Thursday, March 1, 2012

Surprise! ISDA Finds No Greece Default Plus Gold Massacre Update

I discussed the role of Credit Default Swaps, the big banks and Greece here. Today we learn that ISDA has, in fact, declared Greece not to be in default though they will revisit the issue later.

Zerohedge has their own comments on this surprising (not really) event here.

In a somewhat related matter, Jim Sinclair discusses how yesterday's gold/silver massacre occurred simultaneously with about $700 Billion in new stimulus through US Dollar swap lines courtesy of the US Federal Reserve. Its a great interview and puts a better perspective on the gold market. Click here for the MP3. Sinclair views yesterday's event as a central bank intervention much like the currency interventions often seen in the FX markets by countries defending their currency (often devaluing it against other currencies to stay competitive). Given the close relationship between currency prices, quantitative easing and gold prices, this seems entirely possible.

Yesterday, when I watched the video I posted of Ron Paul squaring off with Ben Bernanke, I had a sense that we were seeing a public display in a much larger game being played behind the scenes. Many people seem to think the gold market was attacked somehow as a result of Ron Paul's "performance" with the silver Eagle coin. I disagree. I'm only speculating, but my sense is that Paul knew there was an intervention about to happen and made the choice to use his time to publicly make the point that gold & silver are the only true money despite was about to transpire in the markets.

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