I know some don't like Safehaven as they are bearish but did you see this, which was part of Kirby's article...fwiw =========================================================== http://www.safehaven.com/article-4423.htm Goldman Sachs position on TOCOM [Gold - Tokyo Commodities Exchange] as of Dec 21 was 7,088 contracts short and 3636 contracts long. As of today Jan 5, 2006 they are 13,905 contracts short and 3611 contracts long. On Dec 21 gold was $489 and today it is $533. In other words gold has increased $44 and Goldman Sachs has increased their net short position by 6842 contracts!!
This is VERY significant. Goldman on Jan 3 came out with a statement that gold was one of their "top trading picks" and they forecast an AVERAGE gold price for 2006 of $515. This is FRAUDULENT. They are publicly making statements and advising their clients on the future of gold which is absolutely 100% different from how they are invested for their own account. Notice that their long position even CONTRACTED with a gold price that went up $44. The short position has increased in the OCT 2006 contract. When that was put on between $489 and $533 how can they publicly predict an average gold price of $515?This is like Merrill Lynch when they were advising clients to buy certain dot.com stocks while their analyst was sending e-mails to his friends to dump them.
Is it possible that this is not GS trading but them acting on behalf of a client? Unlikely because with such a move in gold the long position would have to increase if the general public were buying these positions. One would not see clients build up a 6842 contract short in a single contract month. Also it was Goldman who just joined the TOCOM and immediately shorted 50 tonnes of gold and then covered on a price break they created by shorting another 20 tonnes. They covered the whole 70 tonnes position and went long by one tonne. This is not a pattern consistent with acting on behalf of clients. This is a pattern totally consistent with FRAUD. This is the sort of activity that they should be sued for. This warrants a complaint to Spitzer and the SEC. You can not recommend to your clients to go long gold and predict $515 gold price and then reduce your longs and go short almost 7000 contracts. It is simply outrageously and blatantly criminal. GS is so used to doing their criminal acts in secrecy on the COMEX they have overlooked that their positions are a matter of public record in Japan. [RK emphasis]
The crucial thing that so many of these short-term gold traders miss is that gold still is incredibly cheap in historical terms -- about the only such investment asset left.
This will provide a powerful tailwind for years to come.
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