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Chill out dudes

- Bron Suchecki - Perth Mint

Listing the facts again:
1) Before the chrash, Chinese foreign reserves only were sufficient to buy 69,000 t at the that price
2) At this moment, Chinese foreign reserves converted into gold are worth 76,000 t
3) the total amount of gold on this planet is 160,000 t
4) the total amount of commercialy available gold is 76,000 t
5) at present prices China only can buy all the commercially available gold on the planet
6) China will not allow Bernanke to devalue their reserves, and will not switch to Euro, which, according to Germans, has up to five years to live
7) China will convert their entire foreign reserves into gold, only if they can, trying to keep the market steady as they do
8) China is limited by time constraint (US fiscal collapse) on one side, and gold supply constraint on the other, with gold price limiting (but only before the price chrash) the ammount of gold they can acquire,
9) paper gold market is rigged, since penalty for non-delivery at the contract expiry is symbolic. Having enough cash one can generate any gold price one wants.
10) the interest of China is to bring the paper gold price down, increase physical gold supply (haisten fiscal collapse in EU to force EU reserve gold onto the market), postpone fiscal collapse in US

Conclusion:
It's very likely that China is manipulating both gold and silver markets, using two banks as henchmen. There will be no disconnect, if they can help it, and very soon they will be handling both ends of the trade in both paper and physical markets until all the gold is in China. Then they'll pull the plug, and the lights in the rest of the world will go out .

Commented 4009 days ago

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Beginning of the headline :OK, it is all getting a bit silly out there on the gold interwebs, particularly in respect of the supposed physical-paper price disconnect. I have been trying to kill this meme ever since it first appeared in 2008 but it seems the idea of production capacity shortages seems too difficult for many to get. The "real" price of gold isn't what you pay for a 1oz coin on eBay. As Mish says "Premiums on small denomination coins is not the same a general premium on physical gold itself." But don't ta... Read More

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