Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Buying a Custom Built Gaming PC From Overclockers.co.uk - 1. Delivery and Unboxing - 17th Feb 20
BAIDU (BIDU) Illustrates Why You Should NOT Invest in Chinese Stocks - 17th Feb 20
Financial Markets News Report: February 17, 2020 - February 21, 2020 - 17th Feb 20
NVIDIA (NVDA) GPU King For AI Mega-trend Tech Stocks Investing 2020 - 17th Feb 20
Stock Market Bubble - No One Gets Out Of Here Alive! - 17th Feb 20
British Pound GBP Trend Forecast 2020 - 16th Feb 20
SAMSUNG AI Mega-trend Tech Stocks Investing 2020 - 16th Feb 20
Ignore the Polls, the Markets Have Already Told You Who Wins in 2020 - 16th Feb 20
UK Coronavirus COVID-19 Pandemic WARNING! Sheffield, Manchester, Birmingham Outbreaks Probable - 16th Feb 20
iShares Nasdaq Biotechnology ETF IBB AI Mega-trend Tech Stocks Investing 2020 - 15th Feb 20
Gold Stocks Still Stalled - 15th Feb 20
Is The Technology Stocks Sector Setting Up For A Crash? - 15th Feb 20
UK Calm Before Corona Virus Storm - Infections Forecast into End March 2020 - 15th Feb 20
The Growing Weaponization of Space - 14th Feb 20
Will the 2020s Be Good or Bad for the Gold Market? - 14th Feb 20
Predictive Modeling Suggests Gold Price Will Break Above $1650 Within 15~30 Days - 14th Feb 20
UK Coronavirus COVID-19 Infections and Deaths Trend Forecast 2020 - 14th Feb 20
Coronavirus, Powell and Gold - 14th Feb 20
How the Corona Virus is Affecting Global Stock Markets - 14th Feb 20
British Pound GBP Trend and Elliott Wave Analysis - 13th Feb 20
Owning and Driving a Land Rover Discovery Sport in 2020 - 2 YEAR Review - 13th Feb 20
Shipping Rates Plunge, Commodities and Stocks May Follow - 13th Feb 20
Powell says Fed will aggressively use QE to fight next recession - 13th Feb 20
PALLADIUM - THIS Is What a Run on the Bank for Precious Metals Looks Like… - 13th Feb 20
Bitcoin: "Is it too late to get in?" Get Answers Now - 13th Feb 20
China Coronavirus Infections Soar by 1/3rd to 60,000, Deaths Jump to 1,367 - 13th Feb 20
Crude Oil Price Action – Like a Coiled Spring Already? - 13th Feb 20
China Under Reporting Coronavirus COVID-19 Infections, Africa and South America Hidden Outbreaks - 12th Feb 20
Will USD X Decline About to Trigger Precious Metals Rally - 12th Feb 20
Copper Market is a Coiled Spring - 12th Feb 20
Dow Theory Stock Market Warning from the Utilities Index - 12th Feb 20
How to Get Virgin Media Engineers to FIX Hub 3.0 Problems and NOT BS Customers - 12th Feb 20
China Under Reporting Coronavirus COVID-19 Infections by 66% Due to Capacity Constraints - 12th Feb 20
Is Coronavirus the Black Swan That Takes Gold To-Da-Moon? - 12th Feb 20
Stock Market 2020 – A Close Look At What To Expect - 12th Feb 20
IBM AI Mega-trend Tech Stocks Investing 2020 - 11th Feb 20
The US Dollar’s Subtle Message for Gold - 11th Feb 20
What All To Do Before Opening A Bank Account For Your Business - 11th Feb 20
How and When to Enter Day Trades & Swing Trade For Maximum Gains - 11th Feb 20
The Great Stock Market Dichotomy - 11th Feb 20
Stock Market Sector Rotation Should Peak Within 60+ Days – Part II - 11th Feb 20
CoronaVirus Pandemic Stocks Bear Market Risk 2020? - Video - 11th Feb 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Gold Price Manipulation - Does it Matter ?

Commodities / Forecasts & Technical Analysis Feb 07, 2007 - 08:43 AM GMT

By: Clive_Maund

Commodities

There has been more talk in recent weeks on the subject of gold price manipulation. The purpose of this article is not to attempt to go into the details of whether or not there is manipulation, or how much there is, or who is doing it or why, because all of this is has been raked over by other writers in considerable detail. The purpose of this article is to examine what difference it makes to us as investors and traders, and how best to live with it.

The first point to make clear is that to whatever degree there is gold price manipulation/suppression, there is nothing much the ordinary investor can do about it - you are going to have to live with it, like taxation - so there's no point in losing any sleep over it.


The next point to grasp is that there is a "might is right" issue here. The plutocratic network responsible for gold price suppression knows that even if they are outed, they can simply brazen it out with an attitude of "Tough luck - there's nothing you can do about it". When you understand this point you realize that those who have worked tirelessly for some years to expose what is going on will probably only ever achieve a pyrrhic victory.

Now here is the fundamental point to grasp, which is the central message of this article. Even if it is proven beyond all doubt that there is a powerful conspiracy to restrain the price of gold, and even if, despite being dragged out into the light of day and branded, those responsible brazenly continue their operations, they will nevertheless be rendered increasingly irrelevant by unstoppable market forces. Take a look at the following chart, which shows the price of gold in Swiss Francs, and you will see that this is already happening, and the picture against the Euro is very similar. They have already lost control, even if they had it - as we can clearly see on this chart, they lost it in mid-2005. All that is left to them now is to fiddle about on the edges trying to fleece traders by creating false breakouts etc and engage in their ritualistic Friday gold bashing.

Now here is the fundamental point to grasp, which is the central message of this article. Even if it is proven beyond all doubt that there is a powerful conspiracy to restrain the price of gold

What has and is happening is best understood not by considering high finance, and going into complex and long-winded economic arguments, but by considering the analogy of an ordinary fruit and vegetable market. Suppose some regulatory body tries to cap the price of potatoes and there is an acute shortage. Unless it is prepared itself to ensure sufficient supply of potatoes to meet demand, the tables in the marketplace will empty and a vibrant black market will spring up offering potatoes at much higher prices. This is the situation we have found ourselves in increasingly with gold since mid-2005.

There is growing demand for the metal itself worldwide and powerful players who know the score are not and will not be satisfied with scraps of paper - they want to see the color of their money, and that color is gold - and silver. In addition, smaller players are getting in on the act through the ETF's (Exchange Traded Funds). As the money in these funds expands it must be reflected in increased reserves of the metals and this is providing additional and increasing demand for gold and silver. In the face of increasing demand for the metals themselves, no amount of chicanery by conspirators attempting to suppress the price will succeed - short-selling, derivatives strategies, hedging by certain large gold producers, lying about and fiddling the figures for reserves in bank vaults - all of it will be swept aside by a good old fashioned groundswell of demand.

For practical purposes the arguments about whether the gold market is manipulated are largely a waste of time. So what if it is? - any market in which powerful players are involved is subject to manipulation to some degree, but even they must eventually yield to the overriding force of the primary trend.

 

By Clive Maund
CliveMaund.com

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maunds opinions are his own, and are not a recommendation or an offer to buy or sell securities. No responsibility can be accepted for losses that may result as a consequence of trading on the basis of this analysis. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules