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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

Thu, 12/13/2012 - 09:38 | 3058878 GetZeeGold
GetZeeGold's picture

 

 

Dude is all about leading by example.

Thu, 12/13/2012 - 10:11 | 3058988 francis_sawyer
francis_sawyer's picture

You're right Trav... It's all fantastical bullshit... I'm pretty sure all the bankers right now are queuing up in unemployment lines & tryin to get demselves an Obamafone as we speak... Moreover ~ the overnight hit on PM's (which happens quite frequently, whereby large contracts go whoosh in milliseconds, is all just an unexplainable RANDOM occurrence)...

Other RANDOMNESS throughout history:

- War of 1812 (funded by Rothschild's) starts precicely when the FIRST BANK OF UNITED STATES charter expires...

- SECOND BANK OF UNITED STATES charter expires & an assasination attempt is made upon Andrew Jackson (who refuses to renew the charter)

- Abe Lincoln is shot in the head at the end of the Civil War because his plan is to continue with 'greenbacks'

- Present Day: Just about every banking power node worldwide is infested with GS alum...

Nothing unusual... Happens all the time... 

Thu, 12/13/2012 - 10:42 | 3059130 mvsjcl
mvsjcl's picture

- JFK is assassinated shortly after signing Executive Order 11110, authorizing the Treasury Secretary to issue silver certificates

Thu, 12/13/2012 - 11:23 | 3059335 francis_sawyer
francis_sawyer's picture

I was going to add that one in there... But Crash Davis [Bull Durham] caused me to re-evaluate my thinking with his 'I Believe' speech...

Thu, 12/13/2012 - 10:49 | 3059162 LawsofPhysics
LawsofPhysics's picture

Yes, now remind me, when is the Fed's charter up?  Hedge accordingly.

Thu, 12/13/2012 - 11:04 | 3059237 catacl1sm
catacl1sm's picture

Never. It's open ended.

Thu, 12/13/2012 - 11:11 | 3059269 LawsofPhysics
LawsofPhysics's picture

I have several "open ended" contracts with suppliers that I can terminate at any time.  Of course, I don't get kick-backs from my suppliers (unlike CONgress).  Don't be so naive, there is battle brewing between congress and the Fed as many "representatives" now realize they have been sold down the river.  Currency wars, trade wars, real wars.  Some things never change.

Thu, 12/13/2012 - 09:53 | 3058914 forwardho
forwardho's picture

Thanks Trav, One would think, that making a large sum of money is getting to be a crime around here.

Thu, 12/13/2012 - 10:14 | 3059001 LawsofPhysics
LawsofPhysics's picture

Yes, but then when someone brags about such things I always ask what technology or product of real value it was that they brought to the market to earn such a large sum.  When I get the "deer in the headlights" look, the real problem becomes much clearer.

Thu, 12/13/2012 - 12:19 | 3059652 RockyRacoon
RockyRacoon's picture

Whatever happened to that "IQ150" guy, or whatever his name was.  I forget.  My IQ isn't that high.

Sigh... they come and they go.  Looks like Trav is itching for another suspension. 

Thu, 12/13/2012 - 13:39 | 3059994 Esso
Esso's picture

You can get suspended from Fight Club?

DAMN!

Thu, 12/13/2012 - 17:59 | 3060966 RockyRacoon
RockyRacoon's picture

There are rules other than not talking about Fight Club.  One can tap out or go limp.  Perhaps Trav went a little limp.

There are actually 8 rules:

http://www.youtube.com/watch?feature=player_embedded&v=fbMa4MGFCOg

Thu, 12/13/2012 - 09:15 | 3058818 BadKiTTy
BadKiTTy's picture

"our biggest mistake was not controlling the price of gold" Volker. 

 

Or someting to that effect.  

 

Supply and demand? Gimme a break.  The last thing the banks want is a flight from paper into pm's. 

 

We are a looooooong way from the end game imho.  The shenanigans have harldly even started yet! 

 

If you want to boil a live frog you have to heat the pan slowwwwwwwwwly.......

