Gold: Not worth it’s weight!

Interesting article from seeking alpha on Gold & Silver price drop –

http://seekingalpha.com/article/95496-the-law-of-supply-and-demand-is-dead-for-gold-and-silver

he price for gold and silver that you see plastered all over financial tickers everyday is established in the paper futures markets and not in physical markets where REAL gold and silver actually exchange hands. In the futures markets, only 1% of all futures contracts are closed out with actual delivery of the physical commodity. Instead 99% of all futures contracts are closed out with the purchase of another paper contract. In the case of gold and silver, futures contracts represent digital bytes of gold and silver flying around in a paper market, not real ounces of gold and silver that exist in the physical market. Thus it is entirely possible to utilize this discrepancy to create two entirely different prices for the same commodity. In other words, if not properly regulated, futures markets provide a gateway to manufacture massively fraudulent prices non-reflective of the buying and selling volumes that are occurring in the physical markets!

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2 Responses to “Gold: Not worth it’s weight!”

  1. Gold: Not worth it’s weight! Says:

    […] Go to the author’s original blog: Gold: Not worth it’s weight! […]

  2. Foreign Exchange Market Says:

    A Xarat is a measurement of gold purity not weight. Foreign Exchange Market

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