Investors better remember that a rigged market has a lifespan. Once the manipulation and rigging no longer works, the system collapses and fundamentals return. However, you wouldn’t know that today by the charade that continues to take place in the MSM and from official releases via the Federal Reserve.
Today we had another one of those silly “TAPER RUMORS” to occur next month from none other than Atlanta Fed President, Dennis Lockhart.
According to ZeroHedge article:
It was all going according to plan. POMO lifted the S&P 500 instantly 7 points at 1015ET back to unchanged and the mainstream media could discuss the fact that stocks are “off the lows.” Then (admittedly non-voting member) uber-dove Dennis Lockhart hit the wires with some oddly hawkish commentary:
- *LOCKHART SAYS TAPERING ‘COULD VERY WELL TAKE PLACE’ NEXT MONTH
- *LOCKHART SAYS QE NOT MEANT TO BE ‘PERMANENT FIXTURE’ OF POLICY
Which sent stocks to the lows of the day. We are sure, of course, that these remarks will be walked back by the next Fed speaker but for now, it is clear the market remains entirely headline (and Fed) driven.
Lockhart states the the taper could take place next month. It “could also” take place next decade… so what?. Furthermore, he remarks that QE isn’t a permanent fixture. I would like to remind Fed President Lockhard that the Zimbabwe Dollar was also not a permanent fixture to the Reserve Bank of Zimbabwe… as they are now using other currencies such as the U.S. Dollar after destroying their own currency.
So, after all the FED induced volatility, how did it impact the following at the end of the day:
DOW JONES = -32 points (-0.21%)
SP 500 = -5 points (-0.28%)
GOLD = -$15 (-1.17%)
SILVER = -$0.68 (-3.2%)
Here we can see that the net result was to give the precious metals the enema while the broader markets just yawned off a few measly points. Investors and traders who believe gold or silver’s value is due to supply and demand forces based on manipulated trends orchestrated by the Fed and central banks, go right along with the game play.
These are the same kind of traders that you will see at the local Wall Street bar knocking down kamikaze shooters, bragging how they made a killing shorting the precious metals. I would imagine if you stirred up a debate on the fundamentals of gold and silver, they would laugh out loud and call you an idiot.
This brings me to the market reaction to First Majestic’s Q3 news release. Not only did they beat the street on earnings per share, they are still one of the lowest cost primary silver producers in the world. Their Q3 net income margin to revenue was 21%.
So, how did their stock price get rewarded today:
While it’s true that they sold 500,000 oz more silver-equivalent ounces than they produced (held back from Q2 during the April & June take-down) in Q3, they are still making money even at this manipulated low silver price.
The gold and silver miners in the world are actually PRODUCING WEALTH, whereas the major banks and central banks are STEALING IT. Unfortunately, you can’t get this point across to those have become insane due to the physiological market training by the Fed & member crony banks.
That is why I will becoming out with a MUST READ ARTICLE tomorrow called:
SILVER BEARS: You Have Been Warned
Please check back tomorrow at the SRSrocco Report for this article.