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% With Dow
By: Chris Mullen, Gold Seeker Report

Ira Epstein's Metals Video 2 20 2018
By: Ira Epstein

Silver's Key Resistance
By: Craig Hemke

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

Why Now Is the Perfect Time to Be in Gold and Silver
By: Jeff Clark

Update On the Gold/Silver Ratio
By: Mike Maloney

Chris Powell: Governments Are LYING about Their Gold Activities while Mining Companies Cower
By: Mike Gleason

Gold's Golden Week
By: Stewart Thomson

SWOT Analysis: Gold Traders Overwhelmingly Bullish in Bloomberg Survey
By: Frank Holmes

New Low in Gold Stocks is a Strong Buy Signal
By: Jordan Roy-Byrne CMT, MFTA

 
Search

GoldSeek Web

 
Will ending the London gold fix be the start of a price surge?


 -- Published: Tuesday, 8 July 2014 | Print  | Disqus 

By Peter Cooper

Today the World Gold Council has convened a meeting of industry participants and experts to discuss a replacement of the 100-year old gold fix that is being investigated City regulators who have already fined Barclays Bank 26 million pounds for abusing the system.

The fix has understandably become unpopular with the fixers. Deutsche Bank resigned in April leaving Barclays, Bank of Nova Scotia, HSBC and Societe Generale running the show.

Libor scandal

In the wake of the Libor scandal almost anything seems possible though in the case of gold the finger is usually pointed at the central banks who manipulate the price to dampen inflation expectations. The evidence gathered to support these claims is overwhelming but ignored as you might expect when the authorities themselves are doing the manipulation.

The London gold fix works by setting the price at which the gross amount of gold placed on buy orders matches the gross amount of gold on sell orders across all of the member bullion banks. Yet it has become an anachronism as there are electronic prices quoted for gold in many markets around the world.

We are not sure that gross abuse is necessarily taking place in London. The expert speakers at the Dubai Multi Commodities Conference earlier this year largely rallied to its support.

However, anything that even allows a whiff of insider trading to waft through a financial market is not really worth the candle and ought to go. Silver is facing a similar review due on August 14th.

Price surge?

Will this sort of reform be enough to start a price surge for the precious metals? By itself, no. But as a part of a raft of positive developments for gold and silver this is a useful step forward.

Confidence that price setting mechanisms work fairly and accurately are essential to making any market and precious metals are no different from sheep or iron ore in that regard.

On the other hand, if the London price fix encourages market regulators to go further and question the role of the central banks in fixing gold prices then this really could open a can of worms, and that would send prices much higher.

http://www.arabianmoney.net/

 


| Digg This Article
 -- Published: Tuesday, 8 July 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 - 2017



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.