Trader Note

Learn what to fade and not to.

2017-09-25-WEEK

BOE &BOJ. Gold. See: EVENTS

This Week

Mario Draghi is speaking this week. That is always a good chance to make some decent chops with market volatility.

Be aware that the BOJ governor Kuroda may give the markets a fright when he talks this week. So, trade Japanese data and Kuroda speeches with caution this week.

The rest of the week looks to be quite slow… unless North Korea tests their nuke above ground or the East Coast of the USA is destroyed by hurricane Maria.

  

Gold

Everyone is aware of market manipulations in gold. Everyone is aware of governments devaluing their currencies and a slowing of the economy. The world seems pocked with things that should be driving the fear index higher, yet markets continue to rise while gold is sold off.

The current price of gold seems to be much lower than it should be. With a peak near 1900 per ounce being forgotten in the new traders BTFD minds, it begs the question of what price will achieve in the next correction. Some estimates are as high as $5000 per ounce. Others speculate that if the USD fails, and must be returned to a gold standard or even gold peg, prices of $40,000 per ounce are possible.

Such a price rise, however, is dependent on the size of the USA reserves of gold. Those reserves have not been audited in over 50 years. Those reserves have been loaned out to short seller bullion banks that have been shorting the gold market for nearly 20 years. So when the real crunch comes, there may be no gold available to peg the dollar against.

The government's desire for gold will supersede laws and logic. Foreign countries like Germany have withdrawn much of their gold from USA vaults, so that their gold will not be able to be 'nationalized' by the US government. The need to nationalize wealth will come at the expense of the American people through legislation that allows the government to raid bank safety deposit boxes or personal stockpiles. That 'newly liberated' gold will come from pool gold and gold funds. It will not belong to the government, but they will take it anyway… even if they must change the law to do so. This is what has happened in the past, so why expect anything different to occur in the future?

So buy gold. $1300 per ounce is a good price to be buying gold, especially with all the fear and uncertainty in market. However, buy physical gold to take it out of the hands of short sellers. Store your gold for yourself to take it out of reach of governments trying to 'liberate' your private property.

We all know that these markets WILL crash, so hedge before the collapse.

 

 

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