The Truth about Gold Correction, and its Monster Move North Again

The Truth about Gold Correction, and its Monster Move North Again - Elizabeth Kraus - Gold Coin Blog

Beware of the point when the U.S. Federal Reserve ends the cheap-money mindset that’s fueling the Economy… That uncertainty will bring the best opportunity for Gold! The majority of economists and strategists are now telling anyone who will listen that, the economic recovery is now normal, and are trumpeting this view to jump-start the stock market. They are confidently asserting that “the new normal” concept popularized by Pimco is now a moot issue.

In fact, there is nothing in the major economic indicators to indicate that the current recovery is anything other than anemic recovery. Asians these days say US is in depression and it’s only a matter of time before it gets declared officially. What is told and shown to the public about gold, and what actually is, is hidden manipulation of its worst kind. Let’s not be a gullible bunch! A very famous banker once said :” BUY WHEN THERE IS BLOOD IN THE STREETS”!

While we have unemployment at a historical level and the debts of various states and counties are teetering on bankruptcy, the Federal Reserve balance sheet filled with toxic mortgage crash, the American army is overextended in 720 bases while also fighting unpopular wars in Iraq and Afghanistan, America has to borrow from China to finance its own house, corporate debt is high, private debt is astronomical, the dollar has lost 96% of its value since 1913……. and the fools tell you to pile up some more PAPER ASSETS!

Economy, economics…play their role on Gold as God’s more than ever before! While Gold operates in a society full of economic traps and snares, one has to have a sense and sensibility for it or falter. Some things are just too important to leave to the Economists—and that is the Economy, itself!

Funny thing, since Russia said they will take control of physical gold they have purchased, gold and silver have been going down. Could the Central banks be pushing the price down so they can purchase the required amount for Russia?

It also took a hedge fund manager over two months to get his physical silver from the bank holding it. Hmmmmm, do you think Central banks are trying to scare people out of their gold and silver so they can fill their orders?

Bernanke and other central banks have not pulled money out of the market yet. Ben kept interest rates the same. FOMO bought more bonds today, just like every day. SO what has changed? China’s domestic gold market hasn’t. It’s actually facing supply shortage as the gold demand continues to surge amid the upcoming traditional Chinese Spring Festival. A statistical report earlier released by the World Gold Council showed that the gold investment demand has become the dominated factor affecting the gold prices after the global financial crisis. The global gold demand still remains strong, said the report. And will be even stronger after the veil is lifted off Gold!

During the first three quarters of last year, developing countries, including China, India and Russia, have present huge demand for gold. The world largest gold-backed Exchange Traded Funds has cut 31.26 metric tons of gold recently, bringing its gold reserves to the lowest in the past five months. Gold and silver have been some of the best performing asset classes for the past 10 years! The dow is flat, has been at the same level since 2000s, unadjusted for INFLATION!

Utter nonsense! BUY GOLD, RACK UP ALL THE SILVER YOU CAN LAY YOUR HANDS ON! The Indians are buying, the Chinese are buying, the Japanese and Russians are buying, and the world is buying! There is shortage of the physical stuff, the real stuff! Even dictators in Tunisia know about it!

While enjoying the QE2 inflated stock markups, those of sense and sensibility know the reality. The simple fact that we live in an ‘ artificial” monetary system, based on government issued fiat monies should be a reason enough for smart individual to buy gold! Beyond that fact; our recent history shows that governments will not relinquish any means to save themselves and their corporate acolytes; aka quantitative easing! This is the fundamental reason behind our recent surge in price inflation. What is the point of having a DOW at 20,000 if the price of oil is at 200 a barrel and a loaf of bread is 10 dollars? Does that really matter? That’s my “contrarian paradigm.” Blood in the street has to do with food riots, price inflation, and overvalued securities already happening in the Middle East and South Asia! Undervalued commodities are still being disregarded despite the fact that they have been outperforming other asset classes for 10 years! Holding real hard assets such as gold, silver, platinum, palladium and a whole set of commodities that have been doing much, is much sensible than paper assets!

The yen fell sharply against both the U.S. dollar and the euro on Thursday after Standard & Poor’s cut Japan’s long-term credit rating while the increased prospect of rising European interest rates weighed on commodities. Wall Street stock indexes held near 29-month highs, boosted by strong earnings from companies like heavy equipment maker Caterpillar Inc (CAT.N: Quote) , news that also supported European equities.
Standard & Poor’s cut Japan’s rating one notch to AA-minus, citing the country’s ballooning deficit, which it said will further reduce Tokyo’s already restricted fiscal flexibility. The move will have a limited impact on Japan’s ability to raise money on financial markets, but it raised a red flag with investors about other leading countries’ fiscal imbalances. “It is reasonable to expect that the Japanese downgrade will raise concerns over the sovereign rating of the U.S.,” said Vasileios Gkionakis, macro strategist at Fulcrum Asset Management LLP in London, which oversees $900 million in assets.

The euro’s gains were sharply curtailed against the U.S. dollar on profit taking and a rebound in the greenback based on lower gold prices. Commodity prices were mostly lower as the prospect of rising interest rates in Europe grew after European Central Bank member Lorenzo Bini Smaghi said an expected rise in imported goods inflation could not be ignored. [ID:nFLARCE7IJ]

“The ECB has started to show more concern about secondary price pressures, and the market has acknowledged that,” said Gavin Friend, currency strategist at nabCapital.

Bini Smaghi’s comments went to the heart of current investor concerns, highlighting the potential for inflation to prompt central banks to raise interest rates at a time when low rates are seen as key to boosting renewed economic growth.

Now, as of this morning I was also informed through a Bloomberg article that the Financial Crisis Inquiry Commission has faulted the Fed for lax mortgage regulation helping lead to our most recent financial crisis. Talk about the tip of the iceberg. The article also informed me that Mr. Alan Greenspan declined to comment on the Commission’s findings, as did his spokeswoman, Katie Byers Broom. When Fed spokeswoman, Michelle Smith, was asked to comment she also declined, saying that she had not seen the report yet. Funny, isn’t it? I am sure that Mr. Greenspan did not want to comment on the Commission report because it might raise questions about the significant role he played in our current debacle. It might also raise questions regarding the significant level of consulting fees he is earning for warning us now about the risk associated with the type of Debt Buildup that he created during his realm. I am still baffled, how do these people keep getting away with it!

Based upon what we all know, doesn’t it make you wonder who is paying our ex-Great Economist for his advice these days? And why the television networks still bring him on for his insightful vision? Talk about a risk factor—The truth of the matter is this: during Mr. Greenspan’s full reign at the Fed, the United States was practicing a form of “reverse” Keynesian economics and we applauded him. Not only was Mr. Greenspan jacking up our somewhat growing economy with steroids using mortgage debt, he was allowing the same thing with our National debt. In fact, the Fed was practicing so much “reverse” Keynesian economics during Mr. Greenspan’s reign that we have no room to use it now. Why or how did we let this happen? There is one reason and one reason only. Because we defaulted our own common sense to our non-business oriented economists, who don’t know a damn thing about business, nor seemingly, the economy, itself. I say some things are too important to leave to the economists, and the most important of these things is the Economy.

I also find it rather interesting that Bloomberg News found it important enough to get an early copy of the Financial Crisis Inquiry Commission report to see what they had to say but the Fed seemingly did not? All I can say is this–typical of our economists. Sitting high on top of their Golden Perches, people like Mr. Greenspan, Mr. Bernanke, and the Fed Governors don’t have to listen to anyone other than their own group of selectively groomed economists with like minds, who will support everything they say. And keep quiet about any opposing views. I can almost hear the Fed talking these past couple of days in their secretive little cliquish gathering: “The Financial Crisis Inquiry Commission report? Ah, we don’t need to worry about that. That’s just something a bunch of laymen non-economists put out, looking for someone to blame after the fact.

They don’t know anything about the economy or economics. So, who do we listen too? After all, no one saw this crisis coming. No one other than Roubini, where history has proven, all he does is throw things up against the wall and hope something sticks. Who would want to bet on his projections? And Krugman, who simply says about the economy: “We’re okay. Let’s just stay pat for awhile and let this thing blow over.”

Through all the nonsense, hidden agendas, miss communicated facts, “Gold prices may have seen heavy corrections in the recent days from its unquestionable number uno position, and had fallen slightly putting investors to panic, but technical indicators are showing high and sufficient signs that it will have a super rebound, “says Commodity Oneline. And, wow! Look what happened to gold Friday the 28th…flying North again!

Source: http://goldcoinblogger.com/the-truth-about-gold-correction-and-its-monster-move-north-again/#more-2708