Last Thursday I listened to a spokesman from the Perth Mint and...

Last Thursday I listened to a spokesman from the Perth Mint and read a report from the World Gold Council...an eye opener.
Between both of them the following points were made.

1)The gold price crash started from the big end of town in the U.S. with a 1,000 tonne futures short sell order.

2)The demand for physical gold is not being met due to a shortage.

Back to the first point.I watch CNBC every night and starting about 1 week before the crash there were almost daily reports of Goldman Sachs among others urging people to short sell or quit their gold holdings.It just looked so much like "sentiment massaging".And then it came...the planned assault on the GOP was swift and deadly.The big players made their play through audacious paperwork only (EFT's and Futures).Physical gold played no real part,if any at all.

To the second point.This $200/oz. drop sparked a world wide buying frenzy for physical gold (long queues)-The Perth mint has reportedly sold 147 tonnes in April.Physical gold is highly in favour whilst Paper Contract gold is "on the nose."

This disconnect is a new phenomenon,whereby dealings in the ether over ride considerations of physical shortages. Can anyone REALLY make sense of this? I can't,and if you are going to be honest with yourself I would think that I am not alone.As my friend remarked-If someone like the Chinese govt. had taken out the whole 1,000 tonne contract..."ok boys,now deliver" that would have sorted the "smart boys" out.However this whole exercise would have been so tightly orchestrated to shut out that possibility.

How does this affect MYG and the gold sector in general? The direction of the GOP has become anybody's guess and if there is anybody out there who thinks they know better, then please come forward and enlighten us.This uncertainty,unless the GP stabilises and continues to improve,will make it harder for MYG to finalise the project.A great pity that all the hard work of the past 3 years can be substantially threatened by the reported,and yet still legal,questionable practices of the "sharks in suits"on Wall Street.

I have written this post out of frustration,anger, and a feeling of powerlessness.Have I made any sense?I have no idea. However my gut feeling is that one way or another MYG will still get there.