Despite the Fed announcing it will begin tapering QE and a better than expected jobs report, gold rallied on Friday. In his podcast, Peter Schiff said this is sign sellers are exhausted.
October jobs came in at 531k, finally beating expectations with strength shown across the board. Furthermore, August and September were both revised upwards by over 100k. ‘
Perhaps even more surprising is the early reaction in the gold/silver market. More on this below.
The September trade deficit smashed the record set just last June.
September 2021 charted a total trade deficit of -$80.9 billion. That was up a massive 11.2% over the August trade deficit of -$72.8 billion and crushed the previous June record of -$73.2 billion by over 10.5%.
The Federal Reserve wrapped up its FOMC meeting on Wednesday and finally announced the much-anticipated QE taper. The Fed will cut its bond-buying program by about $15 billion a month. But so what? In this episode of the Friday Gold Wrap, host Mike Maharrey digs into the Fed announcement and raises some very important questions.
Gold has been rangebound of late, bouncing between $1,750 and $1,800 an ounce for several months. Given the inflationary environment, one would expect gold to be soaring. So, what’s going on with the yellow metal? And when will the price of gold go up? Peter Schiff tackled this question during a recent Q&A session on YouTube.
Hedge funds closed shorts and went long in both gold and silver in October.
Please note: the COTs report was published 10/29/2021 for the period ending 10/26/2021. “Managed Money” and “Hedge Funds” are used interchangeably.
The Commitment of Traders analysis last month highlighted the potential over-extension of the shorts leading to a rebound. This proved to be the case in a big way. Unfortunately, the momentum lost steam and the $1810s for gold presented too much resistance.
I reported last week that Comex delivery activity was looking very quiet in both gold and silver. The results for November are very weak. That being said, October and November are historically slow months, so the real test will come in December.
This analysis focuses on gold and silver physical delivery on the Comex. See the article What is the Comex for more detail.
The Federal Reserve has slightly slowed its asset purchases over the last few months. Was this a trial mini-taper?
If so, the results are not good news for the central bankers over at the Fed.
The Fed balance sheet stands at $8.56 trillion. That’s up by $108 billion from the prior month-end, but down over the past week by $8.7 billion. The chart below shows how the Fed Balance sheet has grown by instrument over the last 18 months.
Is inflation transitory, as Federal Reserve Jerome Powell has claimed for months? Or are we on the verge of hyperinflation, as Twitter CEO Jack Dorsey recently warned? In this episode of the Friday Gold Wrap podcast, host Mike Maharrey talks inflation, digs into the data, and concludes that it’s pretty clear we’re in an inflationary spiral.
How much gold is there in the world?
The simple answer — not much!
Scarcity is one of the characteristics that give gold value.
