For those wanting (needing?) to read another analysis of the gold price debacle, here Grant Williams provides a good explanation. There are several reasons which might have prompted this engineered attempt at driving down the gold price. If one of those reasons was to scare the public away from gold as a safe asset and a store of value, it appears to have been a failure. Physical demand, at least among the public, is higher than before the crash.
Jim Wyckoff confirms what many others have reported:
Strong demand for physical gold worldwide, and especially from Asia, continues to underpin the gold market. Reports this week have said there are shortages of gold bars and coins in some countries, with gold retailers jacking up their charged premiums over the spot price of gold.
The public, speaking with their purses, seem to have a better understanding of what is happening than governments expected. That is good for the public, but bad for the criminal class that is trying to dupe them. Mr. Williams provides some amazing pictures of what appears to be a gold buying panic.
For those wanting a comprehensive analysis of the gold industry from both a supply and demand standpoint, here is a good resource.
Will there be other raids against gold? Probably, but future ones are apt to not be as dramatic. Is this a time to be buying gold? Time will tell, but it is about $200 less per ounce than it was a couple of weeks ago.
Because I believe that gold should be a part of every investor’s portfolio, this drop provides those who have none or are underweighted to acquire some at what may appear to be bargain prices down the road. Consult your financial adviser before making any financial decisions.