To begin with, this statement by the Bank of Japan’s Kuroda validates my blog post yesterday about Japan’s monetary pivot to gold and to the east: “no need and no possibility for helicopter money.”
My best guess is that the only productive activity for Bernanke on his last trip to Japan was eating blowfish sushi and hitting the teenage stripper establishments.
The manipulators are making it easier for us to accumulate gold at a cheap price. I moved money from my fiat checking account into Bitgold every day this week and twice yesterday. I managed to catch what looks like the low of this latest manipulated pullback. Every time they hit gold I buy.
I exchanged emails with Dr. Paul Craig Roberts yesterday about the sell-off of the price of gold this week caused by the obvious “invisible” hand of the Fed. Note this was a week in which Japan was supposedly going to drop $100 billion in helicopter money at Ben Bernanke’s behest – an announcement which should have sent gold soaring:
Me: I agree this was a manipulated take-down of the price but, you know as well anyone, markets never go straight up except the Dow/S&P 500 when the Fed wants to make those indices go straight up – like now. Gold was overdue for a trading correction. I agree there’s some idiots out there who think the Fed is powerless now over gold – that’s ignorance or sensationalism.
Dr. Roberts: Is there such a thing as a trading correction when the price is controlled and manipulated? Is it a trading correction when the bullion banks dump, as we have shown numerous times, massive paper shorts in the futures market?
Me: I agree with your point there – but to be honest, I like to see any market pullback after it has the type of run that gold has had since early February. Should it be pulling back from a much higher price platform? Yes. But gold was on the verge of going parabolic, which is never healthy in any market. The Fed is doing us a favor. I have been moving a lot of money from my checking account into my Bitgold account this week every morning. If gold was not being pushed down, I might not have added any.
The other interesting aspect of your point there is the amount of paper the Fed is needing to throw at gold to keep the price down. The open interest has been more or less at an all-time high on the Comex for a few weeks now. The last time the open interest was this high was when gold was pushing $1900.
In other words, it is requiring a much bigger relative effort for the Fed to prevent the price of gold from spinning out of its control now than it did when gold was about to launch over $2000.
They have not lost complete control yet, but they are much closer to that event now than they were in 2011.
On another note, the fact that the SPX spiked higher on the original Japan helicopter money announcement but has not sold off on the withdrawal of that threat underscores that fact that the Fed is pulling out all stops to push the market higher
But this is just the “marquee” indices – the Dow, SPX and Naz – as plenty of stocks have been and are heading lower because the core economy in the U.S. is falling apart.
“this is the time to be a gold bug”
The interview with Kuroda was in June before Bernanke went there with his helicopter. Anyways the Japanese do the opposite of what they announce if they think it will hit the markets more effectively.
I’m surprised that the Euro banking problem hasn’t blown up, yet. The banksters are between a rock and a hard place. They have to keep this as secret as possible for fear of sending the markets into crash mode. At the same time, I’m sure that the rats who comprise the Cartel are doing everything possible to unload their positions on each other. One wonders, how long they can keep this shit show going?
When cartels start to fail, their is always a chiseler or two, quite happy to screw their partners-in-crime.
PS. When does the oil patch junk debt problem start to blow?
In addition to Fed intervention, another thing I am seeing mentioned on the internets is that since bonds yield next to nothing, lot of foreign buyers and even pension funds are just piling in to the SPY for its 2% yield. There’s the Yellen put to keep the market from falling at all, so you get that 2% yield plus capital appreciation. What a great deal, what could go wrong! Someone needs to file a lawsuit against the Fed for running this multi-year ponzi scheme. They have made a mockery of markets, inflicting severe financial pain on retirees and savers, putting utmost financial strain on workers who have seen rents go up 100% or more due to these Fed shenanigans.
Here a note from Holland.
Thanks for sharing your market insights with us, read you every day.
There is one thing tough you are overdoing a bit and that is selling BITGOLD.
I confess I fell for it opened an account on the 30th of may and got verified 2 weeks later. Agree they have a swell product but not especially for rest of the world, that is outside USA/Canada.
Here are my two cents.
For most deposit types like ACH/EFT bank transfers (processing 1-3 business days), the per gram price is locked in when you hit the process button. But not for bank wire transfers from f.i. EU.
Here what happened to me;
After my initial wire transfer on the 10th of june to see how things would
work out with a new account, nothing happening because of clerical delay I was told later.
Reluctant by this experience I postphoned my second wire of 8500 euro for some days i.e the 18th of june.
I did a reclamation on the 23th of may and was told wire transfers take 5 working days and the price is not fixed the moment I get the reference code.
Long story short…I missed the Brexit run up.
Buying gold in the Western world with a 5 day delay is in my opinion a total steal and a sheer degradation of their product.
I asked BitGold about frontrunning the buy order but of course no answer was given.
If Bitgold would indeed be using pre-order wire transfer information to its advantage we are talking about an unethical practice here aren’t we.
For anything I know they could be using the BTFD daily bank adagium; slam gold hard with paper gold sell orders and then buy the low.
I find it unbelievable that anno 2016 where HFT traders trade in less than
nanoseconds, this company will always need 5 days to receive money from the EU.
From my experience with BitGold, the startup process as a customer can be a bit cumbersome, but once established seems to work great. Try moving money into Bitgold with a bank debit card. No fees here in the U.S.. They price you buy in gold is the moment you make the ‘deposit.’ It can take a few days for BitGold to clear the transfer with your bank, but this happens because BitGold doesn’t want to take your money until the gold is actually in the vault. They told me this when I inquired. You can see that your bank debits your account, but the transaction is not completed until a couple of days later.
I think certain types of money transfer can be more problematic, but hey, when the transfer clears, you’re the holder of gold in an allocated account. And then there’s that Mastercard debit card you get to access your account with.
This is the future of debit cards, and using real money as savings.
Regarding your opinion on the price action in the bullion market: Do you really, really think that the manipulators cannot and would not paint a “healthy” price action in the market while accomplishing their long term goals of suppressing the price? Do you think perhaps there is also a possibility of manipulation in the mining stocks? Why the brutal sell-offs recently? Whole sectors are getting massacred.
You have pointed out in the past that we are now further away from the value of miners relative to the metals than we have every been. If your going to mess with the metals prices why in the world would you leave the metals proxies untouched?
Forget who – “There are no longer any markets, only manipulations.”