Stocks sold off, but were rescued and the 3:30 Ramp did the rest. The VIX rallied, and stopped dead in its tracks
The ViX is generally believed to be the Fed's interventionist tool of choice these days by traders. Selling volatility often just preceeds an Equity rally, whereas it used to be the reactor to stock movement. Now, the tail wags the dog. The Vix is asier to move, thinner liquidity, and less balance sheet risk, as opposed to buying stocks as the Plunge Protection Team (PPT) was created for in 1987 post the crash
Buy American
The dollar took that to heart.
And Gold, responded. Note: This was no "flight to safety" or "Risk-off" rally, as Bonds were also weaker. This was Inflation
Gold finished up 4 weeks running. Next test will be how it reacts at Feb Rollover after Options Expiry Jan 26th. There is some selling above, as evidenced by the long wicks in the candles
interactive chart here
1970's Or Bust
- Bonds down >Stocks up > Non-reusable Commodities up > Dollar down >Stocks down > Gold up
From our November 18th: Article How China (and the West) Manipulate Metal Investors
The US public will bear the burden of the Dollar's debasement while the Treasury slowly defaults on its own debt. The Dollar will be the last to circle the drain after the emerging markets have loaded up on it. US citizens will not be able to exit dollars then.
Next chapter will be "Buy American" based on the fact that the greenback wont be able to buy anything else. We will be trapped financially. Next US manufacturers will have license to make inferior products because the consumer is locked into domestic purchases via a weaker dollar and electronic money. Why do you think companies like Apple are considering reopening factories here again? Because the consumer will be trapped in part after the incentives to open the plants have kicked in.
Years, not months from now this will happen. But it must happen to clear the markets. Government intervention only works in the direction of the trend. Markets must clear themselves. Full Article here 1
1Note, MarketSlant has migrated to new servers. Some pics have yet to migrate
Good Luck
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