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Interesting read, a good warm-up for what hopefully

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gharma   Wednesday, 07/10/13 01:41:32 AM
Re: rlfb06 post# 296
Post # of 314 
Interesting read, a good warm-up for what hopefully turns into a more revealing interview. The way gold leasing works and the likely result if one assumes a shortage of physical causes a dramatic price increase has all been understood for decades however.

Interested in the Worm Oroborous type phenomena? The consider.
The Treasury and Fed are forced to recall leased gold, but of course that collapses the physical market as that much is unavailable, which leads to collapse of JPM, Goldman Sachs, et al. But that collapse cannot happen as they are not just too big to fail, they are now recognized by the US Government as too big to prosecute. So the US Government (with the aid of the Fed) have to bail them out, basically paying exorbitant prices for gold (via those commodity houses / bullion banks using the bailout money) to get back to the US Treasury and Fed in satisfaction of the expired leases.

Nightmare? Sure. But very real, and not really anything new. Its been that way for decades. Up to now the leases have been covered by new leases when their term comes due.


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