 

K@ 

Thu, 12/13/2012 - 09:40 | 3058882 eclectic syncretist
eclectic syncretist's picture

Gib it away, gib it away, gib it away (to China) now.

Red hot chili peppers.

Thu, 12/13/2012 - 09:28 | 3058819 JustObserving
JustObserving's picture

Gold falls

That makes it sound like it was a natural event and not a take down ro prevent its rise to trillions in printing.

$16 trillion and rapidly growing national debt and the $50 trillion to $100 trillion in unfunded liabilities.

It is $16.37 trillion today and unfunded liabilities are $121.85 trillion and they are rising at $8.37 trillion a year. Bernanke will be printing for ever and at an increasing pace.

Alan Greenspan spoke at the Council on Foreign Relations earlier today, and what was his advice? That central bankers should be doing what these columns, among others, have been rattling on about, namely that they should be paying attention to gold. “Fiat money has no place to go but gold,” the former Fed chairman said at the Council

http://www.nysun.com/editorials/greenspans-warning-on-gold/87080/

Sep. 15, 2010

Thu, 12/13/2012 - 09:49 | 3058905 SheepDog-One
SheepDog-One's picture

No worries, new poll shows americans support ObaMao raising taxes (of course they believe it wont get raised on THEM) and cutting 'benefits' LOL the sheeple sure love their own slaughter!

Thu, 12/13/2012 - 09:16 | 3058822 youngman
youngman's picture

Pretty amazing....but I will take the stand that its the big boys....coming to the realization that it is now time to get into metals...so they just turn on their computers is the low volume illiquid Asian markets to drop the price.....and now are buying the real stuff somewhere....we just added 6 trillion dollars to the mix...more today...paper will be getting useless....that is my contrairian thought

Thu, 12/13/2012 - 09:17 | 3058823 disabledvet
disabledvet's picture

I find nothing reckless but a lot of "we only have faith in debt" which is clearly not in the interest of the war effort. We need industries paying taxes, hiring, producing, innovating...and then we're winning. To me that requires "normalizing" rates...which isn't far from what the Fed..which has dropped its date certain language...is doing right now.

Thu, 12/13/2012 - 09:18 | 3058825 fonzannoon
fonzannoon's picture

Schiff must be having a full blown anuresym.

Thu, 12/13/2012 - 09:20 | 3058830 Who is John Galt
Who is John Galt's picture

Its different this time.

Thu, 12/13/2012 - 09:20 | 3058831 darteaus
darteaus's picture

Gold is a highly manipulated market because it is in no government's interest that citizens dump currency to buy money.

Thu, 12/13/2012 - 09:21 | 3058832 orangegeek
orangegeek's picture

The gold described here is priced in US Dollars.  When the US Dollar rises, markets and commodities priced in US Dollars fall since Dollar's value rises.

 

What causes the US Dollar to rise?  The USD is negatively weighted against the Euro, Yen, Pound and C-Dollar (93.1%) of the weighting.

 

When these four currencies fall (all four are at near term highs), the US Dollar climbs and vice versa.

 

Expecting Gold to fall more and been expecting it sooner.  Instead, Gold has been moving sideways.

 

http://bullandbearmash.com/chart/gold-climbs-early-falls-days/

Thu, 12/13/2012 - 09:30 | 3058862 GetZeeGold
GetZeeGold's picture

 

 

What causes the US Dollar to rise?

 

Because it's worth a lot of money?

Thu, 12/13/2012 - 09:42 | 3058885 new game
new game's picture

inversely; what make gold decline? lol

gold cost averaging anyone...

m4 colts for silv? lately.

dippidy do da right thing...

Thu, 12/13/2012 - 10:27 | 3059056 sessinpo
sessinpo's picture

How about reality. Because most transactions and debts are still dollar denominated.

 

Let's say you have $100,000 in gold. You have a house mortgage of $100,000 and you decide you want to pay your house off. Well guess what? Your bank probably won't accept your gold (yet). Instead you will have to convert your gold to dollars to make that payment. And that means you SELL your gold (putting downward price pressure on gold) to BUY dollars (which puts upward pressure on the price of Dollars).

