Let’s talk about the realities of the precious metals market. Are they controlled by the Fed and the Bullion Bank Cartel?
Before I get into today’s topic, I want to call your attention to a phone solicitation Susan received from a representative of “The Children’s Cancer Fund.” With a name like that, who wouldn’t be tempted to write a check? But as always the case, Susan asked the telemarketer, “How much of my $50 donation goes to the cancer fund?” The lady answered, “five dollars.” Susan asked her, “Aren’t you embarrassed?” The lady said thank you and hung up.
This is not uncommon. Everywhere we turn, someone is out to scam the public. The moral fiber of our country has disappeared. Bankers steal. Charities are a fraud. Politicians lie and cheat. The Church is reeling from child molestation scandals. Welfare fraud is rampant. Professional athletes look for an edge with banned substances. And who can forget Jerry Sandusky at Penn State?
In the scheme of things, the lying cheating manipulating bullion banks are acting no different than the overall environment that we are a part of.
Getting back to the Children’s Cancer Fund solicitation, I would hope that all of you ask the same question that Susan asked the next time you get a call like this. And one of the best of the scams is the calls from your local police department or highway patrol. Like the rest, usually no more than 5% or 10% actually goes to the stated charity or organization. When you get one of these calls, tell them to shove it!
Lest you think I am being overly moral here, Susan spent six months working many hours a day for the Breast Cancer Fund, in our complex in Aventura. She raised many tens of thousands of dollars – and every single nickel went to the charity!
Today I read an article that asked the question,
“What kind of Commander-in-Chief publicly announces in advance details and targets of his proposed strike?”
Furthermore, the potential for “unintended consequences” is huge. Frankly, we do not belong there! If our Administration is so concerned with human rights violations, why not focus on Africa? Because relatively speaking, there is no oil there.
Yesterday, Zero Hedge posted an article titled 7 Countries In 5 Years below:
Below is another excellent article on a US strike against Syria, from Zero Hedge:
Submitted by Tyler Durden
Until now, the loudest and most material opponent to a Syrian invasion by the “liberating” powers was Russia. Moments ago, China joined the anti-western axis. BBC reports: “Russia and China have stepped up their warnings against military intervention in Syria, with Moscow saying any such action would have “catastrophic consequences” for the region.”
Adding to the picture, Interfax reported moments ago that representatives of Russia and China have withdrawn from a UN Security Council session on Syria. And since both countries have UN veto power, just like back in 2012 when this whole scenario was being replayed, there can be not joint UN resolution.
Based on the pullback in gold and silver, and the rise in the dollar and the drop in oil on Wednesday evening, the markets are betting that the US will not attack Syria – at least not now. So much for Obama’s Red Line!
It used to be that I voted for the lesser of two evils. But what happens when either choice isn’t worth a darn?
For the last 12 years, we have been ensnared in one unnecessary war after another. Who benefits? The oil industry. The military industrial complex. The banks that lend money to fight the wars. The politicians, either party, that gain votes by fighting for the American Way. But the rest of us; well we get nothing but body bags and more debt. We are hated throughout the Middle East. Is it any wonder why?
The truth is that we don’t even have a choice. If we did, there would be very few incumbents left in office and a third party President would be in the White House. But even then, I wonder if things would be better?
Let’s talk about the realities of the precious metals market. Are they controlled by the Fed and the Bullion Bank Cartel or are they just a reflection of trading for a profit by the hedge funds? The answer is YES, they are – both of them! There is absolutely no reasonable doubt that the Fed and their cronies at the bullion banks, led by JPMorgan, hold down the price of gold and silver. They do it to support the dollar and hide the inevitable inflation that is always the result of rampant money creation (QE). As for the hedge funds, and the trading departments of the bullion banks, they make a lot of money trading gold and silver. They don’t differentiate gold and silver from any other commodity. They are just “things” to trade for a profit. As long as the CFTC sits on the sidelines, they have a free reign to do as they please. All one has to do is look at JPMorgan’s huge 25%+ position in gold and silver. In any other commodity (copper, oil, etc.) a 5% concentration would be deemed illegal. In order to maximize profits, the hedge funds and bullion banks need volatility, and that is exactly what we are getting now in gold and silver.
Have you noticed that the moves down are usually much larger than the moves up? It is as if the bullion banks pull the bids on the way down. They love to see the prices fall, so they can come back in and buy all over again at a lower price. The Chinese, Indians and Russians sit on the sidelines and say thank you for being able to buy the physical metals at the lower price.
The way back up is slower; but always remember – no one, not the Fed, not the hedge funds and not the bullion banks, no one can divert the primary trend. The primary trend for gold and silver is UP! Prices can be managed for a while, but sooner or later, the primary trend will take over.
The manipulation to the downside is strictly in paper and it takes place on the Comex. But the lower the prices go, the greater the demand for physical gold and silver becomes, so they have to pull back and let prices rise all over again.
Expect more volatility and an uptrend in gold and silver from now on.
Let’s examine a few charts that look encouraging for gold and silver and give you a peek at where the trend is headed.
Here are the 6-month charts for silver and gold. Both metals are a bit “overbought,” but I like the look of the trends.
Whatever happens in the short to medium term is not overly relevant, as the long-term trend is up, way up.
Here is another chart, a point and figure chart from Richard Russell. Again, the primary trend now is UP.
Gold backed off slightly to close near 1418. The next target — 1500, which I believe we’ll see by the end of September.
Below, we see a P&F chart of gold. Here we see a long correction down to the 1180 box. Then we see a formation that looks like a version of an H&S bottom pattern. The latest action is a surge to the 1420 box. We now have a projected target to 1710.0. Our first objective is to rise above the red trend line to the 1450 box. With a target of 1710, this should be doable.
Our last P&F chart shows the 30-year Treasury bond. Here we see the bullish build-up to the 152 box. Then we see a four-box downside reversal, a three box rally starting from 4 (April), a peak at the 5 (May) box, and then a crushing decline to the 130 box. Note that at 130 the bond has broken below the bullish rising trend line. The price objective is down to 110. If this occurs, interest rates will have surged, and we will almost surely have a collapse in the stock market and in real estate.
–Dow Theory Letters, August 28, 2013