“A gold trader takes a walk!”
Almost the entirety of last week, I felt like I was with Alice, as she was flying
down the rabbit hole to meet the Queen of Hearts … nothing made any sense,
& correlations came and went like blown kisses in a dream … first something
matters then it doesn’t … oh wait, the market has changed its mind again, and
then it’s on to something else … from totally dead trading conditions one
second, to screaming higher the next, like there’s never gonna be another
down tick ever again … until there is, and now it’s an “oh shit moment”, and
you’re transported to the back seat of the “Thelma & Louise” cadillac over the
cliff … “enjoy the ride, it only hurts when you hit the bottom”.
I’m posting 2 charts today, the first the 20 Day MA [both day and New York
session] for the SP500 for 2018, and directly below that, the second chart of
our weekly gold stats.
click to enlarge both
And it becomes quite evident from looking at both above, that gold has
severely lagged in volatility compared to the February/March debacle in
stocks, and very little has carried over to the most recent bloodbath on Wall
Street, these last 6 weeks or so … “WTF is wrong with gold? … cuz quite
frankly, we should be seeing $20+ daily ranges and we’re not … it’s simply the
same old shit, different day routine … so why no reaction from out favorite
yellow pet rock”?
In my book, it’s not the FED and/or the BIS holding gold volatility down
anymore, it’s the frickin’ ChiComs … consider two  very important facts
regarding our buds over in dictator “Xi land”; 1) they receive about 1 ½
billion dollars a day from the U.S., over and above what they import from the
U.S. … that’s a helluva lot of money … in prior years, most of it went into
Treasury bills, notes, bonds … not any longer, and 2) the ChiComs are buying
massive amounts of physical gold from refiners everywhere, particularly
So, why not use some of that useless fiat, a/k/a the U.S. Dollar, and sell gold
futures lower every chance they get … turn around and buy the shit out of it in
the Pacific Rim on futures exchanges from Korea to Australia, and then take
delivery? … so what you lose hundreds of millions in “paper losses”, cuz you’re
buying billions in physical at stable or cheaper prices … it’s simply a cost of
doing business to get the physical you need, without causing a panic in the
market of a price melt up … cuz you need thousands of tonnes of physical gold
… and what better way of getting the West to give it to you than letting the
scumbag TBTF & TBTJ international banks act as your agents for a few coins
in their pockets?
So, they buy in Asia to take delivery, sell in New York to keep the price stable
or lower … they don’t care about “paper losses” … “you wouldn’t either if
someone was giving you approximately $500 billion dollars a year from trade
… give the banks their “nickels and dimes”, but “mission accomplished” cuz you
get the physical you really want … “and that “physical” ain’t ever leaving China
Cuz it all fits nicely into their plans of ruining U.S. hegemony [political,
economic, financial, & social], without ever firing a shot … cuz some morning
you’re gonna wake up to find crude oil is no longer priced in dollars, but Yuan,
and the realization that they have announced that the Yuan is now backed by
gold bullion … where does world commerce flow now? … and without the need
for dollars from crude oil, where does the U.S. borrow trillions to finance the
“free shit army”, from food stamps to grant giveaways to beyond worthless
bullshit studies of the sex lives of frogs? “Do you seriously think they don’t care
what price they pay for all the gold they’re buying [along with Russia & India]?
… in a free market, their demand for physical would be far worse than soybeans
skyrocketing in the worst drought the midwest has ever seen … price would be
skyrocketing beyond belief … but it hasn’t has it, and why not? … cuz they’re not
that fucking stupid to pay anything for it, when they know they can manipulate it
to their benefit, with the help of western bankers”.
Stock market crash? … so what? … for the ChiComs, it’s all about gold priced
in USDCNH, and if that’s stable, nobody in China is gonna get their “big girl
panties” bunched up … however, at some point, when the world wakes the hell
up, gold is the world’s most under priced, under allocated, asset class going
… it most assuredly won’t stay that way in the future.
At least now you know, IMHO, why gold seems so screwed up in its trading,
and why it goes “TNT & Crickets” so quickly … their point isn’t to make
money, their point is to get the dealers to offer them physical at favorable
prices, without the price going northward in a big way … in the process, of
course, specs get crushed, simply cuz nothing makes any sense … one second
gold goes for days and can’t hold $1 gains to save its life … and then in seconds
it turns, and for days it can’t go down a $1, no matter the news or order flow
… it’s the ChiComs folks, right along with their BFF’s JPM, Vampire Squid,
HSBC, Barclays, etc., acting as middlemen and taking their ounce of flesh
… to the Chicoms, it’s simply a cost of doing business that is immaterial for
their ultimate purpose and goal, which is to eventually control the world’s gold
supply and back the Yuan … and if that happens, you can kiss the U.S. goodbye
… we’ll turn into Britain, which in a little over 70 years [1900 - 1970’s], went
from world superpower to banana republic so fast it’s simply incredible
… somewhere Queen Victoria is not happy!
This is Thanksgiving week, so we’ll see how things “shake out” … of course,
Wednesday, Thursday, & Friday will most likely be a wasteland, but these
times are anything but normal, so it remains to be seen what awaits us. In any
event, I’ll be there and attempt to make sense of it … and yes, the PAMM will
trade … onto the week!
Have a great rest of your weekend everybody!!
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