Gold Falls Despite Fed’s QE4 and Reckless Policies

Tyler Durden's picture




 

From GoldCore Gold Bullion

Gold Falls Despite Fed’s QE4 and Reckless Policies

Today’s AM fix was USD 1,694.75, EUR 1,299.16 and GBP 1,051.46 per ounce. 
Yesterday’s AM fix was USD 1,712.50, EUR 1,315.59 and GBP 1,061.69 per ounce.

Silver is trading at $32.81/oz, €25.22/oz and £20.42/oz. Platinum is trading at $1,619.00/oz, palladium at $678.00/oz and rhodium at $1,060/oz.

Platinum is trading at $1,619.00/oz, palladium at $678.00/oz and rhodium at $1,060/oz.Gold was up $1.30 or 0.08% in New York yesterday and closed at $1,711.30/oz. Silver rose $0.43 to $33.38 before it fell back near unchanged in late morning trade, but then it surged to as high $33.78 in afternoon trade and finished with a gain of 1.43%.


Gold Chart by Tick, Dec. 7-13 – (Bloomberg)

Gold fell nearly 1% in illiquid markets in Asia overnight. Some traders may have decided to take profits on the short term long the FOMC announcement trade. Gold bullion prices had already ran up to $1,723 in the 2 weeks prior to the policy statement.

Overnight, as prices fell below the 100-day moving average at $1,705, stop-loss selling was triggered which pushed prices lower quickly.

Yesterday, the Federal Reserve took the bold, some would say reckless step, of linking its monetary policy to unemployment, creating concerns that the U.S. dollar will be debased even more in the coming months. 

The US Federal Reserve will keep interest rates at close to zero until unemployment falls below 6.5%. This is a historic and very radical change to monetary policy. It is the first time a large central bank has ever tied its interest rate policy directly to one facet of the economy – unemployment.

The Fed said that it will maintain ultra loose monetary policies for the foreseeable future and the Fed will in effect double the pace of dollar creation.

The Fed announced it plans to buy $45 billion per month in longer-term Treasuries in addition to the $40 billion per month in mortgage-backed securities, as expected. 

With the unemployment rate at 7.7 per cent in November, the move signals low interest rates for the foreseeable future, and it replaces the Fed’s earlier pledge of low rates “at least through mid-2015.”

All of this is bullish for gold and we would expect the moves to put upward pressure on gold prices in the coming weeks. There have been a few occasions where extremely loose monetary policy announcements have not seen an immediate rise in gold prices and this will likely be the case again.


Gold Chart Yearly, 2011-present – (Bloomberg)

In the run up to the year end the fiscal cliff negotiations will put pressure on the U.S. dollar as will the more important $16 trillion and rapidly growing national debt and the $50 trillion to $100 trillion in unfunded liabilities.

The European Union has agreed to give the European Central Bank the authority to directly supervise the eurozone's biggest banks and intervene in smaller banks at the first sign of difficulty.


Cross Currency Table – (Bloomberg)

Strong support for gold is at the 200 day moving average at $1,662/oz, however there has been physical buying today on the dip below $1,700/oz.

ScotiaMocatta, Barclays Capital and UBS flag support at $1,684/oz, gold's November low. 

NEWS

Gold prices skid on profit-taking after Fed – Market Watch

Gold falls as Fed move raises concern on stimulus scope - Reuters

Gold Drops to Lowest Level in a Week on U.S. Budget Negotiations - Bloomberg

EU nations agree to eurozone banking union – The Telegraph

Vince Cable: investors' expections of bank returns are 'unrealistic' – The Telegraph

COMMENTARY

Gold - It's Time – Zero Hedge

Expect a seasonal rally in silver from Christmas until April - Mining

Carney, New Governor of BOE, Dives Straight Into Monetarist Loony Bin – 24HGold

“Holy Grail” Gold Evidence Panics Western Central Banks – King World News

The Gold Market Seen Through a Glass Darkly - GoldSeek

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Thu, 12/13/2012 - 09:06 | 3058794 GetZeeGold
GetZeeGold's picture

 

 

OK....let's just backup a second...what do you suppose they spent some of that money on?

 

Anyone.....anyone?

Thu, 12/13/2012 - 09:07 | 3058800 trav777
trav777's picture

silverbugz getting BLOWTORCHED!!!!!!!11

Thu, 12/13/2012 - 09:29 | 3058806 GetZeeGold
GetZeeGold's picture

 

 

Hi Trav.....you buying the subsidized metals too? I'd darn near throw grandma from the train for 1.97% off.

Thu, 12/13/2012 - 09:29 | 3058861 Alpo for Granny
Alpo for Granny's picture

Come at me GZG. Granny ain't as spry as she used to be but I still got some moves.

Thu, 12/13/2012 - 09:42 | 3058890 strannick
strannick's picture

Gold is the central banks greatest enemy. With the manipulations we have seen in the last week, while the imbecilic CFTC Commisioners do nothing, obviously gold is going to get hit on the day of QE4EVA.

Thu, 12/13/2012 - 10:02 | 3058938 Badabing
Badabing's picture

Its gold they fear.

I guess we like working and saving while the BANK debases the hard work we accumulated.

So you have no choice but to play in the rigged casino to try to keep up with the inflation they “THE BANKS” impose on all of us working people.

Gold is what they “THE FUCKING BANKS” fear.

“Gold has no intrinsic value” let’s pretend that inflation is the interest.

Q: can we have lower than zero interest ZIRP?

A: only with inflation!

And we can't have infiation with gold going up.

fuck you Ben

Thu, 12/13/2012 - 10:17 | 3059021 Dugald
Dugald's picture

Tie interest to unemployment.....well now how soon do you think it will be before unemployment stops increasing.....ahhhh now you get it, the shits have no intention of increasing interest for a very long time.

Thu, 12/13/2012 - 11:39 | 3059416 your neighbor
your neighbor's picture

Think like they do. They can't buy nor cover at the ask. Once they push the price down, all the gamblers just throw away their positions; hit the bid and the crooks go long or covers. Same as it ever was.

Best of luck to you if you think you can outtrade these crooks. I know I can't so I just stack.

Be patient.

Thu, 12/13/2012 - 11:48 | 3059468 Pegasus Muse
Pegasus Muse's picture

This revelation has to be worrying the Market Rigging Scumbags, as evidenced by the Hit Job they put on gold and silver last night.

Audio Interview: http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2012/12/13_Chris_Powell.html

================

 December 12, 2012

Holy Grail” Gold Evidence Panics Western Central Banks

Today King World News wanted to discuss what has been termed as the ‘Holy Grail’ of evidence which implicates Western central banks in actively manipulating the gold market. This has Western central banks deeply troubled because the information was never supposed to become public. Chris Powell, who has been focused on uncovering this type of sensitive information for 15 years, told KWN, “This is as authoritative (an admission) as we are likely ever going to get that central banks are actively involved, in secret, in the gold market.”

 Here is what Powell had to say: “Eric, this is a report written to the executive board of the International Monetary Fund from March 1999 about the efforts of the IMF staff to improve accountability in world central bank accounting. The report explains how the IMF staff proposed to require central banks to distinguish their gold loans and gold swaps from their gold reserves so the world could see exactly how Western central bank gold reserves were disposed.

The report goes on to explain that when the central banks saw that accountability would be demanded of them for their gold loans and swaps, they panicked. The report says that the central banks surveyed by the IMF staff objected to this precise accounting of their gold reserves.

They said disclosure of gold loans and swaps would be what they called, “Highly market-sensitive” and disclosure would interfere with their secret interventions in the currency markets. This is an admission....

Continued here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/12/12_Holy_Grail_Gold_Evidence_Panics_Western_Central_Banks.html

Thu, 12/13/2012 - 10:18 | 3059023 aint no fortuna...
aint no fortunate son's picture

copper's getting whacked too

Thu, 12/13/2012 - 09:45 | 3058894 French Frog
French Frog's picture

Here is my thinking about TheBernank latest effort:

.slowly but surely people are seeing that there is no real 'trickle-down' effect to giving more money to the banking system via QEx

---> the Fed must avoid a backlash while still serving its masters, so what do you do?

---> link the Fed's policies to unemployment because it will then be almost impossible for anyone to criticize it (who would want to be seen to be against helping the unemployed?)

---> most enlighted people these days agree that today's unemployment levels are likely to stay if not increase due to long term generational shifts (outsourcing, population aging, rise of the BRICs....)

---> with unemployment not falling for a long time (if ever) the door is open for QEx forever.

Simple, or am i being too sarcastic?

 

Thu, 12/13/2012 - 09:47 | 3058898 GetZeeGold
GetZeeGold's picture

 

 

I think a little sarcasm is healthy at this point.

Thu, 12/13/2012 - 10:30 | 3059067 French Frog
French Frog's picture

I put 'sarcastic' because the word I was looking for was stuck at the end of my tongue & I couldn't find it & still can't!

Someone help & put me out of my misery please.

Thu, 12/13/2012 - 11:11 | 3059271 StychoKiller
StychoKiller's picture

Acerbic?  Maybe "caustic!"

Thu, 12/13/2012 - 11:43 | 3059441 FrankDrakman
FrankDrakman's picture

Pessimistic/realistic, or perhaps "sardonic" c'est le mot juste?

Thu, 12/13/2012 - 13:40 | 3059999 Lobbelt
Lobbelt's picture

Cynical?

Thu, 12/13/2012 - 09:51 | 3058912 LawsofPhysics
LawsofPhysics's picture

The Fed is a private bank.  They will do whatever is best for their shareholders and owners.  I do the same thing for my shareholders.  Should the "loans" default, The Fed will go after the underlying assets of anyone who still owes them interest.  Think about it people, it really is this simple.

 

Thu, 12/13/2012 - 10:30 | 3059061 jekyll island
jekyll island's picture

Unless the gubmint bails them out, then the Fed will just print and pay itself back.  Sure is nice to be a monopoly.   All I ever wanted in life was an unfair advantage. 

Thu, 12/13/2012 - 10:45 | 3059138 LawsofPhysics
LawsofPhysics's picture

No, the Fed will go after all the assets of the U.S. treasury.  Still lots of real assets in the U.S.

Thu, 12/13/2012 - 11:22 | 3059331 fockewulf190
fockewulf190's picture

...until it can´t.  Put any government under enough fiscal pressure and they will go radical. Thats when the "norm" goes out the window.

Thu, 12/13/2012 - 11:49 | 3059474 Acet
Acet's picture

Sovereignty bitchez!

As a sovereign nation the US would just pass a law saying it doens't have to pay anything to the Fed. As a private company, the Fed can't enforce jack-shit-nothing on its own against a sovereign nation.

Thu, 12/13/2012 - 10:52 | 3059173 MachoMan
MachoMan's picture

And, even if you revoke the charter, the right to collect should flow through as an asset to the FED's owners... 

Thu, 12/13/2012 - 10:56 | 3059190 LawsofPhysics
LawsofPhysics's picture

Correct. Wonder why no one is talking about this or the expiration of the Fed's Charter.

Thu, 12/13/2012 - 12:32 | 3059726 seek
seek's picture

That's because it's not expiring. The federal reserve act of Feb. 25, 1927 made the fed's lifetime perpetual. All of the expiration talk is nonsense based on the original charter and ignoring the legal changes made to it over time.

Thu, 12/13/2012 - 10:14 | 3058999 sablya
sablya's picture

That's not sarcasm!  It is cynicism.  Cynicism is generally a negative quality but in this case seems bright, shiny and refreshingly truthy.

Thu, 12/13/2012 - 10:59 | 3059205 French Frog
French Frog's picture

Thank you so much Sablya, it was indeed that word.

Thu, 12/13/2012 - 11:37 | 3059399 laozi
laozi's picture

The Cynics were great philosophers, but are now forgotten by most. http://en.wikipedia.org/wiki/Cynicism_(philosophy)

Thu, 12/13/2012 - 09:14 | 3058809 CPL
CPL's picture

Is it under 8 bucks....nope.  Gold under 700...nope.  Business as usual.  

Brb off to dig up some care from give-a-fuck bay.

 

Let's see if the broker has any physical to sell me...nope.  Delivery is at 4 months.  I'll wait until they have it on hand to buy it.  I don't take promises on delivery months in advance for gold or silver.  Unless it's in my hand and present...well, there it is.

 

Neither should any of you btw.  You should walk in the door with cash and out the door with your silver and gold cash.

Thu, 12/13/2012 - 12:05 | 3059552 RockyRacoon
RockyRacoon's picture

Sounds like a strategy to me.

From the article: "The Fed said that it will maintain ultra loose monetary policies for the foreseeable future and the Fed will in effect double the pace of dollar creation."

If PMs can't go up on that then something is seriously wrong.   From this point on I'm absolutely ignoring any technical analysis on PMs.  It's useless in manipulated markets.   I'll fly by the seat of the pants and just order in another pallet of popcorn.

Thu, 12/13/2012 - 09:37 | 3058877 eclectic syncretist
eclectic syncretist's picture

It's a good day to buy some silver!

Thu, 12/13/2012 - 09:46 | 3058899 CPL
CPL's picture

I still can't find any for delivery under four months...the brokers are making the usual noise of "you are first in line, etc".

 

If anyone finds a broker that can ship FedEx next day I would be interested.

Thu, 12/13/2012 - 12:12 | 3059574 RockyRacoon
RockyRacoon's picture

It all depends on what you want to pay.  What premium above spot do you want to pay for Eagles, junk silver, bullion bars, or whatever?   The question is too vague to answer.   I stick with known refiner bars and Eagles for the most part.  Recognizable configurations are the best for the ultimate purpose but the premiums are the downside.  Fact is, later on, when it counts, those premiums will seem trivial.   To boot: the premium follows the product.  When sell/trade time comes, the premium will be in your favor.   It's all about details.  Many will not buy fractional gold Eagles because of the premiums.  Well, that premium remains with the coin.  When you have to rid yourself of the coin the premium swings to you.  It doesn't just go "POOF" and disappear just because you bought the coin.  It ain't like buying a new car and having the new car premium disappear when you drive off the lot.

Thu, 12/13/2012 - 12:39 | 3059762 seek
seek's picture

Both Apmex and Tulving have monster boxes of ASEs in stock -- but not much.

Thu, 12/13/2012 - 12:43 | 3059779 lostintheflood
lostintheflood's picture

If anyone finds a broker that can ship FedEx next day I would be interested.

 

http://tulving.com/goldbull.html

Thu, 12/13/2012 - 13:33 | 3059976 Esso
Thu, 12/13/2012 - 10:26 | 3059046 jekyll island
jekyll island's picture

Never understood your unhealthy obsession with silverbugs and probably preppers too.  It's insurance, trav, you don't get burned by insurance, you get burned by trading. 

Thu, 12/13/2012 - 09:31 | 3058863 midtowng
midtowng's picture

It makes absolutely no sense at all

Thu, 12/13/2012 - 09:43 | 3058886 CPL
CPL's picture

It's people attempting to escape the paper trade of silver and gold which effects the value of the PM's themselves.  

 

Even though paper gold is even more worthless than the USD, and levered x35 with a x3 multiplier and allows 15% margin on physical purchases of it.  It is still, in terms of optics, it is still "gold" and "silver" even though we know it's just worthless paper IOU's.

 

Physical > paper promises.

 

Take the opportunity to buy more if able.  2% discount is significant on 1700.  That's a case of beer or two.  Tank of gas (for a smaller car).  Weekly grocery basics.

 

 

The trick though is finding someone selling.  All the mines are doing right now is serving as a stage for all the strikes that are still going on...and not just in SA anymore, the strikes are everywhere.

 

Thu, 12/13/2012 - 10:22 | 3059035 sessinpo
sessinpo's picture

Yea, it does and I've posted why to many times to count.

Thu, 12/13/2012 - 11:02 | 3059219 fockewulf190
fockewulf190's picture

"OK....let's just backup a second...what do you suppose they spent some of that money on?

 

Anyone.....anyone?"

 

iShares. /sarc

Thu, 12/13/2012 - 09:07 | 3058802 kralizec
kralizec's picture

BTFD

Thu, 12/13/2012 - 09:09 | 3058804 Esso
Esso's picture

Buying opportunity bitchez!

Thu, 12/13/2012 - 09:10 | 3058807 The Axe
The Axe's picture

why GOLD   and No other risk asset down

 

Thu, 12/13/2012 - 09:13 | 3058817 Zgangsta
Zgangsta's picture

Silver is down too!

Thu, 12/13/2012 - 09:16 | 3058821 GetZeeGold
GetZeeGold's picture

 

 

I'm sure the price of gas is sure to follow.

Thu, 12/13/2012 - 09:24 | 3058849 swissaustrian
swissaustrian's picture

all pms fell during the midnight takedown.

Platinum and palladium are down too.

Thu, 12/13/2012 - 09:26 | 3058852 quasimodo
quasimodo's picture

G, I wonder why

Thu, 12/13/2012 - 09:14 | 3058816 swissaustrian
swissaustrian's picture

Traders didn't take profits, bullion banks have to cover shorts before we take off. That's the issue.

Thu, 12/13/2012 - 09:29 | 3058856 francis_sawyer
francis_sawyer's picture

Bankers are getting their year end bonus checks... So they're hammering PM's so they can convert to phyzz at a nice price... Same shit as last year [end]... This will happen as long as they're allowed to print themselves joobux out of thin air...

Thu, 12/13/2012 - 09:35 | 3058872 trav777
trav777's picture

no, they aren't.  stop posting fantastical bullshit

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