Gold Awakes? Fed Brakes?

Welcome to the 400th consecutive Saturday penning of The Gold Update, double the number we’d intended to write until you cherished readers reversed our intent for “Gold 2000 or 200 missives, whichever comes first” to “second.”

What unconscionably has yet to double — and beyond — is the price of Gold to the above scoreboard’s level of 2691, let alone get anywhere even near the 2000 mark, the lowly highlight of the past three years being 2016’s return up to Base Camp 1377. Worse, as the above price track shows, today at 1228 Gold is 110 points (-8.2%) below where ’twas at this date a year ago. One can either read it and weep, or better, Gold go and reap, for in the long haul to buy down here is ever so cheap.

‘Tis especially true when Federal Reserve Bank Chair Janet Yellen, just a week ago having ruled out there being another major financial crisis “in our lifetime” … followed up such conclusive comment on Wednesday with this 180° whirlabout of wisdom: “Let me state in the strongest possible terms: I agree … current spending and taxation decisions … [are] … going to lead to an unsustainable debt situation, with rising interest rates and declining investment … that will further harm productivity growth and living standards.”

We all know the Fed is behind the curve, but they’re just figuring this out now? Then add on International Monetary Fund Managing Director Christine Lagarde stating that “financial vulnerabilities present an immediate concern”, and the price of Gold today ought be as fat, dumb and happy as ever. Instead in turning to the weekly bars for Gold, we find it rather waifish, stumbling along a dark, puddled back alley, cold, frail and unwanted in having recorded a “lower low” for the fifth week in-a-row:

To be sure, Gold did net a gain 16 points for the week, settling yesterday (Friday) at 1228; but to put that into perspective as to just how gloomy ’tis all been in recent months, ’twas only the second-best net up week for the yellow metal in the past 13! And then from here come all of those annoying overhead “Oh-Nos!”, most notably the 1240-1280 box to which Gold just had said “adios” in heading further south a mere week ago.