An Overview of Gold Price Manipulation

An Overview of Gold Price Manipulation

November 21, 2018

Take a look back over the history of central banks in the United States and beyond, and you’ll notice there is a long, clearly documented history of manipulation of gold prices. This isn’t particularly surprising or unusual—just about all financial markets see some level of manipulation. But it is especially noteworthy in the case of gold, because gold is such a foil to the banks that it is in the best interest of the banks to control it as much as possible.

Central banks tend to be a little nervous (or even scared) of the idea of gold, because it is such an accurate barometer for inflation and a strong indicator of the strength of fiat currencies. However, the banks cannot deny the importance of gold as a type of reserve asset, or the power and value that it has on a global scale in the international financial system.

Still, the banks are constantly looking for ways to take more control over gold and gold IRAs, which is one of the reasons why gold price manipulation occurs so frequently.

Historical gold price manipulation

As we mentioned, there is a long history of gold price manipulation on the part of central banks in the United States.

Go back to March 1968, for example, when the United States Treasury decided to shift to “free market” gold when it ran out of “good delivery” gold. During the 1960s, a number of central banks based in Western Europe kept gold prices at or around $35 per ounce by working with each other and planning out their operations through the Bank of International Settlements and by using the Bank of England as a transfer agent. In the early 1970s, the price of gold was released, but the price suppression and demonization efforts on the part of central banks continued, which necessitated physical gold occasionally being put back out into the market to put a halt to rising prices.

There are records of the meetings at which these decisions were made in the Bank of England archives, but those meetings were not publicized at the time. Take a look over those records and you’ll find the members of the central bank were very loath to allow a freely functioning gold market to exist without taking some level of control over it.

The gold lending market continues to remain a shadowy market that allows central banks to take greater control over the price of gold and get away with some morally questionable price manipulation. These banks will do everything they possibly can to conceal the true status of gold lending and pricing from the market as a whole.

Therefore, it’s important to do your gold investing through companies that are completely transparent and are not beholden to the central banks.

For more tips and information about gold investing and the benefits associated with gold IRAs, we encourage you to contact the team at Gold Wealth Financial today with any questions you have. We will be happy to provide you with answers!

- by Steve Hunt

Categorised in: