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Supply And Demand In The Gold And Silver Futures Markets
Authored by Paul Craig Roberts and Dave Kranzler,
This article establishes that the price of gold and silver in the futures markets in which cash is the predominant means of settlement is inconsistent with the conditions of supply and demand in the actual physical or current market where physical bullion is bought and sold as opposed to transactions in uncovered paper claims to bullion in the futures markets. The supply of bullion in the futures markets is increased by printing uncovered contracts representing claims to gold. This artificial, indeed fraudulent, increase in the supply of paper bullion contracts drives down the price in the futures market despite high demand for bullion in the physical market and constrained supply. We will demonstrate with economic analysis and empirical evidence that the bear market in bullion is an artificial creation.
The law of supply and demand is the basis of economics. Yet the price of gold and silver in the Comex futures market, where paper contracts representing 100 troy ounces of gold or 5,000 ounces of silver are traded, is inconsistent with the actual supply and demand conditions in the physical market for bullion. For four years the price of bullion has been falling in the futures market despite rising demand for possession of the physical metal and supply constraints.
We begin with a review of basics. The vertical axis measures price. The horizontal axis measures quantity. Demand curves slope down to the right, the quantity demanded increasing as price falls. Supply curves slope upward to the right, the quantity supplied rising with price. The intersection of supply with demand determines price. (Graph 1)
A change in quantity demanded or in the quantity supplied refers to a movement along a given curve. A change in demand or a change in supply refers to a shift in the curves. For example, an increase in demand (a shift to the right of the demand curve) causes a movement along the supply curve (an increase in the quantity supplied).
Changes in income and changes in tastes or preferences toward an item can cause the demand curve to shift. For example, if people expect that their fiat currency is going to lose value, the demand for gold and silver would increase (a shift to the right).
Changes in technology and resources can cause the supply curve to shift. New gold discoveries and improvements in gold mining technology would cause the supply curve to shift to the right. Exhaustion of existing mines would cause a reduction in supply (a shift to the left).
What can cause the price of gold to fall? Two things: The demand for gold can fall, that is, the demand curve could shift to the left, intersecting the supply curve at a lower price. The fall in demand results in a reduction in the quantity supplied. A fall in demand means that people want less gold at every price. (Graph 2)
Alternatively, supply could increase, that is, the supply curve could shift to the right, intersecting the demand curve at a lower price. The increase in supply results in an increase in the quantity demanded. An increase in supply means that more gold is available at every price. (Graph 3)
To summarize: a decline in the price of gold can be caused by a decline in the demand for gold or by an increase in the supply of gold.
A decline in demand or an increase in supply is not what we are observing in the gold and silver physical markets. The price of bullion in the futures market has been falling as demand for physical bullion increases and supply experiences constraints. What we are seeing in the physical market indicates a rising price. Yet in the futures market in which almost all contracts are settled in cash and not with bullion deliveries, the price is falling.
For example, on July 7, 2015, the U.S. Mint said that due to a “significant” increase in demand, it had sold out of Silver Eagles (one ounce silver coin) and was suspending sales until some time in August. The premiums on the coins (the price of the coin above the price of the silver) rose, but the spot price of silver fell 7 percent to its lowest level of the year (as of July 7).
This is the second time in 9 months that the U.S. Mint could not keep up with market demand and had to suspend sales. During the first 5 months of 2015, the U.S. Mint had to ration sales of Silver Eagles. According to Reuters, since 2013 the U.S. Mint has had to ration silver coin sales for 18 months. In 2013 the Royal Canadian Mint announced the rationing of its Silver Maple Leaf coins: “We are carefully managing supply in the face of very high demand. . . . Coming off strong sales volumes in December 2012, demand to date remains very strong for our Silver Maple Leaf and Gold Maple Leaf bullion coins.” During this entire period when mints could not keep up with demand for coins, the price of silver consistently fell on the Comex futures market. On July 24, 2015 the price of gold in the futures market fell to its lowest level in 5 years despite an increase in the demand for gold in the physical market. On that day U.S. Mint sales of Gold Eagles (one ounce gold coin) were the highest in more than two years, yet the price of gold fell in the futures market.
How can this be explained? The financial press says that the drop in precious metals prices unleashed a surge in global demand for coins. This explanation is nonsensical to an economist. Price is not a determinant of demand but of quantity demanded. A lower price does not shift the demand curve. Moreover, if demand increases, price goes up, not down.
Perhaps what the financial press means is that the lower price resulted in an increase in the quantity demanded. If so, what caused the lower price? In economic analysis, the answer would have to be an increase in supply, either new supplies from new discoveries and new mines or mining technology advances that lower the cost of producing bullion.
There are no reports of any such supply increasing developments. To the contrary, the lower prices of bullion have been causing reductions in mining output as falling prices make existing operations unprofitable.
There are abundant other signs of high demand for bullion, yet the prices continue their four-year decline on the Comex. Even as massive uncovered shorts (sales of gold contracts that are not covered by physical bullion) on the bullion futures market are driving down price, strong demand for physical bullion has been depleting the holdings of GLD, the largest exchange traded gold fund. Since February 27, 2015, the authorized bullion banks (principally JPMorganChase, HSBC, and Scotia) have removed 10 percent of GLD’s gold holdings. Similarly, strong demand in China and India has resulted in a 19% increase of purchases from the Shanghai Gold Exchange, a physical bullion market, during the first quarter of 2015. Through the week ending July 10, 2015, purchases from the Shanghai Gold Exchange alone are occurring at an annualized rate approximately equal to the annual supply of global mining output.
India’s silver imports for the first four months of 2015 are 30% higher than 2014. In the first quarter of 2015 Canadian Silver Maple Leaf sales increased 8.5% compared to sales for the same period of 2014. Sales of Gold Eagles in June, 2015, were more than triple the sales for May. During the first 10 days of July, Gold Eagles sales were 2.5 times greater than during the first 10 days of June.
Clearly the demand for physical metal is very high, and the ability to meet this demand is constrained. Yet, the prices of bullion in the futures market have consistently fallen during this entire period. The only possible explanation is manipulation.
Precious metal prices are determined in the futures market, where paper contracts representing bullion are settled in cash, not in markets where the actual metals are bought and sold. As the Comex is predominantly a cash settlement market, there is little risk in uncovered contracts (an uncovered contract is a promise to deliver gold that the seller of the contract does not possess). This means that it is easy to increase the supply of gold in the futures market where price is established simply by printing uncovered (naked) contracts. Selling naked shorts is a way to artificially increase the supply of bullion in the futures market where price is determined. The supply of paper contracts representing gold increases, but not the supply of physical bullion.
As we have documented on a number of occasions, the prices of bullion are being systematically driven down by the sudden appearance and sale during thinly traded times of day and night of uncovered future contracts representing massive amounts of bullion. In the space of a few minutes or less massive amounts of gold and silver shorts are dumped into the Comex market, dramatically increasing the supply of paper claims to bullion. If purchasers of these shorts stood for delivery, the Comex would fail. Comex bullion futures are used for speculation and by hedge funds to manage the risk/return characteristics of metrics like the Sharpe Ratio. The hedge funds are concerned with indexing the price of gold and silver and not with the rate of return performance of their bullion contracts.
A rational speculator faced with strong demand for bullion and constrained supply would not short the market. Moreover, no rational actor who wished to unwind a large gold position would dump the entirety of his position on the market all at once. What then explains the massive naked shorts that are hurled into the market during thinly traded times?
The bullion banks are the primary market-makers in bullion futures. They are also clearing members of the Comex, which gives them access to data such as the positions of the hedge funds and the prices at which stop-loss orders are triggered. They time their sales of uncovered shorts to trigger stop-loss sales and then cover their short sales by purchasing contracts at the price that they have forced down, pocketing the profits from the manipulation
The manipulation is obvious. The question is why do the authorities tolerate it?
Perhaps the answer is that a free gold market serves both to protect against the loss of a fiat currency’s purchasing power from exchange rate decline and inflation and as a warning that destabilizing systemic events are on the horizon. The current round of on-going massive short sales compressed into a few minutes during thinly traded periods began after gold hit $1,900 per ounce in response to the build-up of troubled debt and the Federal Reserve’s policy of Quantitative Easing. Washington’s power is heavily dependent on the role of the dollar as world reserve currency. The rising dollar price of gold indicated rising discomfort with the dollar. Whereas the dollar’s exchange value is carefully managed with help from the Japanese and European central banks, the supply of such help is not unlimited. If gold kept moving up, exchange rate weakness was likely to show up in the dollar, thus forcing the Fed off its policy of using QE to rescue the “banks too big to fail.”
The bullion banks’ attack on gold is being augmented with a spate of stories in the financial media denying any usefulness of gold. On July 17 the Wall Street Journal declared that honesty about gold requires recognition that gold is nothing but a pet rock. Other commentators declare gold to be in a bear market despite the strong demand for physical metal and supply constraints, and some influential party is determined that gold not be regarded as money.
Why a sudden spate of claims that gold is not money? Gold is considered a part of the United States’ official monetary reserves, which is also the case for central banks and the IMF. The IMF accepts gold as repayment for credit extended. The US Treasury’s Office of the Comptroller of the Currency classifies gold as a currency, as can be seen in the OCC’s latest quarterly report on bank derivatives activities in which the OCC places gold futures in the foreign exchange derivatives classification.
The manipulation of the gold price by injecting large quantities of freshly printed uncovered contracts into the Comex market is an empirical fact. The sudden debunking of gold in the financial press is circumstantial evidence that a full-scale attack on gold’s function as a systemic warning signal is underway.
It is unlikely that regulatory authorities are unaware of the fraudulent manipulation of bullion prices. The fact that nothing is done about it is an indication of the lawlessness that prevails in US financial markets.
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- Big PM Buyers Can Buy Private/Own Production
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This is not that hard to figure out. The real problem is that people are fucking brain dead stupid and have been trained to like looking at large numbers without ever considering the actual purchasing power a large number actually has, if any. There must be metal out there because I keep recieving it and I have never bought more metal in my life than I have so far in 2015 but it never shows up quickly. I buy from a lot of dealers so I see the market up close and not short of bullion right now. I have been buying bullion and sometimes selling since 1999. I get the game.
I caught the blow off top a few years back and worked well for me. Now I have been catching the proverbial falling knife since, or trying to, and it has not been great. That is how I play the game but I left out a few key pieces of information. One of those keys is how much you by at one time. Only a fool would go all in at any price. You have your timer folks as well but therin lies the key difference between a paper trader and bullion trader. Do you have the metal or not? I do not trade paper bullshit on margin through an exchange. Only somebody that wants to lose a lot of money fast would do that and I think some people do. You can't margin call me.
I think a lot of people try leveraged paper trading and get burnt in the PM markets and then bitch about that market because they lost a quick but rather than making a quick buck. That's crying over spilled milk. I think we all know that the boyz run naked shorts against the complex anytime they want to. A lot of people bitch about it and I have too but you also have to wonder just how far down the price can go before something has to give and how much time do you have to wait?
How to use that bullshit to our advantage? Well, let's go back to basics. What do we know about all of the current financial systems in the world? Right, they must collapse. Therefore, it is actually possible for gold or silver to be worth nothing because there will be nothing to value it against. Anything can be worth nothing. Value is percieved or legislated. We hear all of the time that gold will never be worth nothing don't we? That is only the case if what we are attempting to value gold against some asset that is also worth nothing. All assets have another value that is intrinsic...scarcity and neccessity demand.(not to be confused with aggregate "I want everything" demand. It is easy for me to dismiss the "gold is dead money" bullshit because I think that FaceBook stock is worthless for the reason that it relies so heavily on outside inputs to make it work.
I do not care where the bottom of the PM market is so long as I can buy the physical metal. That is all that matters to me and that is what I do and wait. It doesn't matter as we will all die anyway but the metal never dies. I have children and they will pay no inheritance taxes that is for sure.
"How to use that bullshit to our advantage? Well, let's go back to basics. What do we know about all of the current financial systems in the world? Right, they must collapse. Therefore, it is actually possible for gold or silver to be worth nothing because there will be nothing to value it against. Anything can be worth nothing. Value is percieved or legislated. We hear all of the time that gold will never be worth nothing don't we? That is only the case if what we are attempting to value gold against some asset that is also worth nothing. All assets have another value that is intrinsic...scarcity and neccessity demand.(not to be confused with aggregate "I want everything" demand. It is easy for me to dismiss the "gold is dead money" bullshit because I think that FaceBook stock is worthless for the reason that it relies so heavily on outside inputs to make it work."
Good analogy of the value of something trading for something else. Learning to look at valuations detached from $ denominations is quite a good practice and keeps things in perspective.
I like to think that 1 ounce of gold will probably get me 1 acre of fertile land somewhere sometime when I want it, regardless of $ valuations on land or gold. That is a fair trade in my mind.
I agree price is rigged..and PCR is the best.
but... supply in gold is a constant on world mine production.. it can only go down as mines close... and upside supply is very limited, so the graphs here do not apply..
so... price goes down, mines close, supply goes down, .. demand goes up...
Given what's going on...
supply should be a horizontal straight line, or down with increased manipulation. Demand line , perhaps inverted a little, but all the gold is sold... the demand does not go down.. it's always bought up.
Price perhaps should be a third line..taken off the axis... as it cannot travel up the axis.. only within a range..
What a bizarre world we live in....
hang the neo cons
People who rely on charts in this environment for stocks, gold, etc are living in la la land...
Selling short 5000 GC futures in one millisecond and buying back at lower price is not manipulation,
is a risky strategy but is not manipulation is free-market
that's it
Tberefore the free market is a swindle. Amirite?
Selling a large volume for the pure purpose of affecting the share price is manipulation, in fact the definition.
Selling 13 tons of 'paper' gold in 4 seconds in a thin market pushes the price down, overshoots as others bailout. This is pure manipulation, even if they then buy back in at the lower price. In fact that makes it even worse. Likewise, dropping 400 tons of gold in a morning.
In order to understand gold as money, you have to break the mindset of valuing it in Federal Reserve notes or any other funny money. Gold is a relatively rare commodity that has certain qualities such as not corroding, being refinable to high purity and being easily divisible. As money, it is simply a convenient commodity to trade for other needed commodities, and, as such should be valued in terms of other commodities. This gives the best sense of how it has held its value not over the last five years, but over the last several hundred years. As a comparison, you can download the Cole report (Excel format) which tabulates the price of various commodities in American cities from about 1750-1861. Using a price of $20.67/ounce for gold (real PM backed dollars), you can calculate the average amount of commodities that an ounce of gold would purchase. I started in 1800 to avoid doing conversions from other monies that were in circulation prior to then. During that period, an ounce of gold would buy about 225 pounds of beef or bacon. Today, an ounce of gold will purchase about the same. That is how gold preserves wealth, not thru market speculation. I am sure that there are other studies that could be used and adjustments would need to be made for population growth, gold supplies, etc. to set current purchasing power of gold. That will be a complete re-education in thinking for the populace after the collapse and reset.
Exactly. It's an insult to an oz of gold and the people who mine / refine it to compare it to printed paper.
somewhat off topic, but please help, could someone explain how re-pricing gold works?
FDR did that, but how does that give us more money? was that much more paper currency issued accordingly? if so, wouldn't the prices of all adjust accordingly, and the end effect be equivalent not re-pricing?
if an economy's currency is not backed by gold, and it re-prices gold, would that effectively make it's currency gold-backed?
now, if such an economy re-prices gold, and with a right percentage of its paper currency to its gold reserves, it may print more paper currency than there is today. the additional can therefore be used to fill debt holes for example?
whatever mechanism, the additional paper currency is not free, everyone in that system would be paying for it, right?
how does it work?
what's so attractive about re-pricing gold that made FDR do it?
all explanations/comments/views/opinions welcome!
The Creature from Jekyll Island is a good place to start.
Currently gold and fiat money are not linked, therefore all the fiat money can be printed that one can imagine... and they do create it almost to infinity with respect to derviative risk liabilty now over a quadrillion...
Gold price is suppressed by selling fake 'naked' future contracts or gold they do not have and cannot deliver... they don't want people to see that gold is highly valued, as that would make people lose faith in the fiat dollar, euro, etc...
USA likes Fiat money as they hold the world reserve currency status... people want their money as it is used in trade... this gives USA an advantage to print money from thin air and exchange it for real goods from other nations...Rest of world is tired of this and wants fair money for fair exchange.
x
if a nation such as China backed it's currency by say 3%, then people would want this chinese money moreso than Fiat USA money... as it is linked to gold. Unless people think that gold is worthless.
IF china sold gold backed bonds, investors would gladly lend money on this... as it has collateral - gold... as opposed to US bonds that shall never be repaid...
ok. that's all good. that's all bad. that's all brilliant. that's all stoopid.
and that's that. now in case of China, it's sort of the same as FDR, we need extra money to fill debt holes with, or invest with, or boost the economy with.
the question is: how does re-pricing gold do the trick for that? how does that work, in China's or FDR's case?
you are missing the point... fiat money was created to infinity for the west... to bororw, lend, to buy things of value but the money has no value... it shall never be repaid..it does not come from making things of value.. it is just created on a computer.
Nations that produce real things do not want this fake money any longer. BRICS... and others...
Gold backing means the money has some sort of value..
Fiat is garbage... you could print your own money and if people had some faith in it, they would assign it a value... when they lose faith in it... they refuse to take it.
i'm missing something, hence i can't understand why FDR repriced gold, but i'm not missing the point mentioned above, for that's not my question.
i'm merely trying to understand what repricing gold did for FDR, and in particular, HOW it did that, the mechanism involved there.
all that have nothing to do with how today is, and what we think about today.
as i said, the question is somewhat off topic, it's a question on HOW repricing gold works, as in FDR's days for example. it is NOT, i repeat NOT, a question about whether repricing gold will solve today's problems or not.
Gold repricing works ONLY if by DECREE there is a gold-to-fiat conversion. That is, for instance, back in FDR's case $35 to an ounce of gold. Thus if the government, that is FDR, came out and said it is now $50 to an ounce, that means your $ has weakened, for you can't buy as much gold as you did before, and everything back then was priced, inherently in gold ounces, but you didn't see that directly.
But that is all academic now. For there is no $ to gold conversion that is DECREED by the government, it is all open market. Sort of. As the article points out, there is REAL PHYSICAL GOLD, and IMPLIED GOLD that is characterized by contracts between traders. The Contratual Gold Contracts assume a position on the gold price for the future. The problem is though, future contracts of gold and the real gold price of gold when gold reaches that assumed contract date, NEVER correlate.
In short, futures on gold, is meaningless, and people are realizing there is no creditable alignment between the futures and the real gold. Hence if you were to buy real gold, it is more expensive than you expect it to be if you read it on a futures contract in the past for your present time, and so lots traders are losing money in gold futures trading because the real world is not the same in the financial world, and its in the real world where you have to make real money, not in the fantasy of the financial world.
Thus, today, re-pricing of gold is meaningless. For gold is now open market and freely traded and is not controlled by the state. UNTIL, in the case say of the US, if executive orders are released, like the one that FDR did in 1933, ORDER 6102.
This is why, dispite and against all the stupid financial commentary that experts say that gold is finished, why gold is being hoarded right now, big time!
Gold's day is to come. Its too early yet. Right now you will a big push in the drop of gold price, all because, a lot of people have betted wrong, and need to cover their loses. Gold will drop in price as the sell off continues, but the smart money is buying gold and getting ready for roaring 20's we will see again.
Treat gold as insurance, keep some for that day when it all goes to hell. For only gold will keep its value, fiat currency will be changed by edict.
The US was on a gold standard. Revaluing higher in dollars meant they could print more money and still be backed with the same amount of gold.
yes, got that.
but with the same amount of products/services, the prices of all things would just automatically adjust to that increased amount of money, than the only thing achieved is all prices change from smaller numbers to bigger numbers, which is to say we don't get extra free money at all. so what's the point of re-pricing gold then? bigger or smaller numbers are irrelevant to lack of money to invest with, which was the problem FDR was supposed to be facing then?
i must be missing something here, otherwise why would FDR do it?
"the prices of all things would just automatically adjust to that increased amount of money"
The US was in a DEPRESSION. Prices did not jump up so the same old banksters got what they wanted, for a while, free money.
Production high,demand low, and a contradiction of from where new demand will come from (or from what)
Debt plays here ,debt rigging there, how do you put gold reserve demand in the middle of this?
You have to issue the arrest warrants for the members of Federal Reserve. The criminals have taken control and need to be stopped before the get us all killed.
We no longer need them and especially not in a criminal function. We have technology that can really do the job that is needed.
Gold also has very strong cultural social history. People are not fooled. Its valuable. Russia is buying physical gold strongly now, taking advantage of the Wests artifically manipulated low prices. Lol.
I didn't buy any pms this week but I got a hold of two little pails of Remington .22s ...2800 shots.
...turning paper into lead so to speak.
These pm price smash downs happen often at the end of the month, when the COMEX boyz are scrambling to settle paper accounts.
edit...it's still relatively easy to order actual bullion, but buying .22s is a sob. I was quite proud snagging the bullets this week.
It was five hours from home, that I finally found some, and the rule was only one per customer...but I scammed a second one. The silver and gold dealers will still do it over the phone as much as you want...for now.
Please tell us what the deal is with 22LR! 9mm and other calibers have been easy enough to get lately. I haven't even asked about 22LR for a while now. I've heard it is finally available on occasion. "On ocassion" means in the store for more than twenty minutes.
Is it the next SHTF currency or something? There have to be some people with absolute truck loads (OK, shitloads) of the the damn things.
Back to killin' snakes...
I've bought three Ruger 10-22s in the last year. Go on your search engine and look up 10-22 automatic fire. They are a neat little item, under the radar...and very nasty. 120 shot clips are available. I think alot of guys are burning .22LR bullets through them on you tube.
a bet on a horse race, is not a promise to deliver a horse, or several horses, later
Utter BS article
Gold is *not* money. its an asset. its taxable. your deposits are not (yet) taxable
Gold market is *NOT* manipulated.
There are abundant other signs of high demand for bullion, yet the prices continue their four-year decline on the Comex.
BS the market is dropping because there are sellers. who is selling ? people who bought on the way up at the wrong prices. for example, institutional investors piling into GLD ETF. or leveraged Chinese speculators forced to liquidate...
As we have documented on a number of occasions, the prices of bullion are being systematically driven down by the sudden appearance and sale during thinly traded times of day and night of uncovered future contracts representing massive amounts of bullion
oh yeah ? if it was so easy, people would try it also the other way. buy a lot of futures contract at thinly traded times of the day.
the truth is there are stop losses being taken in Asia. when you're a broker and have a stop loss order, you execute immediately, thats your fiduciary responsability. if you wait a bit more, the stop loss execution may be even worse. the guys who put their orders in asia time causing a 10$ drop when the market was at 1600$ is not looking foolish at all today though at the moment of execution, he might have....
BS is you
Oh very simple, just send me over some gold. I'll send you down some paper which the call "money"...And not it does not matter at all if gold would raise against funny papers. That is quite absurd isen't it. It' so terrible hard to print some more paper mone, but making some grams o gold is easy... Yes that makes sense. Strange enough still that gold is now aroudn 1100 USD/ounce, And has been left in 1971 with 35 USD /ounce. Hard to understand? Or are you just playing devils advocate?
so what ? what was the price of a picasso or a stamp collection in 1971 ? or of a burger ?
invalid argument.
"the truth is there are stop losses being taken in Asia."
You actually looked at the data to come up with that conclusion? Something like a $1.5 billion dollar stop loss, that dude must have deep pockets.
1.5bn$ of volume doesn't mean somebody sold 1.5bn$ worth of futures.
if the market is illiquid, the same 1.5M$ may have traded 1000 times for every cent of those 10$ down between the only 2 market makers awake hitting each other because they don't want the hot potato...
There have been some very good articles describing the overtrading in paper futures. A clarification needs to be made about the term "naked shorts". Although commonplace this term in incorrect. I have used it myself incorrectly so am not casting dispersions. A naked short is an illegal transaction. The transactions on the Crimex are not illegal as they involve selling against an existing or newly created futures contract with a buyer on the other end. http://www.investopedia.com/terms/n/nakedshorting.asp
But let's not get too anal retentive about this. The bottom line is these transactions, especially coming from speculators, in spirit are naked as there is no expectation of transfer of the underlying asset. Producers and processors hedge, but the speculators who now totally dominant paper trading are effectively just gambling. They have also destoyed price discovery and the orginial purpose of a futures market.
these contracts will never be honoured in phys... just US fiat money
FDR's day was different than today... US needed a gold chest... to base it's money supply on compared to other nations..
as to value... tell me, what is the most you would pay for a Van Gogh painting? $100? $100,000,000?
If you were selling a used car that you own, will you take Zimbabwe currency?
If you are in the desert without water for days… how much will you pay for a jug of cool clean water?
If you are China and produce manufactured goods, and are given crates of US dollars, and they seem to just create more and more and more US dollars as if there is no end… Would you continue to accept them as payment? Or would you want something more valuable?
The FED had no choice but to force gold and silver down, it would have unmasked the true inflation numbers. Fucking assholes.
There is simply too much paper currency in today's world.
PM prices have to be crushed or the whole game falls apart.
