Gold prices rose slightly on Wednesday with bargain hunters and investors searching to protect assets during rising global tensions a midst currency wars. Gold last reported a.m. is $1263 up $2.40 and silver is $17.46 up 11 cents.
Overnight news reported that China is easing its monetary policy by cutting its reserve requirement ration for domestic banks. In other words, China will continue driving its economy into the ground by printing more money. The upside is China will keep buying gold. Central banks are succumbing to the reality despite laborious efforts that everyone is in a race to the bottom. Quantitative easing has never worked to create jobs or strengthen economies and was not designed for such.
Reality tells us central banks are destroying economies with stimulus and fattening their own coffers. Since 2008, the “big six” U.S. banks have grown over 80 percent courtesy of Fed money and the backbones of U.S. tax payers. If QE were really devised to strengthen economies central banks would have admitted defeat 6 years ago and changed course. It doesn’t take much effort to see that global economies are in deep trouble despite media hype that all is well.
Pressure appears to be mounting on Greece as Prime Minister Alexis Tsipras has “softened” his tone on rolling back austerity measures for Greece. The European Central Bank and EU countries have Greece by the throat for two primary reasons. Greece owes everyone and needs more money as it spirals downward economically. The only options Greece has is to borrow more money from the ECB or Russia. Either way it’s more debt placed on a nation that for now has no hope of economic recovery.
We are witnessing a chess game as current and new prospective members position themselves to gain the upper hand in the formation of the new London gold fix. The London Bullion Market Association is complaining that it still has not received guidelines as to how the new system will be regulated. The LBMA stated if a significant number of participants cannot get approval to take part due to lack of regulatory clarity, there will be a disruption. Ironically this is the same organization that has repeatedly been involved in market scandals including the gold fix. Two member banks, Barclay’s and UBS were both found guilty and fined last year for misconduct and a clear attempt to manipulate prices for both gold and silver. It seems the “conspiracy” theorists are on to something.
China has been the largest buyer and producer of gold in the world possibly giving Chinese interests a dominant voice in determining the daily price fix. There is concern that the Shanghai Gold Exchange may supersede London as the hub of the global gold market. Make no mistake about it London is fearful that it will lose control of one of the world’s largest ponzi schemes. China is coming in looking to take over the system and they are acquiring the physical gold to do it.
Ruth Crowell, Chief Executive LBMA claims she’s delighted to see a high level of interested participants for the March launch. Ruth maintains she looks forward to having enhanced numbers of participants for day one for the LBMA Gold Price. Note to China, please don’t buck our system.
Interesting fact that after many years of continual abuse on part of the LBMA and COMEX concerning manipulating precious metals markets, investors are still buying. Gold and silver are tough negotiators and are not intimidated by fiat currencies and bloated stock markets.
Gold Goliath is offering special pricing on 1 oz. Sunshine Mint silver bars and the 1 oz. Silver Canadian Maple. Both products are available below production costs.
For investors seeking to diversify in gold we suggest the 1 oz. Gold Canadian Maple Leaf. It’s offered at .9999 purity and available at less cost than the 1 oz. Gold American Eagle at .999 purity.