the metals rally here. 

 

There is also a Summer assignment for those of you who wish to have a framework for the unfolding tragedy that is the Anglo-American financial system.  I suggest you scroll down for it.

I had taken my trading account down to effectively zero cash on this last move lower in the metals, especially in the last two weeks.  That was how sure I was that these market were grossly oversold. 

 

So this multiday move higher has been rewarding, and I thank God for it. I did take some trading positions off the table today to get back to a more 'comfortable' trading position. I do not touch my long term positions and try not to even think about them.

So what next?  Follow through is everything here. We have taken out some good resistance levels and some important moving averages as I show in a gold and silver technical chart below.

But we still have not taken out the big downtrend in gold. Silver as well.

Today was nice. It would have been nicer to have known why the metals moved so violently higher today, in what certainly turned into short covering. I have picked up almost no rumours from trading desk chatter today. That in itself is some information.

Price movement makes market commentary. I don't think the Fed's statement yesterday is what caused this, but it is the go to plug for those who have to say something. Anyone who thought the Fed would do anything else must be a tourist.

 

Tomorrow is stock option expiration.  The miners had a significant move higher today.  

 

There was no meaningful action in the Comex warehouses.  It is like watching a portrayal of some market in Madame Tussauds' Wax Museum.

I am leaning toward the unwind of commodity rehypothecation in China as is ZH, but it bothers me that so far it is all base metals being discussed. We know there is a lot of leverage in the precious metals. And as you know, these latest antics by the Pigmen and their Merry Pranksters with the sovereign debt of Argentina was a real stick in the eye for the BRICs.

So let's see what happens tomorrow. And let's enjoy today.

 

I include a closeup of the gold chart just below so you can more easily see exactly where we are with respect to the longer term trends.

Have a pleasant evening.