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Government Shutdown Craters Gold, Sends Russell To New All-Time Highs
US Equity markets started green and ended green despite giving back some POMO gains in the afternoon. The Russell 2000 closed at all-time highs with the best day in a month (up over 2% from yesterday's lows)... on the day the US government shutdown for the first time in 17 years.
We will say no more as even the TV's talking heads were afraid of what man-behind-the-curtain that exposes. VIX and Treasuries were not as exuberant as stocks and in fact the S&P retraced back to their realties (and VWAP) before the 330RAMP began and took us to the highs. The USD dumped early (EUR strength on Italy) but clambered back to only a small loss on the day. The big news was in commodity-land where gold and silver were smashed early (and silver rebounded) as were copper and oil. The lunatics had full control into the close as VIX was Heisenberg'd (along with EURJPY) taking the S&P to its highs of the day - totally incredible.
Stocks caught down to bonds from early exuberance - then went fully vertical into the close...
But gold and silver were the big story of the day... though all commodities were hammered...
It would seem like we need moar shutdowns...
Charts: Bloomberg
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PPT still open for business.
The magic money machine is still running, so gold and silver should be doing okay.
http://dareconomics.wordpress.com/2013/10/01/around-the-globe-10-01-2013/
The shutdown won't keep the private banks from pumping short confetti into the >90:1 phony gold paper market.
I hope the shutdown doesn't affect pictures of Paulina Gretzky staring with me at her newly-discovered young adult mammaries.
Her father is Wayne Gretzky. #99, aka The Great One. Eh.
Notice that bond rates are still at record lows, which discredits the claims that our government is not ‘creditworthy’. Honestly, what is the point in the debt limit? Why not let our creditors decide whether to invest in our economy?
http://accredited-times.com/2013/10/01/is-it-time-to-eliminate-the-debt-ceiling/
Choke yourself.
actually i was going to ask "what's the point of taxes." if it's as simple as just monetizing forget a mere debt jubilee (cuz you still have Government)...let's just stop paying period. i mean "nothing says rich like racking up trillion dollar deficits forever and watching the dollar rally on the news." (just the take the Government with you like the old days.) at a certain level we're being encouraged to run those deficits actually. huh. didn't see that coming...
The onion news has a business section now?
"Honestly, what is the point in the debt limit?"
Honestly, that the debt will get so high that we won't be able to pay the interest on it.
But, this already happened. Which is why the debt is now being monetized (i.e. default).
So what's the point in a debt limit at this point? Just let it rise all the way up to hyperinflation. Then we can start afresh.
Zero times a hundred trillion is zero. it's free money.
Right, this must be because the credit "market" trusts the government!! Clearly, the Fed buying 60% of all new debt using printed money has nothing to do with artificially low interest rates.
Great time to buy PMs at these bargain prices. Oil may fall lower to $80 then I'll grab some of that too.
The Big picture is that overpriced stuff -- like stocks an dhouses -- are due for a huge correction any time, probably in the 40-50% range is my guess.
I would if my wife could assure me she won't strangle me after I told her it's a bargain at $23(which it is)
All out of powder unless it hits single digits, then I will sell one kindney for starters
The shutdown didn't crater gold. The cartel ran the stops. The cartel was visible all morning before the COMEX open, especially in silver, and then the COMEX was blasted with naked short selling. See this:
http://thenewsdoctors.com/another-day-more-algo-silver-manipulation-paging-mr-chilton/
Best,
Eric Dubin, Managing Editor, The News Doctors.
Let's see, government shut down over Obamacare, debt ceiling approaching fast with signs of a partisan standoff,
a president refusing to negotiate with the House of Representatives. Stock market soaring and gold and silver getting
creamed. Everything seems normal, nothing to worry about. Why do I get this feeling that all this will not end well?
This is so insanely broken I can't even think of trading anymore. The only option I'm entertaining is to go out and BUY MORE FUCKING METAL.
This reminds me of everyone claiming the sky was falling in Reagans first term before growth took off and the deficit was BIG-BIG-BIG ,,, but we had better drugs then , cheaper too. The only difference is that this time the sky IS falling.
More of the same - what is up is down, what is backwards is forwards. Get used to it for the duration...
Bernanke's solution... shut down government a few days every month... winning!
Another tragic boating accident. Ship of state has run aground....
insane close.
Today's newly prancing unicorns must have dumped all their skittles on the street and no one was around to clean them up. Now the market is levitated by all the skittle eating banksters. Has Wall Street reached 'escape velocity'...escape New York !!!
8000 people in NYC pay 50% of the taxes, and soon the Mayor will be a socialist democrat they say...hmm.