 

Thu, 12/13/2012 - 11:21 | 3059262 HardlyZero
HardlyZero's picture

Globally, the EU will fall before the USA, so the Euro will devalue first and because US dollar is supreme (at this time).

So I would expect the price of Gold to decrease as USD increases in value (while the Euro collapses first).

Much later the USD will also decrease in value, and then the price of Gold will skyrocket up.

 

so...for Stackers....keep any physical you need to survive (anything), and sell all stocks (e.g. GLD, PHYS, SLV, SLW, etc.) and sell all miner stocks...go to cash.    Then very soon after the Euro collapses and USD is 'on top', and POG is very low....then buy on the major dips...and maybe some Silver too.  

We are heading into massive changes in the economy, unsterilized fiat money printing, debt ceilings, fiscal cliffs, austerity...so the US stock market will also collapse and cause massive disruptions....

As long as a stock market exists (later) then pick the right time to go back into Gold and Silver stocks full force.

SUMMARY: Keep the physical bullion...sell the stocks.  Buy the stocks back later after the collapses.

BTW...there may also be a force majure at the COMEX due to lack of physical on-hand...if that happens this will also be a major disruption in the precious metals market.

Thu, 12/13/2012 - 12:53 | 3059827 seek
seek's picture

If you think physical is going to be available (much less that the price will be lower) immediately after the Euro collapses, you are quite the optimist.

Far more likely we see a demand spike reminicent of January 1980 as people in Europe rush to protect savings. Any price decline in PMs during a time of massive economic uncertainty would result in physical simply disappearing from the market and physical premiums blowing up like we've never seen.

Someone might be willing to sell you a forward paper contract, I think force majure is a certainty, with a cash rather than metal deliverable when the time comes to take possession.

Seriously, cashing out to try and time the market right in the middle of a major currency event is definitely a picking-nickels-before-steamroller move.

Thu, 12/13/2012 - 09:21 | 3058834 VonManstein
VonManstein's picture

Dont see any of this "profit taking" anywhere else in the "risk" structure. 2.5% down overnight is not normal behaviour for any other asseet. We all know the game. Also Deutche is in trouble, apparently they have some "exposure" to the Silver space

Buy low... hold.. and thats it

Thu, 12/13/2012 - 09:21 | 3058838 LasVegasDave
LasVegasDave's picture

To understand just how rigged and crooked the metals markets are, consider what would happen if a hedge fund sold 5X the outstanding shares of AAPL into the market in the span of 30 minutes on a shortened trading day.

That kind of shit happens at least once a month in the gold and silver markets, yet no investigation or charges of manipualtion are ever brought by the regulators.

If you believe the govt. statistics on unemployment and inflation, then you will also believe that there is no manipulation in the metals markets.

 

 

 

Thu, 12/13/2012 - 09:22 | 3058839 Iam Yue2
Iam Yue2's picture

A perhaps less jaundiced take on the sell off in Gold;

http://www.reuters.com/article/2012/12/13/markets-precious-idUSL4N09N21W...

Thu, 12/13/2012 - 10:04 | 3058958 HurricaneSeason
HurricaneSeason's picture

They don't say why unemployment is heading towards 6.5%, giving the government surpluses instead of deficit spending and hurting gold prices. It's because jobs are coming back from China because $250 a month wages wont be as competitive once gasoline prices go back up. Costs of labor and social security and healthcare and workman's comp and the EPA, while higher than $250 a month, don't compare to the increased product costs if gas goes up 10% or 20% when you have to ship the product from the other side of the world.

 

Might as well make the bedtime story a little longer, maybe even add a chapter about how the government surpluses will allow for a revamp of the aging infrastructure creating a generational boom in the economy.

 

Thu, 12/13/2012 - 09:22 | 3058841 AllWorkedUp
AllWorkedUp's picture

Where's the CFTC???

Oh yeah, clearing the path for the criminal activity.

