The set-up was 2nd quarter GDP's initial estimate of the economy expanding by 3.0% and a bunch of OK earnings reports announced before the cash market opened, followed by fairly dull trading, though slightly positive across all the major indices until 2:00 pm ET, when the Fed delivered its policy statement, holding the federal funds target rate at 4.25-4.50%. No change. Stocks went up a little bit, but as soon as Chairman Jerome Powell stepped up to the microphone at his 2:30 press conference, massive selling ensued, sending all of the indices into the red, the Dow dropping 460 points in a matter of half an hour. Once Powell moved on, stocks recovered into the close, with the NASDAQ actually finishing the session in positive territory.
Meanwhile, over at the completely fake commodity exchange known as the COMEX or CME, gold and silver got whacked, and hard. One trader mentioned that 400 million ounces of (paper) silver were moved between 8:00 am and 4:00 pm ET. Gold dropped $60 over that time span, and silver fell from $38.05 to $36.94, after it had been pushing $40 an ounce late last week.
It's obvious that there are some people who desire to see gold and silver at lower prices, but there is simply no explanation for Wednesday's extreme action in either stocks or PMs. Nothing really changed. No Fed rate cut, no surprising GDP data, no nuttin' honey!
Gold is recovering this morning, but silver remains at three-week lows. One has to appreciate the concept that keeping gold and silver cheap serves to boost the perceived popularity of the might U.S. dollar as the reserve currency par excellance. What it also does is lower pricing power of those countries that produce PMs, such as Russia, China, Peru, Mexico, Ghana, Kazakhstan, Uzbekistan, Indonesia, Chile, Argentina, India, and South Africa. Five of those are full BRICS members. The rest are all affiliated, so, no, there is no coincidence that the COMEX, LBMA, and the London gold and silver daily fixes all endeavor to price PMs lower whenever they can.
The blatant price-fixing by Western powers in the face of the Global South, BRICS and pretty much the rest of the world (ROW) is soon to be ending. Russia has announced that gold and silver will begin trading on their exchange at St. Petersburg (SPIMEX) later this year.
China already has their own metals bourse, the Shanghai Futures Exchange, and is fitting out precious metals vaults in countries around the world for central bank storage and facilitation of trade settlements.
The main focus, for now, are vauting facilities in Hong Kong, Singapore, and Saudi Arabia, with more to follow.
After the market closed Wednesday, Meta Platforms (META) and Microsoft (MSFT) released second quarter results and people must like what they saw, because in pre-market trading, META is up 11% and Mister Softie is up eight percent. Mastercard (MA) also posted positive results, citing a "resilient" consumer, which, in reality should be an "in-debt-up-to-the-eyeballs" consumer. Visa (V) reported earlier this week, mouthing the same sentiment.
The way some American companies make money - charging 23-35% interest - is becoming morally repugnant.
New all-time highs are straight ahead, the perfect gift-wrapping for those end-of-month account statements. Futures are soaring. Dow, +94 points; NASDAQ, +315; S&P, +56 at 9:00 am ET.
The choices are becoming clear: buy stocks priced in Fedbux or precious metals priced in yuan, rubles, or other foreign currencies.
At the Close, Wednesday, July 30, 2024:
Dow: 44,461.28, -171.71 (-0.38%)
NASDAQ: 21,129.67, +31.38 (+0.15%)
S&P 500: 6,362.90, -7.96 (-0.12%)
NYSE Composite: 20,630.88, -130.68 (-0.63%)
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