julian d w phillips coments on the end of the gold price suppression scheme:
So how will this end gold suppression and management?
It takes gold sales to hold down and manage of gold prices. Lending won’t do it now will hedging any more, because any large sales of gold will be snapped up without a really significant and semi permanent lowering of the gold price. When you find huge buyers in the market, whose only concern is not to drive the gold price higher on small purchases, you don’t sell gold to manage or suppress price.
Right now these central bank buyers want tonnage, large tonnages, but it is not there at the moment, so they content themselves with buying small amounts persistently as it comes onto the market. It’s a dealers dream to find a big seller and place it with a big buyer and not move the price. It’s a buyers dream to buy big quantities and neither move the price nor be noticed. And that’s where the market is now. Yes, short-term forays into the market may happen to even out moves, but not by central banks of note.
So any scheme from now on to suppress or manage the gold price will face central bank buyers who will take all gold on offer. Even large quantities could move with little price movement.
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