“Trust your gut. I believe we’re witnessing the ultimate ’emperor’s really naked’ moment,” Marcus said about precious metals manipulation.
Gold and silver prices spiked earlier this summer, with gold passing US$2,000 per ounce and silver nearly pushing through US$30 per ounce. But since then they’ve fallen back to lower levels.
For Chris Marcus, founder of Arcadia Economics, the precious metals‘ price activity is reminiscent of what happened in 2011 — the last time gold reached an all-time high.
That move in gold coincided with Switzerland deciding to peg the Swiss franc to the euro, and Marcus said he expected gold to break US$2,000 at that time. Instead, it topped out at about US$1,920.
He was surprised to see the circumstances of gold’s price drop — the fall came during a holiday weekend in the middle of the night, when liquidity is thin.
“At the options trading shop that I worked for, we were specifically trained (that) you would never execute something like that,” said Marcus. “If the markets are closed on a holiday weekend on a Sunday night, it seems bizarre that someone with a ton of gold just figured, ‘Okay, the Swiss are going to start printing their currency, I better get rid of this gold.”
Marcus, who is the author of the book “The Big Silver Short,” has been following the gold and silver markets closely since then, with a focus specifically on price manipulation. What he’s found has been eye-opening, but he emphasized that what market participants need is patience.
“I would suggest we might be pretty close to the end point of the metals suppression,” he noted — but there are no guarantees, and Marcus said he’s come to realize that in the meantime less can be more when it comes to investing. “Maybe the markets are always going to do what the markets are going to do, and what we can control is our mental reaction,” he suggested.
Above all, he encouraged investors to trust in themselves when it comes to understanding gold and silver market manipulation. “Trust your gut. I believe we’re witnessing the ultimate ’emperor’s really naked’ moment. This isn’t complex financial analysis. Sometimes I think of it as the greatest hypnotic thought experiment in history,” Marcus concluded.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
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