by Graham Summers
Gold Seek
Are Central Bankers delusional?
Over the weekend, Benoît Cœuré, Member of the Executive Board of the ECB, penned a piece defending the ECB’s policies from the criticism that NIRP hurts savers.
The first paragraph reveals, quite clearly, just how lost the ECB is regarding the efficacy of its policies.
Is the ECB stubborn because we are adhering to our monetary policy despite strong criticism? No. We are complying with a precise task that was conferred on us. The EU treaties gave the ECB a narrow price stability mandate. In 2003 the ECB’s Governing Council clarified that euro area inflation should be below, but close to, 2% over the medium term.
Markets’ dependence on central bank largesse has also revealed the limits of the unconventional ultra-accommodative policy. The end of the debt Supercycle poses secular headwinds for growth because the level of debt suppresses central banks’ ability to rekindle a credit cycle. Contrary to fears of QE creating uncontrollable inflation, it turns out that high debt levels are deflationary, and deleveraging are difficult to effect when income is growing so slowly. Monetary policy has lost potency in terms of its ability to stimulate growth by rekindling demand for credit. This is because the credit creation process, the primary channel through which monetary policy typically impacts the economy, is impaired.
Happy days are here again in precious metals! Did you hear? There is a “rally” taking place at the moment. Yes, the price of gold has rallied all the way back to where it was at the end of 2009. The price of silver has rallied all the way back to where it was in the middle of 2009. Woo-hoo!
Speaking of the Wall Street and global banks that populate London’s financial district, John Mann, a Member of Parliament, asked the rhetorical question at a Treasury Select Committee hearing on February 4, 2014: “Have we or have we not just had the biggest series of quantifiable wrongdoing in the history of our financial services industry?…Is there any other industry in recorded history in this country who’s had a comparable level of quantifiable wrongdoing to your knowledge?”
Australian entrepreneur Craig Wright has publicly identified himself as Bitcoin creator Satoshi Nakamoto.
Let me be clear right from the outset: this is not an article about politics when it comes to whose guy or gal is currently seated or running. This is about the current state of affairs as it pertains to business; how they seem to be in motion; and, how it may affect one’s business, or, business in general. As for the “who’s in,” or “who’s out” – that’s for others to debate.
One of the strongest arguments against investing in gold was that the metal yielded no interest while you were holding it so it stands to reason that the environment of low interest rates should be friendly for investors in precious metals.
In the fifth century B.C., Greek dramatist Aeschylus said, “In war, truth is the first casualty.” Quite so. Whenever national leaders decide to go on the warpath for the sake of their own ambition or self-aggrandisement, it’s the citizenry that will pay the bloody price for their aspirations. Since war is rarely desired by the citizenry, it has to be sold to them. Some form of deception, exaggeration, or outright lies must be put forward to con the populace into getting on board with the idea.
Atlantic City, the once-celebrated gambling mecca on the Jersey Shore, is dangerously close to defaulting on its next bond payment.
On a recent Monday in April, more than 100 executives from some of the world’s largest financial institutions gathered for a private meeting at the Times Square office of Nasdaq Inc. They weren’t there to just talk about blockchain, the new technology some predict will transform finance, but to build and experiment with the software.
Well, the five-year anniversary of the “Sunday Night Paper Silver Massacre” came and left with a whimper – as despite the 141st “Sunday Night Sentiment” capping of the past 147 weekends; the Cartel has not been able to prevent gold from rising above $1,300/oz, which is where it stands as I edit just after Monday’s COMEX open. In fact, aside from a brief moment in early 2015 – before the Cartel orchestrated the final phase of the four-year “bear-market” that ended in December 2015 – gold hasn’t been above $1,300 for nearly two years.
Pope Francis, on his recent visit to the Greek island of Lesbos, said that Europe must respond to the migrant crisis with solutions that are “worthy of humanity.” He also decried “that dense pall of indifference that clouds hearts and minds.” The Pope then proceeded to demonstrate what he believes is a response “worthy of humanity” by bringing 12 Syrian Muslims with him on his plane to Italy. “It’s a drop of water in the sea. But after this drop, the sea will never be the same,” the Pope mused.
Key U.S. economic information may have been leaked ahead of its release, judging from the price moves in key equity and bond futures contracts, according to a study released Monday.
Fred Reed wrote a gem of a rhetorical essay, “Capitalism and the Minimum Wage: ‘I Got Mine, Screw You.’” I was so impressed that I stole it, almost word for word, changing only “capitalism” to “trade unionism.”
Dear Friend of GATA and Gold:
The Metals Take Off