Economics

Economics
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Updated: 3 hours 56 min ago

Market Wrap: We are the Sultans of Gold & Silver Price Swing

25-Aug-2017

Cap the metals they may. Smash the metals they may. Save some ammo for another day, cause Gold & Silver didn’t come here to play. We are the Sultans of Price Swing… 

Gold & silver have been on tight lockdown all week. After gold punched through $1300 on Friday, August 18th, both metals have been range-bound and capped ever since:

 

 

Furthermore, we have been monitoring the daily chart all year, and noticing, especially with silver, that there has been very little to no consolidation. However, all that has changed this week:

 

 

 

The MSM will be quick to point out a healthy “consolidation”, “basing”, or however they would like to spin it, but one look at that chart and we know exactly what it is: Fierce capping of price ahead of the Fed’s Jackson Hole Keynesfest.

The “consolidation” is pronounced in gold as well:

 

 

 

Of course, we can rest assured that the battle for $1300 will not be pretty. This is the third defensive stance by the market manipulators this year. After the April and June gold offensives, maybe we took for granted “third time’s a charm”, and now we are finding out that since June, they have been hardening their defenses.

And then, of course, today happened. Gold and silver caught a bid, and gold popped above $1300 at 9:17 a.m:

 

(No, that’s not the elusive yet uber-bullish “Loch Ness Chart Formation”, that doesn’t happen in the metals. That is the “Cue the Fat Finger Chart Formation”)

Then, 23 minutes later, the smash began, and one minute later, for one minute, between 10:41 a.m. and 10:42 a.m., 21,135 gold futures contracts were dumped on the COMEX.

Sorry, but I’m done with the sugar-coating and the fun strike-through fonts. Let’s just call it what it is: All out desperation to keep a finger pressed down hard on that sell button until every last person who wanted to buy gold was sold to and then some. I’m sure that guy has a blister on his finger, yellow stains on his undershirt, and a ring around his collar. Here’s the volume spike close up so you can get angry, mad, or sick:

 

 

 

Today’s 21,135 contract dump merits a zoomed out look for further consideration:

 

 

We all know what happened in the wee hours of November 9th, 2016, but a closer inspection of daily volume shows that while the cartel has been successful in containing price, they haven’t been successful in really knocking it back to $1050 or anything like that. Also, in addition to the “flood the market with naked short gold futures contracts and buy them back when enough have been printed to outspend then outlast the specs”, there has been a slowly increasing volume creep all year. So much so that it looks like it is about to get very, very loud. For example, North Korea came and went, as did Charlottesville and the Total Solar Eclipse. If we live by the 24 hour news cycle as Jim Rickards states, what explaination is there that gold would have such a massive spike in volume (dumping) on a day when nothing is going on?

Publicly, the Fed ignores and avoids gold all of the time. So while Jackson Hole is a whole lot of “meh” in terms of an effect on gold, with the proxy exception of talking the US dollar one way or another,  there is really no reason to see what we are seeing. It’s not FOMC day, it’s not minutes day, it’s not Nonfarm Payrolls day, it’s not anything massively market moving day, other than a Fed convention just like all the other Fed conventions.

And so today, the metals are standing their ground. They are not on the offensive, but they are not retreating, and gold and silver have recovered all their losses within just a couple of hours:

 

 

 

It is bittersweet, because we know the metals are strong. Copper and palladium have shown us that. The pill that’s hard to swallow is the one that could have led us to a $75 day in gold and $1.00 day in silver. We had some big move days in 2016 don’t forget (Brexit & Trump), and today, we could have had a big move off of nothing but the pent up energy everybody must be tired of waiting for. All that it means, however, is that once the pent up energy cannot be contained, the cartel will wish they could keep it at $75 and $1.00 days.

If you really want to bust out the tinfoil, here is some fundamental food for wrapping it in the foil and putting it in the microwave thought. North Korea? Crickets. Racial divide and blood on the streets? Crickets. President Trump screwed this up or stuck his foot in his mouth on that? Crickets. What we do have, is a ton of this:

 

 

 

 

Now, not to belittle a hurricane or the people that stand in it’s forecast path, but think about it for a second. Fear trade? Nope. Hurricanes are local events. Partisan politics? Nope. Hurricanes don’t care about blue or red. OK, so that leaves racial tension? Nope. Harvey is not even in the top 250 boy’s names in the US:

 

 

We aren’t even sure how popular of a name Harvey is?

So as you can see, the MSM has shifted to about as non-gold sensitive of a topic as they can. Now I know what you’re thinking if you try pulling out the “but people can barter with gold and silver post-SHTF”. Yes they can and you are absolutely right. They can and they do. However, just watch. If the hurricane gets bad enough, the MSM will either blame it on President Trump, or they will throw all that racial/political/gender/everything divide out the window for as long as they cover the story and for one moment highlight the “coming together in a time of crisis”.

Gold and silver are still as bullish as ever, and the cartel is as active as ever trying to keep the price down.

In other market news, the US dollar has just put in a fresh new low on the year:

 

 

Kind of makes you wonder if there are any dollar bulls left? That was the trade of 2017 after all, and from the looks of it, they are in scramble mode trying to make the gold and silver trade not look like the real trade of the year. Cue Bitcoin?

Palladium has hit a new high on the year:

 

 

 

And so has copper:

 

 

Crude, bonds, and the stock markets get honorable mentions this week but no charts.  Crude is down slightly on the week, 10-year note yield is down on the week, and for this week’s stock market comparison, since the WSJ thinks this market is all that matters, the S&P is up about 20 points on the week.

We have been all over the Fort Knox Gold Story like an inconsiderate cousin’s fingerprint on your 2017 American Gold Eagle.

