It will not be long before Gold and Silver play follow the leader to exploit their insurance policy role as…
Goofy overseer of an indebted empire
‘What was that all about?’, I enquired, seeing my work colleague storm out of a meeting with his Manager. ‘Never had that reaction before’, my boss said, ‘I promoted him to Senior Administrator and he got up, hurled a torrent of abuse at me and slammed the door in my face. He thought he was that grade and level already!’
Manager, Senior Administrator? Do you remember those days, when job titles were simple, clear and a true reflection of your status at work? I have been out of the ‘rat race’ for 18 months and every now and again I look at the job vacancies, just in case my trading fails, or my blogs result in libel cases with Bugsy ‘whack-whack’ Morgan. I look at the job titles and they appear to have no connection to the job description. Everyone seems to be a ‘Head of’, ‘Director’ or ‘Vice President’. Back in the day, we never saw a Dictator, sorry Director, and if we did it was like a royal state visit, with curtsying and bowing the order of the day. Now, they and ‘Head of’s’ crawl out of gaps in the office furniture at every turn. “Oh yes, I am ‘Head of Inclusion and Diversity’. “Really, how many people are you ‘head of?’”. “Oh, no one, just me”. How very inclusive and diverse.
Our culture encourages us to pursue titles and that is fine, as long as we do not base our identity around them. I made the lofty heights of Manager before finding the escape tunnel, so in old currency that would be the middle of the corporate food chain but in new currency, and at the current rate of distorting job titles, I guess I would now be CEO. Surely it is not unreasonable for me to amend my CV and change my historic job titles to Director, Vice President and Super-hero? I am not lying; I am simply bringing my CV up to today’s standards. For inspiration, I came across an abundance of suitable descriptions to choose from. Indeed, the employment website, reported widespread use of ‘Rockstar’, ‘Guru’ and ‘Ninja’, so, my CV now includes Ranch dressing expert, Head of Elephants, Bride kidnapping expert, and Namer of clouds. Part-time positions of Media Distribution Officer (because I had a paper round), Chief Chatter (Call Centre Manager) and Fake mourner (because I can cry at funerals) have now been added and I have also decided to bring back professions that are now obsolete. I wake my son up most mornings so Professional Knocker-Up is there, as is Huckster (con artist) for my time with a Bank.
Interestingly, I could not find any compliance or regulator jobs in the recruitment pages, so I guess they do not exist anymore. The pièce de resistance of my new, updated 21st century CV was otolaryngologist because my kids constantly had tonsilitis when they were younger and so I consider myself an expert in this field. CV keyword ‘job title’ finding tools will be in hyper mode if mine is ever re-submitted.
Some organisations such as Disney and Make a wish foundation inspire job titles such as ‘cast members’ or ‘fairy godmother of wishes’. Other organisations have adopted ‘holacracy’ where people are freed to do what they are good at – even if that means holding a cluster of seemingly unrelated roles. Why wasn’t this around when I was younger? I could have been a Namer of clouds, Head of Elephants, and a Bride kidnapping expert all in one role and at the same time.
Applying either of these approaches to key Government roles could lead to a seismic shift in our understanding of what they do. The British Prime Minister becomes Pinocchio of Buffoonery; the US President becomes Goofy Overseer of an indebted empire; the French president becomes ‘Wreck it Ralph’ and the Fed Chair becomes Scrooge McDuck, overlord of fantastictrillion dollars and custodian of monthly banal chitter chatter. Indeed, last week’s Fed meeting and statement was the usual banal chitter chatter, an expected non-event that did nothing to stop the anticipated pressures on the precious metals all week:
Having peaked at $1795 on the daily chart on Thursday 22nd and Friday 23rd April, prices were subsequently capped at $1780 and then $1770 the following week, until Monday and Tuesday of this week, when further attempts to break the psychological $1800 resistance level were again repelled.
Similarly, Silver reached a peak at $2640 on Friday 23rd April and prices were capped at $2620 and then $2600 for all last week, which was not surprising, given the Fed meeting and Silver options expiry, where a full or partial beating is usually guaranteed. This week, we have seen attempts to break the psychological $2700 resistance level, which again, stubbornly, refuses to give way.
So, do we have Custer’s last stand at $1800 for Gold and $2700 for Silver?
Zooming out to the Gold weekly chart, and we will have resolution soon enough of whether the longer-term uptrend or medium-term downtrend gets the upper hand. The criminals will want Gold to continue the downtrend to $1600. Whilst we could retreat further to $1725, I think we double bottomed at $1675, which pretty much represents the 61.8% Fibonacci retracement of the move from $1450 to $2075. At $1775 on Tuesday, we are now close to a retracement of 50% of that move. These are often strong areas to rebound.
Ditto with Silver on the weekly chart, either we will see a breakthrough or breakdown soon enough. A poke above the downtrend at the start of this week is positive but then the capping boys get to work. It is going to be an interesting May and June.
Not a good week last week for the miners and the above chart for Newmont is indicative of their recent plight by heading towards a re-test of the recent breakout of the down trend. Is this a healthy reverse head and shoulders forming?
Stand at ease though everyone. Commodities are on fire and Corn, Copper, Aluminium, Lumber etc are surging, surging, surging. It will not be long before Gold and Silver play follow my leader to exploit their insurance policy role as a hedge against inflation.
The price of Copper alone has risen nearly 100% in the past year due to pledges by Governments to boost renewable energy and electric vehicle use. Boosted by lockdown do-it-yourself projects and falling mortgage interest rates heightening demand for new homes, Lumber prices are also booming. With commodity inflation already baked in and global economic recovery leading to increasing employment and pressures on wage inflation, I cannot see a better environment for Gold and Silver to thrive.
Food for thought
Warren Buffett recently attacked various companies and the Robinhood trading app for encouraging a rising number of amateur day traders and speculators to gamble in the stock market and treating it like a casino. There has certainly been a proliferation of investors, speculators (whatever you want to call them) in recent months and with the growth of gambling linked to online betting companies you could argue that it is not just linked to the stock market. Is investing gambling? What do you think? I am hooked on this interesting question and it is one that I will explore in more detail next week.
Here in the UK, we officially live in the 18th happiest country in the world and despite covid and the way in which countries have dealt with the pandemic, the results are consistent over the last few years. Finland is the happiest nation for the 4th year in a row. Bizarre really when you consider that Finns survive with no sunlight in the winter, but 24 hours of it in the summer. I am going to change my daily routine to having a relaxing sauna and morning dip in an ice-cold lake before starting my trading day. The report highlights the success of East Asia, Australia, and New Zealand’s during the pandemic, and says that “the evidence shows that people’s morale improves when the Government acts”. Ah, now I understand why we are in 18th.
Stay safe and see you next week. I am Sheep Shearer and I shear sheep.