Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
INTEL (INTC) Stock Investing in AI Machine Intelligence Mega-trend 2020 and Beyond - 18th Jan 20
Gold Stocks Wavering - 18th Jan 20
Best Amazon iPhone Case Fits 6s, 7, 8 by Toovren Review - 18th Jan 20
1. GOOGLE (Alphabet) - Primary AI Tech Stock For Investing 2020 - 17th Jan 20
ERY Energy Bear Continues Basing Setup – Breakout Expected Near January 24th - 17th Jan 20
What Expiring Stock and Commodity Market Bubbles Look Like - 17th Jan 20
Platinum Breaks $1000 On Big Rally - What's Next Forecast - 17th Jan 20
Precious Metals Set to Keep Powering Ahead - 17th Jan 20
Stock Market and the US Presidential Election Cycle  - 16th Jan 20
Shifting Undercurrents In The US Stock Market - 16th Jan 20
America 2020 – YEAR OF LIVING DANGEROUSLY (PART TWO) - 16th Jan 20
Yes, China Is a Currency Manipulator – And the U.S. Banking System Is a Metals Manipulator - 16th Jan 20
MICROSOFT Stock Investing in AI Machine Intelligence Mega-trend 2020 and Beyond - 15th Jan 20
Silver Traders Big Trend Analysis – Part II - 15th Jan 20
Silver Short-Term Pullback Before Acceleration Higher - 15th Jan 20
Gold Overall Outlook Is 'Strongly Bullish' - 15th Jan 20
AMD is Killing Intel - Best CPU's For 2020! Ryzen 3900x, 3950x, 3960x Budget, to High End Systems - 15th Jan 20
The Importance Of Keeping Invoices Up To Date - 15th Jan 20
Stock Market Elliott Wave Analysis 2020 - 14th Jan 20
Walmart Has Made a Genius Move to Beat Amazon - 14th Jan 20
Deep State 2020 – A Year Of Living Dangerously! - 14th Jan 20
The End of College Is Near - 14th Jan 20
AI Stocks Investing 2020 to Profit from the Machine Intelligence Mega-trend - Video - 14th Jan 20
Stock Market Final Thrust - 14th Jan 20
British Pound GBP Trend Forecast Review - 13th Jan 20
Trumpism Stock Market and the crisis in American social equality - 13th Jan 20
Silver Investors Big Trend Analysis for – Part I - 13th Jan 20
Craig Hemke Gold & Silver 2020 Prediction, Slams Biased Gold Naysayers - 13th Jan 20
AMAZON Stock Investing in AI Machine Intelligence Mega-trend 2020 and Beyond - 11th Jan 20
Gold Price Reacting to Global Flash Points - 11th Jan 20
Land Rover Discovery Sport 2020 - What You Need to Know Before Buying - 11th Jan 20
Gold Buying Precarious - 11th Jan 20
The Crazy Stock Market Train to Bull Eternity - 11th Jan 20
Gold Gann Angle Update - 10th Jan 20
Gold In Rally Mode Suggests Commitment of Traders (COT) Data - 10th Jan 20
Disney Could Mount Its Biggest Rally in 2020 - 10th Jan 20
How on Earth Can Gold Decline During the U.S. – Iran Crisis? - 10th Jan 20
Getting Your HR Budget in Line - 10th Jan 20
The Fed Protects Gamblers at the Expense of the Economy - 9th Jan 20
Last Chance to Get Microsoft Windows 10 for FREE! - 9th Jan 20
The Stock Market is the Opiate of the Masses - 9th Jan 20
Is The Energy Sector Setting Up Another Great Entry? - 9th Jan 20
The Fed Is Creating a Monster Bubble - 9th Jan 20
If History Repeats, Video Game Stocks Could Soar 600%+ - 9th Jan 20
What to Know Before Buying a Land Rover Discovery Sport in 2020 - 8th Jan 20
Stock Market Forecast 2020 Trend Analysis - 8th Jan 20
Gold Price at Resistance - 8th Jan 20
The Fed Has Quietly Started QE4 - 8th Jan 20
NASDAQ Set to Fall 1000pts Early 2020, and What it Means for Gold Price - 8th Jan 20
Gold 2020 - Financial Analysts and Major Financial Institutions Outlook - 8th Jan 20
Stock Market Trend Review - 8th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Global Stock Market Shock as "Captured" System Starts to Crack

Stock-Markets / Stock Markets 2014 Oct 10, 2014 - 03:46 PM GMT

By: GoldCore

Stock-Markets

This week has seen some market volatility (see VIX Chart) reminiscent of the functioning market from days of old. The markets are spooked, bad news is overtaking good news and bearish views are becoming vogue. We are seeing a titanic battle taking place between the various bull and bear camps and they are starting to unleash some serious firepower. 

