Gold Slammed To 3-Week Lows Under $1250 After Lacker Ramps Up Hawkish Tone

Tyler Durden's picture

The weakness in precious metals - as the dollar soared - after yesterday's Fed minutes has extended this morning as Fed's Lacker unleashes even greater hawkish-ness. Gold is back at 3-week lows, back below $1250 with its biggest drop in 3 months...

 

Double-whammy...Gold's biggest one-day drop in 3 months on very heavy volume

 

Now back at 3-week lows...

 

And higher-beta Silver is sliding fast...

 

Pushing Gold/Silver back to one-month highs...

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
philipat's picture

Wash. Rinse. Repeat. Same old same old.

 

NoDebt's picture

Now you know why they're REALLY hiking rates.

philipat's picture

I follow your drift but I still doubt they will actually raise rates. It's just more POMO (Permanent Open Moth Operations)?

philipat's picture

There is obviously also a power game in play with the Chinese. Expect to see very substantial CNY devaluations over the coming weeks. Those "Shanghai Accords" didn't survive very long did they?

VinceFostersGhost's picture

 

 

Gold is the only game in town.....it's on sale.....get thee some.

BaBaBouy's picture

ALL HAIL THE FED...

GOLD Must Not Rise.

ALL HAIL THE FED...

philipat's picture

According to the CFTC there is nothing wrong......so much time to "Regulate" but so much porn to watch.

Shit the "Edit" time is viscious today?

Food Loaf Junkie's picture

Keep droppin, I see my target price of 1180 gold, 14.00 silver on the horizon.  This may indeed be one of the last entry points before the panic.  In the words of Art Cashin "Be wary, alert, and very.very nimble.

Slomotrainwreck's picture

Gold is the only game in town

At 75:1, I'll take silver any day of the week ... ummm except when the LCS is closed.

Hillarys Server's picture

I heard Jim Rogers once say "If it doesn't feel right, don't do it." (It might have been my imagination, though.)

That's why I like silver.

If you buy 50,000 dollars of gold, it can slip into you back pocket. It's small and flat like a bulky train pass.

If you buy 10,000 dollars of silver, it's around a ten kilo bar and you can hardly pick it up.

If something that costs 50,000 dollars can fit in your back pocket, it will still only fit in your back pocket at 20,000 dollars. And at 20,000 dollars you'll still be wondering if it's actually worth that much since it fits in your pocket! So you never really can have a gut certainty about the fair value. You'll just use logic and calculations.

With silver, though, something that's as shiny as silver and there's so much of it that you can't pick it up, you can think: If this heavy thing cost only a couple thousand dollars everyone would buy it because it would be so obvious that it's worth a lot and so cheap.

I'm not saying it well, but does this make any sense at all? With silver you can have a gut feeling of how much it's worth, but with gold you have less.

It's probably similar to the book Blink, which I haven't read, but I blinked at the cover.

Winston Churchill's picture

Recent slamdowns have preceded some geopoliyical event that causes a knee jerk rise.

Take you best guess what of many things it could be.

Is a white swan in a black turtle neck, a black swan ?

 

 

ShorTed's picture

Now on sale in aisle 3, Gold marked down $12/oz.  Get yours while supplies last (and before the ChiComs buy it all)!

NoDebt's picture

Phil- these are rate increases in name only.  The Fed's current overnight interest rate range is allegedly 25-50 bps.  We're regularly on the bottom end of that and often dip below it (see previous ZH articles).  It's a number they pull out of thin air but don't do anything to actually enforce.  They've drained NO liquidity to force rates up to that level.

In short, it's a fake rate increase.  A press release talking point so they say they've done it while in reality they've done nothing.

philipat's picture

Completely agree. The "Excess" reserves and RRPO pattern point to the same picture. It's not that 'the market" is fooled because "the market" volume is 70% controlled by the CB/BIS/TBTF/HFT/ESF Complex, all part of the same club so nobody is going to break ranks. So nothing changes and we live in limbo in this perfect utopian centrally planned matrix. Time for my red pill...

But I still think the next rate increase is not going to happen. Let's see what happens with China and Saudi Arabia over the next few weeks?

Truther's picture

Lacker.... A nickname for a banker that lacks half a brain, and the second half is full of shit.

nibiru's picture

You have an interesting way of spelling Yellen, Draghi, Kuroda... 

BaBaBouy's picture

Fuck The Cabal...

