RE:RE:RE:RE:RE:NY Comexcskhurasu wrote: If you really think the gold market is continuously subject to criminal manipulation, why do you invest in it?
Because criminal manipulation works only under certain conditions. Over the longer term investing in precious metals has been profitable for patient folks who wait until other factors take over and push the prices higher.
Small markets like commodities, including gold, are easy to manipulate on a day-to-day basis when regulators look the other way. But there are other forces at work that can't be controlled. Government spending for example. Corporate debt levels for another. Over time, this undercuts the buying power of currencies and forces the price of commodities higher. Even basic supply/demand changes can get in the way of manipulation, as with palladium. That market can still be manipulated at options expiration, but at levels above $2500 the demand issues seem to be in control.
The foreign exchange markets and fixed income markets are much larger than the gold market, and much harder to manipulate. The Fed can dictate overnight rates, but not the 10 year or 30 year bond, or the level of the U. S. dollar relative to other currencies. The U. S. already must pay much higher rates of interest than other large developed countries. Even when our rates are very low, rates for the other nations simply go negative. There is always more demand for the bonds of other countries than for U. S. bonds, even when you have to pay those nations to hold your cash. When you think about it, that's a pretty harsh statement on the confidence investors have in the U. S. government. As for the Fed, they completely lost control when they had to start supporting the overnight repo markets on a daily basis. Now their balance sheet has hit $8 Trillion and climbing as they continue to shore up the house of cards.
I get it when folks complain about manipulation. The indicators are so obvious, especially on options expiration days when flash-crashes occur. I suspect the venting is therapeutic as we wait for the longer term payoffs. But make no mistake, this risky experiment in Modern Monetary Theory will not end well. Those who think some "Great Reset" will fix the problem don't understand that the price we pay will be the loss of the U. S. dollar as the world's reserve currency. There will be a ton of deals made to spread the impact of that change over time, but there's a reason that the Chinese and other countries are loading up on gold sir. We would all be wise to maintain our focus on the bigger picture and allocate accordingly IMHO.