GOLD 0.51% $1,391.7 gold futures

midas du metropole

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    The James Joyce Table
    Midas du Metropole
    Topic du Jour


    October 29 - $752.80 up $13.10 - Silver $9.83 up $1.02

    Gold Rises, But Held In Check Due to Fed Announcement

    "...first ascertain exactly the position of the various capitalists, then control them, influence them by restricting or enlarging, facilitating or hindering their credits, and finally they can entirely determine their fate." … Vladimir Ilyich Lenin [Vladimir Ilyich Ulyanov] (1870)
    - GO GATA!

    What else is new? Yesterday was an option expiry day for gold and silver, so The Gold Cartel kept the prices of gold and silver under pressure. With their short option positions taken care of, both precious metals were allowed to rise today, and sharply so in the morning. When I turned on my screen this morning, gold was up $21 with the euro down .0060. How many times do the cabal crooks, with other allies, have to get away with this shame before the CFTC lightweights wake up?

    If the CFTC can’t get them for one thing, they ought to try another. Gold made it all the way up to $773.60, which was just too much excitement for The Gold Cartel. The PM Fix came in at $764, up some $25 from yesterday, which was needed to meet the physical market demand. Once the Fix was over, the gang went to work to maul gold for the rest of the trading session. While $750 was breached, in essence the cabal has not given up on defending it further.

    These constant, irritating trading patterns are sickening to observe day in and day out. And then there is the Fed decision on interest rates today. Couldn’t have the price of gold soaring $35 higher with the Fed lowering rates. SHOOT THE MESSENGER again.

    WAY OVERSOLD silver finally showed signs of life, as sold out as it was. While the $10 level was defended today, silver ought to take out that price easily and chug on from there.

    The gold open interest fell 588 contracts to 313,709. Somebody made a quick buck in silver today, as its OI went up 1818 contracts to 95,716. Its open interest ought to be washed out too and begin to move up from here, as some specs move in to buy silver on the cheap.

    Fed interest rate time…

    14:18 FOMC cuts discount rate target by 50bp to 1.25%
    * * * * *

    14:18 FOMC cuts federal funds target rate by 50bp to 1.0%
    The move was widely expected.
    * * * * *

    FED- PACE OF ECON ACTIVITY APPEARS TO HAVE SLOWED MARKEDLY DUE IMPORTANTLY TO CONSUMER SPENDING DROP

    U.S. FED CUTS BENCHMARK FED FUNDS RATE 1/2 POINT TO 1.0 PCT, DISCOUNT RATE 1/2 TO 1.25 PCT

    FED SAYS BUSINESS SPENDING, INDUSTRIAL OUTPUT HAVE WEAKENED, PROSPECTS FOR U.S. EXPORTS DAMPENED

    FED SAYS INTENSIFICATION OF MARKET TURMOIL LIKELY TO EXERT ADDITIONAL RESTRAINT ON SPENDING

    FED-POLICY ACTIONS,LIQUIDITY MEASURES SHOULD HELP IMPROVE CREDIT BUT DOWNSIDE RISKS TO GROWTH REMAIN

    FED SAYS WILL ACT AS NEEDED TO PROMOTE SUSTAINABLE GROWTH, PRICE STABILITY

    FED SAYS EXPECTS INFLATION TO MODERATE IN COMING QUARTERS TO LEVELS CONSISTENT WITH PRICE STABILITY

    FED VOTE TO CUT RATES WAS UNANIMOUS

    Dave from Denver notes…

    The key for me in today's FOMC rate cut decision was that the decision was unanimous - contrary to the last couple meetings in which a couple FOMC members voted for a rate hike - and that they are taking rates down in the face of rapid, hyperinflationary expansion in the money supply AND with obvious observable, despite Govt garbage statistics, accelerating price inflation.

    This tells me that Bernanke is not using just helicopters to throw dollars into the system, he is using the entire U.S. airforce transport and bomber fleet. It also tells the only tool the Fed ultimately has left is to accelerate the expansion of the money supply. We are finally seeing the reason behind the Fed's November 2005 decision to stop reporting M3. Good-bye USA, hello United States of Weimar America.

    Anyone who is not aggressively using what dollars they have to accumulate gold, silver and mining stocks is placing themselves and their family at great economic risk.

    ***

    Gold was immediately taken down to $747 below the pivotal $750 area, rallied back to the $758 area, rising late along with the US stock market, and then was pushed right back down to $750 when the market reversed course late.

    Now we need a decent closed above $750 so we can shoot for $800. It sure should.

    As we all know, commodity prices have been decimated and were incredibly oversold. Today, was rebound day…

    *Crude oil finished up $4.77 per barrel to $67.50.

    *Copper gained a stunning 22.95 cents to $2.0885.

    *The CRB roared 15.42 higher to 274.34.

    ONLY gold finished well off its highs, thanks to Comrade Paulson and his storm troopers.

    Comex silver deliveries...

    Hi Bill,
    I'm told there will likely be a nasty surprise for those taking delivery of silver bars from the Comex. Apparently, in past deliveries, some buyers found themselves receiving bars that were severely tarnished and flaked. If future deliveries fail the quality test, might this not cause a massive spike in the silver price?
    Nick


    The dollar fell .88 to 84.94 and the euro rose .0137 to 1.2944.

    The yield on the 10 yr T note is 3.86%.

    The LIBOR rate fell to 3.42%.

    More gold goodies:
    Many Indian cities were closed today because of a second Hindu Festival, unfortunately including those most reliable in their gold pricing. From the data available, it would appear that with world gold at $750.45 and $749.80, ex-duty premiums were lavish: $10 or more. This suggests the world’s largest gold buyer will continue to be active. The rupee firmed a little, closing at $1=R49.69 (Tuesday R49.87) but the stock market was only up 0.4%.

    Yesterday’s rise of $12.60 saw open interest slip 588 lots (1.8 tonnes). This suggests that short covering edged out fresh longs. But presumably there was appreciable new buying (or short selling) and the absolute change is too small to account for the rise.

    Today’s $13.50 rise was on estimated volume of 138,108 with a switch effect of 50,018: net, not a heavy day.

    ***


    CARTEL CAPITULATION WATCH

    What a ride for the DOW. It was up more than 200 late. I blinked to finish up my commentary and now see it closed down 74 to 8990. The DOG managed to hold on to a 7 point gain to 1657.

    08:30 Sep Durable Goods Orders reported 0.8% vs. consensus (1.1%); ex-Transportation (1.1%) vs. consensus (1.5%)
    Aug Durables revised to (5.5%) from (4.5%); ex-Transportation revised to (4.1%) from (3.0%)

 
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