The credit rating agencies also appear to have dodged a bullet: Lawmakers "could strip a provision designed to eliminate perceived conflicts of interest between the credit rating agencies and the companies whose debt they rate," Reuters reports

Shocking? Hardly

Like OTC derivatives regulations, do not expect the right thing to be done. As such, the problems we presently have are nothing compared to 2011 - 2012. This type of political expedient occurrence gives credence to those that believe $1650 is a paltry price objective for gold.

Jim

There is nothing more to add. Time and price projections are correct.

Bill Murphy Hits Bullseye – again!

GATA's work and contributions to Main Street's understanding of gold should not be marginalized.

The gold industry is truly daffy. Not a week goes by when a number in this industry fail to give credence to my decade long statement: Never have so many known so little about their own industry. It is truly astounding and NEVER changes as the years go by…

The mainstream gold world analysts have been neutral to bearish on the price of gold most of the way up … and still are. The mainstream financial market press never calls them on it and asks them how they could have got it so wrong. Barclays is calling for gold to drop to $800 by the end of this year. JP Morgan is looking for $950 gold in the years ahead. When they are proved wrong AGAIN, the financial market press will continue to give them all passes and then ask for their next predictions.

Source: grandich.com
Source: gata.com

Gold & Silver

Volume has been light into the gap(s) support. This is a bullish setup. What cannot go down with force will reverse and attempt to break resistance with force. This will be the third challenge (3 taps and out) of the 5/14 high.

Paper Gold ETF (GLD):


The junior to major ratio illustrates the increasing leverage towards the rising price of gold.

Junior to Major Gold Shares Ratio:


Silver continues to struggle under 5/19 resistance. The inflows into stocks and gold suggest that silver will play catch up once the 5/19 gap is cleared.

Paper Silver ETF (SLV):

U.S. Stocks

A close up of the S&P 500 chart reveals a breakout on light volume. Technically speaking, this is a false breakout. False breakouts can be reversed over time as trend energy builds into the advance, or serve as a warning to an unstable technical position. As I have said before, capital flows seeking protection against devaluation are dominating market trends. Trend energy will likely pick up as the rally progresses. Markets tend to reverse when time is right, and volume simply confirms that.

The 5/14 and 5/4 overhead gaps are pulling hard now.

S&P 500 ETF (SPY)


Breadth confirms the short-term trend change despite the light volume. The UpDn%T(E) indicator illustrates the tranfer of control from the bears to bulls.

NYSE Breadth

Currency Collapse May Stimulate Economic Expansion, BIS Says

It is this line of reasoning that ensures that gold will trade well above $1650.

Currency collapses tend to spur a resumption of economic growth rather than fueling a decline in gross domestic product, according to the Bank for International Settlements.

Source: bloomberg.com

China and other countries buy US Treasury debt

The sizable gains are being driven by fears that Greece and other European governments could default on their debt. Worries over possible defaults have sparked a flight to safety and that has benefited U.S. Treasury securities. Treasurys are considered the world's safest investment -- the U.S. government has never defaulted on its debt.

(1) While sovereign nations rarely default, they do attempt to print in response to their excesses.

(2) Worries over a flight to safety may have benefited U.S. Treasury securities, but the real beneficiary, which managed commentary cannot compare, has been gold.

Source: finance.yahoo.com

Lawmakers gird for showdown on credit raters

The down spiral will continue in the financial and business world as a effect of the failure to intervene at the cause point of the problem. Intervention was directed by the Western world at financial entity bailout and not points of improvement for main street. China focused on business and not assistance only to the fat cats. As a result this business recovery will turn out to be a present of FASB only and not in any way a true economic phenomena.

Jim

Sen. Blanche Lincoln offered to modify her plan to limit swap trading by banks in return for assurances that at least some parts of her proposal will be included in the final financial reform bill. The new proposal would allow banks to trade and deal derivatives through separately capitalized affiliates, rather than spin off their derivatives businesses entirely. The proposal isn't entirely bank-friendly, however, as banks would still have to set aside billions of dollars to protect against losses in these affiliates.

Source: Banks get derivatives reprieve.