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Financial Markets: Pinocchio’s Enchanted Island
Submitted by Leonard Sartoni via Goldbroker.com,
The control of the commercials that the COMEX manipulators have is very depressing for the gold market investor. As soon as gold and the miners are about to get on another bullish leg, that the moving averages are positively aligned and re-crossing the 200-day MA, that the traders are standing by to get back in the market and are following the buying signals, BANG! A new flash crash! And, as usual, it is explained by vague and far-fetched reasons. The last example we have is what happened last Friday: Because of slightly better numbers on jobs creation in the United States, gold has been massively attacked and lost $40 in a single day! Ten days like that would bring gold down to $834! This is gigantic! One doesn’t have to look very far to realise that the manipulators are still running the show and are systematically keeping gold from resuming a bull market. They have failed to keep it under $1,200 for any length of time in 2014, but they are very active in keeping it under $1,300, because this would trigger technical buying orders.
The Fed will probably try to hike interest rates in June by 0.25%... so? The dollar is already too expensive and will hurt exports, the mountain of private and public debt in the U.S. will not be able to support a rate hike, and neither will the stock market, already in an historic bubble! An interest rate hike in the U.S. would most likely totally extinguish what frail economic recovery there is. The Fed is about to make the same mistake Jean-Claude Trichet made for Europe: By over-estimating the capacity for economic recovery and by wanting to retain the weapon of rates reduction when recession hits, the central bank is going to choke an eventual recovery. The reality is that central banks are caught in a snare and the only weapon they have left is the destruction of their own paper money. One after the other, they go for competitive devaluation of their currency. After the Fed and the Bank of Japan, it’s now the ECB’s turn. Who will be next?
As long as this market is manipulated, no technical analysis will hit the target! We have been living in a new era of “fantasy finance” since the Fed officially intervened massively, in 2009, and since the non-official control of the gold price, in 2013. Investors are now thinking that everything is possible: stocks rising into infinity, oil being given to us by producers and refiners almost for free (it sells cheaper than mineral water), countries that can borrow at historically ri-di-cu-lous rates, and, no later than just a few days ago, a bank in Denmark that pays people to contract a real estate loan (negative rates)!
The financial world, with its lies and immoral management, has been transformed into a Pinocchio’s Enchanted Island... for adults ! How long will these aberrations last? As long as central banks do not come back to a monetary system based on gold and as long as they massively manipulate the markets trying to keep the current monetary system from failing. Officially, they do it to control interest rates and money printing but, un-officially and with the complicity of business banks, to control strategic assets such as gold and, probably, stocks, to maintain the “wealth effect” and try to boost middle-class spending in the U.S.
Of course, there will be a price to pay! Children are turning into donkeys on Pleasure Island and they are paying dearly for their gullibility! Today the market punishes the conservative investor and favours speculators and idiots who see central banks as the Hand of God in the financial markets. We are witnessing a full deterioration of the markets. In my view, the results of these manipulations (the most scandalous result being the richest getting richer, not by global wealth growth, but on the backs of the poorest) are much more diabolical.
Let’s open our eyes: At this point, people are kneeling like little kids before the Fed, the ECB, the BoJ and all those imperilled institutions, so that they continue to feed the fantastic world of post-2008 finance with more liquidity and easing! The gullibility of people today is such that they have completely exited from assets that could protect their wealth when the bill comes due for all this monetary debauchery. Suddenly, in just a few days or weeks, investors will turn into donkeys, and those who are branded as donkeys today (investors in safe haven assets such as gold) will be rewarded for their patience and their wisdom.
Unfortunately, I have no idea when this return to Earth will occur. In this new era of fantasy finance, I think that central bankers have gone into the final phase of paper money destruction, pure and simple. There will be no reparation possible without calling in the ultimate debt extinguisher, i.e. gold. This is the reason why central banks continue to accumulate gold or are asking for repatriation. At this stage, the more they fight recession by printing money, the more the certainty grows of an accident worse than in 1929 happening, that could lead to an historical debacle that would mark the remainder of this century. The only advice I can give today is to remain patient and to resist the chants of the media Sirens trying all they can to draw us to Pinocchio’s Enchanted Island!
