GOLDBUGS AMEX Goldbugs Index (GOLD)

[peel+green]

The new SGE physical gold market, opening tomorrow and 11 days earlier than expected, throws the game open in an interesting way.

Personally, I see it as another huge step in shifting pricing power on the POG to China; I see the market moving significantly away from the LBMA and COMEX,and I see a possibility of arbitrage if Wall St continues to seek control of the POG by way of the futures market in North America.

In time, and in probably a shortish time, producers will sell into the Chinese market for a better price and the COMEX will be drained after a period of diminishing influence.

The USA has abused its market control on its home territory and now the bill will be paid, probably by US taxpayers.

In a wider context, both Russia and China, and now India, have seen very clearly what the USA has tried to do with gold futures to protect the diminishing dollar, and only the weakness of the Yen and the Euro ('whatever it takes' Draghi) makes the USD look 'strong.'

Everything Yellen has said today was clearly anticipated yesterday ('signs of improvement, but weakness in the Labor Market, no raise in interest rates for quite some time').

The USA simply cannot raise interest rates because if it did the USA would bankrupt itself thanks to almost $18 TRILLION in National Debt and an economy that that lies moribund.