I have a feeling that the physical markets in China will shrug off the BS paper prices in the US and gold in china will sell at a much higher price there... that's when the whole shit house goes down....
The paper market has no tangible relationship with the physical market if settlements are all in cash. Therefore the supply/demand status is only relevant if the traders decide so.
the settlement of COMEX contracts is in physical gold. wake up.
Uh....actually about 98% are settled in cash, very few are settled by delivery.
Yep...you know fuck all about gold on the COMEX... eventually you guys say something that makes it obvious.
Fed from inception has been a ill intent private bank by the cabal banksters.
Fuck me. Another article explaining the manipulation. Just what I needed to read. NOT!
How about an article describing how/when this blatant-shit comes to an end?
The way I see it, it's not gonna end. All the physical in the world can be bought-up and gone and yet it will still trade in a narrow band well below it's true price.
Can't wait to read another iteration of this article in 6 months. Every day KWN say's the bottoms about to drop-out yet nothing changes.
Too be cont.
Just a reminder. the largest gold holders are central banks. And they still are the providers for what they call money. Now imagine how it would look if the "useless" PM especially gold would rais as dramatically as the new generated money. How would that fall back to the central banks?
So they must keep every raising as much in check as they can. But in the end the perverse system comes to a perverse conclusion. The central banks will print more money and at some point the confidence in the paper money breaks, see the prices for gold e.g in RM (old german Mark)
https://en.wikipedia.org/wiki/Hyperinflation_in_the_Weimar_Republic
So there's not practical limit in the price of gold in whatever paper-money. So I even can argue if the pric raises over a few hundred thousand Dollar / Unze, all debsts can be served with just the 8000 t of Gold the FED is supposed to have. (Many just doubt that AFAIKT)
Anyway, if people are intelligent they will start selling of there funny paper-money. But one should not have any illusions about the stupidness of men. There is no practical limit on this either. So they will do believer what benks or central banks will tell them. Reality will beat them harshly, in the longer run
So nothing really is so "wonderous". It's manipulation to keep the Ponzi-Scheme that our currencies are running. That's what every dipp currently cries out. If you do not believe that ask yourself, how can it be that something that is limited loose value against a thing which can be produced by just typing in a few numbers? Sorry the paper-moneyes are the problem, gold is not the problem.
In the End my name will beat and stick. Gold is money. dot.
I have to call BULLSHIT on this.
THERE IS NO SHORTAGE OF GOLD OR SILVER FROM ANY RETAIL ONLINE SUPPLIER including but not limited to APMEX or Provident Metals, the two largest online metals dealers.
IN OTHER WORDS:
NO PROBLEM GETTING METALS IF YOU WANT THEM.
Great! Why don't you order some silver eagles for immediate delivery!
This is a good, thought provoking article.
a lot of people lose their mind with gold.
You guys should look (again) at Humphrey Bogart in the treasure of the Sierra Madre...
there's no shortage of gold. there's no shortage of stupidity from those crying for manipulation, there's only a shortage of dollars in their pocket to buy more of the gold on offer...
in the biggest avenues of NYC, London and Tokyo, Singapore or Geneva its possible to buy millions worth of gold bars every business day and without any notice.
Of course, one cannot find those shops on the nearest shopping mall or on internet.
Economists do not understand markets because they are not rational. The key component is that too big to fail banks have a cartel on the market. They can and do mainiupate prices. This makes even the most basic economic obsolete in the short/medium term. Eventually though, they will be proven right. This will not happen until there is a run on gold, markets panic, and the dollar crashes.
Watch for it.
Wait wait, I get it now! When golden nuggets skyrocket to $1900/oz:
NO MANIPULATION!
When golden nuggets drop to $1000/oz:
YES MANIPULATION!
Are you people really that stupid to evoke the 'hey you cheated!' line when you lose a battle but not when you win? No wonder you're so damn poor! You're afraid to actually work for income. You expect it to magically appear from your useless shiny rocks!
Wait wait, I get it now! When golden nuggets skyrocket to $1900/oz:
NO MANIPULATION!
When golden nuggets drop to $1000/oz:
YES MANIPULATION!
Are you people really that stupid to evoke the 'hey you cheated!' line when you lose a battle but not when you win? No wonder you're so damn poor! You're afraid to actually work for income. You expect it to magically appear from your useless shiny rocks!
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