Dennis Gartman dons tinfoil hat: BIS trying to keep gold down

http://www.gata.org/node/17654

Dennis Gartman insists that there are no conspiracies in gold

Dennis Gartman is a mouthpiece for the Fed and bullion banks--and their surreptitious price suppression of precious metals.

http://www.gata.org/node/12839

Hathaway - Give-Up Phase As Gartman Shorting Gold Is Bullish

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/14_Hathaway_-_Give-Up_Phase_As_Gartman_Shorting_Gold_Is_Bullish.html

Dennis Gartman on CNBC

Dennis Gartman, the respected commodities expert who pens the widely read "The Gartman Letter", and who can been seen on CNBC every day, called a top on gold at $930. When gold surged to $1050, he said he was still bearish on gold, yet he had reversed course on his own trade, and had gone long due to technical momentum (presumably after losing a ton of money shorting gold at $930). He also declared gold was in a "bubble"--even as he confessed he had gone long--and that he just didn't understand why gold had rallied so high and so fast. Today, in overseas trading, while America gluttons on turkey and dressing, gold is threatening $1200.

So this is a guy who can barely admit he was totally wrong on gold, costing followers millions of dollars, and now he can glibly declare gold is in "bubble" status--without even looking at the fundamentals of not just the recent rally, but of a DECADE-LONG BULL MARKET IN GOLD?

What about US Treasury bonds? The trillions of IOU's being issued by an insolvent government will come due at some point, and that is not a bubble? What if the creditors of that debt reject taking on that risk at yields of 3%, and demand 15% before even considering buying more Treasuries? What about that bubble? Rising interest rates will tank bond values, much like they did in the early 80's when inflation and deficit spending were out of control. Deficits are much worse today--in the trillions, with a "t".

And what if the US government itself defaults on its borrowings, unable to fund even the interest on that debt? What will happen to the asset values of hard commodities? How high could gold or oil climb in dollars?

Yes, the Fed's quantitative easing will yet again create asset bubbles. But as usual, the investing public will get fleeced again because the bankers are pointing at the wrong "bubble."

Irony

Without getting ideaological (okay, I'm lying, let's get ideaological), enclosed is an interesting note from well-respected Dennis Gartman:

Speaking at the People’s Congress in Beijing recently, Premier Wen Jiabo made it quite clear that China intends fully to achieve 8% growth in GDP this year. Not next year; not two years hence, but this year...’09; the year of the Ox... this year.

Interestingly, Mr. Wen made it clear that not only was the government intent upon force feeding liquidity into the nation’s banks, but was also prepared to make material cuts in income taxes, across the board to sponsor such growth.

Wen made it clear that the only way he can see Chinese economic growth returning to the not-so-long-ago-lost halcyon days of 9% growth almost relentlessly shall require more than simple reserve injections.

Mr. Wen said that it is his intention to turn China from an export driven society to a consumer driven one instead. He know that liquidity alone will not suffice to do what Beijing needs the economy to do; hence Mr. Wen will begin this new era of growing consumer demand by cutting corporate and personal income taxes. According to The China Daily, Mr. Wen said, in the simplest of terms, that it is Beijing’s intention to spur the economy forward by “boosting domestic demand through residential tax cuts, in addition to the levy reduction for companies.”

The latter has already been put into effect; the former is coming. Mr. Wen’s proposed “residential” tax cuts include tax cuts on securities transactions; tax cuts on property sales; smaller taxes on exports and an end to a number of “administrative charges” on various goods and services. At a time when American law makers on the Left are debating the possibilities of taxing stock transactions, the Chinese are moving to end them!

Further, China is moving swiftly ahead with very real “infrastructure” spending. The new term here in the US is “shovel ready.” Our stimulus program is manifestly un-shovel ready; in China, the shovels are already at hand and the programs are being put into effect, with workers being hired and ground being broken.

Mr. Wen has the calendar working for him too, for this year marks the 60th anniversary of the founding of the People’s Republic. As is always the case, China will have myriad numbers of building programs in place to commemorate that event. Too... and this is hard for us to believe, for time passes so quickly... this is the 20th anniversary of the Tiananmen Square Uprising. Mr. Wen and Mr. Hu will want to make certain that things are on the economic mend in order to keep dissidents wrong-footed throughout the years.

This is a strange era in which we live then. We live at a time when ex-Communists are taking the more free market route toward a consumer led society. We are living in an era when Beijing reads Atlas Shrugged and Washington reads The Manchester Guardian. We are living in an era when tax cuts of all sorts are effected by Beijing, while Washington talks about and effects tax increases of all sorts. We live in an era when Beijing gets out of the way of entrepreneurs, and Washington throws rocks and rubble in their way instead.

As was said in Ecclesiastes, “To everything, turn, turn, turn...”

Good Luck and Good Trading,

Dennis Gartman