Thu, 12/13/2012 - 09:23 | 3058843 MFLTucson
MFLTucson's picture

This is just another example of what a disgrace the US markest have become.  QE1, 4, manipulation of stocks, bons, gold silver, .... how can you escape these criminals?

Thu, 12/13/2012 - 09:24 | 3058844 WhiteNight123129
WhiteNight123129's picture

Leave Gold alone, it will go wild when you least expect it.

BTW. What is positive for Gold is the Treasuries sinking, very very bullish for Gold (but not now), but people do not realize that yet....

Bonds outflows are in store, and they will chase something, Equities? THe issue is with long bond yield rising it is like a wall in front of PE expansion.

You want to help your Gold position? Short the treasuries...

Thu, 12/13/2012 - 09:30 | 3058859 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

rin, ran, run:)

Gold bullion prices had already "ran" up to $1,723.  "run"

Tuco 

Thu, 12/13/2012 - 09:36 | 3058873 fonzannoon
fonzannoon's picture

There will be a day when shorting treasuries and being long gold will be the mother of all trades. Until then there is a chance it works out like this.

http://www.youtube.com/watch?v=VDdN_b6TjYo

Thu, 12/13/2012 - 10:11 | 3058963 WhiteNight123129
WhiteNight123129's picture

The very fact that many people were scared about shorting Treasuries or willing to go along despite the sheer absurdity of it from a fundamental standpoint made the price absolutely crazy. Tensions were building because the yield over inflation expectations was very tight. It could have resulted in either Gold moving up or bonds going south, because something has to give.

Now as soon as Treasuries are not able to break new record low yield and as the short end of the curve is going to get negative (the end of FDIC), the steepening of the curve should accelerate inflation. The negative short end of the curve could spark some action in Gold early next year.

My opinion was that the masses would never understand why money printing would result in Gold Land, Equities and Bonds going up but that inflation eventually would crush PEs and Bonds and that the masses would buy Gold when inflation is on the newspapers front page. That is when you want to sell Gold. So far we had currency debasement which is not the same thing as inflation. The CPI BTW measures wages because it does substitutions, it does not measure prices.

 

Thu, 12/13/2012 - 10:22 | 3059037 beachdude
beachdude's picture

"There will be a day when shorting treasuries and being long gold will be the mother of all trades."


Have been playing this off/on since '08. It's tricky, so now I'm in and leaving it on with TBT, TMV, and DGP... my time frame is quite long and I'm patient. 

Currently getting hammered, and have been for a while.

The trade isn't working yet, either.

Thu, 12/13/2012 - 10:38 | 3059109 WhiteNight123129
WhiteNight123129's picture

If you know Fullarton, you know that money printing puts the price of all interest bearing securities up, but the signal comes from the divergence between yield and inflation expectations.

The largest divergence was just recently.

Thu, 12/13/2012 - 11:38 | 3059407 WhiteNight123129
WhiteNight123129's picture

If you think so then I suggest you either sell your Gold or buy Treasuries. I do not know which one is right but I think short Treasuries is like buy Gold in 1999, everybody hates it, that is why it is so much more attractive. For Gold, the bull run is old, not over, not over but Old. THe best part is the short treasuries right now. This was the blind spot to exploit.

 

Thu, 12/13/2012 - 11:29 | 3059341 HardlyZero
HardlyZero's picture

I would now keep all physical precious metals on-hand to survive any events going forward.

I would now sell ALL (paper) stocks in markets.

I would then later re-buy the same precious metals related stocks and miners...after the collapses in the stock markets.

Thu, 12/13/2012 - 09:31 | 3058866 I am a Man I am...
I am a Man I am Forty's picture

Now that we've had 2 years to evaluate the municipal bond market since Meredith Whitney's famous bad call and ZH's fearmongering.  I present to you the chart of MUB.  I was junked endlessly for noting that the previously mentioned were full of shit and did not know what they were talking about regarding municipal bonds.

http://finance.yahoo.com/q/bc?s=MUB+Basic+Chart&t=2y 

Thu, 12/13/2012 - 09:56 | 3058934 youngman
youngman's picture

Two years ago we did not know that the Feds would be buying 85 billion a month and that 0% interest rates would be the norm....the rules at the time she made the call was right on I think....interest rates should have gone up...but they changed the rules...right now there is no "market"....even the MUB is people just chasing returns....they are not investing...they are trying to keep their job on a quarterly basis...not a good investment strategy....

