Perhaps the reporters didn’t get the message, or worse, perhaps it was a message for a specifically programmed algorithm. Here’s the details…
Reuters would be one the last MSM news outlets to report on gold price suppression.
But that’s what it read like in this article, right down to the title.
See the title and first few lines and decide for yourself:
PRECIOUS-Gold locked below $1,300 as market braces for Fed decision
NEW YORK/LONDON, June 12 (Reuters) – Gold prices remained locked just below $1,300 an ounce on Tuesday as investors waited for clues on the pace of U.S. interest rate rises following the impending conclusion of a Federal Reserve policymaking meeting.
The choice of “locked” is a very interesting word choice. For example, when a person buys bullion from a dealer, they “lock” in the price, meaning the price doesn’t go up or down, but rather, it’s what the price is at the very moment. In other words, “locked” implies something that doesn’t move in price.
The Reuters article is also a piece of anti-gold propaganda.
Never let a good gold bashing go to waste.
That’s the mantra.
Just yesterday, I showed how the anti-gold propaganda conducted by the MSM is all around us.
This is especially true of the mainstream financial press.
What the mainstream financial press does not touch, however, just like the central bankers themselves, is the topic of market manipulation and price suppression.
That is, unless the topic can’t be avoided, and when it can’t, gold price suppression is quickly dismissed as something proven to not exist, or something that tin-foil hat wearing conspiracy theorists obsess over.
That said, it is important to know what High Frequency Trading (HFT, algorithmic trading) is, because words found in articles on the internet matter, especially words in articles of the mainstream financial press.
First, some background.
There are no longer people like this at the exchanges shouting orders on the floor:
That went the way of the do-do bird.
Instead, here’s what are making gazillions of trades in mere nano-seconds:
Now it’s not as cool as a shouting contest, but computers are a very efficient way for the revolving door of Washington/Wall Street Global Elitists to skim, front-run and rake in insane profits very quickly.
And how does this HFT work?
Computers, known as “black boxes” as the traders like to call the ones they’ve programmed, have code written into them, specifically formulas and algorithms, that take in data really fast, process it, and then make trading decisions.
We’re talking about many thousands of trades in less than a second. That’s how fast it is.
Part of the formula is mathematical calculation in the form of an if/then statement, such as if the DXY drops by .082%, buy “X” number of shares of GLD.
I’m oversimplifying it, but you get the point.
The other thing the algorithms do is automatically search and parse though news, press releases and other online information. The computer’s A.I. scans for key words, and makes trading decisions based off of those words.
For example, an article could read – “Gold is locked below $1300” (sound familiar?), and the HFT computer could make the decision to sell “X” number of shares of GLD, or gold futures, or whatever.
So the words in news articles are also part of the price suppression schemes.
Now, I can’t speak to specific algorithms, nor the writers of the Reuters article, so I’m not sure of any specific intent here.
I’m merely making a point.
Regardless of intent, as I said, the MSM never let’s a good gold bashing to to waste.
This one is typical.
Call it “conventional wisdom” in finance which is not only wrong, but also a form of brainwashing the masses.
For example, in the Reuters article (bold added for emphasis):
Gold is highly sensitive to higher interest rates which can boost bond yields, making non-yielding bullion less attractive to investors, and could strengthen the dollar, increasing the cost of gold for buyers using other currencies. Investors expect the Fed to raise rates on Wednesday but will be looking for hints at future policy. A more aggressive stance on monetary tightening would hurt gold.
First of all, a Fed Funds Rate of 1.75% to 2.0% doesn’t even keep up with inflation, so real rates are actually negative. That means that gold wins every time against something that is earning a negative real return.
See this article I wrote yesterday explaining how gold is an inflation hedge.
Secondly, in reference to the quote above, “aggressive” monetary policy would be done to reign in inflation, which again, would see gold rising in price anyway.
So you see the point.
Never let a gold bashing go to waste.
Watch for movement in gold today, especially at 2:00 p.m. EST as the FOMC statement is
fed to the HFT computers released to the public.
– Half Dollar
About the Author
U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.