Russell the love muscle... frickin incredible
Contrary Tuesday? Buy gold/sell stocks/cross fingers.
WTF was that "bang the close" about?
there is no market. there is only the bernak.
But "Why", Fonz, why? What's in it for them? It's not as though gold is about to go parabolic and threaten the USD.
The only real power-play beneficiaries that I see, are the BRIC CBs -- who get to buy bullion real cheap.
Even Jim Rickards seems to have gotten is wrong: http://jimrickards.blogspot.com/2013/09/gold-to-get-stronger-dollar-to-w...
But that's because he's using the "Rational Market" model, when it's anything but "Rational" or anything but a "Market". If he were to assume the "Manipulated Market" model, then he would have predicted what he said earlier (and what I've been saying for weeks): "Little correlation to Fed or Market activity in a PM-Sideways-market."
The federal government shuts down, equities go up and PM's drop 3%. WTF, over!~!~!~!~!~!
We are truly living in a bizarro world.
Not bizaro. This is what an unregulated market looks like.
This is what a desperate attempt to paint a facade of credibility on a crumbling reserve currency looks like.
Bingo.
<--- Central Bankers are the governments
Which is aligned with my thesis that the GOP will cave when Boner gets a call from Ben, Jamie or Lloyd.
Charts above don't do justice. 5 min VXX for example, traces a truly parabolic cascade with matching parabolic ramp up in volume as it cascades into the close (and keeps going).
Holy moly. There's no pretext anymore.
Damned infernal machines!
They appear to know their calculus, that's for sure.
If there is a subtext that trading is warfare, the machines are the perfect example of chart ballistics.
Btw, where is that Hindenberg Omen these days?
.
It's flying alongside a slow-motion eagle.
That picture isn't complete without an accompanying soundtrack by John Ashcroft.
http://www.youtube.com/watch?v=woLQI8X2R6Y
Got to fly like an eagle, to the sea, fly like an eagle, let...oops, wrong artist...sorry
The omen goes down as a mythical trading indicator of yesteryear. The new bankster markets are controlled by the Central Banks.
Looked like huge short covering.
On a side note though, I was pretty disappointed silver did not tank.
I was looking to add on holdings. Gold is way overpriced.
Jeez, Silver was down big at mid day. Were you expecting it to go down $5?
Gold is way overpriced
If M3 was still published you’d be staring at a long line of zeros behind the first digit.
On this basis alone, Gold is cheaper now than it was at $750.
Ps, I did not vote you down. You shared some value comments; But on Gold, I prefer personally letting you know that you’re wrong.
Well, considering that support for gold is $1270, we are almost there. Then we'll see if your assertion is correct.
Shit Ass Fuck!!!
Sun Zoom Spark!!!
Skittle sharting bankser !! !!
Balloon Foot Tiger Man!!
http://planetwill.jt.org/media/characters/fredschneider.html
Looks like I'll be buying some gold in addition to my monthly silver.
What, no platinum? /jk
Guess we'll be getting a new NANEX article here tomorrow. That's what traditionally follows after a BULLSHIT ALGO FUCK FEST, right?!?!
What the ever-fucking fuck?
But don't worry, CFTC and Shilton tell us this PM market is TOTALLY legit.
Bart could not tell you as the CFTC has shut down today along with all the other unnecessary functionairies.
"But don't worry, CFTC and Shilton tell us this PM market is TOTALLY legit."
Thing is, they aren't saying that. They are saying they see nothing happening that they have authority to act upon. You could steer an aircraft carrier through the crack in that door. Apparently the New York Times business section didnt even carry the story about the suspension of the Silver investigation (or if they did it was way in the back of the paper). It was barely acknowleged by the press.
They have let us know in no uncertain terms that we are on our own.
Ah. But they're certainly not doing anything to correct problems either. It's just tacit approval.
If they had a shred of morality they'd publish everything found, reported, investigated and put the information out there. Sure, maybe they don't have the power to act but why wouldn't they have the option to publically shame or expose what is going on?
And since when is banging the open/close/fix etc not within their purview? It only happens every gorram day!
My understanding (worth that you paid) is that if the manipulation is done by say, JPM at the request of the BIS or the Fed, then it cannot be illegal by definition.
The govt has given itself pretty much full authority to "intervene in key markets" including gold and to do so secretly if its in the interests of the nation.
One way to interpret the statements made by CTFC when it dropped the silver investigation is "there is nothing we can do anything about". Publishing everything they have would ruin any official manipulation scheme and they work for the manilulators so thats out.
