Michael Batnick of Ritholtz Wealth Management did a wonderful job with the Friday edition of his market letter, "The Irrelevant Investor," elaborating on the anomalous behavior of the gold price lately.
His analysis was headlined "What Happened to Gold?" and it can be found here:
https://theirrelevantinvestor.com/2021/02/26/what-happened-to-gold/
Batnick writes:
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If you went into a laboratory to build a gold price optimizer, you would want a couple of things.
-- A falling dollar.
-- Rising inflation expectations.
-- Money printing.
-- Central bank balance sheets expanding.
-- Fiscal deficits increasing.
-- Political turmoil.
All these things were in place over the last few months, and yet gold has done the opposite of what you expected it to do. It’s down 9% over the last 6 months, and it’s 15% below its highs in August.
Gold could rally on any one of the items I mentioned. All six were in place at the same time, and it couldn’t get out of its own way.
The dollar is sitting near multi-year lows, and gold can't rally. ...
I guess time will tell if gold is broken, or if it’s merely catching its breath. Either way, you can't help but notice how unusual this recent decline is given that gold didn't work when everything said it should.
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Unfortunately Batnick quickly curtails any curiosity, declining to look for any explanations, though seeking explanations might make his letter more relevant.
Batnick's lack of curiosity may not be surprising in light of his employment at Ritholtz Wealth Management. The firm's chairman and chief investment officer, Barry Ritholtz, who is also a columnist for Bloomberg News, long has derided complaints of government-instigated manipulation of the gold market and has refused to respond to perfectly cordial requests to examine the issue:
https://ritholtz.com/2013/04/the-10-rules-of-goldbuggery/
But maybe others will read Batnick's observations and respond with a little more curiosity than he and Ritholtz seem capable of.
An aid to such curiosity -- a comprehensive summary of government gold price suppression policy and methods, and the documents thereof -- is available at GATA's internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
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