There seems no question that somebody or something is manipulating gold market prices. Posted by James Randolph on March 05, 2011
Put the manipulation of gold market prices to work for you.
March 05, 2011 – There seems no question that somebody or something is manipulating gold market prices, holding back the inevitable breakout while overpriced equities mysteriously rebound from obvious corrections. You can’t point the finger at the Fed because they just aren’t that clever. And Wall Street can’t claim the credit because if they could manipulate commodities that market would cease to exist.
That leaves every other nation on the planet. You know, the guys that Bernanke dismisses as totally irrelevant. In reality, it is those external forces that have the power and the incentive to control US market prices.
The vast majority of the globe’s sovereign wealth is represented by US debt securities. At one point in time that was well advised considering the unparalleled strength of our economy. Having no competition as dominant global merchant we had no trouble imposing the dollar as the standard of trade and the enormous mass of our economy made it particularly resistant to economic shock. The proliferation of derivatives offered to hedge against unfavorable movement in exchange rates sealed the deal.
But now it is clear to everyone but the Fed that those securities are becoming increasingly toxic every day, and central banks worldwide are faced with divestment of those instruments while protecting their own currencies. Since it could be decades before a viable alternative emerges to take the dollar’s place, there is but one logical option open to them.
Central banks will follow China’s lead. Despite producing more gold than any other country, China has vastly stepped up imports while slowly divesting itself of US debt. To optimize returns from the transition requires keeping a lid on the gold market while continuing to inflate American equities. China alone can exert tremendous influence on our markets, so imagine what a concerted global effort could do.
No mystery. No magic. Just one exceptional opportunity for gold investment.
Senior Staff Writer – Certified Gold Exchange