Chinese Stock Plunge Forces a Trading Halt Will it affect Gold/Silver prices?

US Markets Plunge After China Halts Trading

 

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Gold is up almost $13 and silver is up 20 cents. I'd say it's helping.

 

Maybe some minor action, but nothing big. For those hoping a collapse in the US equities market (if it happens) will send PM prices soaring should think again. So many folks got burnt bad the last time and they WILL remember. IMO there is little chance of the irrational PM markets we saw the last time. Maybe in 50 years or so after everyone forgets or dies, but not now

 

The pendulum swung out too far, it's swinging back. I don't expect anything dramatic - but I do expect a noticeable change once people realize the cost of living and doing business has gone way up.

Nobody is going to make any big decisions in the next year - they will all be playing "wait and see" through the election year. With a lame duck president - it will build the wall of worry. Add to it some unrest overseas, a weak technical market and a major election year. I said it last summer. We're due.

I have been diligent in DCA buying throughout the year, and I'm in a good position up or down. I don't think it will be down much longer.

 

Usually short term stock losses put pressure on PM. PM dived in late 2008-2009 due to people selling PM to cover stock losses.

 

And what happened next in 2010?

The other thing to remember is that right now PM's are hated and probably a bit oversold. In 2008 they were at record highs. We're closer to the low of a decade ago than the recent high.

It's all in how you interpret the data, but my bet is that we're at or near the low. And with any shocks to the market or world order - you'll see PM advance.

 

If North Korea really did test a H-bomb that should be worry enough for anyone. Unless it's just a million man mob jumping up and down.

 

It's good to see the move going up for a change.

 

It will definitely help to gain the prices

 

I agree this is what usually happens. Although PM's have taken such a big hit over the last few years that I wouldn't be surprised if the trend changes this time.

 

From a Barron's article this week on gold ETF's:

Quantities of synthetic gold sold are created out of thin air, with almost no connection to physical metal. The negative investment thesis seems to rest upon confidence that central bankers, and the Fed in particular, will steer a course away from radical monetary experimentation that will return to a normal structure of interest rates and robust economic growth.

The fact that these expectations have not been fulfilled in the nearly nine years since the initiation of zero interest rates, notwithstanding the recent 25-basis-point Fed rate hike, leads us to believe that investor credulity in central bankers may be stretched about as far as it can go.

The very popular short exposure in gold is, in our opinion, vulnerable to a trend reversal/mega short squeeze. This would occur if gold ETF assets under management (AUMs) were to rebuild or if holders of COMEX futures were to stand for delivery in a big way.

http://blogs.barrons.com/focusonfun...ripe-for-mega-short-squeeze-fund-manager-says