Guest Post by Jesse
“Benign remedies are for the innocent. Misdeeds, once exposed, have no refuge but in audacity. And they had accomplices in all those who feared the same fate.”
Tacitus, Annals
Gold and silver were hit early on today, and knocked lower on high volume in relatively quiet trade, while the stock market was being pumped higher.
The Fed would like to set the stage for their FOMC meeting next week, and rather badly so. They are afraid to do it with these unstable equity and bond markets, because if they raise and the market breaks, they will be blamed for it. You can see that the IMF and the World Bank have already covered their posteriors by warning. And Larry Summers has also chimed in.
It is not a 25 basis point increase that will break these markets. They are already broken, an accident waiting to happen. The trail of policy errors goes back to the Greenspan chairmanship of the FOMC.
The Comex continues to bleed out, with additional gold and silver leaving their warehouses yesterday.
Registered (deliverable) gold has fallen to 185,314 troy ounces, a low we have not seen since before the year 2000. On a quick calculation pending the final numbers early tomorrow, I would think that the ratio of paper claim to actual deliverable gold at price is now at an unprecedented level of 226:1.
Say what you will, this is not ‘normal.’
Continue reading “When the Unsustainable No Longer Sustains”
