That is, until Frank Veneroso appeared on the scene challenging GFMS s conclusions about how many tonnes of gold had actually been sold or lent forward. With relentless logic Frank builds his case that a short position amounting to 10,000 to 14,000 tonnes hangs over the market, built by the gold carry trade. GFMS stoutly disagrees. Since gold bugs historically tend to be suspicious of officialdom, it s fairly easy to sell them on conspiracy, especially one to suppress gold s price. Even without a conspiracy, the miners and hedge funds continually growing short positions would require them to sell more and more gold as the price rises.
Gold serves as a report card on central bankers fiat currency management.
We know that Greenspan intervened, either directly or indirectly, in the gold markets, the stock markets, and the platinum market to staunch the 1987 crash. Well, for me it s not, but you draw your own conclusions. In supply, low prices are keeping a lid on gold production. Three quarters of total supply came from mine production and very high hedging. Central bank leasing and sales filled out the rest of the supply.