Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

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

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

Gold Seeker Closing Report: Gold and Silver Fall Over 1%
By: Chris Mullen, Gold Seeker Report

What’s Going On With Gold?
By: Dave Kranzler

Gold and Silver Investors’ 8 Commandments for Avoiding Rip Offs
By: Stefan Gleason

Gold: World Currency Or Ultimate Asset
By: Stewart Thomson

Jack Chan's Weekly Precious Metals Market Update
By: Jack Chan

Physical and Cryptographic Silver are Asymmetric Trades
By: David Smith

Michael Pento: How The Trade War Will Hurt The US — And The World
By: John Rubino

EXTREME OIL PRICE VOLATILITY: Bad Sign That All Is Not Well In The Markets
By: Steve St. Angelo

Oil Takes Center Stage: Commodities Halftime Report 2018
By: Frank Holmes

How Does Gold Affect Climate?
By: Arkadiusz Sieron

 
Search

GoldSeek Web

 
Why James Turk and John Rubino say the price of gold is set to soar to $10-12,000 an ounce


 -- Published: Tuesday, 10 June 2014 | Print  | Disqus 

By Peter Cooper

Former head of commodities at the Abu Dhabi Investment Authority and GoldMoney.com founder James Turk and John Rubino are well known figures in the gold industry. They’ve just published a new book, ‘The Money Bubble’. It argues that the price of gold is about to soar to $10-12,000 an ounce.

In a nutshell the authors contend that the major paper currencies of the world actually now have less gold backing them than previously thought. An analysis by the Gold Anti-Trust Action Committee concluded that nearly half the world’s gold reserves of 29,000 tonnes have been dumped on the open market through central bank leasing or lending as they term it.

$10-12,000 an ounce

You can calculate what the price of gold needs to be to restore gold backing to paper currencies to solve a crisis of confidence in several different ways. This is where the future price of $10,000 to $12,000 per ounce is derived. The formulas given in the book are a bit complex but the price implications are easy enough to follow.

The authors blame the ‘gold price smackdown’ of last April on a desperate action to ‘avoid a default in which a counterparty failed to deliver physical metal when obliged to do so’ and a ‘pre-emptive strike’ by the bullion banks and central banks which have colluded for years to suppress the gold price to mislead markets on the true rate of inflation.

Last April the manipulators won and the gold price fell 28 per cent in its worst year for 13 years. Messrs. Turk and Rubino describe how bullion banks led by Goldman Sachs recommended shorting gold in early April. Then a handful of major banks sold enough futures contracts to take down the price below key support levels and selling compounded driving the price down nine per cent in one trading session.

The Financial Times quoted a prominent trader as saying: ‘These moves are becoming more prevalent, and to my mind have to be the work of somebody attempting to manipulate the market or someone who really shouldn’t be trusted with the sums of money they are throwing around.’

A final blow to the gold price was struck by the Indian central bank ‘which decided, supposedly to reduce the country’s trade deficit, to impose strict limits on gold imports’. But this game is about to end in the opinion of this new book’s authors.

Short squeeze coming

‘In reality the great gold takedown of 2013 backfired so disastrously that not only is a repeat less likely, but its opposite, a short squeeze or counterparty default that sends the price dramatically higher has not become just possible but probable in the next few years.’ Why is that?

First, gold is migrating from West to East as China and Russia voraciously convert their dollar reserves into gold and vaults are being emptied. Secondly, gold ‘backwardisation’ when the current price is higher than the future price has twice previously indicated a price hike to come in 1999 and 2008. Thirdly as demonstrated above price manipulation is about to breakdown.

Then all it takes is for the pension funds of the world to discover gold and the price is off to the levels James Turk and John Rubino expect. This book is a sensational piece of analysis but its conclusions are not nearly as sensational as they appear at first sight. Gold prices at these levels will also mean $500 an ounce silver (click here).


| Digg This Article
 -- Published: Tuesday, 10 June 2014 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



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 - 2018



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

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com 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, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.