Precious metals expert Michael Ballanger discusses market reactions post-Brexit vote.
To truly appreciate market crashes, you must have an ample serving of grey hair.
Over the weekend, I must have received three dozen “Emergency Email Alert” notifications by newsletter services and financial intermediaries that got absolutely obliterated Friday morning and were expecting more of the same on Monday, which they got in spades. This new generation of “wealth advisors” has, unfortunately, been living off the largess of Central Bank guarantees and the winks and nudges of the “Finance Ministers” and “Treasury Secretaries” and “Chancellors of the Exchequer,” where they make investment decisions based not upon analyses of balance sheets or income statements but upon the collective wisdom of Champagne Socialists. I have been writing about this for about thirty-five years and while it has not yet manifested itself in the advance of the prices of precious metals to levels that would correspond to the level of coinciding currency debasement, especially in the United States and Europe, it is going to be the “Talk of the Town” here in 2016.
Yesterday I heard two commentators on CNBC ask two of the stupidest questions in history. The first one was when Bob Pisani asked, “Why is the VIX (Volatility Index) down over 2 points with the S&P off 40?” The answer, which was even more ludicrous than the question, implied that traders had purchased volatility prior to the Brexit vote, and once it spiked after the decision, they were selling “vol,” which was telling you that the selloff was going to be short-lived.
No, Bob, that is incorrect. The only “traders” selling “vol” yesterday were those at 33 Liberty St. in New York (home of the NY Fed), after instructions were taken from the “Working Group in Capital Markets” (covert arm of the U.S. Treasury).
They weren’t …read more