Understanding the gold and silver market At the risk of sounding like all the other reports and conspiracy theories I will try to summarize these short manipulated markets by central banks and governments. First recall back in 2010 when the price of gold was increasing nicely and at the top the IMF announced they would be selling some gold I think it was 200 tons and then some 400 tons, India bought a big chunk of that and they also claimed they would do it in a way that would not impact the markets (well not too much) the initial report did create a bit of a panic sell off, mostly contributed by the banks I suspect selling contracts short so they could then cover those at the reduced price they created with the IMF sales.
You will today read all kinds of doom and gloom reports with the conflicting reports out of Cyprus and backed by Drahgi that Cyprus will have to sell their reserves to get the their bailout funds, lol where do you think some of those funds will come from? Well, from the short selling of long contracts of course which I suspect has already been initiated by the likes of the JP Morgans and Goldman Sachs of the world banking systems.
Goldman reports seemingly out of the blue (but impeccable timing) to announce the gold bull is over and they will/may be establishing a short position LOL, that's hilarious and most likely scenario is they already are very short. I believe the current short contracts in gold and silver could very well already be at one of their highest levels in history. But the objective now is a final short thrust to maximize the panic and get the long speculators to sell thereby dropping the price even further as we witnessed happened exactly as planned on Friday.
The big question is how far do they want it to go down before they start covering, they will cover some with the Cyprus sell off but seriously it's only about 11 tons, a spit in the bucket, so what would happen if long speculators instead of selling not only bought but requested delivery... that kind of pressure would result in a major upside and short squeeze also unprecedented in history IMHO.
For a company like AR, this is all very good news for the long term, slow down production and take your time building up those reserves because the upside will be explosive.
How far AR's SP drops in the meantime is all gravy for the savvy investor. I'm a buyer, please keep up the selling.
M