Gold

[nipper]

of course, there's a story behind the development

 

Two of the world's largest banks, HSBC and JPMorgan, have stopped buying gold from the Perth Mint, citing potential damage to their reputation and concerns the government-owned refiner could lose its London accreditation. The black ban follows revelations in The Australian Financial Review that the mint was buying up to $200 million of gold a year from a convicted killer in Papua New Guinea and that child labour and toxic mercury were present in its supply chain....

https://www.afr.com/companies/finan...st-ba...20200724-p55f3v

[mullokintyre]

Gold and silver starting a bit of a recovery rally.

Is it too early to see another upside??

Mick

[mullokintyre]

Gold and silver both running ahead.

Making me nervous.

Will put some sells in tomorrow and take a bit of profit off the table.

Mick

[mullokintyre]

Gold and silver both crunched today,

might be time for a breather and a little consolidation.

be interesting to see what happens after the Northern Hemisphere opens up 2 nite.

Mick

[mullokintyre]

And the crunching continued.

Silver down by 4 bucks, gold down over a hundred plus change.

Fundamentally nothing changed, just the sentiment.

Hope it stays down for while to shake out the chickens, then it will be time to get back in.

Mick

[nipper]

The Ascent is Not a Recent Phenomenon Gold's ascent began five years ago, with interest rates low and question marks beginning to be asked about the world economy. Interest rates were kept low during and subsequent to the GFC, as a means of accelerating and maintaining economic growth, but have never been allowed to return to 'normalised' levels. There are inherent dangers in keeping interest rates too low for too long, as they create asset bubbles and lead to artificially high equity markets, as investors chase returns.

 

https://www.sharecafe.com.au/2020/08/14/gold-price-overview/

Uncertainty is really driving the gold price now .... concerns about economic growth, do central banks have enough firepower to fix the economic mess, will it make a difference, and how long COVID19 will last. If we reference the last major economic crisis, the GFC, we didn't see gold's peak until three years later. If gold prices continue to rise for another three years, predictions of $3,000 do not seem unreasonable at all.

 

- nice graphs too

 

[mullokintyre]

My ole Mat Chuck Butler had this to say in his newsletter yesterday

The Kitco.com website has an interesting chart each day, they show what the price of Gold that was affected by the dollar trading, and then they show the amount of movement that was affected by "sellers"... Yesterday, the move in Gold that was caused by dollar strength, was $1.00... That alone should tell you that the boys in the band backed up their truck full-o-short trades, and unloaded them.... 575,000 contracts were traded in Gold yesterday... That's unbelievable to me... But then when the boys in the band want to take something down, they don't mess around!

 

The total damage done to Gold at the close of the day, was $117.90!!!! Leaving Gold at $1,910.... The good news is that maybe the boys in the band used up all their bullets yesterday, as Gold is up $25 in the early trading today...

 

And Silver was treated as badly as Gold, but Silver's loss of around $4.00 was a larger percentage downward move. And Silver closed at $24.76, with around 350,000 total contracts traded...

 

And during all this engineered takedown of both Gold & Silver, there was not a peep from the CFTC, or the COMEX, or any other entity that should have been saying things like, "we're going to investigate how this happened"... So, as Ed Steer said in his letter today, "a pox on them all"...

 

And therein lies the problem.

The massively large commercial banks have been screwing the system for years and not only getting away with it, but seemingly with the conivance of the regulators.

 

From wall street on parade

 

 

On January 31 of this year, researchers for the Federal Reserve released a study that showed that the largest banks operating in the U.S. have been gaming their stress test results by intentionally dropping their exposure to over-the-counter derivatives in the fourth quarter. The fourth quarter data is the information used by the Federal Reserve to determine surcharges on capital for Global Systemically Important Banks, or G-SIBs.

 

The report, “How Do U.S. Global Systemically Important Banks Lower Their Capital Surcharges?,†was written by Jared Berry, Akber Khan, and Marcelo Rezende.

 

We decided to evaluate this claim for ourselves, using the quarterly derivative reports provided by the Office of the Comptroller of the Currency (OCC), the regulator of national banks. The data was appalling. The largest Wall Street banks not only dropped their level of derivatives by trillions of dollars in the fourth quarter, but they restored those derivatives by the end of the following first quarter. (See first OCC chart below which shows the largest of the top 25 banks by derivative exposure.)

On May 30, with little mainstream media attention, four European academics published a report on how some of the largest Wall Street banks (all of whom received massive amounts of secret Federal Reserve bailout money during the 2007 to 2010 financial crash) were shamelessly gaming the system again.

 

Rather than complying with the derivatives regulations imposed under the Dodd-Frank financial reform legislation of 2010, the Wall Street mega banks had simply moved much of their interest rate derivatives trading to their foreign subsidiaries that fall outside of U.S. regulatory reach. This is known as regulatory arbitrage: seeking the most lightly regulated jurisdiction to ply your dangerous trading activity. (Think JPMorgan’s London Whale fiasco.)

While the political pundits are putting out acres of bullshit partisan pieces about the evils of trump or the lunacies of biden/harris, the fundamental parts of the American and possibly the worlds financial systems are being systemically screwed. All so some already obscenely rich people can become even more obscenely rich.

Mick

[mullokintyre]

Gold and silver both up in later day rallies.

Big question is, what will the commercials do with their paper trades tonite??

Mick

[bg99]

This article is worth looking at combined with the one Nipper posted Aug 15

 

https://www.kitco.com/commentaries/2020-08-...real-terms.html

Looks to me if the 2011 peak is to be a re-run of the 1975 peak we have a way to go yet... has a cup n handle look to it too

 

[mullokintyre]

That chart suggests that if the pattern were to follow for silver, then silver has an even larger way to go.

Mick