Gotta hope the two JPM whistleblowers Maquire keeps talking about come forward. Otherwise we will have to wait 30 years to read the official govt records when they are released.
This was another easy one to call.
Less money for government=moar money for the 1% and their partners-in-crime, the HFT algos.
Who has real physical PM supply?
No wonder Karl Denninger is packing it in. Maybe it's time for all of us to go Galt and leave this shit behind?
It is a complete waste of time following these markets.
I went all cash a few weeks ago. The markets are too psychotic right now, none of which are being driven by fundamentals.
Seriously, how exactly did the TV people try to explain the moves today in their 'free-and-rational-markets-know-all' framework? I know they are deluded liars but am curious what sort of pretzels they twisted themselves into today.
I would love to see what Santelli has to say
Saw him earlier today gushing about our "Constitutional Republic" and how it was working to solve America's problems and pass bills. I shit you not.
Tyler never shows those brain dead clips of Santelli.
Here is the video you are referring to. For one, I happen to agree with him. I guess some people get it, and some don't. The system is working. If the House and Senate were both Dem controlled, we would not be having this convo. The people have spoken, so those anarchist tea-baggers are on the Hill for a reason. More to come in 2014.
http://video.cnbc.com/gallery/?video=3000203866&play=1
Falling for the two party false paradigm won't help anyone. The Tea Party was coopted long ago by the Koch Bros. Controlled opposition now.
Total Kabuki Theater. Only thing assured is moar debt, moar spending and less freedom.
And I was wrong, he called it a "Democratic Republic". So even worse, Santelli doesn't know it is a Constitutional Republic.
Maybe some of you mindless ZH junkers could explain to me how a handful of Tea Party members could actually shut the gov't down?
It is preposterous and laughable on it's face. Like Boehner, Cantor and crew are Tea Party types at all. Yeah, sure they are.
Any chance we can get the likes of Keiser, Maguire and Schiff complete with loudhailers to confront "Lord Bart" and his honor guard at the CFTC?
Is there anyone within ZH pipeline that would show an interest in making that happen???
You can blog tell the cows come home but if you don't confront power at some point what we're witnessing is what you will get -only more of it.
My 2 cents
I'm not curious at all.
I'm going to paint my base boards this evening before I settle in to watch the Pirates-Reds on teevee tonight.
I could give less than two shits what these people have to say. Whatever words they utter, they will either be lies or bullshit. Or both.
And, above all, it will be pointless.
It is hillarious. I heard them mention that part of the reason was there were no congressional members talking today, but the only problem with that is the futures were up huge overnight and there were a lot of congresessional members talking last night.
I loved watching them squirm to try to explain this.
Re; I know they are deluded liars but am curious what sort of pretzels they twisted themselves into today.
Any upward movement is proof of how "free and rational" the markets are.
Any downward movement is just overreaction to news which isn't really that bad and eventually the "free and rational" markets will go up again and show how well "free and rational" markets really should work.
Let me guess... uh... RECOVARY!! THIS IS PROOF IS STRONG, SUSTAINED RECOVERY! A RECOVERY SO STRONG IT CAN STAND A GOV'T SHUTDOWN!!
The shutdown virtually guarantees that there is no taper until at least December. That's all these markets care about
I've already heard some suggest that this is the cover they need to actually increase QE in order to "protect" against a shutdown slowdown
And you find any of this surprising, how???
Dysfunctional government, record debt, propped markets - and tangible assets are monkey-hammered.
I must be smoking the wrong stuff.
I am smoking the right stuff and I am still confused. Although, I am giggling and have the munchies.
.
Even if you smoked a bale of reefer, you'd still look at this and think, "man, that's just fucked up."
To make any sense of this situation requires the dangerous, deliriant, and hallucinogenic tropane alkaloids of Jimsonweed.
Daddy Bernanke is a proud father today. He accomplished his goal as he has ELIMINATED market risk. He has handed matches to all his small chidren.
Good.
Lets hope they all self-immolate so we can be assured that the next generation will have none of them as Fed Reserve Chairman.
Bang Dae-Ho
Futurama - ALL GLORY TO THE HYPNOTOAD
http://www.youtube.com/watch?v=W84DLa0CLNE (0:12)
dis a military operation; ya'll still thinking logical.
I always kind of figured gold would at some point be briefly worthless and briefly priceless on the way to whereever it is we are going. I just wasn't sure in what order it would happen.
I think we are starting to get our answer. Trader Dan's post today pretty much sums it up. Even if every physical shortgage and manipulation story is true it doesnt matter and won't matter for a long time. All that matters is the technical picture being painted by the paper market which tells us the price by definition. These techicals are bordering on terrible for the umpteenth time in the last two years.
