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US Dollar Tumbles Ahead Of FOMC
Whether it is European banks (Greece and Italy) plunging again, lower-than-expected crude inventories, or expectations of an uber dovish Fed this afternoon, the US Dollar has suddenly gone bidless against the major currencies.
USD dumped...
Against all the majors...
Decoupling from stocks...
Charts: Bloomberg
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Bidless!!! Bitchless!!!
Shit be gettin real Bitchezz!!
Ooops, my bad!
Yellen set to announce a cut in the FOMC rate to 0, and that they will not raise rates until 2276.
They're trying to put as much cushion under the indexes so that when there's a 40% correction they can say "[S]ee, we're still way off the lows of 2009."
QE was a success after all!
NIRP DERP!
Bullish or Bullishit?
cleaning out some longs before they jack it up
Bullish bullshit !
Let's see a REAL DROP for a change.
The FED will always be there to buy in the END!
What remains of the former USSA, will not last till 2276
You talkin crazy again. You done must have Obola.
The Illuminati are on the run. They KNOW there will never be a NWO. Thanks be to God! And the Galactic Federation!
Looks at the dollar curve today - now look at the gold curve today - think anyone is worried about ratios?
And Gold is also going down! lulz
What is gold?
It seems like we need to go over this every 5 months or so but here we go again:
Gold is used for "hard currency" exchange in lieu of a total systemic collapse (good luck with that dream), Speculation on a greater fool to sell the gold to, and in line with 1 & 2, speculation on rampant inflation caused by monetary easing -> lending standard lowering to improve employment / lower employment friction in retooling your economy or real economic growth via higher productivity.
Now, seeing what we read every day on ZH, the most bearish bear on the face of the world... we have
1.) falling purchasing power around the globe, which means margin purchasing of gold is going to zero. Luxury sales, the only real consumer of gold for women-toys is stalling, and gold inventories/luxury fashion houses prove this point without need to argue it further. Don't believe me? Go look at the oil numbers just published. They're as fresh as it gets so get a good long huff.
2.) in line with 1, global inflation and growth is near the lower zero bound. Therefore no point to argue hyperinflation is going to kick up, given the large reserve excesses required under Basil III, and the risk of collapse in ECB system. So, as ZH has shown many times over, lending is not improving because everyone is pretty bearish on this economy, right down to capital replacement/refresh cycles.
Which leads to 3; retail panic selling into the bear slump in gold.
Look at the last 5 year WAP of Troy. Now if you were buying on margin, or savings, and your investment has outperformed for the last 5 years, but underperformed the last 2 years.... what do you think retail, which has cash needs and yield needs are doing. The correct answer is not buying more to "save". They are panic selling to lockin profits. Go to your local goldbug/wingnut street dealer and ask him what is his normal inventory period. If your Broker was bullish on gold, would he be keeping a long-inventory or would he be blowing it out as fast as demand allows him to. Would we be seeing dealers going bankrupt or pulling out of the fix if gold was a profitable business ? again, no.
Which leads to the final point against gold.
Inventory. If you really, badly want to find a gold mine, you need to staff mines. Slave labor does it cheaper and better in African/Chinese mines which sadly has made gold production a non-regulated, no-cartel market with zero price floor and a cash cost on the black market around 600/troy. Due to the deal promotes and fixed labor costs at institutional/corporate held mines their break-even cost is around 1800/troy. So you can see the problem. If gold does rise, there is so much inventory + projects on backlog, it is a sellers market in every turn. If you honestly believe the gold market is going to "turn around" frame that in the context of record streaming deals, where deflation is clearly flashing red in streaming offtake margins.
Which is why we see pockets of idiocy think they can swindle a bunch of newb investors into gold again; as a mythical cure all for street research & insight. Because people are lazy, and dumb. Many want to believe a single brick of element can replace & explain away all their underperformance just by joining this "club" vs. actually building a company, or learning how money is made. Given that ultra low barrier to entry, gold has plenty of followers, and charlatans leading ever more lemmings over the cliff.
Take it, or leave that explanation where it lies, just don't cry ZOG when you see gold move, but have no idea how or why it moves vs. inflation expectations or cash indexes. The truth hurts, walk it off. If you feel I or the markets are wrong, keep on buying for the day growth goes back to 3%/y in the US, and we see full 18-36 employment, oh, and inflation is above 7% in the CORE metrics. I'll be here, waiting.
The only good thing gold has done is create currency demand by allowing people to launder their funds easier via trade demand for that currency. Gold pegs, Siliiver pegs and Bi-pegs themselves have zero to do with market or growth economics.
Now put a stake in it. Tis the season.
Ebola.
The ability to short gold at a ratio of 100 to one using printed paper as a substitute seems to have been dropped from your diatribe.
Who is selling Physical Gold in massive quantities?
I read that Shanghai needs it for their 100% backed Fiat to commodity exchange.
