The Fed continues to print $85 trillion/month of free money, the government is shutting down, and political parties are deadlocked on elevating the debt ceiling, a U.S. default on debt is getting closer to reality than anyone would like to admit. So what does the U.S. dollar do exactly? Well, at the moment the U.S. dollar is gaining strength. Silver and gold continue to languish at prices below levels last seen when QE3 was launched (and continues to thrive). Fiat must be good to hold forever......right????
Well....at least the Dodgers beat the Braves moments ago. And I'm not even a baseball fan....anymore.
Just what will light a fire under precious metals prices? Where is that last straw.....that will break the camel's back? I dunno! Debt grows, government grows (ie, Obamacare), job market is frozen or is shrinking (going to part-time mode), and silver and gold forget their 5000 year heritage.
Yeah....nothing makes sense. China's Central Bank holds over $3 trillion in reserves but at least a third of that consists of U.S. Treasuries. So if U.S. debt is downgraded with anything resembling a "default", China's storehouse of wealth suddenly takes a downward hit. Nothing makes sense! Why hold treasuries in this environment?
Typo! Fed now printing only $85 billion/month......soon to be $85 trillion/month.....LOL More importantly, why isn't China trading in their treasuries for resources and resource companies, especially silver and gold miners. After all, they yearn to be a world reserve currency and need to connect their currency to something of value....not just inflated promises of "full faith and credit", etc.
Quail, it still the bankers in control. Supply and demand of metals is mostly trumped by the movements of banks, their money and client money. Clients include governments, international corporations and the very rich. This is how currencies/pairing works. China is a client for developing international corporations and trade. Everything around the world is priced in a currency. When you want to sell or buy a product with another country, the pairing currencies will be adjusted if several events are timed within a certain length of time. Why, because every product is money and other more real forms of money surrounds that, as in taking advantage. Banks are like the mafia.