With all eyes on the Fed Meeting, the harsh reality is bullion banks may be forced to push the gold price even higher. Here’s why…
Gold & The Fed
July 29 (King World News) – Alasdair Macleod: Ahead of the FOMC meeting it is interesting to work through the Fed’s options. They know, more than we do, just how bad the economic and financial situation is. The problem is how to obtain the operational flexibility without frightening the horses.
Meanwhile, the banking system is in a fix. Bankers want to cut their commitments in forex, derivatives, gold – you name it. But that is difficult: we already see equities running away because the markets are thin and they are thin because market makers are not taking large commitments.
Banks May Have To Run Gold Price Higher To Escape The Short Trap
With gold there is a huge problem. The bullion banks are short, losing about $40 billion on Comex alone, and there is no way they are able to close down their positions. I imagine I’m talking to an old jobber in the London Stock Exchange when we had a trading floor. My question to him is how to deal with an intractable short position. He will say, “There’s only one way to do it. Let the price run until everyone is on board and then bang the price. It’s the only way to get your shorts back.”
If the Fed and the Bank for International Settlements have any sense (and the BIS are experienced dealers) that’s what they should do. That being the case, Powell can err on the dovish side in his statement this afternoon.
Also of importance…
Multiple High Grade Gold Assays Over Wide Intervals
Bryan Slucharsuk: “Eric, we have just received our first assay results from this program and I am very pleased to report to you that our initial holes have encountered multiple wide cuts of high grade gold. This is an exceptional start to drilling and the high gold grades are going to create a lot of attention.
Spectacular Gold Intercepts – And They’re Just Getting Started
Today, Fosterville South announced some spectacular gold intercepts. Investors can view the Fosterville South News Release for full details but results include holes such as GMDH28 which records core length 39.5 meters at 7.25 g/t Au from 118.6m including 10.6m at 17.1 g/t Au from 137.85m and drill hole GMDH26 which records core length 5.8 meters at 18.4 g/t Au from 91.8m including 4.6m at 22.68 g/t Au from 93m. Also note, that in drill hole GMDH28, three occurrences of visible gold have been observed over a drill length of 12 meters located on fractures and within quartz veins.
Mineralization Open Along Strike & Depth And Drilling Is Accelerating
Drilling is ongoing with two drill rigs currently turning at Golden Mountain. The mineralization is open along strike and open at depth so we are incredibly excited. In fact, in the past few days, our team in Australia have quietly staked another 400 square kilometers for Fosterville South and therefore have tied up the prospective ground contiguous with our Golden Mountain claims. With high grade gold results like this, we wanted to make sure to have everything around us tied up and consolidated.
My personal belief, Eric, is that this gold bull market is just getting started and it is a once in a generation opportunity. And for us to have these types of high grade gold results at the start of a drill program in one of the top jurisdictions in the world is incredibly exciting. I can’t wait to talk again in the near future as more gold assay results flow from our increased drilling activity at Golden Mountain. Fosterville South, symbol FSX in Canada and FSXLF in the US.
Legend Pierre Lassonde gave an an incredibly powerful interview to King World News discussing where the gold market, gold industry, and mining stocks are headed, and what he had to say will surprise a lot of people around the world. To find out why legend Pierre Lassonde says the upside on gold is unlimited and much more click here or on the image below.
Will Gold See A Historic Short Squeeze?
***ALSO JUST RELEASED: Look At What Just Hit An All-Time, Plus Look At This Major Driver Of Gold’s Rally CLICK HERE.
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