Antidote For Manipulation
Though, admittedly, it's anecdotal.
So, let's see...The Cartel uses the Chinese New Year holiday to jam price through the 200-day moving average. This trips a bunch of sell-stops and here we are. The gold chart now looks lousy and it is below each and every relevant moving average. Once again, if the LegHounds are going to go to work on ya, you'd better just let them finish their business. This too shall pass, though, and the opportunity to trade some paper may even present itself very soon.
So, what's this anecdotal antidote, you ask? Well, here's just a sample:
- Once again today...and even though it's a Chinese holiday...the Comex drop sparked enormous allocations of physical in London. This continues the trend of paper-bashing in front, deliveries out the rear.
- And this story certainly got a lot of play over the weekend: http://www.bloomberg.com/news/2013-02-10/putin-turns-black-gold-into-bullion-as-russia-out-buys-world.html. But what a joke it is that this MSM story opens with this paragraph:
"Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer. His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China, according to IMF data compiled by Bloomberg. The added gold is also almost triple the weight of the Statue of Liberty."
- Are you kidding me, Mr. Rose & Ms. Tanas? "A quarter more than runner-up China"? Did you somehow miss this story?: http://www.zerohedge.com/news/2013-02-05/china-imports-record-amount-gold-december-price-drop. Note the source material for the ZH story is this article, also from Bloomberg: http://www.bloomberg.com/news/2013-02-05/china-gold-imports-from-hong-kong-gain-to-all-time-high-in-12.html
- But again, no sense alarming anyone. There's no way that China could be moving toward transforming the yuan into a reserve currency...at least according to The Economist: http://www.economist.com/news/leaders/21571442-rise-chinas-currency-will-change-way-world-does-business-yuan-money
- And, of course, this from Bloomberg and BusinessWeek should just be ignored: http://www.businessweek.com/news/2013-02-09/china-passes-u-dot-s-dot-to-become-the-world-s-biggest-trading-nation
- But my favorite is the notion that "gold is in a bubble" and that "everyone who wants to buy has already bought". A few days ago, we shared a post from SilverDoctors concerning first-hand evidence of extraordinary individual demand in China: http://www.silverdoctors.com/first-hand-account-of-gold-silver-mania-in-china-black-friday-style-mobs-scrambling-for-bullion/. Over the weekend, a Turdite reported a similar situation, this time in Thailand:
"Hi Turd. Just got back to my apartment in Bangkok. Went to china town, its Chinese New Year today. WOW. Talk about quite the time. I am here for a month exploring the city and trying to drum up some international business contacts. Anyways on to why I emailed you. The gold buying was freaking NUTS!!! Stores were packed. I walk by a huge horde of people and a big announcement, I weave through the line to see what the commotion is. It is Disney announcing a new line of gold coins and jewelry they are launching, people were going berserk. I thought I would mail you some pics. Thought the Turdites might enjoy."
So, take it all for what it's worth. However, it certainly seems that if The Monkeys insist on jamming price lower in NY, there's an unlimited supply of physical buyers around the rest of the globe, from Central Banks to ordinary citizens. The question is: On whose side do you want to be on, the paper sellers or the physical buyers?
Lastly, I was honored to be on with Dr. Janda again yesterday. Here's a link if interested in listening: http://www.davejanda.com/audio/TurdFerguson021013.mp3
Have a great day.