• Dan Norcini notes that falling inventories in GLD have been a warning on gold.

• Personally,  aside from gold’s bad technicals and silver’s deplorable ones, which have been ongoing for months now, I saw a very ominous warning last week when an article at the Gold Report featured this title: An Ebola Armageddon Could Trigger a Rebirth in Gold and Silver Prices: Eric Sprott.  Need we say more about whether the “community” has learned and/or changed its ways?

• While I am on the subject and now that the damage is being done, let’s excerpt some of NFTRH 314, beginning with the charts that have kept us very aware the bad technical situation that could not be spun any other way…

Precious Metals (10.26.14)

Few words are necessary for the above.  Words are only necessary for sponsors of these items who need to rationalize for their followers.  I continue to sleep soundly with gold (well, not literally) and continue to realize that these things are no good right now to people interested in pricing as opposed to value or insurance.

If that changes on Monday I’d be thrilled because it would mean that an honest light was being shone on the system (at least as pertains to gold, as a money alternative or value anchor).  When ever it does happen we will manage it accordingly.  But there will be no clicking the heels of our ruby slippers!  Until then this is what it is, especially silver.

Pertaining to the Eric Sprott thing above, here is an atypically emotional response from the Market Sentiment segment…

Speaking of mindsets (there’s a pun in there you might recognize if you are familiar with the gold “community”), I want to transition the sentiment view to the gold sector and highlight the most frightening thing I have seen to date (for gold bulls this Halloween) in the bear market.  It is a fright mask in the likeness of Eric Sprott by way of the Gold Report.  The title?

An Ebola Armageddon Could Trigger a Rebirth in Gold and Silver Prices

“Could an infectious disease kill the monster that has been choking gold and silver prices for more than a year? On the heels of a lively Sprott Precious Metals Roundtable discussion, The Gold Report caught up with investor Eric Sprott to ask how a tragedy in Africa could impact the price of precious metals and mining stocks. We also spoke to his Executive Vice President of Corporate Development John Ciampaglia about a new way to gain exposure to gold.”

This is the most bearish thing that has come out of a bear market filled with contrary indicators who have refused to give up.  Eric Sprott and his Corporate Development guy have latched on to the latest headline maker and found a way to fit gold into the equation.

Admittedly, they go at it from a rational supply/demand perspective (with African mines affecting an already supposedly supply-constrained industry) as opposed to a simple‘Ebola’s out there, buy gold!’ hysteria, but this very article betrays the nature of so many of the mouthpieces of the gold “community”.

Instead of talking about value, insurance and even the gold price’s ability to drop wildly amidst a risk ‘ON’ asset market atmosphere, they continue to pump a fear bid in hopes that finally, something bad happening in the world will get gold up off its ass and prove them right.  The supply/demand (usually involving Indian Weddings, China Demand, etc.) argument has been rationalized every step of the way through the bear market and every step of the way it has kept the true believers (in gold’s price) in Palooka Ville.

What gold promoters don’t seem to realize is that people are not as stupid as they cynically think they are.  That applies to the average gold bug who, though naïve and prone to bias reinforcement, I believe is grounded in the want for something better with respect to the monetary system and the society that springs from it.

When people pump a frightening infectious disease (using the word “Armageddon” in the title of an article) as a reason why gold’s price will rise or when a certain promoter who shall go unnamed continually writes in a way that implies he is always right while records show bullishness on gold and gold stocks (most often featuring the Modi, Indian Weddings angle) all the way down (he’s still at it, constantly) in the bear market, the implication is that the sector has not yet been cured of its own disease.

There are less of them now, at least less of them that are given media time as the ranks of people who have lifted them up and anointed them as gurus have thinned out.  But the process is not yet complete.  Happy Halloween.

Back on the post’s theme, out on the internet today…

• Our view has been that the economy is good (or at least has been good to this point) and per Bloomberg, the better than expected GDP bears that out.  I know, I know I am not dealing in reality, right?  Well the economy has been good for corporate interests and a hell of a lot of consumers as well.  Of course, GDP is back-looking.  What’s the US dollar up to?

• As pertains to the above pessimism on the US economy, here is Josh Brown with agraph of how negative people around the world are in estimating their own countries’ unemployment rates.  Ah, human nature… and a good dose of inequitable monetary policy.