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Whatever happened to pinocchio?
There was some lesson or something...
As bad as the economy is, Pinocchio's growing nose is about the only growth we got going here.
Overheard on the Enchanted (Fantasy) Island...
Tattoo: "Ze Plane! Ze Plane!"
Mr. Roarke: "Not to worry, my little friend... it is yet another flight from another naive foreign central bank here to try to collect the gold they have left in our "safekeeping." They actually think they will ever get it back! Ha! Like all the rest... They too will return empty-handed."
Pinocchio got wood rot and had a nose job.
I heard he got a woody..
Every Politician, banker, CEO, etc. (name your favorite Satan) has one, kind, generous heart.....but they also have 10 greedy, evil, fingers!
Every Politician, banker, CEO, etc. (name your favorite Satan) has one, kind, generous heart.....but they also have 10 greedy, evil, fingers!
so....do the one thing that makes sense (if you understand what is happening)...buy physical and sell paper...
One only needs to protect the value of the physical one might need to sell before a reset of the gold price.
I actually enjoy the smack downs. I know they are coming. I know gold will not be allowed to rise in price until it benefits the CBs....so I hold physical and sell 10 to 20% of it with inverse GLD funds.
If gold rises..whoo hoo my stack is more valuable. If gold falls my hedge rises....no sweat.
This is clearly not ideal, the system is corrupt...but what else can a guy do...really?...
No different than an option model, only yours has a better outcome when the SHTF.
"There will be no reparation possible without calling in the ultimate debt extinguisher, i.e. gold."
reparation n. - the making of amends for a wrong one has done, by paying money to or otherwise helping those who have been wronged
seein' how the same overlords sit on the worlds gold reserves, how can this make any f*ckin sense? They gonna shower you with their gold? I reckon they will... fookin idots
Fuck off with that oil for free bullshit! It is only reverting to the historical price norm adjusted for inflation. Oil has only been higher a few times due to manipulation. Take that weak shit somewhere else punk!
Um, u have any idea what the marginal cost of production is? It ain't $45/bbl. Your reversion to the mean presumption only makes sense if the cost of production remains constant. As it is, finding and exploiting new oil is substantially more expensive than it was 10yrs ago, when the price was heading for $150. At today's prices you can pretty much kiss North American shale goodbye, along with North Sea and most other offshore.
Good riddance!
as oppose to the markets no ?
Yellen and her group of cunts and bastards have to keep the illusion up. How can they not? The senile depends wearing cunt bitch would have some explaining to do if her 5 trillion dollar gamble didn't pay off.
It's nothing more than yellen the cunt, bernank the bearded bastard and hank two-faced paulson trying to cover their decrepid asses.
Of course, the long legged pimp daddy's empire has crumbled to shit and the only bright point is the market. So the dumbo eared jihadist in chief needs the market to go up, up and up to save face and keep his lies coming.
btw - 100% of dems voted against auditing the fed. remember this when the day of reckoning comes
"One doesn’t have to look very far to realise that the manipulators are still running the show and are systematically keeping gold from resuming a bull market. They have failed to keep it under $1,200 for any length of time in 2014, but they are very active in keeping it under $1,300, because this would trigger technical buying orders."
I have a fair amount of (paper) gold so this interests me. The sudden sell-offs of gold are interesting - someone dumps a LOT at a great loss compared to selling a little at a time. Is there no way to find out who keeps dumping gold - the massive dumping - so regularly?
Interesting you hold paper gold, any particular reason? I guess if all else is squared away and you like the repeat abuse, that's cool.
No, no reason at all. Thanks for playing!
(My God there are a lot of morons on ZH. LOL!)
No problem CAC, it's a legit question. Good luck with the paper.
They lie about everything. Why would they lie about this?
The banksters need to repay us.
Though it looks as if Pinocchio could have a pretty successful "mustache riding" business.
Careful, the politically correct term for lying is misremembering.
.
That was 'doubleplusungood" of me.
I'll check into Room 101 now.
The banksters need to repay us.
I heard that Wall St Pinocchios are into Wall St hookers.
I just finished my second Makers Mark on the rocks and Pinocchio is starting to look like Brian Williams. Can't wait to finish my third.