Supply and Demand in the Gold and Silver Futures Markets – Paul Craig Roberts and Dave Kranzler

http://www.paulcraigroberts.org/2015/07/27/supply-demand-gold-silver-futures-markets-paul-craig-roberts-dave-kranzler/

This article establishes that the price of gold and silver in the futures markets in which cash is the predominant means of settlement is inconsistent with the conditions of supply and demand in the actual physical or current market where physical bullion is bought and sold as opposed to transactions in uncovered paper claims to bullion in the futures markets. The supply of bullion in the futures markets is increased by printing uncovered contracts representing claims to gold. This artificial, indeed fraudulent, increase in the supply of paper bullion contracts drives down the price in the futures market despite high demand for bullion in the physical market and constrained supply. We will demonstrate with economic analysis and empirical evidence that the bear market in bullion is an artificial creation.