Gold $1600 (Part 2)

[Brian4Liberty]

And now 10 year treasuries drop below 1%...

[oyarde]

Bad move by the Fed. No matter how it was accomplished, yesterday’s run up instilled some confidence. The emergency meeting and rate cut instantly destroyed that confidence. Not only that, they used up some of their very limited room to lower rates.

Just another reason that central planning does not work. Far too many factors involved.

i agree , dumb move

[Krugminator2]

Just another reason that central planning does not work. Far too many factors involved.

Central planning would be doing nothing. If you did nothing you would be pursuing a deflationary policy. As is this is just getting policy to neutral. Still probably need to cut in couple weeks too.

As I write this, for example, the Fed has just announced an immediate, emergency 50 bps rate cut in response to the coronavirus panic. I don't know if that response is ideal; but despite what many of my libertarian friends think, I'm certain it's better than no Fed response at all. Nor do I believe that a prudent libertarian case can be made for arguing that we'd be better off had the Fed stood pat.

https://www.alt-m.org/2020/03/03/why...nt-do-nothing/ Why the Fed Shouldn't (and Can't) "Do Nothing"

The rate cut today was a good start, but we need another 50 basis points at next week’s meeting. At a minimum, the Fed needs to un-invert the yield curve ASAP. A new communication strategy (say level targeting or average inflation targeting) would be even more helpful.
Sometimes I worry that policymakers think in terms of being “done”. “Oh God, here’s the market asking for another rate cut again. OK, here you go—are we done now?”

https://www.themoneyillusion.com/the-fed-is-never-done/

[oyarde]

And now 10 year treasuries drop below 1%...

not sure why anyone would want any of that

[oyarde]

Central planning would be doing nothing. If you did nothing you would be pursuing a deflationary policy. As is this is just getting policy to neutral. Still probably need to cut in couple weeks too.



https://www.alt-m.org/2020/03/03/why...nt-do-nothing/ Why the Fed Shouldn't (and Can't) "Do Nothing"




https://www.themoneyillusion.com/the-fed-is-never-done/

i think the timing was bad

[Warlord]

Bad move by the Fed. No matter how it was accomplished, yesterday’s run up instilled some confidence. The emergency meeting and rate cut instantly destroyed that confidence. Not only that, they used up some of their very limited room to lower rates.

Just another reason that central planning does not work. Far too many factors involved.

Schiff having a dig at the Fed chair:

[Krugminator2]

i think the timing was bad

I said they should have had an emergency cut last week. But as is I would probably cut when markets are panicking not when they are rebounding hard to have a little bit of extra effect.

[Brian4Liberty]

Central planning would be doing nothing. If you did nothing you would be pursuing a deflationary policy. As is this is just getting policy to neutral. Still probably need to cut in couple weeks too.
...

You may be right. The very existence of the Fed is a market manipulation and attempt at central planning. They will never get it right.

Thus, the only solution is to abolish the Federal Reserve.

[Krugminator2]

Thus, the only solution is to abolish the Federal Reserve.

That we agree on.

The thing is if we are going to have monetary policy I would prefer it to not create bubbles when things are good and not overly tight when the economy looks bad.

The yield curve inverted last year. It seems like lowering rates at the short end would be a no-brainer. If you aren't going to ease now, then when? To me the Fed was way too loose after Iraq and fueled the housing bubble was way too tight in the financial crisis. Kept rates to low for much of the last decade which fueled a market bubble and is not getting too tight again. And I blame all of this on discretion. If you just followed the markets like the two year note policy would be much better.

[oyarde]

Nikkei up , Gold up , Silver & platinum up , dow futures up

[Bern]

Wasn't widely reported last week, but ...

...
Perhaps Friday’s Comex price fall had something to do with the CME Group on Thursday 27 February, where they raised maintenance margins on the Comex 100 oz gold future (GC) by 10% from 5000 to 5500, claiming it was a “normal review of market volatility to ensure adequate collateral coverage“. Those margin changes went into effect at close of business on Thursday 27 February (effective as of Friday 28 February). So the stress of higher margin requirements could be a contributing factor to the Comex selloff.
...

https://www.bullionstar.com/blogs/ro...ce-disconnect/

We've seen this before. It really shouldn't be surprising.

Gold had just broke through the $1,650 resistance before the selloff last week brought it back down to test the $1,580 line. It looks like $1,580 is now the bottom resistance zone and the upper bound of $1,650 will be tested again.

[devil21]

Wasn't widely reported last week, but ...



https://www.bullionstar.com/blogs/ro...ce-disconnect/

We've seen this before. It really shouldn't be surprising.

Gold had just broke through the $1,650 resistance before the selloff last week brought it back down to test the $1,580 line. It looks like $1,580 is now the bottom resistance zone and the upper bound of $1,650 will be tested again.

Good catch. You're right, they did the exact same with margin requirements repeatedly during the big G/S run 10 years ago. Nothing is left up to market forces. It's all manipulated. That, along with the futures expiration at the end of month, was the reason for the large spot drop.

[oyarde]

Wasn't widely reported last week, but ...



https://www.bullionstar.com/blogs/ro...ce-disconnect/

We've seen this before. It really shouldn't be surprising.

Gold had just broke through the $1,650 resistance before the selloff last week brought it back down to test the $1,580 line. It looks like $1,580 is now the bottom resistance zone and the upper bound of $1,650 will be tested again.

I am expecting 1700 soon . I think the resist comes @ 1800 .

[Warlord]

Gold futures were headed higher on Thursday, supported by weakness stocks and a slide in government bond yields due to worries about the COVID-19 epidemic.

Bullion is attracting haven bids as California declared a state of emergency, and more cases of the epidemic were cropping up globally, including in Australia and South Korea, making containment of the disease increasingly challenging.

“Gold looks like one of the most attractive assets in this global environment, With US rates likely heading towards the zero lower bound.,” wrote Stephen Innes, chief market strategist at AxiCorp, in a Thursday research note.

“This should mean that both retail and institutional investors, portfolio allocations in gold will rise exponentially,” he said.

Gold for April delivery GCJ20, 0.572% on Comex were up $9.30, or 0.6%, at $1,652.30 an ounce, after settling off less than 0.1% on Wednesday. May silver 0.458% added 9 cents, or 0.6%, to trade at $17.350 an ounce.

U.S. government bond yields remain mostly under pressure, with the 10-year Treasury TMUBMUSD10Y, 0.945% holding near a record nadir below 1% and the Dow Jones Industrial Average DJIA, +4.52% and the S&P 500 index SPX, +4.22% set to give back some of Wednesday’s sizable gains.

https://www.marketwatch.com/story/go...=mw_latestnews

[Warlord]

Dow down 3.3%, gold up 1.5%

[Bern]

Looks like gold surged past $1,650 but was quickly knocked back down. It's hovering right in the $1,650 range and likely won't close above the line today. Maybe tomorrow...

[Warlord]

[Bern]

On second glance, I may have underestimated gold's action for today... $1,670 at the moment....

[Warlord]

On second glance, I may have underestimated gold's action for today... $1,670 at the moment....

Gold has been really strong over the last 24 hours. Looks like @oyarde was right; it's going to take out $1690 either tomorrow or next week.

[oyarde]

Should be closing in on 1675 . I am going to have a nap and count my money .

[PRB]

Historically

DJIA
9/11 : 9k
02/2009: 7k
Nov 2016: 19.5K
Today : 27K
Today/9/11 : 3x
Today/low point in 2009: 3.85x (~4x)

Gold
9/11 : $290
02/2009: $900
Nov 2016: $1200
Today : $1700
Today/9/11 : 5.85x (~6x)
Today/low point in 2009: 1.88x (~2x)


Silver
9/11 : $4
02/2009: $13
Nov 2016: $16.50
Today : $17.50
Today/9/11 : 4.4x
Today/low point in 2009: 1.5x

[Warlord]

The market is crashing.. -4%!

[PRB]

The market is crashing.. -4%!

good! hopefully more! I'm itching to buy.

[Warlord]

good! hopefully more! I'm itching to buy.

As I typed that it rebounded 100 points. Something fishy going on. We'll need to consult @devil21

[PRB]

As I typed that it rebounded 100 points. Something fishy going on. We'll need to consult @devil21

I'll just have to wait it out then.

[Warlord]

I'll just have to wait it out then.

I suggest you buy cruise liners and airlines

[Warlord]

Back down -4%.

Wild swings...

[oyarde]

good! hopefully more! I'm itching to buy.

At this point I would wait until the dow drops below 23,200 at least . The fed killed the market recovery . Best thing anyone could have done was buy a bunch of 14.00 silver and 1200 gold last summer.

[PRB]

I suggest you buy cruise liners and airlines

Good call

https://www.nasdaq.com/market-activity/stocks/bkng

[devil21]

As I typed that it rebounded 100 points. Something fishy going on. We'll need to consult @devil21

Sorry I missed your call, please leave a message.