TinBrick

You don't have to be a card carrying member of GATA to recognise that there is something very peculiar about this price action - a picture is worth 1,000 words! (By the way, those are Dan Norcini's comments on the chart, not mine.)

Pot . . . kettle . . . black In any case, Fuller does substantiate his opinion - this guy is of course free to disagree with his interpretation, but at least Fuller provides some facts.

Merkel rejects ally's call to use gold as bailout loan collateral. DEREK SCALLY in Berlin GERMAN CHANCELLOR Angela Merkel last night gave short shrift to a political ally’s call for the use of gold as collateral for all future euro zone bailout loans. Labour minister Ursula von der Leyen’s suggestion yesterday caused ructions in Berlin and prompted an immediate denial that it represented government policy. The solo run appeared a calculated effort by the minister to boost her domestic profile ahead of an emergency Bundestag sitting of the ruling Christian Democratic Union (CDU) last night. Dr Merkel, without mentioning her minister by name, said making new ideas via the media was “not the way to get things done” in the euro zone crisis . . . ("Irish Times", 24/08/11 - more here.)

This morning's London fix was $1,886.50, $9 higher than yesterday's p.m. fix - I don't think the fat lady has sung yet . . .

It'd be nice to think it was over £1,800, give it time! In another little milestone, although the spot price touched $1,814.95 on Aug 11th, the London fix exceeded $1,800 for the first time this afternoon (Aug 18th) when it was fixed at $1,824.00.

Today (August 15th) marks the 40th anniversary of the closing of the gold window by President Nixon - ending the convertibility of dollars to gold. The fiat dollar is now officially middle-aged . . . http://www.youtube.com/watch?v=iRzr1QU6K1o

I've watched this twice and I still don't get the significance of the $1,764 figure, except that Sinclair says it is derived from a 1920s newspaper article by Jesse Livermore and "it's mathematical". It would be nice to think Jim's right, but his justification of the significance of the $1,764 price level in this interview could hardly be any vaguer . . .

Gold in Euro past €1,200 - now at €1,201.52 (4:27pm)

Interesting straw in the wind! I recall reading a couple of years ago, I think on James Turk's blog, a comment to the effect (I'm paraphrasing here) that one Monday morning we'd wake to find the price of gold in Asia is $5,000 bid, none offered. Could this be the Monday? We can always hope!

Essentially, van Eeden's thesis is that jewelry demand is an insignificant component of the gold price, whether that demand is high or low. As a proportion of the total supply of gold, jewelry demand is not enough to make any difference either way. I'm sorry, I can't reconcile the above with this: Why would a bank (or anyone) hold 5% to 10% of their assets in a metal which has very limited industrial/commodity uses and is otherwise only used as jewelry, unless that metal was also considered to be money or money's equivalent? (EDIT: I should also have pointed out that not all CBs are selling gold, and some - notably the Russians - are buying.)

This seems a bit self-contradictory to me. As I already noted, gold has very limited industrial/commodity use. I can see the logic of CBs divesting themselves slowly so as not to cause huge price falls, although similar logic didn't seem to trouble Gordon Brown when he flogged the UK's gold at rock bottom prices. Paul van Eeden has convincingly argued jewelry demand has only minimal impact on price. (Have a listen to this interview on CWR from last year: http://commoditywatch.podbean.com/2007/10/...chael-hampton.) So why would banks hold 5% to 10% of their assets in gold, if gold is not money or money's equivalent? (EDIT: Incidentally, van Eeden has been spot on in his calls on the PoG this year. In April he said "I would not be surprised to see the gold price drop $150 an ounce, taking it well below $800 again" and in a newsletter from mid-July he gave his estimate of the theoretical "true" price of gold based on the money supply and gold supply growth at $757. I just wish I'd paid more attention! )

The "barbarous relic" argument has some merit and it is indeed hard to see how we would return to gold backed currencies anytime soon. However, if gold is not "good money" why do central banks continue to hold large stockpiles (notwithstanding sell offs in recent years) and why does the market place any value at all on it, especially given that its actual usefulness as an industrial metal/commodity is very limited?

Speak for yourself, I've no idea where it's going!

Casey Daily Resource also cites an improved supply situation in South Africa as a factor in driving down the price. http://www.caseyresearch.com/displayDrp.php

I think the rationale is recession = fewer car sales = less demand for platinum in catalytic converters