Sir SpeaksALot's picture

well, someone is buying those metals heavily now :)

nibiru's picture

Soros! you know now... and it's all coincidence! Nothing to see here

VinceFostersGhost's picture

 

 

The evil bastard isn't buying it for his health.

DownWithYogaPants's picture

Darth Soros' health depends on the big black dark helmet vacuum sucked to his head.

"Janet, Um yer Faaaather"

Quintus's picture

Nothing to do with the 500:1 leverage in Comex futures at the moment? 

Lots of Bullion Bank asses hanging out the window right now.  Smashing metals lower is the only way out for them so don't be surprised when it happens.  Any excuse will do.

philipat's picture

Wash. Rinse. Repeat. Same old, same old....And with Commercial NET shorts at record levels, we have some way to go to return to a more neutral OI. Fucking criminals.

nibiru's picture

Right when I thought they stopped rigging PMs... 

Kaiser Sousa's picture

yeah right...

i think i'll sell all mine and buy some FaceFuck and other stawks...

 

DEATH TO THE MONEYCHANGERS.

Sir SpeaksALot's picture

it s gonna be all right, just wait till they dont hike in June...

 

 

by Jim Sinclair http://www.jsmineset.com/

Dear Comrades in Golden Arms,

I was there and considered by some to have been the largest gold trader from 1968 to March 1980. I recall every day of it like it was yesterday.

NOW:

  1. I do not believe that gold has registered its all-time high by a long shot.
  2. I do not accept the recent decline from above $1900 as a gold bear market.
  3. I believe all accepted tools for market timing will fail in the long term super bull market.
  4. I believe the recent long decline to be but a reaction in the giant bull gold market.
  5. Into a new New Normal, all previous relationships between gold and anything will not apply.
  6. The basic motivator of new gold prices to come finds it basis in the physical gold market, not in the paper gold market.
  7. The 1% are not stupid or in the main would not have the positions that they have if market jerks.
  8. Knowing without any doubt what is about to occur, they have been for 8 years cleaning out the physical market.
  9. China and Russia are not gold speculators, but know exactly what is about to occur, having made it a policy to accumulate gold on a continuing basis.
  10. Like China and Russia, the right time to buy gold and therefore silver is when you have spare cash to do it.
  11. The demand for physical gold will eventually overcome the physical market, forcing deliveries to be taken on all the world’s paper markets and demanded in the forgotten large OTC derivatives of gold, written naked.
  12. The sign that this is taking place will be the ever increasing margin requirement of paper gold until it hits 100%.
  13. At that point the paper exchange is no longer a paper exchange but rather a physical exchange because physical gold supply will trade at a large premium to paper gold.
  14. This is the point in time when the question will be asked what is the value of a metals contract that cannot perform, the paper gold contracts.
  15. The answer to a non-performing contract is that its value is zero.
  16. Paper gold will trade down to the value of the paper it is written on, zero.
  17. At that time the value of physical gold will be whatever the major owners of physical wish it to be.
  18. The value of gold producing companies still functioning will be determined by their over the ground stored physical at full gold value and its underground gold at a modest discount to the stockpiled gold.
  19. Very few gold miners can grasp that concept. Investors do not have a clue.
  20. Talking heads seem to be getting a hint that something has changed in gold but have no clue as to why.
  21. This transmutation of what gold is, is happening right now, not some time in the future.
  22. The gold market is reflecting this in this minor recovery, making all fishing line market movements a great buy while gambleholic traders still can sell modestly into Rhino horn moves up.
  23. I do not think trading is correct because the final change will come overnight. You will go to sleep in one financial market and wake up the next day in the new New Normal financial world where gold, not paper, is King.
  24. The 1% makes this one of the first choices of assets to own on their decision tree.
  25. This explains the strange action of gold with the manipulators to the dirty work of their masters.
  26. As the paper price of gold is capped, the 1% are the major buyers on the physical metals, mostly direct from refiners and producers.
  27. This means that trillions of paper dollars need to be covered.
  28. The USDX may well be the most useless indicators of the value of the dollar.
  29. The value is not to be registered against other fiat currency, but rather in buying gold versus gold.
  30. As such, the USDX falls out of its traditional relationship to gold. This also reduces the SDR to a joke.
  31. Therefore the 1% is on the bull side of gold in the physical market while the Banksters have been on the short side of the gold price via paper.
  32. Time is running out for the short of paper gold to be a riskless trade with the Federal Reserve at its back. The intrinsic value of the silver and gold contract is zero and zero cannot fulfill the contract obligation of the paper gold contract. That is how the paper metals exchanges go boom. Therefore zero value for a delivery month on paper gold or silver is zero profit to the short of gold and silver paper contracts.
  33. All those long gold anything will have the wind at their back for a long and deserved change.
VinceFostersGhost's picture

 

 

That's........that's about it.

