Gold And Silver Levitate As The Day Of Printing Nears

Tyler Durden's picture

Gold has pushed back above $1600 this morning (and +2.6% year-to-date) as it appears the Hilsenrath-rumor is sinking in and the day of reckoning printing draws nearer. There was little new in the statement, as we have stated, but its timing and specificity is to be noted though we, like BofAML are more predisposed to expectations of a rate extension next week to mid-2015 followed by NEW QE in September (with a disappointed equity market slump in between that 'enables' NEW QE). The herald cry from every hypocritical CEO and retired banker this morning appears to be "but, but, but the central banks have to do something" - even if they 'know' the economic impact is nil - as pre-emptive omnipotence has always worked before.


BofAML: Fed action is likely in the next several months

The Wall Street Journal is suggesting that the “Fed Moves Closer To Action.”


Originally posted on the WSJ Online late yesterday it helped spark an end of day rally in equities (even with the rally equities finished down on the day) and a bid in Treasuries. Today, the article appears on the front page of today’s Wall Street Journal, Jon Hilsenrath, argues that “Federal Reserve officials, impatient with the economy’s sluggish growth and high unemployment, are moving closer to taking new steps to spur activity and hiring. Many officials appear inclined to move unless they see evidence soon that activity is picking up on its own.” The last statement is important because as we have argued the Fed does not need to see a further deterioration in growth to spark more monetary easing but rather no meaningful pickup from today’s sluggish pace.


Further, Hilsenrath notes that “central bank officials could take new steps at their meeting next week though they might wait until their September meeting to accumulate more information on the pace of growth and job gains before deciding whether to act.” Overall, this article is very much consistent with our view. In our view, the Fed isn't quite ready to launch QE3 yet – would prefer to see more data – but could extend forward guidance to reflect the recent string of disappointing data at their August 1 meeting. We continue to expect a rate extension next week to mid-2015 followed by QE3 in September.

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firstdivision's picture

Market didn't seem to notice the USG10Y hitting a record low over-night.

nontaxpayer's picture

I believe the ballpark estimate was $55k and is now $60k...

Stackers's picture

Cartel traders are just finishing their coffee. Give 'em a minute and they will have it pushed back under the brick wall known as $1,600 here in a bit.

malikai's picture

QSN is running gold on the Public gateway. It looks like another setup. Note the divergence is -$17 at the moment.

Need a current Firefox or Chrome to see it.

Muppet of the Universe's picture

dude seriously.  i am having a hard time wrapping my mind around how 1 track yours are. 

I understand, gold and silver long term.  But we are soooo mother fucking far away from another QE.

wtf are you thinking?  WHY would QE come this high in the market? 

That's like firing a firehose a mile before you've reached the burning house.

What do you think is going to happen to gold and silver as the market heads down?


I mean if I wrote, gold and silver to the moon?  I get 100 dopes votes up.

But if anyone even attempts to challenge that view logically, its vote down without thinking.

How the fuck do you expect to beat the muppetry; ascend to something stronger.

If you just hold the qe's coming eventually! mentality. 


You could have just let the banks short it into oblivion and bought again at super low prices, sold off, let bank's short again into oblivion, and buy again at super lows. 

Instead its just this 1 track mind and no timing.  What do you think is going to happen to your precious plan (when QE comes we buy gold silver!!)... 

if the Bernank just issues a silent qe4 like he did late 2011?  Start using your brains if you got em.

pzpzpz owned.

TheCanadianAustrian's picture

So if someone says "gold and silver to the MOON", what is your logical response?

Do you not believe in their long-term fundamentals? If not, why do you continue to visit this site? You know what this place is about.

Or are you one of those people that think they can time the highs and lows and predict the next move of a market that can go months at a time without ever responding to fundamentals?

Muppet of the Universe's picture

you make a shitpoor austrian, but a great canadian.  Yes I can and do call the markets.  Yes I do believe long gold silver.  But not for a long long time.

zerotohero's picture

Muppet you had me at "yes I can and do"

I dont belong here's picture

You mind loaning me your crystal ball for a couple of weeks? Define long long time.

Muppet of the Universe's picture

Gold and Silver will soon be breaking with their relative correlations with the Indices.  This is good.  It will allow the market to fall and gold to rise.

1607-1613 appear to be critical juncture prices.  I would remain short until this range is crossed. 

As correlation between indices and gold dips to 0 (which it more or less has), expect the pinch to be taking over, and gold and silver to begin moving freely. 

Eventually gold and silver will take up negative correlations.  Dips in the market are alway met with negative correlations between gold and indices.

So this means, even though the market MAY be in a downswing later on, gold can still continue up.