The sleepy volumes of late have ticked up appreciably, and small investors are shifting in their seats nervously. The secret that no one really wants to admit (especially while they are making money) is that the recent stock market rally is a gargantous fraud. It has very shaky foundations indeed, propped up on pillars of monetary jelly. At its core is a massive money creation machine which is utterly unaccountable and unelected and a very select credit distribution system. 


Market Volatility Index - 1989 to October 9, 2014 (Thomson Reuters)

You have heard the arguments regarding growing mountains of debt, the risk of inflation and stagflation, overvalued stock markets, property markets, massive derivative positions etc etc etc. 

Perhaps you have become a little desensitized to these risks, because the party still seems to be going on, and no one is panicking. Yes we have had a few bumps in the economic road to date but they have been explained away. But far more has happened on your watch then you may be aware and it might all becoming to a head very, very shortly. 

What has happened is that the entire capital market complex has become "managed" and captured by a few very powerful institutions. What this means is that we have moved from a market based global economy - which matches buyer against seller in an efficient price discovery mechanism, to a planned global economy, where intervention is the norm and the views of those in leveraged command matter more.

The markets are, and have been for the past 10 to 15 years, transfixed on the policy decisions of the U.S. Federal Reserve Bank, and all other global central banks are transfixed on the policy decisions of the Federal Reserve too. The power that this one institution has been given is staggering. They can, without any recourse, to elected officials, initiate policy that can send the global economy into a tailspin. Their policies can push millions if not billions of Emerging Economy citizens into destitution  or transform them from impoverished to empowered. 

The market gyrations we are seeing this week are multi-faceted. At their heart is a game of chicken between what the markets say they need and what the Federal Reserve is willing to give them. It all comes down to the terms by which credit is released and managed and how productive those in receipt of money can be with the credit. 

There is also another battle being waged, those that wish to print money to stimulate and those that wish to manage government expenditures in order to balance the fiscal books. The market assumptions regarding Germany and its economy are being found to be false, the growth assumptions for the global economy are being found to be false, these falsehoods are now being priced into expected returns, and as such current valuations are being seen as being shaky.

Many commentators believe that the central banks and regulators have become captive to political and specific industry interests, we would agree. What is even more troubling is the degree to which the markets themselves have become centralised in their outlook. For example, In the last number of years an enormous amount of the world's capital market asset basis is increasingly be managed by ONE single company and or directed by the services provided by Blackrock’s “Alladin” system. Indeed The Economist magazine believes that “Alladin” monitors and supports upwards of 30,000 investment portfolios and assists in the direction of over 17 Trillion dollars in assets.  That is 7% of the worlds total. This is sheer lunacy.

What if the Federal Reserve makes a bad call, what if the Alladin misses it, what then?

Too much power vested in two few is a recipe for disaster. Truly we have put a fox in charge of our hen house.

Gold has started to grab attention as concerned money seeks a safe haven.  Interestingly over the last 10 years gold has risen in most currencies and far outperformed the equity markets. 

See GoldCore’s ‘Gold Important Diversification As Living In One Greatest Financial Bubbles Ever’ Webinar Here

RECEIVE BREAKING NEWS AND UPDATES HERE

9TH OF OCTOBER - THOMSON REUTERS INTERVIEW GOLDCORE’S MARK O’BYRNE FOR THOMSON REUTERS GLOBAL GOLD FORUM

Jan Harvey  thomsonreuters.com  I'm joined in the Forum now by Mark O'Byrne, research director at GoldCore, who's agreed to talk us through his view of the market. Welcome, Mark! 
Mark O’Byrne  goldcore.com  Thanks Jan. Thanks for having me on ! 

