Everybody Out of the Gold Pool!
April 13, 2010
– Comments (19) |
RELATED TICKERS: GLD
, SLV
, BNS
This is the second installment in an ongoing investigative series to shed light upon the astonishing developments underfoot within the gold and silver markets.
http://www.fool.com/investing/general/2010/04/13/everybody-out-of-the-gold-pool.aspx
If you like the article, please be sure to recommend it so that it will reach as broad an audience as possible. With a few noteworthy exceptions, the media remains decidedly silent on this story. Rather than wait for the major outlets to finally realize the enormity of this issue and the verifiable veracity of the evidence compiled, this is one Fool's attempt to hasten a public understanding. Please share this article with your friends and family, co-workers, etc. If you are active in any other online communities where you think readers would appreciate this content, please also post a link to this article and its predecessor as you see fit. Thank you for your co-operation.
Here are a few excerpts:
"If you hold unallocated gold or silver bullion certificates issued by one of the major bullion banks, I urge you to consider that this segment of the market may collectively lack an adequate physical supply of metal to satisfy claims, in the event that any significant proportion of investors tender their paper certificates for physical bullion."
"If the alleged leverage pervading the over-the-counter (OTC) markets and the futures exchanges is ground to a halt by increasing physical demand, the scarcity of supply will become more pronounced still. Just as the banks essentially wagered that mortgage values would never decline, it seems that a similarly dangerous wager may yet be on the table: a bet that gold and silver investors will never call the bluff of a massive paper-based shell game."
"If you're swimming in an unallocated bullion pool, I recommend climbing out before lightning strikes the water. For investors seeking bullion exposure through vehicles that do explicitly state the nature of their holdings, in ways that alleviate these sorts of concerns, I continue to suggest Central Fund of Canada (AMEX: CEF) and the Sprott Physical Gold Trust ETV (NYSE: PHYS). If you have any concerns or questions relating to this developing story, please post them in the comments section below, or follow my Motley Fool CAPS blog for ongoing community discussion."
The first article from this series is here.
These developments hold enormous repercussions for every sector of the economy, and indeed for every national economy on the globe. The currency-related repercussions can scarcely be overstated.
If you're not following this story, then you might as well be investing with a blindfold on.
Thank you for continuing to track this rather complex tale ... you will be rewarded for not looking the other way through your resulting preparedness for the unavoidable delevering of the paper markets for gold and silver.
Fool on!
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