Alasdair Macleod: Fed Throws in the Towel, “Something is About to Break”

Play

With massive currency volatility & a big jump in gold & silver in the wake of the FOMC statement, Alasdair Macleod joins the show this week discussing:  

  • Massive moves in the dollar are justified, as The Federal Reserve has effectively thrown in the towel on any raise in interest rates! 
  • Is the dollar’s parabolic moon shot over?  Alasdair explains why he is a “Seller of the Dollar” here 
  • A BIG RESET is coming- “Something is about to break” 
  • UK, Germany, France, Italy, & Australia join Chinese/Russian-led Asian Infrastructure Investment Bank… as  founding members!Putin has played the most extraordinarily brilliant move I have ever seen!” 
  • Alasdair states that when the US tries to join the Asian Infrastructure Investment Bank IT WILL BE REFUSED, and the days of the dollar are basically gone! 
  • SHORT SQUEEZE!  Gold & silver rip higher Friday
  • Macleod explains that “The dollar will begin to weaken when the market begins to realize what has occurred!”

The SD Weekly Metals & Markets With The Doc, Eric Dubin, & Alasdair Macleod is below: 

 

QE To Infinity - WilliamBanzai7

 

QE To Infinity – WilliamBanzai7
Source:  William Banzai 7

Call it Stockholm syndrome.  The Fed tells me I don’t have to be “patient” anymore, the powers that be let precious metals move a tiny bit higher, and I feel like I should say “thank you” as I peek out from my bunker.

Friday’s closing prices mark an outside reversal week for gold and silver.  It couldn’t have come at a more important time, given that the technical picture was downright ugly. 

gold

 

Silver

Now that the first month of ECB QE is in the rear-view mirror, Grandma Yellen and her merry band of jawboning cohorts have signaled a more Dovish tone on the Fed’s timing for interest rate normalization.  The rapid rise in the dollar was no doubt causing policy makers to worry about the earnings translation hit large capitalization US multinational companies are taking.  The Fed has sought to repair the banking system and float the general economy on the back of rising asset prices and the last thing Yellen wants to see is a sizable stock market correction.

The timing of the Fed’s more dovish tone couldn’t be more obvious;  the dollar was starting to go parabolic.

dollar

Since 2011 we’ve seen major central banks alternate the timing of their QE programs so as to manage impacts to currency exchange rates and markets and economic expectations in general.  The dollar will likely see another leg higher before it ultimately rolls over later this year.  There remains a great deal of dollar denominated debt around the world that will be closed out in the coming months, generating a bid for the dollar above and beyond the illusionary flight to safety quality the greenback enjoys as the least smelly shirt in the fiat QE laundry bag.

Bottom-line for the precious metals space:  we should be poised to see the repair of some of the price damage we’ve sustained since last January’s peak.  A two-thirds retracement over the coming weeks should be doable given how aggressive the cartel had to have acted against strong physical demand.

Weekend reading/listening:

Thanks for checking out this week’s show — Eric Dubin

Eagle