by Harvey Organ, Harvey Organ Blog:
GOLD DOWN $4.65 AND SILVER IS DOWN 10 CENTS AS THE USA INDEX CLIMBS TO 97.59/VOLATILITY INDEX CLIMBS A HUGE 3.08 POINTS TO 20.44/ITALIAN BOND SPREAD/GERMAN BUND SPREAD RISES ABOVE 3.00 TO 3.04/CHINA REPLACES THE USA WITH RUSSIA IN THE PURCHASE OF SOYBEANS/FIFTY MILLION APARTMENTS ARE EMPTY IN CHINA IN A NIGHTMARISH SCENARIO/CARIGE BANK IN ITALY BAILED OUT TEMPORARILY BY OTHER ITALIAN BANKS BUT THE SITUATION IS DIRE/MALAYSIA SEEKS FULL REFUND FROM GOLDMAN SACHS IN SCANDALOUS 1MDB AFFAIR/SURE LOOKS LIKE VOTER FRAUD IN FLORIDA AND MAYBE ARIZONA/MORE SWAMP STORIES FOR YOU TONIGHT
While the sanction war America started against Russia in 2013 appears to have opened the door to de-dollarization, Washington’s latest gambit towards Iran seems to have fully opened the floodgates. And that is because the latest country to willingly accept trade outside the dollar just happens to be a long-standing ally of the U.S..
As reported last week, shortly after SWIFT caved to US pressure and defied the EU announcing it would cut off a selection of Iranian banks, on Monday, the US Treasury said the Iranian Central Bank has been officially cut off the SWIFT financial messaging system. The disconnection, which comes at a time when Iran’s economy is reeling and its currency is tumbling as a result of restricted oil exports (albeit offset by numerous temporary waivers for top Iranian oil clients), will made it far more difficult for the Islamic Republic to settle import and export bills.
It’s not pretty.
Precious metals were lower in quiet trade this week, which was dominated by the mid-term elections and a strong dollar. Gold was down $12 from last Friday’s close at $1220 in early European morning trade today (Friday) and silver down 40 cents at $14.34 over the same time-scale.