FOMC Wednesday

140
Wed, May 1, 2013 - 2:33pm

Today's FOMC Fedlines are a non-event. So now we turn to tomorrow.

Thursday brings some news from the ECB. Won't that be fun? Perhaps a reason for the paper jockeys to jam prices lower again? More likely, prices rebound tomorrow as today's shorts are squeezed back out. Then we do this same dance over again on Friday. We'll see.

For now, here's the FOMC statement from the ZH scribd page:

April Redline

Moving on, my thoughts on the day were summarized in this comment to the previous thread. Rather than re-type, how about a simple C&P:

"All you need to know is this: Nearly every important Eastern and Asian buyers market was closed today for May Day. Just like we've seen in the past, absent physical purchasers, the Spec HFTs and Cartel monkeys play freely to kill paper price. Today is no different.

The only real stories today are these:

https://www.zerohedge.com/news/2013-05-01/arizona-becomes-2nd-state-make-gold-silver-legal-tender

https://www.zerohedge.com/news/2013-05-01/crude-inventories-surge-record-high-energy-demand-collapses

https://www.zerohedge.com/news/2013-05-01/manufacturing-ism-drops-lowest-december-employment-drop-biggest-2008

https://www.ft.com/cms/s/0/f7d2e844-b253-11e2-8540-00144feabdc0.html#axzz2S3ls6nkg

https://www.bloomberg.com/news/2013-05-01/crude-falls-for-second-day-on-signs-of-economic-slowdown.html

https://www.usnews.com/news/articles/2013/05/01/weak-adp-estimate-raises-concerns-about-jobs-report

My enthusiasm for typing a new thread is low because I simply don't care what these baboons are doing to paper price. I don't. Gold (and silver) is being sold off because the global economic weakness is prompting paper traders to sell all commodities. And gold is a commodity? Not to me!! And screw the FOMC minutes. Nothing but worthless SPIN and MOPE. We all know by now that QE can't and won't end. EVER! Ending QE would collapse everything. Not going to happen.

Paper trading is completely disconnected from economic reality. Today's paper action deserves nothing but a cursory glance and shoulder shrug."

The only other interesting item at this time in the open interest and CoT survey. For the Wednesday to Tuesday reporting week, gold surged over $62 in price and its OI climbed by 6,000 contracts. Silver, however, was dealing with May contract expiration so, while it also surged forward by $1.36, its OI fell by about 15,500! This sets up another very interesting CoT report this week. Who, in silver, was buying/covering and closing May positions? Was it the Specs? Was it the Comms? How much by category? A very interesting CoT this week, indeed.

But the CoT is still 49 hours away. Before then, we're going to have all kinds of price volatility, likely enough to make us not even want to see the CoT as we'll all be ready for the weekend. Hang in there, keep the faith and let's see what tomorrow brings.

TF

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  140 Comments

foscotanner
May 1, 2013 - 2:39pm

top 5

:-)

Actually my first ever second.

I have had one first, two thirds and now a second.

When it comes to predicting price - i wish i could come anywhere other than bottom :-)

dgstage
May 1, 2013 - 2:40pm

Metals

They did not hate the news. Like you said earlier today more spin and mope.

plecotus
May 1, 2013 - 2:43pm

third

back up we go?

Swineflogger
May 1, 2013 - 2:43pm

Turd! I mean Third!!!

Rat Puke 4th

The Watchman
May 1, 2013 - 2:47pm
StevenBHorse
May 1, 2013 - 2:53pm

Most interesting comment from today was this nugget

"The committee is prepared to increase or reduce the pace of its purchases."

Very interesting indeed. Since prior minutes had been perceived by the market as hawkish, this is without a doubt a very dovish statement.

Also couple that line with the video of former Fed guy Kevin Warsh.

https://www.youtube.com/watch?feature=player_embedded&v=KXLRdhM5s1c#!

Start at 41:00.

There is no exit, no stopping. It's the nature of a exponentially growing system. They will only stopped when the market revolts. Don't be so silly to believe that the TPTB can hit every bid in a panic.

Silver_investor
May 1, 2013 - 2:54pm
Double Bogey
May 1, 2013 - 2:59pm

LCS report

I walk into the store

Me: Got any silver?

LCS: Sure, we're running a special today, Maples for $6 UNDER spot!

Me: You're joking!

LCS: You started it!

ReachWest
May 1, 2013 - 3:09pm

Monarchs of Money

The following is a CBC (Canadian) mini-documentary, titled "The Monarchs of Money", that ran a couple of days ago on the CBC nightly news. It focuses on Central Banks and QE. It's worth watching - although there several tidbits of what I would consider soft-shoed mis-information. One quote - from Mark Grant - "there is no good ending here, just varying degrees of bad endings." It does seem that the Central Banks are starting to lose the PR battle. Worth watching - here is the video on YouTube. [Apologies if this has previously been posted - I have not noticed it] https://youtu.be/7T_VxdLJdDU

May 1, 2013 - 3:12pm

Livermore's advice and comments...

...about the difficulties of sitting tight while being right ring strangely true right now.

There is a lot of hand-wringing, expert opinion, gold vs. silver bashing, conspiracy-decrying going on at the moment. There is small likelihood that anyone will ever find out the COMPLETE, WHOLE truth about every detail of the mechanics of securitized PM markets -- whether by voluntary disclosure, whistleblowing, court proceedings or investigative reporting.

But I am curious, if one understands/believes that the fiat monetary regime of the past decades, combined with the ever more efficient intertwining of large business interests and government (taxation, redistribution, selective subsidization, selective enforcement, etc.) has been:

- a tremendously successful wealth tranfer conduit

- whose throughput and efficiency of operation (in terms of wealth moved/concentrated) has increased sharply in the last ca. 10-15 years

WHY does anyone think that financial vehicles operating within the framework such as GLD or SLV are fulfilling any other purpose? I am not saying anything about the actual contents or 'ownership' status of any physical metal in or not in the custodial vaults, nor about the redemption process -- my comment is merely intended to apply to the ultimate purpose of the construct. If you can make money holding/trading it, good for you.

But it seems to me that the gold and silver thread used up in the spinning/weaving/tailoring process went to some of these for 'special participants':

While everyone else involved will end up looking like this:

And in a broader sense, this applies not only to those vehicles -- but to the adherents of paper assets in general. The 'value' rests on and derives from the trust placed in the terms of the contract, the enforceability of the contract, and the protection afforded to both parties. I see all of these being (or have been) eroded.

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8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
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Key Economic Events Week of 8/12

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7/30 8:30 ET Personal Inc/Spending & Core Inflation
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7/26 8:30 ET Q2 GDP first guess

Key Economic Events Week of 7/15

7/15 8:30 ET Empire State Fed Index
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7/16 9:15 ET Cap Ute and Ind Prod
7/16 10:00 ET Business Inventories
7/17 8:30 ET Housing Starts and Building Permits
7/18 8:30 ET Philly Fed
7/19 10:00 ET Consumer Sentiment

Key Economic Events Week of 7/8

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