Gresham’s Law states that bad money drives good money out of the system. People will use inferior money in their daily ‘bartering’ for goods, services, investments etc and hoard good money.
We are seeing Gresham’s Law work in the gold market, where eastern hemisphere Central Banks, investors and populations are in the process of hoarding all the gold the west will send their way in exchange for the constituent country fiat currencies. ‘Here, take our currency and convert it to dollars and sell us your gold.’
And the gold seems to disappear from sight. Can anyone hazard a guess how much gold the People’s Bank of China controls or where it’s safekept?
Recently my friend and colleague Craig ‘Turd Ferguson’ Hemke – TFMetals Report – noticed an usual amount of gold was being removed from the ‘registered’/investor account in JP Morgan’s Comex vault. Last Friday, for instance, 24% of the eligible gold disappeared from JPM’s registered vault account and disappeared to destinations unknown: LINK
Again yesterday another chunky 160,750 ozs of gold fled the questionable custody of JP Morgan’s eligible account (click on image to enlarge):
This post was published at Investment Research Dynamics on November 20, 2015.
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