While many sites then jumped on
the bandwagon and interpreted this event in different ways, the reality is that
it revealed that there is a shortage of physical gold at these prices. So it is
not at all surprising to me that the price has risen as sharply as it has,
because those desperate to get their hands on physical gold are now bidding up
the price as we speak.
This is a desperate attempt to
get entities to part with their physical gold and take paper currency instead.
In my view it’s going to take much, much higher prices to get these entities to
part with their physical gold, if they are willing to part with it at all.
The reality is that all of the
physical gold is now in extremely strong hands after the latest shakedown. So
tricking people into parting with it might prove to be an incredibly difficult,
if not impossible task.”
Eric King: “James, as you know KWN reported in the
Andrew Maguire interview that in just 7 trading days we
had Eastern central banks and various sovereign funds purchase a staggering 580
tons of physical gold, which is 25% of the world’s annual mine production.
Those orders for physical gold will have to be filled. Where are they going to
get 580 tons of gold to fill those orders?”
Turk: “The only way they will
even have a chance of getting that gold is by significantly raising the price of
gold. As I was saying, they are going to have to try to induce various entities
that hold large quantities of gold to part with it. There is no way in hell
that’s going to happen at these incredibly discounted prices.
As I mentioned, the players who
own large quantities of gold are very strong hands. If anything they are
looking to accumulate even more physical gold, not sell it. This is why gold is
in historic backwardation. It’s telling us that there is a significant shortage
at current prices.
They can’t create gold out of
thin air. It has to come out of the ground. And it doesn’t come out of the
ground fast enough to satisfy current demand. Maguire mentioned a 7-day trading
period where the physical buyers purchased 25% of the annual mine production.
The bottom line is the sellers will be forced to come up with that gold for
those buyers or we will see another historic event, a major default by one or
more LBMA member banks..."
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