Firstly, if anyone had any doubt the investment banks and instos have an inside edge with the market, then what happened with NCM last week is a smoking gun if I ever saw one. ASIC should do something- but they won't because ultimately this is how the market works- and if it worked efficiently, then the banks and instos wouldn't make money. The banks make the bulk of their money from proprietary trading.
I always wondered what they meant by proprietary- now I know it means having information the rest of the market doesn't have. The MBAs you need to get into these places are a smoke screen to lead the market to believe they make their money from being smart. Reality is most of it is made by being unethical/ immoral/ crooked- whatever you want to call it. Dangerous thing is they are smart too- a lethal combination!
What happened to the Price of Gold last night is further proof that we- the little guys- are in a casino.
US job number was perfect- just high enough to show the US economic recovery is on track- just low enough so the unemployment rate actually went up! Result is that QE is going to continue!.
Yay- I thought- that must mean the price of gold will go up. It should, given stimulus is going to continue- right?? Wrong; the price got belted down.
Can you imagine what would have happened if the jobs number had been fantastic and implied stimulus was going to be withdrawn? If that had happened, the price of gold would have been absolutely smashed to smithereens!!!.
So it all doesn't make sense. Until, that is, one considers who has the most to lose out of the price of gold rising- and the answer is the Federal Reserve and probably the investment banks as well. Ultimatley, the want the stock market to keep rising and to keep the USD strong. Given the gold price is a derivatives, paper based driven market and opaque as to who is buying and selling, it is PERFECT for them to manipulate.
Anyway, why I am I venting about something I've already vented about over and over again. Just never ceases to annoy me.....
NCM Price at posting:
$12.35 Sentiment: None Disclosure: Not Held
