Interesting article on recent gold price drop
bronco2078
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bronco2078
Posts: 10,227 ✭✭✭✭✭
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Would that qualify as a black swan?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>Based on Dr. Fekete's comments it looks like just a matter of time before Bernanke realizes he is pusing gold price in the wrong direction.
Would that qualify as a black swan? >>
A year ago Bernanke and his policies were pushing gold higher. Now Bernanke and his policies are pushing gold lower. No wonder diehard PM advocates are often looked upon as kooks. They themselves dont even know if they are coming or going.
Sit back, relax and enjoy life. Life is way, way too short.
Knowledge is the enemy of fear
By the way, some in the media were spreading the rumour on Friday that Goldman Sachs was in the bullion market buying physical with both hands on Friday. If and when that sort of thing comes out, it might prove to be their 'bridge too far' because then those they have betrayed by them (again) may turn on them as well who are disgusted by the actions in the markets.
Now, let's assume this is true for the sake of argument. So what?
Two things come to mind: first, doesn't GS function as a "market maker"? and their ROLE is to buy when others are selling (even if they've advised them to sell) this is true no matter what the security, if they change their opinion on a stock from positive to negative, and people decide to sell as a result, shouldn't they be among those who buy their customer's stock?
And second, again assuming it's true and GS was buying at the new lower prices, isn't true that if they and others like them weren't buying, then prices would have gone even lower?
It's an interesting situation to analyze. Also interesting to consider that many who were bearish on gold at $1800 might get bullish at $1200, hope we, um, i mean "they", don't get called hypocrits
Liberty: Parent of Science & Industry
<< <i>A year ago Bernanke and his policies were pushing gold higher. Now Bernanke and his policies are pushing gold lower. No wonder diehard PM advocates are often looked upon as kooks. They themselves dont even know if they are coming or going.
Sit back, relax and enjoy life. Life is way, way too short. >>
Higher gold from QE was an unintended consequence that the FED was willing to accept because they knew they could deal with the rising price of gold using other "tools."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>There's a lot going on in that article, lots to discuss, but this here quote stands out:
By the way, some in the media were spreading the rumour on Friday that Goldman Sachs was in the bullion market buying physical with both hands on Friday. If and when that sort of thing comes out, it might prove to be their 'bridge too far' because then those they have betrayed by them (again) may turn on them as well who are disgusted by the actions in the markets.
Now, let's assume this is true for the sake of argument. So what?
Two things come to mind: first, doesn't GS function as a "market maker"? and their ROLE is to buy when others are selling (even if they've advised them to sell) this is true no matter what the security, if they change their opinion on a stock from positive to negative, and people decide to sell as a result, shouldn't they be among those who buy their customer's stock?
And second, again assuming it's true and GS was buying at the new lower prices, isn't true that if they and others like them weren't buying, then prices would have gone even lower?
It's an interesting situation to analyze. Also interesting to consider that many who were bearish on gold at $1800 might get bullish at $1200, hope we, um, i mean "they", don't get called hypocrits
The issue I see with Goldman buying on Friday , if that happened, is that they recommended that it was going to go down. If they convince people to sell then buy then all they are doing is treating their clients like muppets again. Which I suppose is normal for them as they seem to have a history of front running people that they advise.
If you truly are a market maker then you shouldn't be giving investment advice period , it doesn't pass the smell test.
If firms trade on their own behalf they shouldn't be giving any recommendations either.
If firms trade on their own behalf they shouldn't be giving any recommendations either."
I think we might characterize this as an economic wreck, with the fiat vehicle under water, the airbag deployed and Bernanke, et al, throwing all hands at trying to hold the ballooning airbag below the surface. Something just keeps popping up!
<< <i>"If you truly are a market maker then you shouldn't be giving investment advice period , it doesn't pass the smell test.
If firms trade on their own behalf they shouldn't be giving any recommendations either."
Also agreed.
Knowledge is the enemy of fear
I dont think it was an unintended consequence at all. I also dont think Bernanke cares much about the price of gold. I dont think he has any desire to control its relative value vs other assets. If his actions create a bubble in the metals market, then I think he believes it would be a bubble with very little collateral damage. It would have much less impact on the economy than a stock market or real estate bubble.
Knowledge is the enemy of fear
As cynical as I sound, I noted that Ben Stein (whom I hold in high regard ) gave some very reassuring statements on a FOX broadcast last week.
"while there was a rush to sell paper gold, there was a rush to buy physical gold, which remains in a bull market, trading at whopping premiums."
