![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/quotes_2a.gif)
Is the death spiral here?
So let's review: Gold was merrily bopping along up a few dollars when all of a sudden every commodity in the world began to sell off. At one point gold literally fell $8 in three minutes. (Funny, I have never seen it rise $8 in three minutes!) To make a long story short, gold closed down some $17 while silver got its ass handed to it and closed down .56.
Now I am not going to complain about today's losses, as both gold and silver really needed to come in a little. Today was a classic down day in; death like plunges, huge rallies then another death plunge to close towards the lows. Instead, what I am going to bitch about is the constant tap dancing on gold's grave that I heard endlessly today. Every single time gold was mentioned on CNBC today, the losses were mentioned with such glee it seemed everyone on the station had a huge short interest and was making millions off the fall. I already talked about the moron who called the end "to this parabolic move" in gold. Tonight on Fast Money, Dylan Ratigan, actually posed the question is this the end of the bull market in commodities? You would have thought these morons never saw profit taking in a bull market!
According to Dan Norcini over at Jimmy's site, he believes the rout started when China intervened in the Soybean market to try and temper food inflation. Well, in this black boxed market of 2008, if one commodity market starts to crater, they all do.
The gold stocks got absolutely hammered, at one point the HUI was down 24, before closing down 17. Nothing like giving back two weeks work in one day. Funny, I don't remember the HUI being up 17 let alone 24 during this run up. The shorts were having orgasmic convulsions, they were making so much money at one point.
All of this action happened in the face of a lower dollar as things keep getting worse out there. Ben, even suggested that banks forgive parts of home owner's mortgages. Nothing like a little socialism to help things out. The bottom line is the economy and the mortgage situation (along with the corresponding derivative situation) are both absolute disasters and getting worse.
So where too now? Prolly down, gold rarely has a correction like this that lasts only one day; usually it's a start of a downward trend. Does it continue tomorrow? Who knows, as on Wednesday, the ADP jobs report is released and if history is any indicator the report is almost always bullish (and wrong). But in the process the dollar has a two day rally and gold gets whacked. I can't see why tomorrow and Thursday would be any different. Then again, on the other hand, who knows what could blow up tomorrow?
You know what, I really don't care where it goes in the short term, I really don't as things are so FUBAR that it doesn't matter. Think about it for a second, the Federal Reserve Chairman of the United States of America is asking for the banks to forgive principle on mortgages. Does that sound like somthing a hold of gold should be worried about?
Now I am not going to complain about today's losses, as both gold and silver really needed to come in a little. Today was a classic down day in; death like plunges, huge rallies then another death plunge to close towards the lows. Instead, what I am going to bitch about is the constant tap dancing on gold's grave that I heard endlessly today. Every single time gold was mentioned on CNBC today, the losses were mentioned with such glee it seemed everyone on the station had a huge short interest and was making millions off the fall. I already talked about the moron who called the end "to this parabolic move" in gold. Tonight on Fast Money, Dylan Ratigan, actually posed the question is this the end of the bull market in commodities? You would have thought these morons never saw profit taking in a bull market!
According to Dan Norcini over at Jimmy's site, he believes the rout started when China intervened in the Soybean market to try and temper food inflation. Well, in this black boxed market of 2008, if one commodity market starts to crater, they all do.
The gold stocks got absolutely hammered, at one point the HUI was down 24, before closing down 17. Nothing like giving back two weeks work in one day. Funny, I don't remember the HUI being up 17 let alone 24 during this run up. The shorts were having orgasmic convulsions, they were making so much money at one point.
All of this action happened in the face of a lower dollar as things keep getting worse out there. Ben, even suggested that banks forgive parts of home owner's mortgages. Nothing like a little socialism to help things out. The bottom line is the economy and the mortgage situation (along with the corresponding derivative situation) are both absolute disasters and getting worse.
So where too now? Prolly down, gold rarely has a correction like this that lasts only one day; usually it's a start of a downward trend. Does it continue tomorrow? Who knows, as on Wednesday, the ADP jobs report is released and if history is any indicator the report is almost always bullish (and wrong). But in the process the dollar has a two day rally and gold gets whacked. I can't see why tomorrow and Thursday would be any different. Then again, on the other hand, who knows what could blow up tomorrow?
You know what, I really don't care where it goes in the short term, I really don't as things are so FUBAR that it doesn't matter. Think about it for a second, the Federal Reserve Chairman of the United States of America is asking for the banks to forgive principle on mortgages. Does that sound like somthing a hold of gold should be worried about?
posted by Neal | 8:29 PM
0 Comments:
Post a Comment
<< Home