DogeCoin's picture

Don't fret a fucking sale. Load up guys and gals.

VW Nerd's picture

Overnight, China pissed off the western banking cartel by agressively devaluing the Yuan.  This PM hit is the western banking cartel's response.  Just part of the ongoing war.  If it was an honest market move, it would be something to worry about.

fed_depression's picture

And now the Fed can cover those sold futures contracts over $6B or whatever it is in a market that doesn't want gold.

lunaticfringe's picture

They won't hike shit. All they have left is jaw jacking, the last policy tool. How many years have I been listening to this shit? At least 4.

thinkmoretalkless's picture

Lucy Yellen has the football on the tee and Charlie Market is preparing to approach for his kick....and we all know how this ends. Result of June meeting consensus Fall hike "in the cards".

Every day that passes increases the value of having what you own be what you possess.

MFL8240's picture

As planned.  Got caught manipulating Gold through their Bullion banks so needed to switch to a higher level of lying and found the stooge Lockhart to do the dirty work!  

NoWayJose's picture

I suspect this will be the 'last' sale on PMs. The Fed will tighten in June, the markets will tank, and then reality sets in - that the markets cannot live without QE - so we will get it.

TrulyStupid's picture

A big stock market tank is on the agenda  but the politico banksters can't allow that to happen until after Nov 4.. when either of their stooges take the helm and all their incumbents are returned.

MFL8240's picture

Paper Gold heading south and the slob bankers are buying with both hads.  Planned fraud, ...again!

two hoots's picture

 

The juggling act is to keep the Fed, US Gov and US $ all relevant.  That is why it will move up, down, sideways and we will never have market stability.  The world currencies, other CBs, govs, are in constant battle maneuvering as to not drop a baton and the markets will move in tandem with the chaos.  We are stuck reacting to global stuff, not just our own.    

 

monopoly's picture

This correction in this baby bull will get scary. Some will find it hard to stay in and others will not be able to pull the trigger when it is time. But for me, gold, silver and miners are the only true, undervalued and acceptable asset to acquire in these broken markets.

Stay the course and keep that hand on the Tiller. It may be a while but this correction is good for our new bull market, and it will end.

youngman's picture

But Tesla raised 2 billion in funding....lol...gold down..hype is up...I dont get the correlation of higher rates and gold going down...higher rates means more printing of fiat.....so gold should go up in price...IMHO

lunaticfringe's picture

Agree. Markets are so broken and distorted that running your mouth causes them to react. Remember what happened last time they raised a 1/4?

I dare ya Lacker. Go ahead and raise them the whole 1%. Let's not fuck around.  

Latitude25's picture

After the FED raised last time gold broke out on the upside.

TradingIsLifeBrah's picture
TradingIsLifeBrah (not verified) May 19, 2016 8:30 AM

Fat fingered

Bank_sters's picture

Strong dollar is good for emerging markets right?

Ink Pusher's picture

I hope the Chinese 'serve it up cold' when gold comes back with a vengeance.

I calculated over $7Bn in paper dumps moving to drop the price over $30 in a day.

The Bullshit is Boundless.

Seasmoke's picture

Same shit different month.

Wish someone warned me of this fucked up roller coaster ride before I got on it 4 years ago.

Kagemusho's picture

Heard something interesting on SGTReport  China's Gold & The Dollar's Swan Song -- Brother John https://www.youtube.com/watch?v=sAIDKS0whIY

Advance to 16:34. According to the host and guest, there have been attempts to take phys delivery from the COMEX, and those attempting to do so have been warned off.

WTF?

Wow72's picture

That is the point at which YOU realize we are in deep shit and NO ONE Really gets "IT" quite YET.  Like the Quiet before the storm moment.

Kagemusho's picture

Unfortunately that makes (frighteningly) good sense. Somebody had to have been trying to take delivery of real shiny, the way GLD and SLV have become over-sold.

With the mines at near shutdown, taking years to get back up to running speed, there's only so much left above ground. Must be some powerful incentives to get (rumored) Bill Gates to back off.