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Gold/Mining/Energy : Beat the Tiger on the Street

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To: Proud Deplorable who wrote (85)	9/17/2011 10:13:27 PM
From: Nixpix	of 87

Armstrong just posted his latest report on Gold and mentions PAGE "The latest craze is about PAGE (Pan Asia Gold Exchange). Somehow the new Chinese gold market will be an “*honest” market compared to US and Europe. People have distorted this issue of spot v. futures* claiming the futures market is dictating the spot market and somehow this should be the other way around and it is evil. Some imply this is why gold is not $10,000 right now. They further argue that the US/European spot market is not real for you own no real title to a specific bar of gold. You can say the same thing about a $20 bill you deposit in a bank. When you go back and withdraw the $20, it will not be the same actual note. If you buy a stock it too is in “*street name” unless you take delivery for only then will it be actually issued in your personal name. This is the way EVERYTHING* functions. It is not abnormal. Title does not exist in anything unless you take delivery. If you invest in a mutual fund, you no longer have title to that specific money. The PAGE market will be a 10 ounce 90 day contract and it will be in renminbi. This story is being spun to make people think that magically positions will now gravitate to China from COMEX and London because of the lack of title. This is just nonsense. This would then create a contango because PAGE will be traded in renminbi. You will then have currency risk. Nonetheless, people making up these stories to justify buying gold are missing the real point of this contract in renminbi. In other words, what China is doing is flying an indirect way to trade its currency. You will be able to arbitrage the gold stripping out the renminbi. China and its central bank are NOT stupid. The people I met with in the central bank in Beijing were traders, not academics. They know PRECISELY what they are doing. This is opening the door to indirect currency trading. From their perspective, this will allow them to experiment with a free floating currency without it directly affecting the exchange rate. It is a clever black market derivative." martinarmstrong.org

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