Thu, 12/13/2012 - 11:28 | 3059360 HardlyZero
HardlyZero's picture

ZIRP is creating false risk assessments.  When interest rates are 'all zero' then there is no way to judge which investments are lower/higher risks than others.  That is 'the plan'..to keep the dollars flowing into the markets and hide any risk behind the curtain.  This is exactly the approach used at Lehman before their collapse, same approach at Countrywide.  Same approach at the banks with no mark to market.  The large risks are well hidden.

Thu, 12/13/2012 - 09:32 | 3058868 Monedas
Monedas's picture

With no guns nor gold .... we are neutered slaves !

Thu, 12/13/2012 - 09:32 | 3058870 SheepDog-One
SheepDog-One's picture

Monetary policy tied entirely to 6.5% unemployment 'magical number' which is just 100% fake manipulated number anyway and is more like 15%....oh this should end real well.

Thu, 12/13/2012 - 09:37 | 3058875 Esso
Esso's picture

Exactly my thinking, SD1.

Thu, 12/13/2012 - 10:01 | 3058917 SheepDog-One
SheepDog-One's picture

Oh and also, S&P will also be 700 by the time 6.5% unemployment FED new 'only concern' finally gets here? I don't believe it at all, pure bullshit.

Thu, 12/13/2012 - 09:40 | 3058881 BurningFuld
BurningFuld's picture

The FED linked it's policy to unemployment...riiight.  They are like a fucking conjoined twin with the federal governments deficit spending. The only place the Federal government is getting it's money is the printing press. Nice try Ben. Do people actually believe this shit?

Thu, 12/13/2012 - 09:54 | 3058929 SheepDog-One
SheepDog-One's picture

It's crazy, I dont know who that statement from the FED was intended for but it doesn't even begin to make ANY sense at all! 'We'll throw trillions at a made up number'....why what for? They could just say 'Unemployment reached 6.5 today!' and what would that mean? Nothing!

Thu, 12/13/2012 - 09:43 | 3058887 forwardho
forwardho's picture

This should not be news.

Gold and the dollar have a real world inverse relationship. When one goes down, the other goes up.

If it takes more dollars to buy a specific amount of gold over time, your dollars are worth less. This is economic reality.

If gold prices skyrocket, it will be laid bare that the dollar is rapidly loosing value.

Chaos ensues.

This cannot be allowed, with infinite capital, the paper market can be controlled indefinitely.

If the alternative to chaos is delusion, most will take the latter path.

Thu, 12/13/2012 - 12:08 | 3059564 Bay of Pigs
Bay of Pigs's picture

I hate it when people post inaccurate bullshit like this. Gold and the USD have risen together before during this 12 year bull market. Example? Gold went from 450 to 710 when the dollar rallied along with it. 

It has happened a few times, so that "inverse realtionship" theory does not always hold true. Gold is rising against ALL fiat.

Thu, 12/13/2012 - 09:51 | 3058888 Racer
Racer's picture

And will the Bureau of LieS stop its tricks of reporting better numbers via manipulation of birth death and shock horror actually overestimate via birth death adjustments, in order to keep interest rates low?!

Thu, 12/13/2012 - 09:42 | 3058889 RobotTrader
RobotTrader's picture

Another horrific gap down in GLD and GDX again.

 

The "Stackers" and "Preppers" are getting Cornholed again by the "Acclaimed Experts" at King World News and jsmineset.

Eventually, angry Stackers are going to burn those websites down and lynch the proprietors.

Thu, 12/13/2012 - 09:54 | 3058920 LawsofPhysics
LawsofPhysics's picture

With a dollar cost average of under $300 and $12 on my physical gold and silver, respectively, I wouldn't hold your breath waiting for that to happen robo.  LMFAO!

Thu, 12/13/2012 - 09:56 | 3058935 SheepDog-One
SheepDog-One's picture

And just last nite Robo was here saying he expects gold to go up, and that would confirm the economy is booming.

Robo moving his own goalposts every play.

Thu, 12/13/2012 - 10:11 | 3058987 carlnpa
carlnpa's picture

Robos track record has been pretty good.

Ignore at your own peril, regardless of other opinions.

Thu, 12/13/2012 - 11:27 | 3059352 WhiteNight123129
WhiteNight123129's picture

I do not remember them calling to short the treasuries... Did I miss something?

Thu, 12/13/2012 - 10:23 | 3059039 WhiteNight123129
WhiteNight123129's picture

We need a lot of discouragement to sink in for us Gold bugs. Come on, we have had 12 nice years. Gold has done an excellent job, let is rest a bit in its corner so it can stand up again and deliver its last knock-out punches. Some doubts and questions from the Gold bugs themselves, some triumphalism from the Equities idiots and a universal claim that we have a recovery yet no inflation. When we are at that point, the whole thing falls appart and Gold goes to the moon.

So RobotTrader keep up the good work please.

 

Thu, 12/13/2012 - 10:54 | 3059177 mvsjcl
mvsjcl's picture

Robo and Trav back at the same time after lenthy absences. Funny that.

Wed, 12/26/2012 - 17:33 | 3097270 MeelionDollerBogus
MeelionDollerBogus's picture

goldpricemodel 2013 projection

goldpricemodel 2013 roc 52-week

2012 11 05 277week ROC -goldpricemodel

2012 06 18 277week roc 02 goldpricemodel 2011 Jan to 2012 Dec 28

Hardly any concern to those who saw it coming: buy GLD PUTs into the drop & buy up bullion with the paper profits on discount prices. That's how the game is played, just not by robots. Robots, robottrade, don't take delivery of physical gold.

Thu, 12/13/2012 - 09:43 | 3058891 Kina
Kina's picture

Indeed gold is fell in iliquid markets because they were trying really hard to get the best price for their sales.

 

Gold falls like a stone in iliquid markets because they want to use their invisible gold to push down the price... criminal manipulation.

 

The MSM, the CFTC and etc.... well of course they are all captured and employees of the banksters.

Thu, 12/13/2012 - 09:43 | 3058892 Quinvarius
Quinvarius's picture

A dip gold is how the central bankers convince themselves that they are convincing you of something.  All I am convinced of is that they just made another mistake.

Thu, 12/13/2012 - 09:45 | 3058897 SheepDog-One
SheepDog-One's picture

YAY 6.5% magical unemployment number we'll throw TRILLIONS at it to get there because it's magical dontcha know!

Have fun in full-retard....thats where we are from here on out I think Im going to go hide out in the Bikini islands or somethin.

Thu, 12/13/2012 - 09:46 | 3058900 Mad Mohel
Mad Mohel's picture

Sit tight my droogs, did you all think it would be a walk in the park? It's a motherfuckin war!

Thu, 12/13/2012 - 09:48 | 3058901 I need more cowbell
I need more cowbell's picture

Yikes, both Trav and Robo back from the dead. Maybe something to this Mayan thing...

Thu, 12/13/2012 - 09:48 | 3058903 new game
new game's picture

sureal bullshit policy, surely to fool the masses.

nowhere to begin to understand.

stick your flag in the shifting sand, i guess.

un-fucking-believable.

becoming increasingly vulnerable!

Thu, 12/13/2012 - 09:50 | 3058909 Tsar Pointless
Tsar Pointless's picture
Federal Reserve, Central Banks to Extend Credit Lines

On CNBC.com.

Top central banks are extending their arrangements to swap dollars and other currencies to make sure banks have the money they need.

The decision announced Thursday extends a crisis measure that was to expire Feb. 1, 2013. Now it will be extended for another year.

Taking part are the U.S. Federal Reserve, the European Central Bank, the Bank of England, the Swiss National Bank and the Bank of Canada. The Bank of Japan is to consider the measure at its next meeting.

The idea behind making each other's currencies available is so banks can get whatever currency they need to meet their obligations. The measure helps stabilize a financial system dealing with the fallout of five years of turmoil, a debt crisis in Europe and slowing growth in emerging markets.

The crisis is over. But the crisis measures will never be over.

Thu, 12/13/2012 - 10:00 | 3058946 SheepDog-One
SheepDog-One's picture

Must....Create....Credit....only way banksters....can survive....

Thu, 12/13/2012 - 12:35 | 3059595 Anasteus
Anasteus's picture

Slightly corrected...

Top central banks are extending their arrangements to swap dollars and other currencies to make sure banks have the money they need. This, particularly, comprises opening new highly leveraged positions operated by not yet well-tuned HFT algorithms causing occasional unintended billion losses as well as the continuation of the fluent money transfer to governments also known as sovereign bond buying. Furthermore, the central banks are extending the arrangement to swap gold among each other on a large scale to make sure the currencies being discussed will retain at least some value. A swift unanimous agreement was reached upon the fact that currencies with zero value would endanger the significance if not question the existence of the banking system as a whole. Therefore, this crisis measure is not planned to expire.

Taking part are the U.S. Federal Reserve, the European Central Bank, the Bank of England, the Swiss National Bank and the Bank of Canada. The Bank of Japan is still hesitating as the bank has already had a large amount of claims and liabilities in all possible currencies yet not seeing any remarkable progress in the economy. Nevertheless, the bank is expected to join other central banks soon after assuring the progress itself is of lower priority importance.

The idea behind making each other's currencies available is so banks can get whatever currency they need to meet their obligations in international derivative markets. The measure helps stabilize a financial system dealing with the fallout of five years of turmoil; extends bonus budgets for managements just unwittingly causing the turmoil as well as manages various necessary international settlements. It also helps boost growth of new emerging leveraged market instruments.

Thu, 12/13/2012 - 09:55 | 3058926 carlnpa
carlnpa's picture

This may be a short term program.

Back of napkin numbers.

143.3M employed, 12.1M unemployed, 88.8M not in labor force.

Assume not in labor stays at 88.8M, number of unemployed needs to be reduced from 12.029M to 9.295M.

So we loose 2.734M unemployed through attrition (expiration of benefits) and we hit the magic 6.5%.

Since we are gaining 1M snap participants in 2 months, we should hit the 2.734M in five months, somewhere around april of next year.

Problem solved.

 

Thu, 12/13/2012 - 09:58 | 3058941 SheepDog-One
SheepDog-One's picture

They should all be hanged, then we might have a chance to save ourselves from their epic mess.

Thu, 12/13/2012 - 09:59 | 3058939 youngman
youngman's picture

The Treasury has to sell today....30 years I think....this should be interesting to see who buys them....not me...

Thu, 12/13/2012 - 10:16 | 3059008 mdtrader
mdtrader's picture

If gold is going to go down when there is copious amounts of money being printed and ZIRP's all over the place, then I'm not sure when it will go up. The 89 week MA is around $1657, which may be tested soon. 

Thu, 12/13/2012 - 10:28 | 3059050 DavosSherman
DavosSherman's picture

I'm truly saddened.  I'm going to stop reading ilene, GoldCorp, Graham, SailerBoy and a few others.

ZH took a twisting turn 8 or so months ago, very, very sad.

My dear GoldCore, every major CB move is marked with the CB's cordinated effort to manipulate gold.  If you read Eric Sprott's fine work that gets posted on ZH and looked at the numbers: Supply, Scrap Supply & Demand, you'd see the CB's have to be leasing and even selling.

In addition to not wanting to look like shitheads and not wanting the alarm to sound on every currency, China sees "SALE ON GOLD" and buys the fucking dips when they aren't buying the entire mines during these events.  So the price never craters.

Lastly, gold isn't something you follow daily, it's moody and has bitchy price swings.

This shit from GoldCorp et al has been a terrific waste of my fucking time---no more!

