by David Kranzler
Investment Research Dynamics
The chart (and blog title) above is from James Turk via King World News. Turk was making the point that the western Central Banks, via the bullion banks, are short $4 billion worth of paper gold on the Comex. With all of the Central Bank money printing, and the Fed is by far printing the most, it would be a disaster for the fiat currency system if the price of gold were to break free and rediscover price discovery. It’s only a matter of time until this occurs. But for now the Central Banks are making a concerted effort to do what they do best: defer reality for as long as possible.
For now the goal is to prevent gold from breaking above $1800, which means the invisible “battle line” is at $1790. I remember when gold was trying to get over $400. It seemed like it took forever. But once $400 fell (shortly after Elliot Wave aficionado, Robert Prechter, proclaimed gold was going back to $50), it didn’t take long for gold to double (about 18 months). I think once gold gets through $1800 and holds, it will challenge the all-time high at $1900 relatively quickly. For as bullish as I am on gold, I’m 3x more bullish on silver.