The Treasury is doing everything that it can to keep the masses out of gold. It's simple to understand how the Treasury has been operating lately.

As scared sellers liquidate their positions in the market, they look around at what's up and gold isn't one along with the pm shares. When the general market firms on occasion, for the moment, the Treasury could care less about gold.

The discrepancy between paper and physical gold may come to a head soon if the DOW breaks its 5000 day average at 7800 by the recent announcement that China is mulling the addition of 4000 metric tons of gold to their already 600 metric ton holdings. Dan Norcini from jsmineset.com says that if China makes that purchase they will have the second largest gold holdings of any central bank in the world.

I wouldn't be surprised if China has indeed been adding to their gold holdings since taking a position a while back at $375 from two forced liquidating hedge funds. Why would China announce through unofficial chanels that they might be a buyer. I think there is more to it than attempting to talk up gold for their own producing industry of about 300 tons. A message seems quite clear: COMEX, stop paper selling gold lower or we're going to take delivery on you.