So we can’t help but leave you with this:

 

#DYK the gold bar @USTreasury Secretary Mnuchin is holding weighs about 27lbs? #UnitedStatesBullionDepository #FtKnox pic.twitter.com/fMj6Y2QShx

— United States Mint (@usmint) August 24, 2017

And as a bonus, this:

 

And as a double bonus, we hope you enjoyed this market wrap covering the most eventful unch gold & silver week ever:

 

 

 

 

The Truth About Bundesbank Repatriation of Gold From U.S.

25-Aug-2017

– Bundesbank has completed a transfer of gold worth €24B from France and U.S.
– Germany has completed domestic gold storage plan 3 years ahead of schedule
– In the €7.7 million plan, 54,000 gold bars were shipped and audited
– In 2012 German court called for inspection of Germany’s foreign gold holdings
– Decision to repatriate from Paris and New York was ‘to build trust and confidence domestically’
– 1,236t or 37% of German holdings remain in New York Fed facility
– Bundesbank wants to hold gold bullion
– U.S. government declines to audit gold reserves … doesn’t want world to realise gold’s importance in the global monetary system

Editor: Mark O’Byrne

Last Monday, U.S. Treasury Secretary Mnuchin feigned to inspect the U.S. gold reserves in Fort Knox and joked flippantly that he assumed it was there.

A day later the Bundesbank, announced that they had repatriated much of their gold reserves from the U.S. and France. Coincidence or coordination?

In 2013 the Deutsche Bundesbank announced plans to store half of its gold reserves in Germany. At the time, only 31% was stored in the country. The Gold Storage Plan involved bringing gold home from both Paris and New York.

The plan was expected to take seven years. At the time many asked why it would take so long to return just 674t of gold. The Bundesbank has completed the plan three years ahead of schedule.

The German gold repatriation was in response to the critics and or in order to safeguard the German gold reserves and ensure they are owned in a safe, allocated and segregated manner by the Bundesbank.

In the last five years the German central bank has 374t and 300t from Paris and New York, respectively. The Bundesbank opted to keep 432t in the Bank of England vaults.


Whilst the tables above (from the Bundesbank) show the repatriation of gold was ultimately successful, it has promoted much discussion about the security of gold in central banks.

The decision to move the gold back to home soil has also vindicated many who have long argued about the murky gold reserve dealings of the United States.

Click here to read full story on GoldCore.com

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

[KR1114] Keiser Report: Empire of Debt

25-Aug-2017

We discuss the narcissism of central banks holding $15 trillion in their own assets. We also discuss Morgan Stanley saying that some of their investors see Bitcoin as a better hedge to inflation than gold. Max continues his interview with Dan Collins of TheChinaMoneyReport.com to discuss the looming trade war between the US and China, and the mountain of US treasuries owned by China.

Double Down with Craig Hemke

25-Aug-2017

Spanish conquistador, Herman Cortes, once opined that the Spanish had “a sickness of the heart that only gold can cure.” Do today’s gold investors also have a sickness of the heart that only a rising fiat exchange price can cure? And is bitcoin’s charm standing in the way of that cure? Craig Hemke of TFMetalsReport.com says that gold and bitcoin complement each other and those gold bugs hating on the cryptocurrency sector have got it wrong. But will gold rise again? Hemke says watch out for $1320 and then maybe the sickness at the heart of the gold investor community will be cured.

Click this image to listen!

Click on image above, or here, to listen to the podcast.

Cyberwar Risk – Was U.S. Navy Victim Of Hacking?

24-Aug-2017

– U.S. Navy collisions: More than a coincidence?
– Latest U.S. Navy collision is fourth involving a Seventh Fleet warship this year
– Have US Navy vessels become victims of hacking asks Rickards
– Chief of Naval Operations, Adm. John Richardson, has not ruled out cyber intrusion
– “Once is happenstance. Twice is coincidence. The third time it’s enemy action…” – Ian Fleming
– Cyber security cause for concern in autonomous vehicles, aeroplanes and now ships
– Serves as reminder that a connected world can expose and create vulnerabilities
– Cyber security a major threat to banking and financial industry
– Investors should hold physical gold as insurance against hacking, cyber attacks

Source: Navylive

The tragic U.S.Navy incident of the USS John McCain earlier in the week has raised several questions about the cause. Many are wondering if it was more than human error given this is not an isolated incident.

In the last year there have been four collisions in the area, including the latest one. So far in 2017, 17 US sailors have died in the Pacific southeast in events which have been attributed to accidental collisions with civilian vessels.

  • In January the USS Antietam ran aground near Yosuka, Japan.
  • In May the USS Champlain collided with a South Korean fishing vessel.
  • On June 17th seven US sailors died when the USS Fitzgerald — operating near Yokuska — collided with a container ship from the Philippines. It was determined that “the bridge team lost situational awareness.”

Pentagon and intelligence insider Jim Rickards points out “when the same basic incident happens twice, you have to raise your eyebrows. When you have a low-probability event that happens twice, in other words, the likelihood of coincidence becomes infinitesimal.”

"Once is happenstance. Twice is coincidence. The third time it's enemy action." – Ian Fleming
Four 7th Fleet collisions in one year. pic.twitter.com/vKbFWPAAsr

— Jim Rickards (@JamesGRickards) August 22, 2017

Rickards and others are wondering if the Navy’s decades-old reliance on old electronic guidance systems has become the victim of multiple cyberattacks.

There are two main ways a hacker can interfere with a warship: by attacking its GPS  or a malware attack on its computer network.

Click here to read full story on GoldCore.com

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

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