Wednesday, October 16, 2013

Gold Price Manipulation Receiving More Press

Last Friday gold prices were smacked-down on the COMEX by a huge sell order.  More details are posted here:

The blog-o-sphere from Peter Schiff to Zerohedge was ablaze with commentary about the smack-down.

Gold price manipulation reporting has now gone mainstream as non other than CNBC reported on Friday's market action.  CNBC articles quoted traders.  
"There is only one conclusion that seems logical regarding Friday's gold trade and the one from a month ago, and that's that they were designed to manipulate prices,"
"So huge, in fact, that the trade's impact was felt across the commodity market. Silver and platinum were hit at about the same time, and even crude oil appears to have been affected."

CNBC reporting does not quite put it all together.  Despite reporting on price manipulation they ignore it when discussing gold price action and forecasts.  For example, here is a CNBC video segment where they rationalize short term gold prices with fundamentals ignoring even the possibility of manipulation.    
If gold can't rally now, when can it?Why can't gold rally? D.C. concerns do not help gold, as it shrugs off the Yellen nomination. Gold's next move, with CNBC's Jackie DeAngelis and the Futures Now Traders.
Gold will rally when futures contract holders demand delivery of physical gold in excess of what the COMEX can deliver.  The COMEX will be forced to cash settle revealing the dearth of physical supply.  When the COMEX cupboards are shown to be bare gold investors in GLD will doubt that GLD has physical because GLD's authorized participants are the same banks that run the COMEX.  This doubt will create a run on GLD.  

The run on GLD many have already started.  According to hedge fund manager William Kaye in a King World News interview ". . . when it comes to the ETF GLD, you need about $13 million worth, or 100,000 shares, if you want to redeem the shares for physical gold.  We have a number of our sources who have told us directly that JP Morgan and some of the other bullion banks are in fact turning down investors with 100,000 shares who have asked to redeem those shares for physical gold."


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