Thu, 12/13/2012 - 12:20 | 3059651 Bay of Pigs
Bay of Pigs's picture

Yes, GoldCore is a pile of shit. Their analysis (if you can call it that) is a joke.

The articles are usually littered with MSM propaganda and disinformation. ZH should have dumped them long ago.

Thu, 12/13/2012 - 10:33 | 3059079 fijisailor
fijisailor's picture

IF easing is linked to employment and employment is totally fabricated then easing will end when .gov decides to place the unemployment numbers where they want to..  It's all manipulated.

Thu, 12/13/2012 - 10:48 | 3059157 BigPerm
BigPerm's picture

Who do i have to curse?

Is it the TPTB, the Masters of the Universe, Masons, Jesuits, Club of Rome, PPT, Group of 30, Templars, CFR, TC, Roundtable, RIIA, Illuminati, who?

Someone is getting cursed today --- I've had enough of low gold prices

If anyone has the answer, I'll be scanning the alpha wave

Thu, 12/13/2012 - 11:08 | 3059259 FranSix
FranSix's picture

I don't know if gold price corrections here aren't due in a large part to imminent bankruptcy of yet another major futures broker. The moves here are very similar to those of the correction when MF Global & PFG Best went bankrupt, yet the gold price is well-supported.

Thu, 12/13/2012 - 11:14 | 3059285 catacl1sm
catacl1sm's picture

All of this is just mental masturbation. The TRUE price of silver is hanging out in the $35-$40 oz range. http://www.ebay.com/sch/i.html?_sacat=0&_from=R40&_nkw=roll%20of%2090%25...

Thu, 12/13/2012 - 11:15 | 3059291 DowTheorist
DowTheorist's picture

While being in a secular bull market, in the medium term (3-6 months) gold is at crossroads now.

Gold and silver are caught between the Oct 4 highs and the Nov 2 lows. A breakout above the Oct 4 highs would re-confirms the primary bull market. However, the violation of the Nov 2 lows would trigger a primary bear market signal.

http://www.dowtheoryinvestment.com/2012/11/dow-theory-update-for-nov-12-...

 

 

Thu, 12/13/2012 - 12:25 | 3059685 H E D G E H O G
H E D G E H O G's picture

same ole shit from tptb, just a different day. we are used to it by now so back the truck up and load as much as possible.....................................

Thu, 12/13/2012 - 12:44 | 3059781 FranSix
FranSix's picture

OK so QE4 announced and no rally whatsoever in the bonds. Jawboning.

Thu, 12/13/2012 - 14:38 | 3060184 jjsilver
jjsilver's picture

Some traders may have decided to take profits on the short term long the FOMC announcement trade

 

Absolute bullshit, and this shows goldcore has it's head up it's ass or is just another banker shill trying to deflect attention from the truth. This site is becoming more like CNBC every day

Thu, 12/13/2012 - 14:55 | 3060279 yrbmegr
yrbmegr's picture

"It is the first time a large central bank has ever tied its interest rate policy directly to one facet of the economy – unemployment."

This is not a correct statement, is it?  I mean, central banks are supposed to tie their interest rate policies directly to one facet of the economy--prices.

Thu, 12/13/2012 - 16:02 | 3060576 tyrone
tyrone's picture

What gets me is not that POG went down, but the media's incessant use of the words: "Gold fell..". Gold didn't "Fell"! We all know that. So, why doesn't anyone who writes these media pieces (of trash) say it like it is:

Gold was smashed down today by those who have something to gain by PRICE SUPPRESSION. And who would those be? Obviously, those in the banking world would be #1 on any list.

Fri, 12/14/2012 - 02:20 | 3061991 Spore
Spore's picture

Starting January 1st Gold will become a tier 1 bank reserve asset. The same as the US DOLLAR side by side! They changed the rules for a reason. HELLO McFLY!!!

Fri, 12/14/2012 - 07:23 | 3062111 hz
hz's picture

Spore, this is not true. Careful what you read!

Do NOT follow this link or you will be banned from the site!