China announced its first-ever "fix" for the gold price on Tuesday, as the world's biggest producer and consumer of the yellow metal seeks to establish its own benchmark.
The Shanghai Gold Exchange set the price for 99.99 per cent gold at 256.92 yuan (S$53.94) per gram, it said on its website.
This is PURE PHYSICAL gold auction - bid on by at least 18 banks (in contrast to last weeks confession by Deutschbank that they had participated in silver/gold rigging - and will also offer to inform on other participants, of which there were at least a few...its was just numbers passing back/forth on paper - http://www.silverdoctors.com/silver/silver-news/deutschebank-turns-states-evidence-the-floodgates-are-now-open/)
"China needs a gold benchmark that reflects local market flows and reduces gold's price dependency on the US dollar," Roland Wang, managing director of industry group the World Gold Council in China, said in a statement.
"An Asian-focussed, yuan-denominated benchmark will significantly increase the liquidity and efficiency of the gold price," he said.
China keeps a tight grip on inflows and outflows of the yuan, but says it is seeking to eventually make the currency fully convertible.
The exchange will also study yuan-dominated benchmark prices for other precious metals including silver, platinum and palladium, according to domestic media reports.
(Enough of all the "games" in the precious metals markets)
The average person isn't aware of how GLD on the Comex market is traded, but its very similar to a game of musical chairs
"The ultimate question: What price is actually being discovered on the Comex? Is it the price of “gold” or is it the price of an unbacked and under-collateralized paper derivative contract?
Basically, here’s what you need to understand. The only “price” that is discovered on the Comex paper derivative exchange is the price/value of the paper derivatives, themselves. The price discovered is definitely NOT the price of gold.
Whenever prices rise, it’s due to a surge in speculator interest in the paper derivative contracts. Prices fall when speculators exit this paper market and move on. To meet this surging demand for the underlying paper derivative, the Bullion Banks that are allowed to operate as de facto “market makers” create and issue new paper gold contracts from thin air. These banks are not required to deposit any metal up front as collateral nor are they required to limit the amount of paper metal they can alchemize on any given day...."
"The Comex is now operating on a ratio of 542 paper ounces for every 1 ounce of registered gold. This means the February delivery period is about to begin with only enough registered gold to satisfy just 740 contracts.
