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PAPER BEATS ROCK

29th November 2013

By: Darlene Creamer

  

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Countries that produce few commodities are buying platinum in futures markets with ever decreasing amounts of the freshly printed paper money. The upshot is that the world is getting platinum cheaper than it would if it owned the resources and the mines. If there is very limited near-term trading but thousands of contracts representing multiples of annual supply being traded backwards and forwards two and three months out from now, will those trades be accompanied by physical delivery? Can they really be classified as trades if they are not? Is the current registered, available-for-sale, physical volume of platinum on the Nymex really only 1/160th of annual demand? If so, is the world price being backed up by an insignificant amount of physical metal – and at virtually no cost to the controlling bankers? It behoves South Africans in the know to communicate the manner in which the price of this national patrimony is arrived at.

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