Like currencies, gold is traded almost continuously, as traders transfer positions to their colleagues in western time zones. According to one of them, a major trader had fallen short of selling gold at current prices with the expectation of buying it again at lower Gold Prices Per Gram. Some traders said that they thought that the price of gold, at least, had reached an absurd level and that it would soon stabilize or fall. Meanwhile, the London Metal Exchange, which last week denied considering adding gold futures contracts to its seven existing metals contracts, announced today that it had appointed a committee to study the matter and the potential implications of Gold Price Per Gram fluctuations. Gold trading was so frantic and prices were so volatile that, at one point, it was said that there were no quotes because traders were too busy trying to order their positions.
Fixed gold prices represent the compound prices reached by several commercial banks and brokerage firms in the OTC gold bullion markets. The volume of gold trading in London, which is believed to be surpassed only in Zurich, is impossible to assess, since the five trading firms that set the price in N. The contracts of the stock exchange, which has been trading in silver since 1968, have no limits to daily price fluctuations and would presumably also offer a “safety valve” ready for US players unable to trade when daily prices reach their limits imposed by the United States commodity exchanges as a security measure. The decision to try to take advantage of the gold rush would require approval from the Bank of England and perhaps also legislation.
Traders reported that demand for gold was spreading to the silver market based on the theory that silver had advanced relatively less and therefore had greater potential. Traditionally, gold is considered a safe parking spot for investment funds during times of political uncertainty.