wikileaks flash: us gold rigging - china knows, page-19

rowingboat

You are partially right. Price discovery is occuring. But, and it's a big but, the price being discovered is not the price of an ounce of gold. It is the price of a claim to an ounce of gold. There is a huge difference.

Gold is moving East because more people in China and India are invoking their claim than people in the West. Because we in the West have forgotten there is a difference.

But we are gradually remembering, and as we do, unallocated gold that is fractionally distributed amongst maybe 100 people becomes allocated to 1 person. And the price of a claim rises a little more. When all unallocated gold is allocated, then we will know what the real price of gold is.

So the price of gold is not so much manipulated as rigged. And really it's as much for historical reasons as nefarious purposes.

This blog post explains it well. All FOFOA's posts are well worth a read if you have a spare 3 weeks.

http://fofoa.blogspot.com/2010/08/relativity-what-is-physical-gold-really.html