Fake Payroll Report Friday – Ecador’s Gold – The Dollar Is Not In An Uptrend

First, today was the monthly Government non-farm payroll report folly. The best part about is that is gives us the entertainment content of watching CNBC’s Steve Lieman and Mark Zandi make absolute idiots of themselves.

The big media spin is that, supposedly, the economy has finally “recovered” the number of jobs that had been lost 2007. Even if that were true, big deal. If you look at the labor force participation rate, it’s at a 62.8% – a level last observed in early 1978 (Link), which is when most households were still one-worker families. Since 2007, 12.8 million people have disappeared from the labor force (retired, disability insurance, student loans, stopped looking/welfare).  If you factor in population growth, getting back the jobs lost since 2007 is pathetic.  And most of those jobs are lower-paying, temporary, or statistically created by the Government’s “birth/death model.”

As for Goldman Sachs’ hypothecation of Ecuador’s 13 tonnes of gold. Ecuador has 26 tonnes in total. You don’t manipulate the market with 26 tonnes.  China withdraws over 30 tonnes per week from the Shanghai Gold Exchange. Then there’s India. Then there’s Russia. Then there’s Viet Nam (Viet Nam is the 5th largest gold importer in the world – that’s a fact).  Then there’s all the other gold-buying countries.  At least 50 tonnes of gold gets bought every week. This is gold that has to be delivered.

Coincidentally, or not coincidentally, Russia bought 25.5 tonnes in April. My bet is that Goldman may have needed that gold from Ecuador to deliver to Russia.  If not Russia, then to any of the other buyers I mentioned above.  It’s not the Govt of Viet Nam that buys gold. It’s the people. They want the real stuff, not a paper certificate.

Finally, we know the Bank England was missing 1300 tonnes of gold after the April 2013 $200 price takedown.  It takes 1300 tonnes to manipulate the market, not 13 tonnes. Goldman has hypothecated 13 tonnes of gold from Ecuador that Ecuador likely will never see again.

How come no one is asking about the 1500 tonnes of German Govt gold that is missing from the Fed? How come no one is asking about the 1,000+ tonnes of gold that the Italian Govt keeps at the Fed?  Ecuador’s 13 tonnes gets bought and delivered in less than 1/2 a week.

Finally, Zerohedge posted a piece by Charles Hugh-Smith in which he avers that the U.S. dollar is in an uptrend.  He’s wrong.  And it shows the problem with taking geometric shapes from 5th grade geometry and imposing them on the price-charts of things traded in  the financial markets.  Here, have a look:

(click in graph to enlarge)

Untitled

I’m not saying that the U.S. dollar won’t go into an uptrend, but I am saying that it is definitively NOT in an uptrend.  It needs to get over 81.53 before we can start debating “uptrend/no uptrend.”

I would bet against that happening – short of Fed manipulation.  As you can see, the accumulation/distribution line is indicating that the dollar is now being sold in greater quantities than it’s being bought plus the RSI and MACD momentum indicators are rolling over.  You can see the accum/distro line is actually rolling over on a 1-yr chart.

I stopped reading CH-S quite some time ago and that’s an example of why.

16 thoughts on “Fake Payroll Report Friday – Ecador’s Gold – The Dollar Is Not In An Uptrend

  1. It may not seem like much gold, but if the TBTF banks can scratch as much from all available source’s, they are free to re-hypothecate those, and support their manipulation of the commodity complex.

    1. Stay tuned. Doing a quick video that should be posted Monday on what I think is going on. Pretty sure I figured out what went down.

  2. Up to this year, I always kept my credit card balance at zero. I am a common worker bee in life and with economic responsibility I have a credit score of 815; pretty good I think. I have been paying my mortgage ahead in hopes I pay it off by age 65.

    I have stop paying a head of my mortage now and with all the extra cash I earn per pay check, with much heart felt consideration and constantly self-education and life observation of our political leaders, I made a choice to I run up my credit card and spend what cash I have, in buying gold eagle one ounce coins and silver eagle one ounce coins pay the minimum the credit card and declare bankruptcy, when I become unemployed from the failing fiat currency and failing economy. I will then leave my house I owe 80k and it’s worth today 50k, and during an economic collapse its worth 1k. I will sell my gold & silver, by a house, car, furniture, things, etc. and go back to college to study something medical. All the elderly folks – baby boomers – no matter what will need medical care.

    If I do keep my current job, then in all likelihood with the rocket value of gold and silver, I will just sell it and pay off my credit card, house and car and save the rest. Oh, yea go to college to adapt to a changing economic world; social security will not there or anything as I get old. It is up to me, to take care of me.

    Buy Gold NOW! Buy Silver NOW!

    When the fiat currency falls and economy too, fall back to the US Constitution as it was written before 1871, keep all the positive laws towards equality and keep education towards equality, liberty and freedom too. Finally, return the US dollar to be back by GOLD&SILVER!

    1. I like your way of thinking… Your right I am going to stop paying a head on my mortgage. F them! I am going to buy more gold and silver with it. ;)

  3. I share your frustration with CHS’ lack of understanding of where the dollar is going. He never talks about Gold or Silver, or why they might be desirable, but he does talk about strong dollar ideas from time-to-time. 1Kg Lunar dragon.

  4. It’s downright depressing to witness the scope of fraud and malfeasance rampant
    in society today. It seems to me the fraudsters know they are going down so
    have decided to go out in a blaze of glory and take the financial world down with
    them so instead of scaling back they double down and ramp up manipulation
    and corruption. How much money do these demented, greedy, power hungry
    bastards want?

    1. Dave, I think that it is more likely that they don’t want anyone else to have any. They appear to want a return to a two tiered feudal system.

  5. Ecuador has no gold. Goldman Sachs deal was a cash settlement, a default, a Force majeure. Back in 2012 Ecuador demanded repatriation of their sovereign gold held in trust by NYFed and London. GS “liquidity” deal was a message to other countries that your sovereign gold accounts will only be settled in cash.

  6. Very interesting article and astute observation by Wes on Ecuador’s gold. Does anyone have any comments on Ecuador’s fate in regards to their use of the US dollar as their currency? How will this affect their economy when the dollar devalues or even crashes?

    1. That’s a really good question. I’ve been wondering the same things since I recently read that Ecuador was planning on getting out from under the dollar and reverting to their old currency. So like you I hope someone can tell about it. I’ve been toying with a move to Ecuador but their using dollars,wouldn’t be much point in it.

  7. Well, I would say that How will this affect their economy when the dollar devalues or even crashes. However, I think that it is more likely that they don’t want anyone else to have any.

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