LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
Has Gold Lost Its Glitter?


By: David N. Vaughn, Gold Letter, Inc.



-- Posted Monday, 10 February 2003 | Digg This ArticleDigg It!

During the gold market bear days when gold plummeted to the low 250s there were many individuals profiting from the lower gold price. 

 

Individuals & institutions were obtaining cheap gold loans for 1% & turning that basically free & cheap borrowed money into huge profits.  To this day those entities that profited & made billions off of a lower gold price have not had to answer to why they were able to do this.  And they never will have to answer to anyone.

 

Today a similar practice is occurring.  There are individuals who are making a concerted effort to bash numerous smaller gold companies & as the price of the stock plummets lower these same individuals are making huge sums of money shorting their stock.  The scam really is beautiful & well executed.  Contributing to the destruction of gold share prices are gold websites printing articles defaming many of the smaller junior & exploration companies.  And as their practice succeeds there are already pre arranged short positions making untold millions shorting gold shares as these share prices plummet.  Anyone here see a connection? 

 

Any intelligent observer of this market is aware that on average gold stocks were higher in the spring of 2002 when the price of gold was around 315 dollars an ounce.  And now the price of gold is 17% higher & the junior gold sector is still under valued when compared to prices a year ago when gold was considerably lower. 

 

And how about this. 

 

Has anyone figured out who will stand ultimately to gain the most as this practice continues & gold shares are driven further lower?  Sure, those benefiting in the short run will be those shorting gold stocks.  But the greater beneficiaries will be the senior gold companies who will eventually be able to buy these smaller junior companies & their deposits for a song because the shorters & various gold web sites are working toward driving their share prices lower.

 

It’s really amusing. 

 

During the dark days of gold the huge seniors were able to come in and buy cheaply those smaller gold companies going bankrupt.  Today, as the shorters & and others are working to keep the junior & exploration company shares cheap the senior gold companies will also be able to buy these companies “on the cheap”. 

 

It’s rumored that a large multi billion dollar senior wants to buy out a small junior it has an 80% partnership with.  How convenient that an article comes out blasting this smaller junior & the hoped for result will of course be a smaller share price that the senior will be able to pay if it chooses to buy out this company.    Brilliant!!!  But oh!  This is being done to protect the gold investor of course so that he may divest his shares of the small junior & of course the senior will only be too happy to come in & buy the shares for a song.

 

Yes, when the price of gold was low the seniors benefited & now as the price of gold is finally heading higher there appears a concerted campaign to defame the junior & exploration sector.  And the shorters & the senior mine companies will be those ultimately benefiting from this strategy.  You don’t believe me?  The end result today is that all investors in the gold market are beginning to question whether their investment in a junior mining company  is a sound investment and whether maybe they would be better off liquidating their junior gold shares & only purchase the senior & larger company shares. 

 

Sure, there are high risk properties out there that are very speculative.  But I find it interesting that this concerted attack is being launched against some of these small exploration plays that are 80% owned by multi billion dollar senior gold companies.  But this is just a coincident right?

 

I got involved in this market many years ago because I saw huge & powerful interests manipulating the gold market making billions of dollars engaging in practices that the common investor would never be able to participate in.  I have worked as an engineer for most of my working years.  Recently I have been involved with the telecommunications industry working in what is called the Central Offices where all the switching is done for fiber lines & T3 circuits.  I started studying the gold markets in 1997 because it was fascinating to me that there was a carte blanche practice going on that was fleecing the small time gold company & gold investor.  And no one cared.

 

The powers that be that control this market have lost control keeping the price of gold down & just as this occurs there begins a campaign to begin defaming the junior & exploration sector & the inevitable result are lower gold share prices.  A prominent gold analyst recently surmised that the large senior gold companies share prices are priced for a 500 dollar gold price.  But the fact remains that on average the junior & exploration gold shares are on average lower than when gold was 315 dollars an ounce a year ago. 

 

And no one recognizes the peculiarity here?  And again, who will be the ultimate beneficiary?  Why the large senior gold companies who will be able to obtain these smaller companies & their deposits for a song.

 

When I began covering the gold market back in the mid 90s it astounded me that many of the old timers were predicting a time would come when the mining industry would be dominated by only a handful of gold companies & consequently these few remaining gold companies would have a monopoly on the industry & would own & control all exploration properties.  I see us moving in that direction today & will not be surprised to see at the end of this decade only a handful of senior gold companies existing and no longer a general junior & exploration market. 

 

How convenient that even as we speak the campaign continues to drive the juniors share prices lower & all in the name of benefiting the investor.  And while all of this goes on the end result will be that the senior companies will be able to come in and take over these companies for pennies because of the lower driven share prices.  And the rewards for those helping to achieve these goals will be the profits generated from selling short these shares as their prices head south.

 

David Vaughn

2-11-2003

 

 

Author/publisher does not trade stock of the company being followed for 30 days before  & 30 days after an article is published.  It is the author/publisher’s goal of this letter that the reader may have his or her interest piqued in such a manner that will compel the individual to do their own further diligent research on the topic, issue or company discussed herein.  All forecasts and recommendations are based on opinion. Markets change direction with consensus beliefs, which may change at any time and without notice. The author/publisher of this publication has taken every precaution to provide the most accurate information possible.  The information & data were obtained from sources believed to be reliable, but because the information & data source are beyond the author’s control, no representation or guarantee is made that it is complete or accurate.   The reader accepts information on the condition that errors or omissions shall not be made the basis for any claim, demand or cause for action.   Because of the ever-changing nature of information & statistics the author/publisher strongly encourages the reader to communicate directly with the company and/or with their personal investment advisor to obtain up to date information.  Past results are not necessarily indicative of future results.   Any statements non-factual in nature constitute only current opinions, which are subject to change.  The author/publisher may or may not have a position in the securities and/or options relating thereto, & may make purchases and/or sales of these securities relating thereto from time to time in the open market or otherwise.   Any compensation that may be received goes toward the rights to reprint, publish & distribute write up.  Authors of articles or special reports contained herein may have been compensated for their services in preparing such articles.   Neither the information, nor opinions expressed, shall be construed as a solicitation to buy or sell any stock, futures or options contract mentioned herein.  The author/publisher of this letter is not a qualified financial advisor & is not acting as such in this publication.  Gold Letter, Inc. is not a registered financial advisory.  Subscribers should not view this publication as offering personalized legal, tax, accounting or investment related advice.  Investors are advised to obtain the advice of a qualified financial & investment advisor before entering any financial transaction. 


-- Posted Monday, 10 February 2003 | Digg This Article





 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.