Skip to content

Could ‘Price’ of Digital Gold Decline another 20%?

May 17, 2013

Today the ‘prices’ of gold and silver are determined within our computer screens (this is a virtual market). We call this the digital gold market or the paper market. GLD and SLV (digital ETF shares) are fluctuating and changing daily with the London and Comex fixings (now based on the digital markets). Some may refer to this market as the ‘paper’ market to differentiate between physical gold and the non-physical gold. In reality, however, we now have a digital market for ‘pricing’ of gold and silver (and all other commodities as well). All this has emerged in the past 15 years. Most of our stock exchanges are now electronic markets as trading has changed from the Open Out Cry system to the digital computer. HFT trading has become ubiquitous as well as the use of algorithms for entering and exiting the markets. Most trading is now done via these high-speed computers and shares are purchased and sold via our computer programs (algorithms). Some 70% of trading volume is now driven via algorithmic trading.

What is currently happening with the gold and silver prices is a result of all the new trading strategies which are now available for traders to access via their HFT computers. Since the digital markets determine the daily prices (the fixings) for gold and silver, this means that digital shares can be traded independently of the physical market. Prices, however, are determined within the digital markets and this means that phantom (imaginary) shares can be traded to suppress these prices. There is currently no fixings for the physical markets (other than each seller adding a premium to the products they sell to the public). This means that phantom (imaginary) shares can be traded ubiquitously to continue a price suppression scheme for the overall gold/silver markets.

The ‘prices’ of gold and silver have been driven down some 30+% since there recent highs in 2011. Could these prices be driven down another 20 – 30%? Is this possible? Could we witness the $ price (the $ digital price) of gold under $1000 and silver under $15? This is certainly a possibility today given that ‘prices’ are now derived via the emotional and irrational electronic markets. Also, trading strategies (like naked shorts) can be utilized to play a game of ‘gotcha’ with the prices. Few seem to understand that prices are now driven by our wired machines (high-speed trading) and via mathematical algorithms and phantom trading. Imaginary shares can enter the market to continue the ‘price’ suppression scheme for these metals.

At some point (down the road) the opposite strategy may develop (price magnification). This is also an artificial process where the digital price of gold and silver could reach unbelievable levels on the high side. A herding mentality could develop within the global trading markets where everyone desires the idea of having gold and silver in their portfolio. The prices of these metals could then reach levels of 10 or 20 times the current levels. It’s all a price manipulation process within our computer screens accomplished via our high-speed computers. The old days of people (traders) driving the prices has been replaced with our wired machines. And the markets are now global and mostly in real-time (24/7).

Fix the following images in your metaphysical MIND for greater understanding of today’s markets:

High-Speed Computers do our Trading

Speed of light sets the limit

HFT traders using Algorithms and Naked Shorts

London and Comex create the daily fixings

Bill Murphy of GATA understands the manipulations

Silver drops even though demand has increased

Algorithms and Wired Markets have created new schemes for manipulations

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: