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The Kitco pumphouse (from IKN263)

Here below is how this week’s edition of The IKN Weekly, IKN263, kicked off. It’s getting an airing here because judgin by the mailbox reaction it’s struck a chord with several people. One of them suggested sticking it on the blog too, so here you go.
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The Kitco pumphouse
Things
have gone downhill at Kitco. Gone are the days when John Nadler would be the
head op-ed writer at Kitco and add a measure of level-headed commentary to the
usual assortment of rah-rah-gold-to-infinity articles jammed packed with
stupidities. Nadler, always the cautious opinion and often an outright bear,
would leaven the goldbug perma-pump articles and bring a little sanity but it
now seems that Kitco’s a little more desperate for business than before and
keener than ever to move merchandise. It tends to be around moments of market
pressure when op-ed objectivity is viewed as a luxury to be discarded by
financial houses, which is why a red flag is being raised high today.
Thursday’s lead opinion piece (1) on Kitco where the man who took over from Nadler, one
Jim Wyckoff, touched on the Ukraine elections, then mentioned the U.S long
weekend and market pause and came to the conclusion that going into this
weekend “…I sure would not want to be
short gold
”. What the hell is that? It’s certainly not anything that could
pass as responsible or level headed from one of the larger purveyors of gold to
the retail community.
Aside the
fact that geopolitical events have long been shown to make mere temporary dents
in asset class prices (ask Gary Biiwii
how long gold can be moved by a single country’s problems, he’ll tell you
either short or not at all and then show you a bunch of charts to prove it
)
it just so happens that the weekend’s raft of elections have gone off in a
reasonably orderly fashion, with Ukraine getting its “Chocolate President” who
was received in reasonable tones by Russia’s Putin (who’s the hand on the gas
pipe faucet), while the feared far-right overthrow there has fizzled to the
point that no extreme candidate got more than 1% of the vote. Yes it’s still
dicey in Eastern Ukraine  but no more so
than a week ago. Meanwhile the hard right and far right (they prefer to call
themselves Nationalists or Euroskeptics) made gains in the European elections,
which makes for some juicy headlines but has large elements of mid-term protest
voting hidden beneath the eyecatching headlines (they have to get your
attention, after all). Come a National Presidential or General election and one
of these hardline groups gains real national power in any of the big player
countries (which like it or not means France, Germany or The UK), then we  can talk about a serious threat to the thing
that matters for the rest of the world, The Euro currency. Until then, the
threat is latent at very best, minor in reality.
I
digress. The point here isn’t that the swathe of politics this weekend went off
the way it did, the point is that Kitco looking really this keen to shift
merchandise and to that end is playing on the nerves of people that don’t know
better and trying to drum up emotion-trade. I don’t have any problem about them
taking a bullish stance towards the market in general (after all, I’m the one
aiming for U$1,400/oz by the end of this year, which is more than bullish
enough at this point) but resorting to cheap tricks and op-eds? Sorry, I expect
better from apparent market leaders. Much better.

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