Commentary for Friday, Sept 26, 2014 (www.golddealer.com) – Gold closed down $7.10 at $1214.10 today so the gold mood is still negative. We continue to whipsaw back and forth around the important $1200.00 mark – this should continue into next week.
The dollar continues to rule – The Dollar Index is at 85.65 which makes for the 11th straight week of dollar gains – and the daily chart looks like a solid bet for higher ground.
Looking at the bigger picture however the price of gold on the week – down $1.00 – amazing really considering the strength of the dollar – the absence of any “war premium” which under normal circumstances would be worth $50.00 to the upside and the end of our quantitative easing program – probably in October.
And to add insult to gold injury the EU is figuring new ways to roll out the printing press – pushing the euro lower and subsequently reinforcing the upward trend in the dollar. The Ukrainian situation has all but disappeared but problems with the Russians and their sanctions are likely to help push the European economy into an even weaker position. Germany is a European powerhouse and her business activity is at 17 month lows. Jeez – what a picture.
But gold is like the Little Engine That Could and given enough time will push through this wall of pessimism – but probably not soon enough to make everyone happy.
Silver closed up $0.10 at $17.48 and with yesterday’s action I thought today would present a much bigger buying picture. A bit quiet here – perhaps volume sales will push higher next week considering that anything below $18.00 has recently been considered cheap.
Platinum closed down $12.00 at $1302.00 and palladium was lower by $19.00 at $783.00. Rhodium closed down $10.00 into the weekend at $1325.00.
Precious Metal Closes for this week – Sept 22 through Sept 26 – 2014
Gold Silver Platinum Palladium
Mon $1216.80 $17.70 $1330.00 $803.00
Tues $1221.00 $17.71 $1332.00 $815.00
Wed $1218.00 $17.64 $1319.00 $819.00
Thurs $1221.20 $17.38 $1314.00 $802.00
Fri $1214.10 $17.48 $1302.00 $783.00
Our Patented Employee and Customer Survey – Gold’s Direction Next Week?
This is what the GoldDealer.com employees think – 8 believe gold will be higher next week – 4 think gold will be lower and 0 believe it will be unchanged.
Also consider a survey on what our customers think about the gold market next week.
Like the employees they were given three choices – up – down – unchanged. We limited the survey to a random sampling of 100 customers – unscientific yes but worth considering because these people actually took action: 70 people thought the price of gold would increase next week – 20 believe the price of gold will decrease next week and 10 think prices will remain the same.
It is not often that true gold believers get much press these days. When the gold market was hot and rising prices supported such talk positive outlooks for gold were all over the place. But with the current speculative money tied up in stocks and the dollar making new highs the real value of gold bullion has been moved to the back shelf.
So is this the time that real thinkers push through the nonsense that the gold bull has been turned out to pasture? I think the case for owning gold bullion is most needed during these trying times. Consider the following – expressed in the extreme by Jay Taylor Media – Why Gold Price Discovery Must Be Denied by the Ruling Elite. Wow – this is the kind of opinion that this market needs – especially because we are at the low end of a trading range which presents value for the long term.
“In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.
“This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.” (Alan Greenspan, as published in Ayn Rand’s “Objectivist” newsletter in 1966, and reprinted in her book, Capitalism: The Unknown Ideal, in 1967.)
Subscribers to this letter should by now take it as a “given” that the daily price quoted for gold (and silver for that matter) is a highly manipulated price that distorts the real price of gold. The “rigging” of the gold price in New York and London is accomplished by a handful of major bullion banks “that just happen to be” the biggest shareholders of the Federal Reserve Bank. As such they have access to limitless newly created dollars that they can use to smash down the gold price in highly leveraged futures contracts.
It is a fact that only about 1% of the London and New York futures contacts are actually settled with physical delivery of gold. Most of the long- and short-term contracts are simply cancelled out, with the holders simply selling their contracts prior to the contract expiration date. These dirty rascals hit the markets not only during active trading hours but also most dramatically in the thinly traded hours before the Asian markets open. As such it only takes these monster financiers a very small amount of financial resource for them to smack down the price of gold exactly when it would otherwise rise in value, whether due to geopolitical hostilities or our growing financial pathology.