Jan Harvey  thomsonreuters.com  Glad to have you. So -- gold's had a bit of a rollercoaster time of it recently, with prices falling back below $1,200/oz earlier this week. What sort of reaction did you see to that decline from consumers? 
Mark O’Byrne  goldcore.com  We saw a tentative increase in demand from existing clients but retail investors remain out of the gold market with sentiment as bad as we have seen it for many years. 

Jan Harvey  thomsonreuters.com  Are potential buyers still attracted to gold at lower price levels? Or are there some concerns that it could have further to fall? 

Mark O’Byrne  goldcore.com  So repeat business is key with clients either reallocating to gold if they previously had liquidated - we advised caution when gold prices surged over $1600 back in 2011 - or clients increasing allocations due to concerns about various risks. Some good HNW and family office business too and a desire for storage in Singapore and Zurich. 

Mark O’Byrne  goldcore.com  Bit of both really. Think majority concerned about further falls but quite a large percentage of our clients see the price weakness as a buying opportunity. Think retail investors as a whole would be very concerned of further price falls as there is still a lot of risk appetite in the world and investors are favouring stocks and property over gold ... for now 

Jan Harvey  thomsonreuters.com  What do you think we would need to see before we saw a stronger return to buying among retail investors? 

Mark O’Byrne  goldcore.com  I believe we need a period of rising gold prices and retail investors tend to be trend followers. We also probably need heightened concern about markets and about the financial system and global economy. A resumption of the Eurozone debt crisis, a U.S. recession, a global recession and major War in the Middle East and other risks of today... 

Mark O’Byrne  goldcore.com  have the potential to lead to a period of risk aversion which may see stocks, bonds and property come under pressure. This would greatly benefit gold and should see higher prices and retail investors allocate to gold again. Unfortunately for investors they tend to forget the most important rule in investing which is ... 

Mark O’Byrne  goldcore.com  ... DIVERSIFICATION. Irrational exuberance and complacency is rife again today --- but for how long and how sustainable - are important questions 

Mark O’Byrne  goldcore.com  We advise dollar, pound or euro cost averaging into gold. This protects from volatility and short term price risk. 

Jan Harvey  thomsonreuters.com  Has there been a change in the kind of volumes, or products, favoured by retail investors this year over last? 

Mark O’Byrne  goldcore.com  Not for us. We tend to deal with investors who wish to accumulate physical gold in the cheapest ways possible. Therefore, we always offer cost effective bullion formats. If we are offering American eagles at very low premiums they will buy them, if we have Gold bars (1 oz) they will go for them. 

Mark O’Byrne   goldcore.com  We are offering kilo bars in volume at near 1% premiums currently, if the client buys a minumim of 4 kilo bars for storage in London, Zurich, Singapore or Hong Kong. Because we are so competitive on the premium, we are attracting some flows from the gold ETFs and some flows from banks unallocated gold accounts. 

Jan Harvey  thomsonreuters.com  What has interest been like in silver, compared to gold? 

Mark O’Byrne  goldcore.com  Thus, much of our business is not new gold buyers but rather from existing gold buyers who are looking to own segreated and allocated coins and bars 

Mark O’Byrne  goldcore.com  Quite similar. Although there is the silver stacker phenomenon of those who believe silver will either outperform gold or will be a better protection from a systemic or currency collapse or both ... 

Mark O’Byrne  goldcore.com  ... they buy silver consistently whenever they have disposable income and have been a constant for years. Their demand can be seen in the data as well. The VAT on silver in the UK and Europe can lead to less demand for silver for delivery but for our Secure Storage we see similar demand for silver as we see for gold - everything from 1,000 oz bars to silver eagles and maples and a combination thereof 

Jan Harvey  thomsonreuters.com  Do you think demand for silver has been affected by the hefty price swings of recent years (which have been even more pronounced for silver than for gold)? 

Mark O’Byrne   goldcore.com  Silver looks unvervalued when compared to stocks and many assets today and there is some merit to their line of thought 

Mark O’Byrne   goldcore.com  Yes the volatility has put off most of the retail investment marketplace. This means that silver remains the preserve of a minority of hard money types and those who are concerned about the financial and monetary system ... 

Mark O’Byrne   goldcore.com  Although silver has been volatile - it is important to put that volatility into context. Silver is less volatile than many "blue chip" shares and many of the tech share darlings of today. Yet you rarely hear experts caution people from buying individual shares ... 

Mark O’Byrne   goldcore.com  It is interesting there is a cross over of bitcoin advocates and early adopters and both share similar concerns about the monetary system ... 

Mark O’Byrne  goldcore.com  Our positon on silver is similar to that on gold. It has a place in a diversifed portfolio. Somewhere between 5% to 10% for gold and 5% to 10% for silver. This means that an investor would have some 10% to 20% in precious metals ... 

Mark O’Byrne  goldcore.com  This would be considered high but we believe that the financial, economic, monetary and indeed geopolitical backdrop merits higher allocations to precious metals today - especially due to their undervaluation versus stocks, bonds and property - all of which are at record highs. 

Jan Harvey  thomsonreuters.com  Thanks Mark. And thanks for joining us today! 
Mark Obyrne  goldcore.com  Pleasure Jan. Sorry for the dreaded blue boxes !  and thanks again for having me on 

GOLDCORE MARKET UPDATE
Today’s AM fix was USD 1,222.25, EUR 964.38 and GBP 761.01 per ounce.
Yesterday’s AM fix was USD 1,227.50, EUR 961.99 and GBP 757.67 per ounce.
        
Gold climbed $1.20 or 0.1% to $1,223.70 per ounce and silver fell $0.05 or 0.29% to $17.35 per ounce yesterday. 

Gold in Singapore remained firm at $1,224.06 an ounce by 0035 GMT, after climbing for four straight sessions. 
The yellow metal is up 2.8% for the week, its best since the third week of June, after bouncing back from a 15-month-low hit earlier this week.
Other precious metals, silver, platinum and palladium all look set to end their five weeks of losses. 

Gold’s safe haven status has been ignited on poor economic news from the eurozone’s biggest economy, Germany, a weaker dollar, and IMF’s weaker growth expectations for Japan and Brazil.

In London, gold pulled back on Friday, ending four days of gains as the dollar climbed against a basket of currencies.

This update can be found on the GoldCore blog here.

Yours sincerely,
Mark O'Byrne
Exective Director

IRL
63
FITZWILLIAM SQUARE
DUBLIN 2

E info@goldcore.com

UK
NO. 1 CORNHILL
LONDON 2
EC3V 3ND

IRL +353 (0)1 632 5010
UK +44 (0)203 086 9200
US +1 (302)635 1160

W www.goldcore.com

WINNERS MoneyMate and Investor Magazine Financial Analysts 2006

Disclaimer: The information in this document has been obtained from sources, which we believe to be reliable. We cannot guarantee its accuracy or completeness. It does not constitute a solicitation for the purchase or sale of any investment. Any person acting on the information contained in this document does so at their own risk. Recommendations in this document may not be suitable for all investors. Individual circumstances should be considered before a decision to invest is taken. Investors should note the following: Past experience is not necessarily a guide to future performance. The value of investments may fall or rise against investors' interests. Income levels from investments may fluctuate. Changes in exchange rates may have an adverse effect on the value of, or income from, investments denominated in foreign currencies. GoldCore Limited, trading as GoldCore is a Multi-Agency Intermediary regulated by the Irish Financial Regulator.

GoldCore is committed to complying with the requirements of the Data Protection Act. This means that in the provision of our services, appropriate personal information is processed and kept securely. It also means that we will never sell your details to a third party. The information you provide will remain confidential and may be used for the provision of related services. Such information may be disclosed in confidence to agents or service providers, regulatory bodies and group companies. You have the right to ask for a copy of certain information held by us in our records in return for payment of a small fee. You also have the right to require us to correct any inaccuracies in your information. The details you are being asked to supply may be used to provide you with information about other products and services either from GoldCore or other group companies or to provide services which any member of the group has arranged for you with a third party. If you do not wish to receive such contact, please write to the Marketing Manager GoldCore, 63 Fitzwilliam Square, Dublin 2 marking the envelope 'data protection'

GoldCore Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules