While there was no unexpected overnight central bank announcement unlike yesterday's surprise by the RBA which unleashed volatility havoc in the FX market, which promptly spilled over into all asset classes, overnight stocks around the world saw another leg lower without a tangible catalyst, while EM currencies fell to a one-month low after two Fed presidents raised concern investors had become too complacent in their belief that U.S. interest rate raises will stay on hold. Or perhaps all that is happening is that after ignoring Trump, the market is starting to finally price in the possible reality of the Donald in the White House (although as Jeff Gundlach pointed out, Trump would be a far better president for the economy and the market than Hillary or Bernie).
Revolutions, of course, can take many forms. There are social revolutions, political revolutions... and even financial revolutions. Now that interest rates are negative in many parts of the world, the financial system has become an incredibly destructive force. Negative rates adversely impact the livelihoods of just about everyone, from the average guy on the street all the way to the banks themselves... and a few key players have reached their breaking points and are starting to engage in acts of defiance.
A lack of intervention in the Yen and strength in EUR have combined to weigh on the US dollar (following the Treasury's "currency manipulator" report. Bloomberg's USD Index is back at one-year lows as, while overnight chaos sent stocks higher, it has driven investors into the safety of bonds (Treasury yields down 2-3bps) and precious metals. Gold topped $1300 and Silver $18 as EURUSD pushes above 1.1500...
There has been a bevy of negative news in the past 48 hours which perhaps explains why futures are fractionally in the green as of this moment.
Many people fear perceived dragons when considering internationalization. When doing so, they often overlook the very real dragon that’s creeping up behind them – the dragon of a declining world.
The price of gold shot up this week, and silver moved proportionally. Headlines are screaming for gold to hit $10,000 or $50,000. Does this alleged new bull market have legs?
Unfortunately, the majority of analysts continue to put out increasingly worthless forecasts as they fail to understand the true nature of the problem... or rather, the predicament we are facing.
Following yesterday's Yen surge in the aftermath of the disappointing BOJ announcement, the pain for USDJPY long continued, with the key carry pair tumbling as low as 106, the lowest level since October 2014 before stabilizing around 107, and is now headed for its biggest weekly gain since 2008, which in turn has pushed the US dollar to to its lowest close in almost a year as signs of slowing growth in the U.S. dimmed prospects for a Federal Reserve interest-rate increase. As a result, global stocks fell and commodities extended gains in their best month since 2010.
There is unfortunately no basis for renewed optimism that this current litigation will have any meaningful impact on precious metals manipulation – with respect to either silver or gold.
It seems - just as we have seen since The Fed's December rate-hike decision - that The Bank of Japan's "shock" decision not to pour more punch into the global equity bull's bowl overnight has sparked another leg higher in the market's indicator of monetary policy incompetence. Gold and Silver are surging back near cycle highs...
A favorite question during the bear market was: what will it take to bring mining back to life?
Can you imagine a 8:1 gold/silver ratio price? Currently, the ratio is 75:1.
It was not until Friday, April 22, over a week after the Deutsche Bank gold rigging settlement news broke, that the CFTC's press office admitted what many had speculated, when he said he was unaware of the Deutsche Bank story and could find no reference to it in the commission's compendium of news reports of interest to the commission's work. And this, ladies and gentlemen, is the "US commodity" regulator hard at work.
"The physical market dog is starting to wag the paper market tail. Anyone trading paper-centric historical patters is driving forward while looking in the rear view mirror."