Greece, thankfully, remains in the “wings” of the international stage and for that we are grateful for we’d had our fill of Greek related events and trading environs over the course of the past several months. However, just because Greece has moved off the center stage and away from the klieg lights does not mean that the problems there have been resolved for clearly they have not been. Elections are coming next month and wholesale realignments within the Greek Parliament are almost a certainty. We do expect that Mr. Tsipras will be the next Prime Minister, but his “party” shall be wholly different than the Syriza Party of recent vintage. He has been abandoned by his own far left-wing, many of whom have moved off to form their own independent far left wing organization, but he seems capable of forging a better working relationship with the political parties to his right and in the end shall remain the Prime Minister.
Also in the end, we’ve not seen the end of Greece’s fiscal problems for certainly they’ve not been resolved even modestly. The Greek tax payer will remain as reticent about honestly paying their taxes as they’ve been previously, although with better government surveillance they will have to pay more than they’ve paid previously, they will simply “cheat” less. Too, the government will remain manifestly left- of centre and that of course means that the “austerity” forced upon Athens in recent months and years shall in the end be shunted aside. Further, Greece and Russia…two nation’s allied by religion… shall find themselves turning to each other, to the dismay of Berlin, Paris, Brussels and even Washington. In all, the problems that were Greece and which so dominated the news in recent months and which has subsided for a while will soon come back to the fore. Count on it.
As for gold, we are fascinated by the fact that Carl Icahn has begun taking an interest in the gold market by announcing that he’s taken a rather sizeable position in Freeport-McMorRan.1 This follows the recent disclosure that Stan Druckenmiller has recently taken up a sizeable position in gold.2
We are quite certain now that the lows made in US dollar denominated gold several weeks ago at $1075-$1085 are important lows that likely shall not be violated.
1 CNBC Interview, Icahn becomes top Freeport-McMoRan shareholder, By Jacob Pramuk August 27 2015. http://www.cnbc.com/2015/08/27/icahn-takes-stake-in-freeport-mcmoran-making-him-10th-biggest-holder.html
2 Bloomberg, Druckenmiller Buys Gold ETF, Boosts Facebook, Dumps Biotech, By Kenneth Kohn and Simone Foxman August 14 2015 http://www.bloomberg.com/news/articles/2015-08-14/duquesne-adds-to-facebook-sells-illumina-buys-spdr-gold-fund
This article was written by Dennis Gartman. Gartman is editor and publisher of The Gartman Letter, and a strategic partner with the AdvisorShares Gartman Currency Hedged Gold ETFs (GEUR & GYEN) who lends his institutional insight to educate advisors and investors about trading gold in different currency terms.