Thursday, November 17, 2005

Why Gold Price at 18 Year High?

The dollar is firm, oil has come way down, no crises at the moment, the stock market is roaring ahead, the US real estate market is holding up. "Everything is fine."

The gold price hit an 18 year high on Thursday the 17th of November 2005 with the PM fix of $486.15, a rise of $18 in just two days.

So what is the real reason for the gold price high?

Bill Murphey of provides a very interesting explanation from a source he calls "Deep Throat" :

"There is an enormous problem out there re gold leases, as brought to your attention by Deep Throat. We are talking about hundreds of tonnes of gold. A bank, or some banks, has leased out physical gold and they cannot return this gold to their owners who want it back now for a very specific reason. This potentially monumental problem is under negotiation at the moment. Perhaps it can be calmed down for the time being. In the end it will have to blow up if the owners demand their gold back. If the banks go into the marketplace, WHEN THEY ARE FORCED TO, the price of gold will go berserk. Only a matter of time. The gold time bomb is ticking and the loudness of the ticking has become greatly more pronounced."

Murphey says the reason for the high gold price is "the Gold Cartel is losing control of their gold price manipulation scheme. There are a number of contributing factors which are surely in play, yet they are second fiddle as to what is really going on behind the scenes."

James Turk of says "The trigger for gold's rise this week was the announcement by the Federal Reserve that it would stop reporting M3 data in March. See Bob's post US Fed to Discontinue Publishing M3 Numbers.

Turk points out "The smart money is realizing that there are some tough times ahead for the dollar in 2006 and more importantly, by hiding the money supply and not reporting M3, the total quantity of dollars in circulation, the Federal Reserve is not facing that reality."

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