When I was a younger lad, I took conspiracy theory seriously. I considered it highly possible that we never actually landed on the moon, that the whole scene of our astronauts kicking up “moon” dust might have been filmed on a Hollywood back lot. And, of course, the Warren Commission report on the JFK assassination simply covered up the truth of what really happened that day in Dallas, November 1963. But, now that I have added a few years of reality to my world view, I clearly see that we did land on the moon not once, but numerous times. I am convinced we really did go there. The Kennedy deal, well, hmmm … So, anyway, when I got the question below, my immediate thought was the reader is thinking conspiracy.
Who controls the world gold prices? Is it an organization or country?
Well, maybe either or both of the entities above is part of a secret cabal that controls gold prices. Truly, who can say for sure – “As whistleblower Andrew Maguire – a London metals trader formerly of Goldman Sachs says, the gold and silver bullion markets are rigged.” Yes, BIG money can and does exert influence over a wide range of markets, including gold, but I am not convinced that BIG money can control the price at will.
A more likely scenario is that the above entities are part of a dynamic that controls gold prices, and included in that dynamic with countries and organizations (money managers, large investment firms, hedge funds, for example) is you and I. Together, we all influence the price of gold when we buy and sell it through its various outlets.
Granted, some entities can influence the price of gold to a greater degree than others, such as when India bought $7.7 billion worth of bullion just a few months back, or recently, as the European banks and China are stocking up. No, my guess is that the reality is that the price of gold moves when lots and lots of buyers buy or lots and lots of sellers sell. Here is what Goldman Sachs has to say about it (a member of the cabal?).
In December, Goldman Sachs predicted that gold will shoot past $1,400/ounce by 2011, largely on the basis of central banks becoming net buyers of gold, gold ETFs continuing to buy substantial volumes, and real estate prices being depressed.
And here is what I had to say a few days back when I wrote about the fluctuation in the price of gold.
… a reality for all of us and that is that the movement in gold is simply a reflection of the uncertainty in the markets.
Be this all as it may. Maybe I am naïve, but the idea that one or two entities “controls” the price of gold is about as credible as the idea that Neil Armstrong never actually landed on the moon. Then again, did you see the 1978 movie Capricorn One?
Trade in the day; invest in your life …