For now, even though the indices may be in an upswing (although this may be impeded by bad economic data (you see the redbook yestered? -17))

Gold and silver may not be carried up.  The end word is that Gold and Silver are correlated, is this is VERY important.  But also, as a general rule, since the indices and gold have no correlation as of currently, rely upon the pinch, not upon their market markup.


Essentially what this means.  Is that this flies counter to everything I've been saying.  Since negative correlation is likely coming, expect the pinch to continue for a while, and that buying on the lows of the pinch is still the name of the game. 

I just want ppl to think outside the box.  You see.  It doesn't matter what The bernank does.  The charts run this bitch.  & the pinch decides what happens.  & tbh, based upon the historic correlations and where we are now, I would expect us to break up and out of the pinch.  However, it is the wise man who lets overwhelming sentiment decide when the pinch is broken.  My job is to short it until then.


fuu's picture

"You could have just let the banks short it into oblivion and bought again at super low prices, sold off, let bank's short again into oblivion, and buy again at super lows. "

They can't get it under $1500 and you expect it to be shorted to oblivion? That's your suggestion?

DosZap's picture

GOLD $50K.

Funny, I have been thinking a lot about this lately, and whatever the price Au attains,it doesn't mean shit,because the fiat price means the paper backing it sucks the big one.

So,as stated Au is INSURANCE.

Once Au gets to 4-5k,the Feds are gonna call it all in.

So,prepare accordingly.

Or sell before they do, take your profits and buy real assets.

Theosebes Goodfellow's picture

I agree with one of your points DosZap. When gold goes to $50k a loaf of bread is going to be $100. As far as the Fed trying to pull an FDR and confiscate gold, let me ask you this. Haven't you been boating recently? Mine tragically sank yesterday. Truly dreadful. I was barely able to swim ashore.

PiratePawpaw's picture

"As all my friends can tell you officer; I am in the habit of taking all my guns and PM's with me on my boating trips. Sadly they were lost in a storm along with my boat; which I clearly no longer have. Sorry" :)

midtowng's picture

Gold just broke above its 50DMA. I'm just waiting for confirmation before buying some more.

Deep79's picture

You guys have been saying QE since last June.

We ain't getting it here, it's simple as that.

When the whole market is waiting for QE to jump on board and "get a 20% return easily", it aint happening.

The Fed will keep jawboning QE, but they are scared to launch, if it fails and we sell off, they are done, they would have lost all control.



agent default's picture

No QE before the election, that's certain.

casey13's picture

The latest rumour making the rounds is that the next QE anouncement will be open ended and allow the FED to buy whatever assets they deem necessary. This will solve the problem of it wearing off but not the posible eventual loss of confidence in the dollar.


dereksatkinson's picture

It's about "flow"..  It always has been and always will be. 



bdc63's picture

"We'll buy whatever we want with as much as we want for as long as want"

Damn, it's a darn good thing we have audit rights over the Federal Reserve or this could really get out of control ... oh, wait ...

Doubleguns's picture

So what if the fed goes belly up the treasury can start printing again. The end of the fed could be happening.

eclectic syncretist's picture

They wouldn't be "buying" anything because they don't print money.  They issue imaginary debt from nothing.

What they would do is erase debts, not your debts, the big banks debts, so that the banks would be in a better financial position to screw you even further.  It's accounting fraud pure and simple, but it's a legal way to "boost the economy" in Fedland.

Now in effect, it is printing money in the sense that if I loan you a billion and then forgive the debt you've essentially gotten a billion free, but the set-up is more roundabout and entirely based on debt.  This is not a semantic point either, because the whole purpose of the central banking system is to be able to skim interest on debt issued from nowhere out of nothing, all off the backs of the citizenry.

Moe Howard's picture

Benjamin Shalom Bernake says "stop smartening up the chumps".

agent default's picture

That's not QE, that's operation kill the FRN. 

ATM's picture

The Fed will have to do QE becasue that is all there is left. If it's today, tomorrow, Sept or next Jan doesn't matter. It will happen because it has to happen. When debts are unpayable and money can be printed the answer is always to print, and print they will.

duo's picture

Don't assume QE will be announced on Fed meeting day.  It will be on a Sunday  night or early on a Friday of options-expiration week.  Whatever will burn the shorts the most.

dereksatkinson's picture

Most likely a day or two after Goldman puts out a huge bearish note.

EscapeKey's picture

It's a good thing the major investment banks have Chinese walls and segregated accounts, otherwise it'd be fairly trivial to write a script which automatically determines the best time to rip their customers off.

Did I say rip their customers off? I meant present them with opportunities and experiences.

Doubleguns's picture

Should have said rip muppets off.

malikai's picture

Your "your money and our experience -> our money your experience" line is still giving me a chuckle.

Deep79's picture

Ya the concensus is they will print print print and print some more

When has the concensus ever been right?

I have always stated, the FED will fight hard to keep the US dolar as reserve currency, we will get a depression, but the elites will still have money to scoop up things when they get crushed.

