posted on Apr, 18 2004 @ 12:25 AM
The price of gold is manipulated by short selling. There are two gold markets operating together, true physical gold sales, and the paper futures
The paper market is huge compared to the real physical gold market and is what controls the price.
In very simplistic terms, this is what happens.
Suppose gold is trading at $400 per ounce.
I come up and say I will sell you all the gold you want at $390 for delivery next month. This is the best deal in town, so everyone buys my futures
contracts, and the price drops ten dollars.
At the end of the month, I say boy have I got a deal for you. I can supply all the gold you want for $380 for delivery next month, how about rolling
over your existing contract and save yourself $10
Next month.................do it again at $360, and so on.
The price of gold continues to drop, the paper dealers both buyers and sellers make a PAPER profit, and NO ACTUAL GOLD CHANGES HANDS.
While all this is going on the Indians, Asians, and Middle Eastern countries are buying real gold and jacking the price back up bit by bit.
This can go on forever until someone puts up their hand up, and refuses to roll over their contract, demanding actual delivery.
The whole situation is near flash point because the supply of real gold for sale is fast running out. As soon as the futures buyers start to demand
delivery the game is up. The writers of all those contracts are bankrupt because they have not enough gold to cover the contracts.
If you or I wrote a cheque for fifty million dollars and had zip money in the bank, that would be fraud. But you can write a futures contact to
deliver a commodity at a future date for a fixed price, even though you have nothing in your warehouse. That is futures trading, and it's quite
legal. Most futures traders are not interested in corn, pork bellies, or gold, they just try to make money on the paper contracts.
Rothschild's are smart enough to realise the game is almost over for paper gold, so they have decided to get completely out of the paper futures
They still plan to trade real gold though, just as they have for 250 years. The game is now almost up for the paper gold guys. When the poo hits the
fan, gold is going to shoot straight up in price. All the futures guys are going to try to buy enough gold to cover their promises, and gold in that
quantity is just not available.
The price will just explode upwards.
If you are smart and buy real gold or silver, or gold or silver mining shares now, you are going to do extremely well in the very near future.