There is a complete lack of understanding of the gold market for most of you. If you actually understood the reasons why gold is at this level, you'd understand why we have just had the largest one day move in the history of the gold market.
I've often used the beachball held underwater analogy stating that once what was holding it down released it it would explode upwards like a beachball reaching for the surface. Others on hear have used the coiled spring analogy.
I've been writing on here for a year about this. Can you not put 2 and 2 together. The largest move in the history of the market (and it hasn't fallen back today on 'profit taking') in the same week that Lehman, ML, HBOS go under as well as Goldman and MS are under severe strain and looking for buyers. Look at whats in front of you. In one week 4 of New Yorks biggest and one of London's biggest banks face extinction. Is it just coincidence that these five (who are THE major cartel players) are going under the same week gold has the biggest move ever and holds it.
It's staring you all in the face but because no one can execpt what has been told to you NUMEROUS times over, no one can understand what is occuring. It can't be spelt out anymore clearly for you.
These are not times to look at models or cycles or classical TA because they only work in periods of normal market functioning and free market operations. This is not one of those periods.
The price of Gold, had it been left to free market forces, would be around double what it is now. It is, was and always has been the canary in the 'gold' mine. Thats why it was interfered with. To stop the alarm bells ringing a long time ago that something was not right in the financial system. It allowed those who were defrauding the system to continue to make obscene amounts of money for a number of years longer.
I will repeat that this is not a short covering rally - Yes, no doubt many shorts did contribute to the move, but that is not the reaosn for it. The reason is that it is being freed from its shackles because those who intervened in its pricing are going under. They finally have more important things to worry about - namely survival.
For months (almost 7 now) I and many others have been reporting on shortages and a disconnect between physical and paper gold markets. Few considered it anything more than rubbish because it would mean a change in one's belief about the market, but there was REAL substance to it.
Because the gold 'barometer' had been rendered ineffective at warning of what was to come the problem has suddenly borne down like a tidal wave and become blatantly apparant and hence sharp, sudden and exceptionally strong movements to the upside have occured. All the talking heads on financial news and all the ma's and pa's to generalise will ask where the HELL did this come from - there seemed to be no warning. THAT WAS THE IDEA. It allowed financial fraud to continue where a select group of individual were creaming millions of dollars in fees from investment monies all with the help of the ratings agency's, the CFTC, the SEC, the Treasury, Fed and the major banks. How do you think they paid themselves $50 million bonus's a year and got golden handshakes of similar amounts.
The attack on precious metals that occurred in July/August was conducted because they knew their banks were becoming insolvent and they couldn't have all this chaos hit the tape with gold and silver hovering around all time highs. They would have broken out hugely to the upside and probably not looked back - look what happened last night and imagine that occuring with gold around $1000. They couldn't let it happen.
Get it though your skulls. The gold market has not been traded freely ever since Jeffery Rubin was Treasury Secretary and initiated the 'Strong Dollar Policy'. If you understand this, you will understand why such a move as occured last night could happen. Its a combination of gold seeking out what should be it clearing price and the situation suddenly dawning on people that a financial derivatives timebomb has just exploded which they 'had no warning' of. BECAUSE GOLD WASN'T ALLOWED TO WARN THEM
Take it or leave but, but stop coming out with rubbish comments like its a short covering rally or its Lehman being liquidated or its just fear that will subside.
It is impossible to fully understand the gold market unless you know what GATA knows and has been publicising for 10 years now. Its like missing half the pieces in a jigsaw puzzle and still thinking you have a perfectly clear view of the whole situation.
I can't say with exact timing what will unfold and how it will unfold over the coming months but Gold will move MUCH higher in the next few years. It may happen much sooner if last night is anything to go by, but for gods sake wake up and realise that not only will it happen, but that IT IS HAPPENING.
Just buy physical or stocks or whatever you preference and sit on them for a bit, just hold tight and ignore the noise. This is a bull market in gold that will be remembered for decades to come just like the one in the 70's. If you buy and hold tight you can ride a good portion of the way, just have the courage of your convictions and avoid jumping in and out based on those powerful emotions of FEAR and GREED.
If you do that YOU WILL BE REWARDED I have not the faintest shadow of a doubt. In the end though its up to you. Those of us who keep trying to explain it can only say it to you so many times. JUST KEEP THE FAITH.......
