Our outlooks on the relationship between Gold and the US dollar, US markets, and oil
Doc, Gary and Chris join us for the market wrap today. We start out with the relationship between gold and the US dollar. Then we move onto the US markets and oil.
Click download link to listen on this device: Download Show
Yup, great show. I especially appreciated Chris comments today since they align with my own thinking on the deflation / inflation debate.
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Gary….did you actually say “The Fed is pushing the market up”?
Hahaha! Stop it man. I give up on you. That sounds like some kind of conspiracy to me since it sure is not stated policy. Where do you come up with this stuff?
A.L……..They DO NOT state their policy.
It’s all in the blanace sheet data every thrusday
Correct Mary. Anyone saying otherwise is full of beans and is uninformed about how the process works.
mary, are all the NUMBERS CORRECT ON THE BALANCE SHEET……..?
HECK, they have to come back each and every month and correct the numbers.
I have to say, A Listener. To me it has nothing to do with conspiracy. It is simply a matter of the Fed providing money to others who, in turn, go into the markets. Not a real complicated thing!
Hear-Hear.
Exactly. The alternative is stocks roll over into a bear market and the Fed sits on the sidelines and watches 5 trillion dollars of QE go down the drain, not to mention the economy falls into recession. The next recession will be worse than the last one because the debt is much bigger.
If you think the Fed is just going to sit and watch that happen without doing everything in their power to prevent it, I have some beach front property I’ll sell you here in Vegas.
Gary, you can start by getting your facts straight to build a little credibility here. There was NOT five trillion in QE as a beginning point. Even if there was I can assure you that none of it would be going down the drain. You also fail to understand that a substantial portion of QE was never even employed and currently sits on the Fed balance sheet as excess reserves earning a quarter point for the sponsor banks.
Do you seriously think the Fed has the power to arrest a real stock market decline once one begins? Even if it wanted too there is not enough money at their disposal that could be employed without everyone knowing they had rigged the game to stop a decline.
We are talking trillions here, not a few billion of walking around money.
So what you are saying is preposterous. Try putting the numbers to your theory and you will see what I mean in no time at all.
We will discuss this subject tomorrow.
Are you serious Al? Do you mean a real interview where you seriously address the accusations Gary is making or will it be more soft-pedal like you tried to pawn off on me yesterday to get me to shut up?
This topic has been the one that gets more objections than just about any other. It is 100% conspiracy stuff and probably belongs on the Alex Jones show. I mean it is an interesting theory and all but there are no facts to support it.
There isn’t even a smoking gun. Gary specifically said “The Fed is pushing markets up” and what that implies is that prices are being manipulated on a widespread and systemic basis.
Before you do a show maybe Gary needs a primer on a balance sheet first. He clearly has no accounting background and is confused about the differences between assets and liabilities or even the purpose the Federal Reserve serves.
Sorry to say but the stuff he keeps repeating everyday is infuriating to me because it sounds so ridiculous. It has no credibility whatsoever. But because your site supports it unchallenged those kinds of ideas become mainstream and less informed people are going to be inclined to believe it.
This is just the kind of stuff that led so many gold buyers to lose their shirts after gold plunged. The gold promoters had stuffed their heads so full of fluff about how gold protects buying power, how it would soar to 5000 dollars, would ensure a glorious long life and blah blah blah….that could could not think clearly when the top came.
So the Feds got your back now, eh?
Well that does indeed imply a conspiracy because it means they manage the markets and its pricing mechanism. I challenge Gary to put some numbers to it. Maybe he has an idea of how much it would cost to control the entire resource sector for example….or to move around a currency like the dollar that trades in amounts exceeding the Fed balance sheet every single week!
What is Gary going to say the day stocks really crash?
OK Al…if its so simple and the Fed provides money to others who go into the market then how can Fed desires be fulfilled without the Fed actually telling them what they want them to buy and sell and when to do it?
And therefore if the Fed is directing others to fill orders, crash gold, push down the dollar and lift stocks etcetera then that is a conspiracy is it not? Because if the Fed is doing that in an unstated way (not acknowledged publicly) then that means they are doing it in secret.
And if it is a secret between a small group then it is a conspiracy.
We will discuss this in the morning.
From that right-wing conspiracy rag, the New York Times:
http://nymag.com/news/intelligencer/43342/
Too bad they haven’t (to my knowledge) really dug in to understand what the full truth is, wherever it may lead.
The exec order for the PWG on Capital Markets says, in part at least, that its purpose is:
to “consult, as appropriate, with representatives of the various exchanges, clearinghouses, self-regulatory bodies, and with major market participants to determine private-sector solutions wherever possible.”
Notice the “wherever possible” language wrt private-sector solutions.
Of course “wherever possible” is totally subjective and up to the gov’t to decide, so they could undertake non-“private-sector” “solutions” at their whim.
Using the word “conspiracy” as a smear and implying discussion of the same should relegate someone to the fringe, however you define it, feeds the irrationality of those pushing ridiculous conspiracies and provides great cover and assistance to those engaged in ACTUAL conspiracies.
Every case should be examined separately, on the facts.
There are obviously mechanisms in place for government entities and private, but government-aligned entities like the Fed, to intervene in markets as they see fit.
The printing presses around the world have been running at a very fast idle for several years.
The global economy is smothering in debt and stagnant, if growing at all.
Government GDP (including IP and brand equity-related measures?), employment and inflation numbers are rigged. This former “conspiracy” is now pretty mainstream…see http://www.cnbc.com/2014/09/24/govt-unemployment-rate-semi-rigged-kyle-bass.html)
Yet the markets march upward.
I’m sure this is all perfectly rational, with no assistance from any government or faux government entities like the Fed that have enormous vested interests in maintaining the facade of economic recovery and the “wealth effect”.
Correction, New York Magazine…still a right-wing rag of course
Alisten…what do you think is pushing it higher..???
Agatha . I will answer for him…………..POPCORN.
Believe it or not Agatha the market still functions only it revolves around policy statements more than at any time in the past. The Fed is not manipulating anything. not even interest rates since that is there reason for being.
OPM – other people’s money. mutual funds close their books 10/31, as do many private funds. These people can push markets around as there is no longer any retail investor activity.
Who bought the treasuries?
The ones that got dumped that was supposed to be the event that drove gold up.
Maybe is enough money around to move the market up without the fed?
U.S.-based institutions have more than offset with their buying the Treasuries China has sold. If all else failed, the Fed can mop them up via its open market operations without telling anyone. They will maintain as best as they can the appearance of the market working – but we all know that they won’t allow a more significant sell off in Treasuries and a commensurate spike in interest rates any time soon.
As long as the deflation myth can be kept alive there will be ready buyers.
God loves them.
If you think that a central bank can’t stop a stock market decline I urge you to take a look at the Japanese Nikkei. Japan is in a recession yet their stock market has gone up 100% over the last 3 years.
A very interesting point.
Gary that is not proof of anything. Look at how the DOW performed from 1933 onward. In the case of the BOJ they do tell us they are buying the market though so we cannot debate that question. They are doing so because they simply ran out of assets to buy. But that still does not mean the Fed is either directly intervening or manipulating the market like you keep saying.
How many times have you repeated the same old comment that the Fed has a printing press and therefore an unlimited ability to suppress gold, push up stocks or move the US Dollar?
It is beyond ridiculous.
Gary has been very accurate regarding the conventional markets. But his take on what the fed is, or is not doing is shading his own theory.
The market is going down, and there will be no QE4!
And Gary, I will be in Vegas the 2nd week of December for dinner!
( not looking for beachfront property )
I’ll bet the stock market is higher in December than it is now. If I’m right you buy dinner 🙂
You got it!
( – ;
This is an interesting 5 minute read with a very interesting chart:
‘The Latest Margin Debt Figures Send An Ominous Signal For Stocks’
Chart is here:
http://thefelderreport.com/wp-content/uploads/2015/10/sc1.png
Forgot to say, I wish I understood shorting the markets better – can it merely be as easy as buying short etfs?
🙂
That would be one of the least risky ways, Bob, although if you have nerves of steel, an absolute certainty of direction, very deep pockets and pretty much no brains about the risk of being bankrupted overnight you can get 3000% leverage with one or two brokers recently (I know, that’s totally nuts and no, I am not kidding).
For mere mortals however ETF’s are very helpful although there are a lot of people here who play options and the risk can be low if you follow a disciplined strategy. Most don’t unfortunately (for them) and lose with surprising regularity.
Some would say its a casino unless you have been taught the ropes by an insider or more experienced person (like Rick Ackerman, for example) who uses butterfly’s and other risk minimization techniques. Go to his site if you are curious.
If you have never tried to short a market you should study the most popular gold and silver etf’s that can be quite frequently profitable once you understand metals markets ups and downs.
For example….DUST, JDST, DSLV, DGLD etc etc and so many more.
Those can move double digits in a single day and allow you to make gains more than once in a session if you follow the charts of smaller degree. You don’t need to make a killing every trade. Just regular 3 to 5% gains. Get in…get out….take a profit….rinse and repeat.
Do the math on compounding. You will get it right away.
Thanks – I have been keeping an eye on them for about 18 months now. Might oneday summon up the courage to short a particular market or share by buying an inverse etf.
I am more of a long person though. Not a day trader. Never have tried it.
Bob, its no big deal if you have the attention span of a moth and the staying power of a guy who never got any for the last three months. Its mostly just short term stuff then you run away. A day or two days at most unless you get trapped in a trade. Mostly hours though. Buy in the early morning and get out before lunch and have a nice day.
I have known guys to go broke doing this though. Like it is some kind of an addiction. They sit glued to their terminals for hours before the day starts and won’t budge for the whole session.
It is probably a mental illness of some sort. But common enough because I have known several who got hooked on it and could not quit until they went broke. They were always looking to get back what they lost and made foolish errors like doubling down after a bad trade and going even deeper in the hole.
The official term for that behavior is Gambling.
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Up above btw I mention 3000% leverage. That should have read 3000:1 leverage. Sorry about the confusion by inserting the % sign. I only mentioned it because I was so surprised when I came across it on a Forex site awhile back. Shocked actually. I have never tried it and don’t recommend that kind of insanity for anybody normal.
3000:1 – Holy cow! I thought I had a high risk tolerance, but that is wacky.
Thanks guys………..appreciate