See Spot Run!

Gold $398.20 up $2.40 - Silver $5.99 up 6 cents - July 2 The class of those who have the ability to think their own thoughts is separated by an unbridgeable gulf from the class of those who cannot...Ludwig Von Mises GO GATA!!!! Today is one of those rare days when I wish I did not have to do a MIDAS commentary because all you are going to get is the same ole rehash about how corrupt and non-functional the US markets have become. They are nothing more than a combination of The Matrix and Stepford Wives with Wall Street and Washington coming up with market mantras and manipulations that have little to do with reality. Their basic mantra is PRICE ACTION MAKES MARKET COMMENTARY. The market managers hold down gold and prop up the DOW to facilitate investors' perceptions and influence their market making decisions, regardless of what the underlying, true fundamentals are. This morning’s jobs report was horrendous and confirms the recent sharp downturn in the US economic numbers: 08:30 May non-farm payrolls revised to 235K from +248K; May unemployment rate unch. at 5.6% * * * * * 08:30 June unemployment rate 5.6% vs. consensus 5.6%; non-farm payrolls +112K vs. consensus +250K * * * * * 08:30 June average hourly earnings reported 0.1% vs. consensus 0.3% June average weekly hours reported 33.6 vs. consensus 33.8. * * * * * Once again we see increasing evidence the typical American consumer is squeezed. Inflation is going way up, jobs are hard to find and income is not keeping pace with inflation. It is more evidence the effects of the tax cuts and government economic stimulus are wearing off and the big picture, negative macroeconomic factors are beginning to kick in and take their toll on the American scene. What could be more bullish for gold than a weakening US economy and US dollar, along with increasing inflation while our interest rates are at historic lows? This increasingly negative interest rate scenario is screamingly gold bullish which is exactly why the Orwellians continue to cap the price. They don’t want an unsuspecting public to know the truth as a suppressed gold price takes away the alarm barometer from the average investor. "Look, no real problems," says the Working Group On Financial Markets, "see how tame gold is." The likes of the Larry Kudlows were yapping like that all morning. This routine has become so obvious it is now almost juvenile - at the See Spot Run level. Only the nitwit retards in the mainstream gold world fail to deal with this blatant manipulation farce. Just back from a breakfast at the Highland Park Pharmacy, a drug store with a 50’s type soda jerk counter, stools and all – with the old waffle irons etc., a real throwback – cheap food and fast service – a real treat. Had to get out of here. Couldn’t stand the aggravation of watching our corrupt powers set the prices for the day. Besides, there was no point watching gold long after the opening because the price was not going to better the first half hour/hour opening high anyway – AND IT DIDN’T. OK, back to work. The bad news is the manipulation scenario I am reporting on IS this disgusting. The good news is the folks rigging the market have blown it so egregiously, gone so completely out of control, the prices of gold and silver are going to go berserk as their nefarious shenanigans go completely awry. For some time now MIDAS has been stating the economy is nowhere near as strong as the pundits claim and inflation is far worse. That is now becoming clear to many in the mainstream investment world, even with the puffed up numbers put out by the Bush Administration. Hiding the truth these days has become harder and harder to do. The Fed and the administration have backed themselves into a corner with their market manipulations and have run out of ways to maneuver. Inflation is real, but if they raise rates to combat inflation, an already fragile economy goes tapioca. The Bush Administration and the Fed are in deep trouble when it comes to dealing with our economy, thanks to the last 8 years of managing markets. What goes around, comes around. To give you an idea of how managed gold is at the moment, one only need look at a few charts. Just a few days ago, the concern was US interest rates were going to soar, the dollar to rally sharply and gold to be crushed. Supposedly, this was why gold cratered after breaching $400 on the upside on Monday. But, LOOK: Runaway September bonds http://futures.tradingcharts.com/chart/TR/94 Swooning September dollar http://futures.tradingcharts.com/chart/US/94 Soaring September euro http://futures.tradingcharts.com/chart/EC/94 Bonds and the euro have surged to the upside and broken out sharply in that direction. The dollar has broken down hard out of a heavy congestion period, which is now a substantial top formation. Gold? Forget about it: Arrested August gold http://futures.tradingcharts.com/chart/GD/84 Gold was not allowed to close above its 200-day moving average ($399.50 basis August) or $400, even though it blew through both points TWICE during the week. Even with all the outside markets going for it, the GOLD POLICE said Thou Shalt Not Pass Go! And that was that. For those who STILL think a weak dollar is the key to the gold price (can there be anyone left?), take a gander at what the dollar did early on today and compare it to the gold response. Gold rallied a piddly $2 and change on THIS: Can you imagine if the dollar had rallied that much how low gold would have plunged this morning? To get a further grip on how flagrant the gold price rigging is these past weeks, note what Houston’s Dan Norcini had to say early in the day: Hey Bill and Mike: Looks like our "friends" don't want gold over $400 do they? Same old modus operandi Cap it on the dollar down days and smash it on the dollar up days. Mike B's premise looks to be holding true. These guys are mounting a fierce assault at the DIVG level near the mid 340's. A bit of historical reference - The euro was at 1.23040 back on April 1 when gold was sitting at $430. The Euro is bumping right up against that same level this morning and gold is fully $30+ lower than it was back on April 1. If gold were trading in lockstep with the dollar it would be sitting at $425 or better this morning. That is how effective the price capping scheme has been. Gold in Euro terms looks absymal. It is trading near the same levels it was in January 2002. Think about that again. Europeans who had bought gold at that time due to concerns over geopolitical developments, et al., have made ZERO return on gold. Amazing. Best, Dan The gold open interest only rose 813 contracts to 220,064, while the silver open interest fell a whopping 5703 contracts to 83,430. Speaking of amazing. Here we have these incredible si...

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