Good comments,

yes it appears as Joltin mentioned, stop loss orders were hit on the NY market just as OPGtrader mentioned the London market closed.

Once again though, the only reason to do such a thing as hit stop loss orders is to lower the price substantially and shockingly. Especially when you time it to make sure there is as little liquidity in the market as possible by doing it when one of the major bullion exchanges is closed.

My guess on who sold such a large amount would be one of the central banks. Probably the Swiss who have been heavy sellers the last 6 months. In fact, they have already sold around half of there announced future sales for the next 2 years in around 6 months.

Is this good business or a conspirasy. Well, since the act of dumping anything into as illiquid a market as you can time, automatically rules out the fact that you are doing it to maximize short term profit. Especially, if the central banks were not dumping gold, the price of it would be much higher at the moment and this would be reflected on their books as an increase in their assets.

This leaves open the possibility that the central banks are doing it for long term profit, political reasons or because they are fools. Well since I do not beleave that the real people who actually run the central banks are fools I will discard that possibility.

This leaves the prevailing theory by most analysts and news letter writers that the banks do it to discredit the gold market and support the paper currency.

I have been a supporter of hard assets and gold ( gold bug if you will ) for a long time now. I raised the possibility of events unfolding as they are amongst my friends and aquantiances as much as 8 years ago. Events and idea's that only in the last couple of years are being discussed by the hard asset and commodity news letter writers.

Therefore I will share a view of mine, that I have yet to see in any news letter writers column, on what I believe the real reason behind the central bank gold sales are.

It is not for short term profit or long term profit because they are selling into a rising gold price and not accumilating ounces on the bear raides they initiated. Therefore we can rule out they are doing it for long profit also, which only leaves the political motive, correct. In other words, doing something stupid as a short term solution.

It is only a short term solution because once the banks run out of gold, as they are doing fast, the market that has been artificially depressed by them will only rise that much more extremely. This is of course if they do not fix in the meantime the systemic problems with the paper money system. Since there appears to be no effort to actually do what is needed to fix the system, this is because in my opinion it is long past being fixable. Then there really is no point in doing what the banks are doing because it will just leave them holding a bunch of worthless paper no one is eventually willing to accept.

To get at the real reason the banks are doing what they are doing one must look at who actually owns the gold in the central banks. Your answer, it is the people of each country that these individual central bankers are supposed to represent. A people who I might add for the most part have no concept of what money really is or the true value of gold for that matter.

Now the people who control the central banks, belong to the same banking cartel that have controled the major banks for hundreds of years. If you do not believe me, just look up the board members of large international banks and do a little research on there names. You will soon find out the truth.

These same people control the individual countries gold by controling their central bank. Controling something is very good but is is not quite the same as owning it, is it? Therefore how does one go about legitimately transfering something they control to actually outright owning it. Why they sell it to themselves on the open market under the disguise of supporting the $US dollar and other paper currencies in the public interest. While at the same time they further devalue the paper currency by printing it yearly at double digit rates. Production can not keep up with this type of money creation, which eventually becomes a parabolic curve that turns totally vertical, cummilating in the total collapse of the paper money just as it has done in every case throughout history.

Now the process of turning these people's wealth from paper assets to hard money assets takes years to accomplish due to the shear wealth they and their associates own. It has to be done slowly in order not to disrupt the markets they wish to get out of and more importantly not to disrupt the market they wish to get into. This is especially true if the market had become so small relative to others as in the case of the resource and precious metal sectors.

Therefore the central banks dumping gold on the open market is in fact the worlds powerful movers and shakers selling themselves the individual countries gold. It is timed to shake out as many of the speculators and longs as possible so that they have as little competion to buy it as possible, while also alowing them to buy up those investors and speculators gold who had the nerve to compete with them for it. Thus they can convert as much of there overpriced paper assets, to underpriced physical assets, as cheap as possible, over a long period of time in order not to disrupt the target markets too greatly.

Thus running stops does set a base of strong ownership from which new rallies can be started as Joltin suggested. The real question is then, just who is this base of strong ownership. Where they the ones responsible for running the stops in the first place in order to lower the price and buy up those positions that invariably get shaken out.

Well just like in the case of ARU who you will find that the same brockerages that have run the stops are the same ones buying up the shares that are shaken loose. So will you find the same thing in the gold market.

Is this just good business, conspiracy or politics. Well the way I look at it, it is all three because they all go hand in hand.

Regards,

F.F.