Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Claude Cormier who wrote (65778)	3/15/2001 10:34:05 AM
From: teevee	Read Replies (3) \| Respond to of 116984

Claude, IMO, the MM of the gold market are not the Central banks but rather the large banks (or their bullion division). They are the ones who control the leasing of the gold from the CB's and the subsequent dumping on the market. The small sales by CB are a drop in the bucket compared to the zillions tons manipulated by the banks. Ah...but you are talking about the "fiat gold" market. The volume of paper gold traded every year is over 1000 times the physical or real gold market. The paper gold market is what provides the liquidity for mining companies and hedge funds to sell forward and industrial consumers to manage their input costs. As for the rest of the paper gold market, it is just another "zero sum game" where no real gold is required or actually wanted. No one other than industrial consumers or gold miners wants to take delivery or deliver. What I was talking about was the buying of real gold. I remember line ups around the block in the early 1980's to buy gold because folks were afraid that their money was becoming worthless. Some of the "solutions" the central banks advocated at that time, in addition to colluding to sell physical metal when necessary in order to maintain confidence in the system, was for all nations to get off the gold standard and the creation of paper gold trading mechanisms such as gold certificates, gold futures and options. The commercial banks and the commodity exchanges happily agreed. This allowed the banks to make a return on their bullion by lending, leasing and writing covered calls. In short, gold is now just another commodity. IMO, if every one purchased just one additional piece of gold jewelry for their significant other, that would have more effect on the POG than anything else-its called supply and demand:-)). The effects of all these changes have been positive for most everyone: the price of gold is more affordable today than almost at any other time; getting off the gold standard has allowed central banks to increase and manage the money supply-this has created the opportunity for an absolutely unprecedented 30 years of economic expansion and higher standard of living. As I said-long live the commoditization of gold.