There was a time when I had great trust in our government, elections, the judiciary, and financial markets.
These days, not so much.
Events of the past 24 hours have cemented the realization that financial markets are anything but on the up and up.
Last night (Wednesday) before going to bed I checked the gold price. It was up more than $37 an ounce due to Russian efforts in Ukraine. Silver was up 46 cents an ounce. Both were big moves.
I got up late this morning and re-checked to see how much money I was making. Surprise! Not much, and eventually I’d be down for the day. Gold and silver had been hacked back to small gains and would be plunged into losing territory before the day ended
Gold had been up more than $70 an ounce overnight and silver had been up more than $1. But from about 6 a.m. onward, when the U.S. “marketeers” were hitting their computer terminals to begin the day’s massaging, gold and silver began to drop as the U.S. dollar began to rip upward.
That would be an American dollar that is the currency for a country which is the world’s biggest all-time debtor, whose economy is roiled by inflation (which reduces the purchasing power of —– dollars!) and a nation that is being led by a senile gent who has trouble forming coherent sentences yet is expected to lead us through a rough patch internationally with Russia, not to mention the dilemma he will face if and when his Chinese buddies opt to seize Taiwan.
Against that backdrop, of course the dollar would rally and traditional safe-haven assets such as gold and silver would go from huge gains to losses on the day. A cynic might suggest that behind-the-scene governmental operatives were at work, injecting money into the dollar via the foreign exchange currency markets and/or the various options exchanges.
But the miracles weren’t limited to the precious metals, which were shanked mid-rally as if they’d wandered into the wrong dark alley.
Stock indexes were tanking throughout much of the day as war worries led to concerns about profits and economic vitality.
The Dow Jones Industrial average was down as much as 800 points before rallying, inexplicably, to close up about 100 points. The NASDAQ, weighted heavily toward tech stocks, went from a couple of hundred points down to up more than 400 points.
What else would one expect on such a tumultuous day? The Plunge Protection Team’s fingerprints are all over this one, no matter how much the CNBC hypesters threw around words like “stunning” and tried to credit Biden’s afternoon press conference with rallying the markets.
There is no plausible explanation for what happened today, other than heavy market intervention.
Such interventions work, until they don’t. When they fail, they fail spectacularly.
Whether we are close to such a meltdown is difficult to determine considering each additional success these behind-the-scenes types manage to achieve.
But it’s virtually certain we’re closer to the end than to the beginning. Forewarned is forearmed.
Sam Ross Jr's site 