Skip to content
April 26, 2010 / Hal (GT)

The three ‘G’s: Greece, Goldman Sachs, and Gold.

Good afternoon. I think we might could see a slight push down on precious metals prices, particularly gold and silver as per usual with the Option Expiration coming tomorrow. Looking at the action today so far with ExactPrice I get the impression that’s most feel the same way as the action is pretty much static so far today.

Gold right now is $1,153.30. Silver is $18.33. Platinum is $1,747.70.

Onto the news. Greece continues to way hard on Europe and the IMF and as we a main backer it weighs pretty heavy for us so I like to keep an eye on what’s happening there.

Greek meltdown in danger of spreading

A US Treasury official said: “Secretary Geithner encouraged them to move quickly to put in place a package of strong reforms and substantial concrete financial support.”

A former IMF chief economist warned yesterday that Greece’s problems could spread. Simon Johnson said market reaction to the Greek deal suggested the eurozone’s problems are about to get worse.

The value of government bonds issued by Portugal, Spain and Ireland all fell in the wake of the deal, Johnson said. He warned that property prices across the eurozone could slump as a result of the bailout deal, raising fresh concern about the health of banks.

Meanwhile, Darling insisted that global agreement could still be reached on new taxes to rein in the banks, despite a mixed reception to proposals put forward by the IMF.

There is an absolute must read on Bullion Bulls Canada about Goldman Sachs and the manipulation of the gold market.

Goldman Sachs and Gold

In 1998, Ashanti Gold (based in the African country of Ghana) was the world’s 3rd largest gold miner. However, in the spring of 1999, when Gordon Brown was dumping 415 tons of the UK’s gold onto the market (purportedly to bail-out the massive “short” position held by none-other than Goldman Sachs), the price of gold collapsed to a post-Energy Crisis low: to $252/ounce.

According to an article which recounts these events, Ashanti Gold approached its “financial advisor” – Goldman Sachs – for “help” in coping with this ultra-low price for gold, and (surprise, surprise) Goldman Sachs “advised” Ashanti to enter into massive “hedging” agreements to forward-sell all their gold. Of course, they didn’t think it necessary to inform the management of Ashanti Gold that not only was Goldman Sachs making profits for itself in selling these hedges, but it was making much bigger profits shorting gold.

Oh, and I think this worth checking out in regard to silver: Is COMEX About to Take One in the Silver Shorts?

Some say there is really only one ounce out of a hundred in physical existence.  So what happens when the person buying wants to take delivery of a thousand ounces when there is only ten to deliver?  Yup!  That’s the BANG!  This is what some claim the situation to be right now on the COMEX.  So, I looked into it a little and found a report put out by the National Inflation Association.

According to this report, “We don’t believe there is only 1 oz of physical silver for every 100 ozs. represented on paper. Most likely, there is 1 to 3 times more paper silver than physical silver. This is still a major problem that will ultimately result in a major silver shortage and short squeeze, once a large number of COMEX holders begin to demand physical delivery of silver.”

Be sure to try out the free application, ExactPrice, and let me know what you think about it or if you can think of any improvements for it and I’ll pass that info along.

Thanks. Until next time.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: