GATA Secretary Chris Powell has invited me to reply to his October 15 commentary — in which he replied to my article of the 14th, wherein I rebutted an academic study that concluded that the London gold price fix was manipulated.
If you look at my article (and indeed previous ones) you will see that my aim is to defend the integrity of the London gold fix as a method to derive a fair benchmark price. My aim is not to defend the integrity of the institutions operating the fix.
The reason for this is that I simply do not have the visibility over all fixing members and their every trade that I would need to say that these guys are 100-percent honest. No one does.
That said, I do know that the market traders at the banks are heavily outnumbered by in-house compliance people and it would be close to impossible for them to do anything improper even if they wanted to. The level of forensic investigation into any position taking is actually quite staggering. In the absence of any evidence to the contrary I simply don’t have a view either way.
I might add that I have the same ambivalence toward GATA.
This post was published at GATA
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