Posted on 12/04/2008 11:44:24 AM PST by Vince Ferrer
Very interesting. Something’s definitely up with gold prices — they have not been acting the way you’d expect them to in a situation like this.
FDR tried to manupulate gold prices in the late 20s.
>>Very interesting. Something’s definitely up with gold prices — they have not been acting the way you’d expect them to in a situation like this.<<
I firmly agree. I’ve been watching the price the last few months and it makes absolutely no sense. But then, neither did the nasdaq in early 2000, if you get my drift.
Only in reverse...
Ping for later reading.
The most interesting part, Gold Short Sellers moving in contra to the price of gold elsewhere is not fleshed out other then to say “the Fed and the short sellers are old friends”..but a market will make a dollar, where is the specific collusion?
It’s the same problem with Gold, the market is too shallow and easily manipulated.
Revaluation of gold, and a return to the gold standard, is the only way that hyperinflation can be avoided while large numbers of paper currency units are released into the economy. This is because most of the rise in prices can be filtered into gold. As the asset value of gold rises, it will soak up excess dollars, euros, pounds, etc., while the appearance of an increased number of currency units will stimulate investor psychology, and lending and economic output will increase, all over the world. Ben Bernanke and the other members of the FOMC Committee must know this, because it is basic economics.
—bflr—
As terrible a vista this might be, consider that Hyper Inflation is not the highest of their worries, Ben “Chopper” Bernanke has said that Inflation, which eats the value of debt instruments, is not a bad thing..it saves Governments money in the long run..
I’d love to know if those investments houses like Goldman Sachs were using Fed Money to purchase gold deliveries to dump on the market down the road.
BFL
Pure crap.
Pure manipulation.
.
And where will silver go? If the country goes back on the gold standard, will the government call in all gold as in the past?
“””In spite of an avalanche of complaints from gold and silver investors, the CFTC (Commodity Futures Trading Commission) has never bothered to audit even one vault to see if the short sellers really have the alleged gold and silver they claim to have”””
Reminds of the naked shorting controversy with stocks.
A fixed market where the retail guy gets screwed every time.
I really am getting the feel like the 8 or so old family members I have buried in the last ten years had who lived through the last depression. - put the money in the mattress, do not trust bakers, stock brokers or anybody else.
They had a good reason.
One thing good about the change in the economic climate is the deafening silence from the rabid free traders and the quit talking down the economy crowd. Peace
I have no idea. I am agnostic as to what is going to happen, but I am interested in trying to see how the economy will play out. I don’t know enough about precious metals to be able to forecast.
“”””If the country goes back on the gold standard, will the government call in all gold as in the past?””””
Lots of argument of that front - Capital and currency controls already exist in some form (limit of $10,000 notification if you take more than that out of the country)Fact is they can do anything they want, if you go to sell it they could tax 95% of the profit.
I have bullion stored at the Perth mint in Australia and some in a stock:GTU - I suppose if it got that bad I could take my certificates to Australia or Canada and cash them in there.
In a emergency the government will do whatever it damn well pleases confiscate Savings (IRA, 401ks) and other property.
Just depends on how bad it gets which is anybody’s guess.
We could implode as Iceland or Argentina. stocks go to 1,000 - 3,000 DJIA then the dollar crashes to $0.10.
The Dollar is the last bubble.
Sidenote
Last week I got notice of a bankruptcy from a furniture company who was making me a custom couch - they did beautiful work for me in the past and have been around since 1944. I lost $2,000 dollars on that trade.
Learned my lesson Cash and carry from now on for me.
“Something’s definitely up with gold prices — they have not been acting the way you’d expect them to in a situation like this.”
Exactly as I see it. Look at the premium (and price) being asked for coins and bullion, (if you can find any), then look at the price of say, a big gold stock Goldcorp,(GG) over the last year?? I know mining stocks don’t always follow the metal itself but they usually do.
My view of the central banks keeping the price down is, because historically, gold/silver have been the ‘early warning system’ of troubled times, and esp. *the* inflation hedge. I think they’re trying to cover up how bad the problem is.
Precious Metals Ping List
Another interesting article .
While I don't personally agree with all of the conclusions,
( For instance: the expectation than any industrialized nation will ever return to the gold standard is laughable IMHO
the background info is useful.
--------------------------------------------------
Some examples:
Every time gold (or silver) is physically moved there is considerable expense in re-assay (mandatory) and of course logistics.
Mining and associated yield of those metals is intimately tied to production of geochemically related resources, lead, tin, zinc, etc. and by such, intimately tied to world economic production,
Both gold and silver have real world technical use which can fluctuate depending again on world economics and technology.
Oil is traded on a spot market with sporadic paper manipulations, but the very graphic, and unrelenting, end game, is its physical exploitation. Precious metals, being not so tightly coupled, are clearly more subject to paper manipulation, but how much more? Perhaps not as much as a pin-stripe suited Fed Reserve geek in a leather chaired boardroom wishes to think. Does anyone know if Ben Bernanke has ever worked in the silver mines of Peru?
Thus there can be a host of "instruments" conjured by the financial guru's, just as we could conjure say some "insurance" instrument associated with the transfer of the metal, or just as negotiable distributable debt instruments were conjured for the mortgage realm. But then Humpty Dumpty reigns.
Energy incidentally, Joules, Ergs, BTU's, etc. is the normalized parameter of man's material prosperity.
Johnny Suntrade
.
Naked short selling is a scourge. I for one will not invest any money in the US equity or commodity markets until this issue is addressed seriously. The means to prevent naked short selling exists, but no will.
It is already illegal to intentionally sell short without the means to deliver but nobody is policing it. Nobody is forcing a buy-in when the trade fails. Furthermore, market makers and options contract market makers are permitted to naked short sell as a hedging strategy, but that loophole is ripe for abuse since anyone could force an option market maker to naked short sell by taking a large options position.
For crying out loud they even have a list of stocks with inordinate numbers of fails and they don’t do anything other than list them as REG SHO (fail). They don’t investigate who is failing, why they are failing, or force anyone to deliver.
This scam has destroyed or damaged hundreds if not thousands of companies. If you can sell shares that you do not own, cannot locate for borrow and have no intention of borrowing, then you are artificially increasing the supply and putting downward price pressure on the issue.
The markets are unsafe and ripe for fleecing - as everyone with eyes has just seen occur.
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