Market now knows the Fed will take out "patience" and replace that with "inevitable" come next Fed meeting or in February at the latest. Gold can now smell the May - June rate hike coming and it will act accordingly. As in straight Down.
now the only question is how far does GLD fall before it bottoms out. $50 a share or possibly $60?
Never thought Yellen and Putin would be on the same page but now we have the Fed Chairwomen about to tell the world higher U.S. interest rates are coming just as Putin tells Russian Central Banks to start selling GOLD fast. Man what a serious blow to GLD as it soon falls to under $100 a share.
“I think 2015 is going to be a great year for the dollar,” said Kathy Lien of BK Asset Management. Lien added that monetary policies are going to drift further next year, and the easing and tightening in other parts of the world will make the dollar more attractive. And as the dollar strengthens gold will fall faster then anyone thought.
tomorrow? I'd hate to be long GLD when Yellen says tomorrow "so long reasonable", and "hello June rate hike".
Yellen knows she has stalled as long as she can. If she wants any credibility left on her resume she deletes "reasonable" and comes out and says "rates higher in 2015. In fact many think the wordage is history as of today. In fact I know its history. Market big sell off after Fed says Rate Party about to END.
If Yellen says "rate hikes coming in 2015 and Gold heading under $700 an ounce". Coming now sooner then you think.
Oil has further to drop
and when it does bottom it will flat line forever. Year plus since there will continue to be long term over production of oil, demand will be soft especially if China bubble pops. Shale oil and natural gas fracking in U.S. will continue for years if not decades. On top of that Canada has a ton of oil just sitting in tar sands as well as Russia. There's just too much of the black oil being pumped now and with so many suppliers all trying to do deals, the price I'm afraid will be under $45 for year's to come.
The Federal Reserve Bank, led by Janet Yellen, is preparing to rip up the balance sheets of US banks, causing capital flight and widespread branch closings, and threatening thousands of bankers’ jobs and compensation, analysts told The Post. The proposed Federal Reserve capital-requirement rules — to protect US banks from the kind of financial crisis that in 2008 brought the American banking system to its knees — may soon feel like an echo of those dreary days. Bankers are already in shock. While some of the final sums are sketchy, the Fed has spelled out the amount the eight banks will need to comply — a nauseating $21 billion in capital. It comes on top of other surcharges imposed by global regulators.
and then add a possible govt shutdown to the mix and Tvix will explode higher. Looks like an easy double to me and everyone expected the market to hold over 200 points today. When you see a big sell off like today it means - Black Friday coming. as in very Black
Thursday is supposedly the deadline for pending Govt. shutdown. Market should open way down on uncertainty especially so if Senate says they won't review any bogus House plan. Could see a good size swing to the downside tomorrow and possibly wipe out any Santa rally.
when the remove the "reasonable" wording from rate cuts and tell everyone rate increases are coming late spring - early summer 2015. Gold won't like that and correct big time.
Little Greece will (again) bring world markets down
Merkel says no Q.E. will Greece back on the Default Band Wagon
China Bubble - Its popping now but China hides the ugly numbers (as long as then can)
Yellen next week says "Scratch that (reasonable) wording" Rate hike coming six months or sooner
Due to falling oil Putin only move is "go to war with everyone".
Lastly - could we see another government shutdown? House has to beg Dems for votes (sick)
Not sure you want to go long going forward - unless you think the picture I painted is just make believe
and that really, really scares the market. Down She Goes
Agree - ECB is not going to do Q.E. until well into 2015 and if Merkel has a say they may never do it. Germany calls the shots in Europe and they don't want to lend free money to Greece, Portugal, Spain, Italy, etc. Clock is now ticking on Fed Rate Hike and as we all know - gold doesn't like interest rate hike at all.
So do these two actions cancel each other out? India news seems to have more impact on gold going higher but Swiss vote got more attention in press. Just curious if the board thinks gold climbs or drops on Monday. I'm thinking the above scratch each other out and gold barely moves tomorrow.