For all those who naively believe markets are always in equilibrium, they should be aware of the dastardly work of Edward Bernays, the nephew of Sigmund Freud, whose propaganda was used by Hitler’s Joseph Goebbels and now on an ongoing basis by our own government as well as by the bankers and military industrial establishment that own the American government. They use mass propaganda to shape truth into lies and lies into truth by stating the same falsehoods over and over again to generate “groupthink.” So whether it is a matter of blaming Putin for hostilities in the Ukraine after the U.S. clandestinely overthrew the elected leader of that nation or of accepting the lies of our highly esteemed ruling elite from Princeton, Harvard, and Yale that gold is a barbaric relic, the establishment is constantly convincing the masses that truths are falsehoods and falsehoods are truth.
Two examples of Bernays’ dastardly, satanic work were the following: Early in the 20th century, he convinced women that it was fashionable to start smoking “Victory Sticks,” especially those manufactured by Phillip Morris, who paid him for his advertising genius. Another time he was paid by United Fruit to convince the American people that the elected President of Guatemala (Arbenz Guzmán) was a dangerous communist and thus justified the CIA-led coup to overthrow him.
The most important lie to turn into truth now for the Anglo-American empire is that fiat money, which can be created out of nothing, is better money for you than gold. Before he sold his soul to the satanic forces who are in charge of America and the Western world, Alan Greenspan spoke the truth partly set out above in his 1966 article, “Gold & Economic Freedom.” Even though he went over to “the dark side,” as recently as 2003 he acknowledged to Ron Paul that he still believed what he wrote in that article. As noted above, Greenspan understood that keeping the masses believing a dollar created infinitely out of nothing is better for them than gold if a collectivist, war mongering state is to survive.
Alan Greenspan quite correctly identified that truth about gold. That truth also illustrates why corrupt governments must use Edward Bernays’ tactics to disinterest people in exchanging dollars for real money—for gold. And so what we have had now for many years is an orchestrated smackdown of the gold price when it “should” rise for the sole purpose of mass anti-gold “group think.” Why is that important? It’s important because if the gold prices started to rise in conjunction with the massive amounts of money being created in this artificial, zero-interest-rate environment, there would be a mass exodus from the dollar, and the post-World War II Anglo-American empire would be toast. Hence the price of gold continues to languish, and that has hurt our investments greatly over the past three years.
But the continuation of this massive distortion is leading to a deeper and deeper economic pathology. The government can lie about the performance of our economy all it wants but, as with Pinocchio’s nose, each lie requires a bigger and bigger lie to cover up the prior one. Eventually, when the economic situation becomes so bad that the masses can no longer put food on their tables, no amount of false economic statistics and happy talk will do the trick. Eventually truth will prevail and even some of the most deceitful and effective purveyors of the big lie, like Paul Krugman, will be brought to justice in the court of public opinion.
How close might we be to that point in time? Charles Nenner’s cycle work, which stays away from subjective views on predicting the future, is suggesting that the big turn for gold should take place late this month or in the early days of October. His target date for a bottom in the cycle has been pushed back lately and that bothers me a bit. But can there be any doubt that the days of this current stock market boom, which has taken the minds of Wall Street off of economic truths that reared their ugly heads in 2008-09 are numbered and with that, trust in fiat money, are soon to fail?
The walk-in cash business was relatively busy today and so were the phones. The Activity Scale has been steady around 5 meaning volume numbers (action) is trending higher. This higher pressure has consisted of a great deal of small to mid-size silver bullion orders and some safe-haven buying relative to gold bullion but no whales have yet shown themselves. We are beginning to see some gold bullion liquidation – not nothing unusual in the way of size.
The GoldDealer.com Unscientific Activity Scale is a “5” for Friday. The CNI Activity Scale takes into consideration volume and the hedge book: (Monday – 4) (Tuesday – 5) (Wednesday – 5) (Thursday – 5). The scale (1 through 10) is a reliable way to understand our volume numbers.
The Activity Scale is weighted and is not necessarily real time – meaning we could be very busy and see a low number – or be very slow and see a high number. This is true because of the way our computer runs what we call the “book”. Our “activity” is better understood from a wider point of view – perhaps a week or two. If the numbers are generally increasing – it would indicate things are busier – decreasing numbers may indicate that volume is moving lower.
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