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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (44499)	11/3/1999 7:26:00 AM
From: tyc:>	Read Replies (1) \| Respond to of 116762

Your was a very important post ! Thank you! gold loans by central banks; Would someone please explain ! I thought gold loans simply enabled bullion banks to deliver into the spot market when a mining company sells forward. Do they also support SPECULATIVE short selling ? If a speculator borrows the gold and sells it, and the price goes up he will make the same loss as he would naked when he buys back the gold to return his borrowings. Anyway what's the difference ? I feel sure that the mining companies forward-sell just because they are speculating that the price of gold will not go up and that short sales are profitable in a falling market. As soon as they start to speculate that gold is not falling, that forward sales are no longer profitable, they will buy back their shorts. If this is so, it is the best possible situation for the price of gold, for it will increase demand just as their forward sales increased supply.