All this talk of hyperinflation is fantasy, they will not let it happen. 

We get hyperinflstion, everyone loses, the guy worth 10 billion is no better than the bum on the strret.

Ya like they will let that happen. Have a 60% correction, the guy worth 10 billion is now worth maybe 4 billion, the he scoops up evrything on the cheap and the cycle starts all over agian.

PiratePawpaw's picture

I have spent my life watching what the herd does, then quietly walking the other way.

Right now the herd is expecting QE.

HungrySeagull's picture

No QE?


Still, It's good to have some Silver on hand.

agent default's picture

And so does the ECB.  So the question is who will initiate QE first, and who will respond with more QE from his side.  Given how politically charged QE was the last time, and the situation in Europe, I would say that the ECB will QE first, with the FED responding after a while.  At least that way the Bernank will be able argue that he was dragged into it, or at least have somebody else to point to and fudge the issue.

zero19451945's picture

I agree. They lose all credibility with the Dow above 12,000.

It confirms that the stock market has nothing to do with the real economy if they print now.

fonzannoon's picture

I am tired of hearing these "they won't print" arguments and then getting into a stupid debate about it. I cut and pasted (below) someone's reply to one of these arguments a few months ago because it stood out to me. I don't know who wrote it but whoever you are this was one hell of a take on things...

"Hope you didn't put much money on that bet, Dawg. These fuckers are going to print hard enough to wake the dead. They'll print like mo'fos, print like mad men, print like fly pimps. Print until their eyes bleed. They will print via the swaps, via bank bailouts and mergers, via fixed Treasury yields, via real honest-to-God negative interest rates, via loans to banks on no collateral, via payroll tax reductions, and in the end via actual fiat paper instruments which they might very well drop in bails from actual mutherfucking helicopters. They will not give two figs what anyone thinks. Here is why. Because this is the Goddamned end of it my friend. There is no accounting beyond this point. There will be no history of it. No one to take notes of rates of exchange, or of the graft and violence, nobody to worry about the deficit or the GDP or the national debt of any nation large or small under the blazing Goddamned sun. End. Of. It. Does anyone bitch about how Rome totally debased their coinage at the end? Hell no. But whoever did it had enough to hand and grabbed some land with a nice vineyard and sat back and waited for the Middle Ages to start 700 years further on. And that's what a singularity is about. Anything that passes through is striped of all meaning. Nothing we think is important now will remain so beyond the event horizon. Nobody will remember, nobody will write about it, nobody will be held to any standard. Ever for evar. So yeah, they'll print like the mad crazed terrorists they are. Because they have nothing to lose, and maybe something to gain. Maybe a dollar. Maybe a day. Maybe a slim chance to escape with some of the loot. Whatever the fuck advantage they see in it, for themselves and their elite crap wanking buddies, they will full-on-full-time-fucking do it to advantage. Watch for it, Dawg. It's totally on this time, on like Donkey Kong. And when the dust is settled in a generation hence it's going to have become another unbelievable episode among the ages of men."
zero19451945's picture

Hope you aren't taking investment advice from that crazed lunatic because last time I checked, people are still writing about Rome debasing it's currency.

fonzannoon's picture

I don't take investment advice from anyone on here nor do I dispense it.

I have an opinion about the fed though. I think it's hysterical that QE which put a floor under the market during a collapse and QE2 which sent the market rocketing higher is supposed to be considered a failure in the eyes of the fed when all they actually care about is the "wealth effect" of the markets.

Yet after convincing the market they are going to do more they will just admit failure now.

If you are talking about the fed's impact on the real economy that is another story. Why people can't seperate the two is beyond me.

kito's picture

Yes fonz, wealth effect...and as long as the fed rumors keep the dow levitating, it will only be rumors....nothing the market has more hope until september....another month or so for the hopium addicts to sit back on the couch, glassy eyed and zonked out, their qe needle tracks getting longer every day.......

fonzannoon's picture

Kito how many 3:50pm false starts are they going to leak before one day the market calls complete BS on them?

Believe me I am not advocating that QE will work. They are totally boxed in now. The rumors will lose the effect more each time and eventually their hand will be forced and when that happens either you will have unlimited orders of ham sandwiches waiting for you at your local deli from all of us or you will probably be on your way to Zihuatanejo,

PiratePawpaw's picture


But not untill the rumors lose all credibility and the herd turns.

fonzannoon's picture

I don't know who is writing to who anymore. I will shut up now.

emersonreturn's picture

wow! thank you fonzanoon for saving and sharing that deserves a pulitizer, equal or better than sam shepard.  a piece, a fragment i hope surfaces after the fall like a shard  from euripides.

firstdivision's picture

Don't worry, they'll crash it ~20% here in the next week or so.