Gold demand v price...and what's coming...

TRUSt_NO_1_2

As most gold 'bugs' are aware there has been massive demand for gold to the point where mints and wholesalers have run out ( in some cases weeks ago )
Yet the price on the Comex which 'fixes' the price of gold has been going nowhere,which puzzled me and of course meant my investments in gold mining companies got hammered.
(There is evidence that 2 major US banks took massive short positions to drive the price down a few weeks ago)

The scenario now is that the sellers on the Comex may not be able to deliver physical gold when the contract becomes due and default.
If this happens,I am informed that the price of gold will go up significantly.

This guy says double in a short period of time

http://www.cnbc.com/id/15840232?video=880574352&play=1

There are other commentators out there also predicting a default on the Comex.

purch

Comex will ultimately become an irrellevance.....

The disconnect between the reality and Comex cannot continue forever, but the longer it goes on the bigger the resulting surge (Wombat's favourite word) will be........

Reaper

That might not be the only reason for gold's poor performance. I haven't heard but I suspect governments are flogging off their gold reserves as fast as they can so they can inject all important cash liquidity into the market.

If I'm right then not much will happen until they start to run short. Of course in the case of the UK we flogged it off years ago for 5p and a packet of crisps, but that's another story.

purch

5p and a packet of crisps

...and knowing Boring old Gordon I bet he asked for Plain Crisps.........

wombat42_2

A handicap for gold has been the strengthening of the dollar. Should the dollar weaken long term as it may well, that will be very good for gold and other commodities.

wombat42_2

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