On the heels of continued propaganda from the Fed today, 40-year veteran, Robert Fitzwilson, wrote the most extraordinary piece for King World News. Fitzwilson, who is founder of The Portola Group, discusses the tragedy of what is unfolding and how key markets are responding such as gold and silver to the ongoing drama.
Below is Fitzwilson’s exclusive piece for KWN:
Fitzwilson: “Whether intended to be so or not, today was the equivalent of the stress tests that the Federal Reserve and their counterparts overseas conducted on banking institutions. It was the markets instead which were tested this time.
Early into the trading this morning, Chairman Bernanke suggested that it was too dangerous to tighten monetary policy. His comments caused equities and precious metals to soar and U.S. Treasury interest rates to decline. His words suggested more printing, more asset purchases and continuing inflation of the stock and bond bubbles….
“Subsequent to those comments, Chairman Bernanke then suggested that the so-called “tapering” of quantitative easing could also be on the table. Stocks and precious metals sold off, and interest rates spiked higher. The range for the Dow Jones Industrials was almost 300 points on the day.
For gold and silver, the spread was $60 and $1.14, respectively. Brent crude oil also had a wild ride during the day, ranging between $103.79 and $102.22 per barrel. The most interesting market move today was for many of the gold and silver mining companies. There were very strong performances.
We also had the release of the minutes for the Fed Open Market Committee meeting conducted on April 30th and May 1st. The views expressed at the meeting were at times dovish and others were hawkish. This too caused more turmoil in the markets, with the Dow Jones, gold, silver and oil all finishing near the lows. Interest rates closed near the highs as fixed income sold off. One observer said that the Chairman had an insurrection on his hands. Maybe, maybe not.