Matterhorn Asset Management founder, Egon von Greyerz, discusses the impossibility of fair pricing in a distorted precious metals market with Max Keiser, of the Keiser Report. Starting at 13 minutes and 10 seconds.
With bullion banks placing outsized shorts in the paper gold & silver trade, natural supply and demand forces are fighting artificial price ceilings in an openly manipulated futures market, of which sophisticated gold and silver investors are all too familiar. Here, Egon addresses such distorted price discovery with simple clarity, underscoring the same with basic math and common sense.
Specifically, Egon reminds that $70 trillion of paper gold is traded each year, despite only $213 billion in annual mine production. In sum, the math, and hence the pricing of paper gold, makes no sense. In such a distorted backdrop, physical rather than grossly manipulated paper gold, is the only real (and historical) store of value and source of sound money for informed wealth preservation.