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Catching a Falling Financial Knife

Gold Posts Biggest One-Day Loss Since 2008

Commodities / Gold and Silver 2010 Feb 05, 2010 - 01:52 AM GMT

By: Robert_Singer

Commodities

You can almost predict the oft-repeated explanations the pundits offer up every time the precious metals behave irresponsibly.


  • The trouble with being a contrarian is that you can never be quite contrarian enough. We began having doubts about the ‘feds inflate…gold soars’ hypothesis last year. It was too easy…too obvious. And if it were that easy to inflate a nation’s currency, how come the Japanese couldn’t get the hang of it in the ’90s?
  • Inflation, yes…but not for a while. And gold? Well, we are in it for the long run. In the short run, anything could happen.
  • To clarify our view on gold, The Daily Reckoning is not bearish on the metal. It is not bullish on the metal either. It is buggish. We are gold bugs. In the long run, gold will retain its value. Since that’s all we ask of it, we are always satisfied. Even if it is down in the short run – and it went through an 18-year down cycle from 1980 to 1998 – it will come back in the long run.
  • A wave of risk aversion swept through global markets, triggering massive technical selling in the precious metals.
  • Bullion tumbled more than 4 percent in heavy trade, briefly falling below $1,060 an ounce as escalating sovereign debt fears in Europe prompted investors to bid up the dollar and unload riskier assets.

The “experts” are having trouble explaining the movements in the precious metals markets because they just can’t comprehend a debt-based monetary system.

The process that the Federal Reserve, or any bank, uses to create money “consists of making an entry in a book, that is all,” says Graham Towers, governor of the Bank of Canada. “Each and every time a bank makes a loan (a debt) . . . new bank credit is created—brand new money.”

There is just no limit to the amount of monopoly those scoundrels behind the Federal Reserve can create out of “thin air” that they use to manipulate the dollar on the foreign exchange market and the precious metals at the Comex.

You are free to blame them for keeping investors from being wealthy while everyone else is out of work, out of hope and living in tent cities, but be sure and thank them for postponing the greatest calamity the world has ever seen.

When The Powers That Be can no longer keep the precious metals from taking off and the dollar from landing at zero, look out, Mad Max and the breakdown of society is around the corner: This is an Ominous Neutral Sign.

By Robert Singer

Robert Singer is an Entrepreneur and the author of a forthcoming book on the Federal Reserve. His articles cover politics and the financial and environmental implications of our consumer society.  The articles have been main headlined and can be found on numerous popular websites: Marketoracle, Silverseek, Goldseek, Daylife, LAprogressive, Canadafreepress, Opednews, Daily.pk and many of the Wordpress sites. Richard Daughty, The Mogambo Guru, proclaimed him a Junior Mogambo Ranger (JMR)

Dem Bones is Connected To De Debt Bone by Robert Singer, an analysis of the Federal Reserve, can be found on numerous popular websites including G. Edward Griffin’s Unfiltered News. Edward Griffin is the author of,the definitive work on the Federal Reserve, The Creature from Jekyll Island.

Meat, Milk and Motors: The New China Syndrome by Robert Singer, an essay about China first released in February 2009 has been widely posted and read on the Internet. Quotes from the article can be found in The Wall Street Journal Digital Network and the essay was the Top World Story on the Pakistan Daily website for over a week.

© 2010 Copyright Robert Singer - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Robert Singer Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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Catching a Falling Financial Knife