They will be very interested in acquiring it.
Of course the Gold Futures contracts are declining.
Actually, in the near future, I predict a price of ZERO on the COMEX Futures Price of Gold.
What is the price of a NON PERFORMING CONTRACT after all?
Enjoy the 1 to 100 leverage on the Comex.
Sooner or later the buyer of said contract will make the demand to COMEX to Stand and Deliver. Hell...Most likely it will be Shanghai which does.
And when COMEX declares a Force Majuere and attempts to settle in Fiat you can bet that everybody with a brain (CHINA as the host of the Shanghai, and Japan) will dump their US Treasuries so quick it will make your head spin.
The control and price suppresion slips through the grasp of the current regime by the minute of every day.
It is just a matter of time as the power of the Empire wanes
And I love the Exponential Function. Most believe that it is a "Slow Motion Train Wreck" until it actually happens. However the forces will be so tremendous and the casualties will be so high that it is unfathomable to most.
It happens slowly at first and then, all of a sudden, you have not anything to concern yourself witth as you have perished. That is how DEATH happens.
And I just sit and write the requiem of a DYING EMPIRE. Most are unaware or in denial of the outcome...like you.
My gold/silver is up 4X's over what I'd paid for it over a decade ago. I don't think we've seen it's highs yet, so I'll just hang onto it as weak hands get shook out in the meantime.
The doubters always pick the shortest time frame possible, and then scream "See!!!!" Those with longer term views benefit from their stupidity.
What has the purchasing power of the dollar done over the last...
year? decline
Five years? decline
20 years? decline
101 years? decline
It's funny, but I have yet to see the Fed address either the shortest of these time frames or the longest or anything in between.
But we see.
Another believer in fiat, Jannet rev the presses for QEn through infinity!
You're making an argument to a crowd of paranoid delusional zealots. You'd have better luck convincing the average Bush man that is which doctor is a fraud or the typical Al Qaeda numb nut that his religion like all religions is an The obvious fabrication.
Nothing you can say, no fact you can present, argument can be made that can change the psychology of somebody suffering from paranoia.
Lets start with your initial question...What is gold? Gold is a metal. Gold is not a paper promise. Paper can be made in unlimited quantities and is. When those who demand gold see that these paper promises can't be kept, then we will see the real value of the metal expressed.
If you don't understand the need for gold at the central bank/ sovreign level and in the minds of most of the world, then you have much reading to catch up on.
The use of gold as a wealth asset has been discouraged but it has never been suppressed. Paper printing of gold derivatives has worked for 15 years or so but now it is failing.
If you do not understand the function of gold you probably should not be doing anything in the gold market. Just buy a bit of physical and enjoy the rest of the movie.
You have to be kidding! USD bidless! What? Do people honestly think there will be an extension of QE decided today? WTF?
No but no harm in starting to work on the pretext already.
Do people honestly think there will be an extension of QE decided today?
Time to hedge and wait for the dramatic swing at 2:00:00.001
wrong ..... try 1:59: 57
Bullish. Sustainable. Efficient.
Strong dolla policy.
Better pull something out of the hat, Gramma!
Great news for Gold. ......
NOPE.
There is no news in the world that can bring the gold price up because it is manipulated.
until $ dies.
You think this is bad for gold? Wait till that Swiss referendum passes. As soon as it becomes obvious the SNB has no practical choice but to purchase 1700 tons of physical gold and prove possession with an audit, expect the price of gold to fall at least $100.
As others have said, gold will never be allowed to appreciate until the next Bretton woods type agreement is made
I don't know what is Butt-in-woods. My hopes are tied to pitchforks and ropes.
What are they doing here?
They're selling, Mortimer.
Why, that's ridiculous...
bitchez
So why is the (fake) "gold price" not responding at all...? Tell me again...
because it's Comex month-end.
Comex? What is that? Empty warehouse?
The Comex is irrelevant. The Forex market trades more gold in a day than the Comes trades in a year (slight exageration but....) XAU is one of the most traded symbols. In a year the entire above ground stock of gold is traded on the Forex markets. Gold is massively traded like a currency. Gold trading dwarfs the stock and bond markets as do most currency trades (3 to 5 Trillion a day total).
The markets that trade physical are important only in what their failure will mean but it is likely that failure will come first in other places. IMO
"Tradition," duh.
lol aint that the truth..that was good
because paper gold and silver are criminally manipulated to whatever price point the Cartel wants them to be at and have absolutely nothing to do with the dollar or any other fiat shit paper anymore.
But one of these days...sometime soon, me thinks...all that shit's gonna change, bitchez.
Tick...tock
Keep stackin' that phyzz, folks...
There's something else too. The reason paper can be manipulated is because the vast majority of people have no clue on how they are being screwed with printed money. They are getting the feeling they are being screwed but they don't understand how. If they understood, they would buy gold and silver and take delivery. If a majority of people bought and took delivery, the manipulation would not work. Reality would bulldoze the fantasy market. The collected water of the Fremen would be opened up and it would rain on Arrakis.
Because USD is better than Gold anyway.
The only way this little Comex paper playpen, with its tiny pile of real gold shoved around from bank to fund to bank and back again and again, is allowed to determine the price of the REAL METAL is because GOVERNMENT wants it that way.
The manipulation is INSTITUTIONALIZED.
Get yer dollars two for one!
Thank the Fed, kids, for our stable currency!
<Bud and Kelly> Thanks, Fed!
Maybe 2 to 4 months before the Fed ramps up QE4.
The Fed is stuck it can't raise rates and many people realize it.
Many would welcome the death of the petrodollar.
Some big players are realizing the fed's printing game gets worse until there is a currency crisis with the US dollar free-falling.
King LOLlar is dead! Long live King LOLlar !!
They will probably need to ramp up the evil Putin and evil Russia propaganda.
NY Fed is bailing out some major player badly needing USD
So, killing themselves?
You sir, are a true optimist. Good luck with that.
Nature is nature.
Sacrificial lambs needed for the others to survive
I think your sepculation is interesting.
http://en.wikipedia.org/wiki/Carter_bonds
De-dollarization attempt has happened before.
I just didn't think they would allow it again.
Somebody big has to go for USD to survive
The dollar can't be forced out, it must die naturally. Too much of the world holds dollars as their wealth for some solo party to effectively take out the dollar on its own. We are seeing the end of the currency. It seems to be taking forever but when it is over it will be obvious what is happening now.
As we watch the day to day action, unless you see the overarching story line, it will seem confusing.
A European Bank perhaps.
Can you say a German bank that just found out it has a big hole in its balance sheet.
Douche Bank?
Sorry...my German is not so good ;-)
That explanation requires collapsing markets somewhere. At the moment, the fairytale is still alive and well and the markets are solid - I don't see margin calls that would require behind the scenes bailouts.
What is the lag time for a margin call?
2 days? 3 days?
So there'd have to be something that broke 2 days ago and has fallen since. I don't see it....
The whole point of providing the dollars is to disallow collapse of that particular entity, so we won't see which one
But the trigger would have to be a drop in price (I'm assuming long position since that's the only place to be except in the toy gold market) to trigger the margin call. You don't need to do something disruptive to prevent a potential margin call, all that does is risk introducing uncertainty into the market.
There is no market, I am literally speaking
Figuratively
dollar down, oil up.
Somebody with rehypotheticated oil was about to go down.
NY Fed is bailing out some major player badly needing USD
You mean this player is the Triple Lehman we are waiting for?
I called for Triple Lehman in May 2013.
It should have already happened.
I didn't think USA would go as far as allowing currency swaps with China and de-dollarization to re-start as in the 70s
Hence, the civil war between Pentagon and Bank Lobby/White House now
It is going to occur. It is inevitable, or........bullets on heads
That outcome is one of the outcomes on my list from a few years ago as a possibility.
Ah, what do I know!? Just working up hypotheses and watching to see how they pan out. Key IMO is watching for rifts at higher levels to the degree we can see it.
http://en.wikipedia.org/wiki/Carter_bonds
carter bonds, denominated in german and swiss currency
Interesting. I assume revalued in Euros at some point.
Totally unaware of that.
You're smarter than a tree full of owls ekm1. ;)
Did you mean bullets IN heads?
bank lobby destroys the USD (FRN)
MIC relies upon petrodollar for energy and funding
these are not reconciable. if this breaks and the USD/petrodollar dies as the banks want, the MIC won't survive in it's current state during the transition to SDR, gold backed whatever.
It is being broken anyhow. So, does the MIC sit by and watch it happen, or take an active role in how the game changes?
Or, the flipside... is the USD the ultimate weapon of war? And in this scenerio, who is really running the show?
The middle class is dead. Long live the middle class.
Spanked 'em like a baby seal
Gimme another cup o dat bailout juice granny Yellin! Shit be 101 proof YEEHAW!
is this ANOTHER post where ZH (inadvertently) calls the bottom?
check back in a few hours
Can't respond, busy buying the ZH bottom.
So US$ INdex down and Gold...down...? mind you I have NEVER seen it up on a FOMC day
Capital inflows letting up. Correlates to the housing market drops.
Little relief here before the EU takes another kick in the nuts.
Plunging.
Oh look EUR/USD is up 20 pips since 07:00.
*yawn*
When the dollar surges, gold plunges. When the dollar plunges, gold plunges. Interesting dynamics.
Looks like the plunge protection team is in full action! 86.10
did i just read a lenghty comment of a half dozen reasons you should sale your gold and run, when did ben find time to post here.
my personal favorite reason he gave was china was mining gold and selling it on the black-market. for $600 per troy ounce.