Wednesday, October 08, 2008

The Gold Price Can Double Fast

"Within the gold complex, there is a disparity between the paper market and the physical market, notes Jurg Kiener, CEO of Swiss Asia Capital. He tells CNBC's Maura Fogarty & Rebecca Meehan that if the paper market collapses, gold prices may double very quickly."



Jurg Kiener interview on CNBC

The Comex in NY has little gold in the vaults compared to the amount of futures contracts on the exchange. Same goes for silver. Look for defaults in the US. Physical prices are moving higher in some cases despite paper (futures) prices moving down or sideways. At some point someone long in the futures markets will see the sense of taking delivery of the metal itself instead of USD. It wouldn't take much of that to cause default on the Comex. Then the price of gold could blast off.

1 comment:

Colin said...

Thought you might find this interesting... In the light of decreasing spot prices...

http://news.bbc.co.uk/1/hi/world/europe/7663753.stm