I wish I knew which poster(s) on here have been saying, "nothing matters until supply lines break" because I think they have it right. Nothing can stop these markets now. Its nothing more or less than what every bubble history book tells us happens every time.
The only other option is the west can no longer supply gold to official partys in the east and we wake up on Monday with a new monetary system which means we experience the huge wealth transfer without the total collapse many seem to expect. I guess thats something to hope for, but it sure will be hard watching the parades thrown for Bernanke's succesor who "saved us all from something much worse" again...
Hyperinflation causes short term volatility in these markets. But in the end it just makes prices rise and destabilizes unbacked fiat currency. So anything can happen when people are slinging around multi-billion dollar wads. They can short paper gold until the market breaks and physical completely disappears. Paper gold is no different than old private bank money that was backed by gold. When they have no gold, the paper is worthless. It is called a bank run.
They've got all the cards, just not all the metal. Most of the market participants still believe in the kind of technical analysis that Trader Dan posts, so all the banks have to do is manipulate prices enough to paint bad-looking charts. Only prices near production costs and tight supplies that produce widespread paper/physical price disconnects can defy the banks in the short term. But with both metals trading near production costs, how much lower can prices realistically go? I don't think they can make drastic price drops stick for long. Do your part and keep buying. That helps insure that at some point we'll have a cash and carry market for metals.
It's amazing to watch. Unbelievable.
I don't see any reason for Republicans to capitulate as long as the markets are calm. In fact they probably prefer much of the government being shut down. If the Bernanke put keeps the markets calm, the Republicans could drag this on for weeks. It seems to me that the Fed has actually helped the Republicans be able to drag this on longer.
Bernanke and Draghi both keep substituting monetary policy to counter bad fiscal policy, but all it does is mess with market mechanisms and allow politicians to not do their jobs. When will these super educated people with PhD's realize they aren't helping when they make it so politicians don't have to fix their problems. Congress is the drug addict and the Fed is the drug dealer that is more than happy to continue supplying the drugs.
Re: When will these super educated people with PhD's realize they aren't helping when they make it so politicians don't have to fix their problems.
The answer is either:
1) These super educated people with PhD's are sociopaths.
2) These super educated people with PhD's are idiot savants who can't see anything beyond economic theory.
3) These super educated people with PhD's are members of the Illuminati.
It doesn't seem there's any other options it could be.
Choices #1 and #3 are essentially the same; choice #2 gives the shitbags WAY too much leeway...
That's the 30 year, not 10
For almost 5 years it's been "Buy on the dips".
Watch Yellen double QE. It's QE untl the US dollar bust.
I went to the pawn shop and bought some gold today, but I was robbed by an out of work parks worker on the way home, sucked.
All makes perfect sense to the algos
To humans, not much
The 1% blackmails Obama: US government has been shut down by the banksters
http://failedevolution.blogspot.gr/2013/10/the-1-blackmails-obama-us-gov...
Hang on for a wild and wooly ride!
I wonder if Saul http://www.bettercallsaul.com/ will handle the whiplash class action suits?
Our owners LIVE for days like this when there can be no doubt that we are all just collateral damage passing through. It's not enough for them to win...everyone else must lose!
Nice way of stating it. It's never enough for these bastards.
Looks like welfare for the wealthy in the form of the PPT proping up markets still continues during the gov't shutdown. Somehow I think that flow of welfare will be one of the last to end.
There go all my plans of swapping my PMs for armloads of paper.
Damn.
Guess I'll have to go exit strategy "B": Swapping for arable land after the apocalypse.
mods are sleeping - POST PONIES!
oh wait...
I mean REGULATORS ARE SLEEPING, sell PAPER GOLD!
I hit silver hard today at the $20.60 support and neutralized my gold loss. Same with my stupid S&P/Vix trade; I averaged down and I'm out, almost a scratch. Both would make a great DVD on how NOT to trade. Time to get flat and take a break. I don't care what happens. I can't go short and I can't go long. Too much uncertainty. I will await some political resolution. Obama still has the Yellen card to play, and if we get a debt ceiling/shutdown deal, the green lights go on, but now's not the time for me.
I will become interested in the metals if they can clear their 50-days. Otherwise, they might run the stops below the $1179/$18 lows, then we see what the reaction is. I will become interested in equities when there's a political resolution. I remain bearish on crude but there's support at $99.20 and I have no position. The Euro put in a reversal candle today, but I suppose one could be bullish until the 20-day and the breakout is lost. I'm flat there too. Gonna concentrate on other projects for a bit. Trade well.