"We believe that the huge short position and orchestration was done to not only make money but also to allow those players to build-up their physical holdings."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The real estate market is orders of magnitude greater than PMs.
Knowledge is the enemy of fear
<< <i>Another take on what happened and what lies ahead
"while there was a rush to sell paper gold, there was a rush to buy physical gold, which remains in a bull market, trading at whopping premiums."
"We believe that the huge short position and orchestration was done to not only make money but also to allow those players to build-up their physical holdings." >>
Yup, it was also an attempt to shake the sheeple from their corn, copper, oil, and cattle positions--all of which suffered big drops. Yes indeed, if Bernanke and the banksters can control our bloated bellies then they will surely control our every move. Yes sir, that's the game.
Knowledge is the enemy of fear
price and expect gold to drop). Gold and silver were the explosive charges. The commodity sector just followed the liquidity flows from there.
<< <i>
<< <i>Another take on what happened and what lies ahead
"while there was a rush to sell paper gold, there was a rush to buy physical gold, which remains in a bull market, trading at whopping premiums."
"We believe that the huge short position and orchestration was done to not only make money but also to allow those players to build-up their physical holdings." >>
Yup, it was also an attempt to shake the sheeple from their corn, copper, oil, and cattle positions--all of which suffered big drops. Yes indeed, if Bernanke and the banksters can control our bloated bellies then they will surely control our every move. Yes sir, that's the game. >>
How does "our belief that gold's collapse was an orchestrated raid by speculators and not spec longs. . .The identities of those speculators, of course, are unknown but are likely a combination of the big bullion banks and hedge funds which have been feasting on gold's volatility" equate to Bernanke and the bansters? You need to get out from under that tin foil hat and start considering the professional opinions of those in the industry.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>
<< <i>
<< <i>Another take on what happened and what lies ahead
"while there was a rush to sell paper gold, there was a rush to buy physical gold, which remains in a bull market, trading at whopping premiums."
"We believe that the huge short position and orchestration was done to not only make money but also to allow those players to build-up their physical holdings." >>
Yup, it was also an attempt to shake the sheeple from their corn, copper, oil, and cattle positions--all of which suffered big drops. Yes indeed, if Bernanke and the banksters can control our bloated bellies then they will surely control our every move. Yes sir, that's the game. >>
How does "our belief that gold's collapse was an orchestrated raid by speculators and not spec longs. . .The identities of those speculators, of course, are unknown but are likely a combination of the big bullion banks and hedge funds which have been feasting on gold's volatility" equate to Bernanke and the bansters? You need to get out from under that tin foil hat and start considering the professional opinions of those in the industry. >>
So you dont think that the severe decline in oil, corn and cattle was an orchestrated move by the banksters? The only commodity that really matters to the world is gold and silver? Yup, the sheeple cant live without gold and silver, so lets steal it form them. Thats the professional opinion you want me to consider? LOL
Like I stated yesterday derryb, EVERYONE has an opinion. Yet VERY FEW have fact.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i>
<< <i>Another take on what happened and what lies ahead
"while there was a rush to sell paper gold, there was a rush to buy physical gold, which remains in a bull market, trading at whopping premiums."
"We believe that the huge short position and orchestration was done to not only make money but also to allow those players to build-up their physical holdings." >>
Yup, it was also an attempt to shake the sheeple from their corn, copper, oil, and cattle positions--all of which suffered big drops. Yes indeed, if Bernanke and the banksters can control our bloated bellies then they will surely control our every move. Yes sir, that's the game. >>
How does "our belief that gold's collapse was an orchestrated raid by speculators and not spec longs. . .The identities of those speculators, of course, are unknown but are likely a combination of the big bullion banks and hedge funds which have been feasting on gold's volatility" equate to Bernanke and the bansters? You need to get out from under that tin foil hat and start considering the professional opinions of those in the industry. >>
So you dont think that the severe decline in oil, corn and cattle was an orchestrated move by the banksters? The only commodity that really matters to the world is gold and silver? Yup, the sheeple cant live without gold and silver, so lets steal it form them. Thats the professional opinion you want me to consider? LOL
Like I stated yesterday derryb, EVERYONE has an opinion. Yet VERY FEW have fact. >>
You like to continually bash the opinions of some quite knowledeable commentators and industry professsionals, so please induldge me and critique the one linked. What specifically doe he say that you can contradict with fact? And don't include anything that is simply a matter of difference of opinon.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
They believe the demand for physical delivery problem has been solved. However, I suspect the eastern players will push them harder.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey