Ned Naylor-Leyland talks to James Turk

Subscribe to our newsletter at http://www.goldmoney.com/goldresearch. Ned Naylor-Leyland (http://www.cheviot.co.uk ) and James Turk, Director of the GoldMoney Foundation, talk about how the new Pan Asia Gold Exchange (PAGE) will change the price discovery mechanism for gold. Ned explains that the futures market currently takes the lead in price discovery over the much larger spot market and how this may change once PAGE starts to operate.
PAGE will provide a valuable alternative because its fully backed, allocated gold contract will provide a better title, closer to physical, than unsecured unallocated contracts.
This interview was recorded on August 5 2011 in London.

Category:

Howto & Style

Tags:

• James Turk
• Ned Naylor-Leyland
• GATA
• gold price
• China
• PAGE
• gold demand
• allocated gold
• gold futures
• Comex
• LBMA
• spot gold interview
• video

[georgemargaris]

will this torrent of good interviews ever end, ahhhhhhh

[fuzzywzhe]

@tlewisj78 I'm ONLY pointing out that if an arbitrage exists, the LBMA contracts will be at a discount.

This basically means, easy money. VERY easy money. Just sell a contract at the Pan Asian Exchange while buying a contract at the LBMA, and you are GUARANTEED TO MAKE MONEY.

China is essentially providing an incentive for traders all of the planet to wipe the LBMA clean of gold if the LBMA trades at a discount, and it very well might. I'm just pointing that out.

[FreeGoldObserver]

@fuzzywzhe

Yes exactly. Good money drives out bad money. Reverse Gresham's law

[tlewisj78]

Acquiring precious metal via PAGE, Comex, LBMA, etc, etc should be secondary to owning the physical metal. End the end, if you don't hold it, if you're not your own Central Bank, then its only a "promise" to deliver in my opinion. That said, acquire as much physical as you can and store it properly, secretly and safely. When it comes to Precious Metal..."Be the Bank".

[fuzzywzhe]

@FreeGoldObserver Yes, I understand that cash settlement can't drive the physical spot price on the Pan Asian Exchange.

My point it, that you can always take physical delivery from the LBMA, and if there is an arbitrage between the LBMA and Pan Asian Exchange, you can take physical delivery, deplete inventory, and deliver it to the Pan Asian Exchange. Eventually inventory at the LBMA goes to 0, you can't take physical delivery, and the manipulation ends, with the metal in Asia.

Low risk.

[FreeGoldObserver]

@fuzzywzhe

Thats the difference with PAGE. Cash settlements will not be what drives the physical spot price.

[FreeGoldObserver]

@tlewisj78

Of course it doesn't. The whole point of buying gold is to divorce yourself from the digital financial system. PAGE gives investors the option of trading and prospecting in the future price of gold in fully allocated accounts.

[FreeGoldObserver]

@smokydave

Those are all futures markets that are settled with unallocated gold.

[dishesdealer417]

China will be selling real physical gold & silver, not dubious ownership of gold that is probably sold to 100 different people that can't ever get the actual gold for delivery unless they are the super rich or somehow influential. Because it is real gold with real ownership rights it will be a price discovery mechanism which will be real & not the manipulated crap that the comex and LBMA fob off on the population. It is hard to manipulate real metal with real owners. Silver soon!!! GREAT!!!

[fuzzywzhe]

@93msinclair "Only thing is how would you hedge the USD/RMB exchange rate? "

Gold wouldn't be denominated in Renminbi,or any currency. All that has to happen is that the gold at the Pan Asian Exchange sells at a premium at the time of the contract to the LBMA which it always should because the Pan Asian Exchange is one for one backed.

[93msinclair]

@fuzzywzhe Only thing is how would you hedge the USD/RMB exchange rate? The LBMA contract is denominated in dollars, whereas the PAGE contract will be denominated in RMB.