Granted, this week was a short week in that Gold stopped trading on Wednesday. Nonetheless, we have the extraordinary circumstance that spot future Gold has traded in a $US 2.50 range ($US 264.40 - $US 266.90) on a closing basis ever since October 26. That's a month ago.
On this site, we maintain three different point and figure charts for $US Gold - $US5 x 3, $US2 x 3, and $US 1 x 3. The most tactical of these charts - the $US 1 x 3 chart - has not moved since October 26. On global stock markets, 1.0% moves in either direction are the norm on a daily basis. On the Nasdaq, a 1.0% move would be a very quiet day indeed. Currencies ditto. Corporate bond markets ditto. Derivatives of all descriptions ditto. Commodities (other than Gold and Silver) ditto. Yet Gold (and Silver to a lesser extend) has been completely frozen for a month, three weeks of which have been spent in an unseemly wrangle over who shall be the next President of the United States.
"He had broad shoulders and a slight body. He had stringy hair, a wide mouth and an elastic age range which made him look like a harassed forty or an unusually vigorous sixty. Holding enormous powers, he schemed ceaselessly to expand them, because it was expected of him by those who had pushed him into office. He had the cunning of the unintelligent and the frantic energy of the lazy. The sole secret of his rise in life was the fact that he was a product of chance and knew it and aspired to nothing else."
That is a description of "Mr Thompson", the "Head of State" in Rand's novel. The physical description does not completely describe Mr Clinton, although some of it fits very well. But what describes Mr Clinton very well indeed is the motivation ascribed to "Mr Thompson". As we described in the current issue of The Privateer, what the U.S. and the world is now witnessing is a struggle between factions of the U.S. political Establishment.
What Ayn Rand describes is the epitome of a man whom a political establishment would pick as their "front man". In a nation in which the government "runs" the country, the choice of who will "run" the government is made by the establishment. It is not made by the "people". They get to choose from the establishment candidates. What Miss Rand describes is the distilled essence of that type of political candidate. If you look at the major candidates for office in this election, and think back to the candidates in past elections, you can use your own judgement as to whom best fits this archetype. This is not, of course, confined to the U.S.. Any modern Western nation is in the same boat.
Political establishments don't confine themselves to playing around with election results or politics. They can't. "Running" an economy is a very expensive proposition, hugely more expensive than merely acting as an impartial "umpire" - the role that the U.S. government was originally designed to fulfil. Making rules is something that anyone can do. Enforcing them is another thing entirely. That takes control, or power, and power is something that is only gained once the control of what the nation uses as money is securely estabished.
If what the nation uses as money is Gold, circulating in coin form, then a political estabishment may exist, but it CANNOT either gain or maintain control of an entire nation's economy. When Gold does NOT circulate as money, then such control can be gained. Is there anyone left in the U.S. that thinks that such control has not been gained? If there is, let him or her take another look at what has happened in the aftermath of the November 7 election.
Finally, since it is impossible to "dis-invent" Gold, to wipe it and the idea which it represents out of existence, then Gold must be controlled. The ONLY aspect of control by the political establishment which has NOT slipped since the election is their control over Gold. Specifically, over the Gold price. In $US terms, Gold has not moved for a month.
On Monday, Gold will resume trading in New York after a four day hiatus. In times of financial strain in the past, such a "long Gold weekend" was often used as an opportunity to mount an attack on the $US Gold price. Given the present situation, the temptation must be great to do so again. It will be interesting to see if the U.S. establishment risks it. The political and legal machinations in Florida have brought much of their previously hidden "modus operandi" to light. A Gold price "hit" on Monday, November 27 would be of the exact same nature as the threatened appeals to the Supreme Court instigated by the Democrats and now followed (out of necessity, it must be said) by the Republicans.
Gold is the "political" metal because it is the only form of money which effectively blocks a political establishment from "running" an economy - and therefore a country.