We all realize by now that the U.S. Government has an obvious agenda to manipulate the price of gold in order to defend the reserve status of the U.S. dollar. It is this status that gives the U.S. Government its “superpower” abilities. It is also becoming increasingly obvious that the U.S. economy is quickly deteriorating again despite the $4 trillion in printed money thrown into the banking system.
The Fed engineered two distinct mini “flash crashes” this morning:
As you can see, over 4,000 contracts hit the Globex computer system right around 4:40 a.m. which drove the price of gold below the key $1350 technical level. This was over 11% of the total volume that had traded up to that point in time from when Globex trading opened at 6 p.m. the previous evening. And then at 7:45 a.m. another 5,051 gold futures contract bomb was detonated, which drove the price of gold down another $5.
Given that the housing market and retail sales/consumer are obviously on the verge of falling like an elevator in Empire State Building which has broken loose from its support cable, and given that Russia has now twice successfully challenged the geopolitical hegemony of the U.S., the Government/Fed is even more desperate to do what needs to be done to defend the dollar.
If the Fed wants to engineer a “correction” or price hit on gold that’s fine. But it becomes patently absurd when the Fed at the same time pumps up the most overvalued stock market in history.
This is going to end very badly – it’s just a question of when.