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Msg  14701 of 14835  at  9/16/2021 12:31:49 PM  by

countrygent


Macro Red Paint


Copper and gold had been pegging little advances the past few weeks, oil as well.

Then not bad retail spending and economic growth numbers out of our American cousins this week and a jittery little sell-off across the commodities and a bump in the US dollar and the key 10 year treasury yield (although it remains in net terror of risk territory with inflation running moderately towards 4% and yielding a paltry 1.33%)

Pre-taper-tantrum? Fed meeting next week. The miners got kicked across the board for trading losses today with a lot of small volume grind downs. Typical 2% to 5% sell offs.. Golds in particular - Nolans SSL down below $8 with a 52 week high of $12.60, ouch.

Has anything really changed that much? The creeping inflation is showing in the grocery store, at the gas pump, governments are going to be desperate to start grinding at their huge debts taken on during Covid, especially if interest rate rises are in the offing. Debt service is going to be a difficult issue and real budget drain if interest rates start climbing.

Chairman Powell has said it is transitory, but I wonder. The political pressure shown by lowering unemployment, unfilled job positions, wage demands ... looks inflationary to me. Surely all that stimulus which has basically been running at different volumes since 2008 has lit a deep smouldering fire. The millennials are coming of age and awakening politically and are hot themselves with crazy high real estate costs and wages for the jobs they are filling have stagnated badly for decades.

All conspired to splatter red paint all over the miners today. Gold off $40 or so, copper down 12 cents, Mama said there would be days like this. I wonder about the influence of pooled funds and formula trading on days like this when you see coordinated sector movement on light volumes, maybe spooking some retail, not much, as well.

Little ETG holding its own on paltry volume.

Back to the bunker!

cg



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