Was last week’s epic gold smash a deliberate exploitation of fresh Russian spot gold positions in the wake of the Cyprus bank bail-in?
SD reader David makes his case below:
I think you will find that the smash-down in Gold was a deliberate exploitation of the Sovereign Russian Spot Gold Hedges that were contracted through Cypriot banks. When the West saw the concentration and vulnerability of these hedges, and the quality of the other Cypriot bank assets such as Greek debt, it was easy to cut them loose, tip of the Russians, and induce them to abandon their open Spot Gold positions with withdrawal of their funds in the face of planned bail-ins. The result – Mario Draghi ordering the liquidation of the Gold hedges, all 1100 tons, or 35M Oz. The Wall Street hedge funds (also tipped off in advance) had already shorted Gold, and the Cypriot action enabled everybody to cover their shorts en-mass and load up on whatever Physical was available. The only remaining thing to do was suppress silver under $24 until option May option expiry today to minimize those possibly seeking delivery, and up we should go.
This may well be a precursor to something big geo-politically.