Gold price drifts higher as Poland shows the importance of physical deliverable gold
The gold price has drifted higher today in terms of dollars, as once again gold managed to close above $1600.
$ gold:
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In terms of €s the price action is pretty flat but the €1300 level is still holding on the close.
€ gold:
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As for £ gold the price is holding just above that support level of £1020.
£ gold:
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Whilst these levels seem to be holding, there seems to be little interest/catalyst to take the metals higher, for now.
Which brings us onto the important lesson that Poland just gave the world. A few weeks back we ran a story, that was woefully under reported, about a gold fraud case totaling some $60bn.
At the time we noted:
It would appear that wealthy Chinese investors thought they were buying gold, but rather than take delivery of the physical metal, investors accepted ‘paper gold’ [basically a receipt for gold] – and rather than buy any actual gold for their clients the fraudsters appear to have simply made off with the money – some $60bn.
Now we have another example this time involving Polish investors:
WARSAW—This week’s collapse of a gold-derivatives business that Polish regulators say was a Ponzi scheme has hit tens of thousands of customers, shaken confidence in the effectiveness of the nation’s financial regulation, and is roiling national politics in the European Union’s largest emerging economy.
On Monday, the company, Amber Gold, Sp. z o.o., which sold a gold-indexed investment of its own design and offered higher interest rates than banks, said it was halting operations. It pledged eventually to repay about $24 million it said it owed to roughly 50,000 clients in Poland.
Basically it seems the same ponzi scam being ran out of China just happened in Poland. Get people to ‘invest’ in ‘paper’ forms of gold and simply run off with the money.
The lesson is very clear when it comes to buying gold, stick to physical deliverable gold only. The entire point of gold is that it is no-one elses promise to pay, and if you’re buying ‘paper’ gold in any form, it then becomes someones else’s promise – something that unfortunately, in an era of LIBOR fixing and ‘segregated’ accounts that aren’t, people are finding them harder and harder to keep.
Related posts:
- Gold price drifts lower ahead of the Fed’s decision
- $1800 gold price shows solid support as gold bounces to $1850
- Gold price drifts lower only to ‘pop’ back towards $1650 as the bull/bear attrition battle rages on
- Six Securities now offer deliverable gold as payment to settle trades on Swiss stock market
- Gold price drifts lower on the week as Spanish 10 year bonds get back above 7%
Link to this article: : http://www.goldmadesimplenews.com/gold/gold-price-drifts-higher-as-poland-shows-the-importance-of-physical-deliverable-gold-7642/
Posted by Thomas Paterson on Aug 16 2012. Filed under Gold News.
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